The Business of Water: Privatizing An Essential Resource

11 March 2010

By Stephen Lendman 

In her 2002 book titled, "Water Wars," noted author, social activist, and ecologist Vandana Shiva called privatizing water: 

-- ecological terrorism; 

-- a global water crisis;  

-- along with overuse, waste and pollution, it can cause "the most pervasive, most severe, and most invisible dimension of the ecological devastation of the earth;" 

-- the road to "an ecological crisis with commercial causes but no market solutions; (they) destroy the earth and aggravate inequality; the solution to an ecological crisis is ecological, and the solution for injustice is democracy;" and 

-- water rights are natural and "usufructuary....water can be used but not owned;" it belongs to everyone as part of the commons as an essential "basis of all life....under customary laws, the right to water has been accepted as a natural, social fact." 

Shiva lists nine water democracy principles: 

(1) it's nature's gift; 

(2) it's essential to life; 

(3) "life is interconnected through water;" 

(4) it must be free "for sustenance needs;" 

(5) it's limited and exhaustible; 

(6) it must be conserved; 

(7) it's a commons; 

(8) "no one has a right to overuse, abuse, waste, pollute," or own it; it belongs to everyone; it can't be treated as a commodity; and 

(9) there's no substitute. 

Corporate profiteers have other ideas and, since 1997, have met triennially at the World Water Forum (WWF) to discuss privatizing water globally in coordination with the World Water Council (WWC). It's dominated by two of the world's largest water companies, Suez and Veolia, as well as the World Bank, other financial interests, UN bodies, and powerful interest groups representing business and world nations. 

WWC's agenda is profits through Public-Private Partnerships (PPPs) wanting to privatize global water resources, sell them to the highest bidder, promote destructive dam and water diversion projects, extort high prices, and make an element of life available only to those who can afford it. 

Their scheme involves controlling city/municipal/community distribution as well as stealing public water, bottling it, selling it at exorbitant prices, and claiming it's pure when, in fact, it's no safer than tap water. 

In fact, a 1990s four year National Resources Defense Council study on the bottled water industry found "major gaps in bottled water regulation and conclude(d) that bottled water is not necessarily safer than tap water." Using independent labs, it tested over 1,000 bottles of 103 brands and found: 

-- one-third contained "significant contamination (i.e. levels of chemical or bacterial contaminants exceeding those allowed under a state or industry standard or guideline);" and 

-- contaminants found in some but not all samples tested included excessive coliform bacteria, synthetic organic compounds (such as toluene, xylene, styrene and others), flouride, phthalate, arsenic, nitrates, and other inorganic contaminants. 

It's no wonder, given the weakness of federal standards and little regulatory oversight. 

People Advocates 

The People's Water Forum (WWF) advocates for global water justice, calling it a "basic element of all life (and) a fundamental and inalienable human right." It rejects all forms of privatization, demanding water be "public, social, cooperative, participatory, equitable, and not for profit." It calls for "the democratic and sustainable management of ecosystems and the preservation of the water cycle through the protection and proper management of watersheds and environment." It says commodifying water harms the world's poor, and wants privatized utilities reclaimed for equitable public use. 

Some Key Water Facts 

Available in lakes, rivers, and underground aquifers, freshwater is scarce, comprising only 0.008% of the global total. It's unevenly distributed. Around 90% of what's drinkable is groundwater. About 70% is locked in ice caps, less than 1% readily available. The Great Lakes contain about 84% of North America's surface fresh water and 21% of the world's supply. About 13% is in Brazil. Other water rich countries include Canada, Russia, China, Indonesia and Colombia.  

One-third of the world's population lives in "water-stressed" countries. Over two-thirds have no access to clean water, and an estimated 25,000 people die daily as a result. The World Health Organization (WHO) attributes contaminated water to 80% of all sickness and disease worldwide. In the last decade alone, the number of children killed by avoidable diarrhea illnesses exceeded the death toll from all armed conflicts since WW II. Every eight seconds, a child dies from contaminated water. 

More freshwater is stored in the ground than in liquid form on the surface. Scientists have discovered a vast water reservoir beneath East Asia, at least the equivalent of the Arctic Ocean, so far untapped. Up to now, no shortages exist, but overuse, pollution, and waste will create them. Water is limited, exhaustible when poorly managed, and there's no substitute. 

Irrigation consumes the most because agribusiness uses ten times what comparable ecological farming needs. Much of what's available is lost through pollution, overuse, and waste. Conservation and keeping it out of corporate hands is vital to human health, well-being, and sustainability. 

One Report Highlights Privatization Dangers 

Food & Water Watch advocates for economic and environmental sustainability through research, the media, public outreach and education, including lobbying for safe, wholesome food as well as public control of groundwater, oceans, lakes and rivers. 

In February 2009, it published a report titled, "Money Down the Drain: How Private Control of Water Wastes Public Resources." It covers corporate efforts to convince cash-starved communities to privatize their water and wastewater systems, saying it's how to raise vital revenue, be more efficient, and the best way to upgrade facilities at low cost. The facts prove otherwise: 

-- because of financing costs, taxes, high executive pay, expected profits, and numerous other factors, privatization is expensive and irresponsible; 

-- private utilities charge up to 80% more for water and 100% more for sewer service; 

-- costs are contained by downsizing workforces, destroying unions, relying on cheap labor, using shoddy construction materials, deferring maintenance, and backlogging service requests to focus all efforts on profits.  

Cities belatedly learn that public control delivers better, cheaper, faster, more reliable service and happier customers. Food & Water Watch concluded that: 

Privatization is not a sustainable model or a way to rejuvenate community water systems. "From high costs and inefficiency to unaccountable and irresponsible operators, a deluge of problems has swamped communities that turned to the private sector. Corporations prioritize earnings over quality, and stockholders over consumers. They seek good returns by cutting corners, neglecting maintenance and hiking rates." 

Privatization is the problem, not the solution to protect our valuable water resources and distribute them equitably to everyone at a reasonable cost. "Public money for public utilities is the best way....to ensure clean, safe and affordable water for generations to come." It also preserves higher paying jobs and the right of workers to organize. Irresponsible profiteers operate otherwise. 

Social activist Maude Barlow chairs the Council of Canadians, Canada's largest citizens organization advocating for numerous economic and social issues, including Canadian independence, progressive policies, energy security, and publicly controlled clean water. 

She explains that future peace or peril depends on whether water is commodified or a public good, saying dwindling freshwater supplies, inequitable access, and corporate control "have created a life-or-death situation across the planet." 

Schemes to shift water from one ecosystem to another for profit are a human rights and environmental nightmare. Private solutions are the problem, not the solution to equitable distribution, conservation, and sustainability. 

However, American and Canadian governments have other ideas, having "decided that water is not a public good but a private resource that must be secured by whatever means" to control who gets it, at what price, and who doesn't. These countries lead efforts to block international attempts to recognize water as a human right. 

In a July 2007 article titled, "The Militarization and Annexation of North America," this writer discussed one way - by integrating America, Canada and Mexico through the Security and Prosperity Partnership (SPP), or North American Union. 

Launched in March 2005, it's for greater US, Canadian and Mexican economic, political, social, and security integration with secretive working groups devising binding agreements legislatures can't change. 

If achieved, it will militarily enforce a corporate coup d'etat against the sovereignty of three nations, their people and legislative bodies, the idea being a US-controlled North America with no trade or capital flow barriers. Especially key will be America's unlimited access to Canadian and Mexican resources, mainly oil from both countries and Canadian water.  

Efforts paused during the Bush to Obama transition, but deep integration plans remain, the grand goal being a single global marketplace under a one world government and much more, including ending social justice and democratic rule, a very ugly future if achieved. 

Efforts to Preserve Water as a Right  

Organizations like the Council of Canadians, the Blue Planet Project (founded by Barlow), Food & Water Watch and others are fighting back to preserve water as a right, keep it out of corporate hands, and stop countries like Canada from agreeing to bulk exports to America when preserving enough for domestic needs is vital. Although Canada is water rich, it must conserve its surplus quantities, given its own growing needs. But plans are being made to divert them. 

Selling Bulk Canadian Water to America 

A January 2006 Canadian Press article, titled "Pressure to export water to US could grow" quoted former US ambassador to Canada, Paul Celluci, saying: 

"Canada has probably one of the largest resources of fresh water in the world." Unmentioned was America's aim - control to privatize it, Celluci saying it's "odd (that) Canada is so willing to sell oil and natural gas and uranium and coal (but) talking about water is off the table, and water is renewable." 

True enough when conserved and responsibly managed, but short of that, freshwater supplies are dwindling, and inequitable access for billions has created a global water crisis. 

Celluci's comment was as close as "any high-profile American (had) come to (admitting) what many Canadians have long suspected - Washington wants our water." 

In fact, Maclean's magazine ran a cover story arguing that Canada should sell it before America takes it. Responsible Canadians disagree, citing among other factors, the threat confronting western Canada. The most important Prairie rivers are fed by mountain glaciers, and they're melting at an alarming rate. The British science journal, Nature, noted that "The consequences of these hydrological changes for water availability....are likely to be severe." 

Cities like Calgary, Edmonton and Saskatoon risk losing their rivers altogether or enough to cause serious harm. According to Andrew Weaver of the University of Victoria's School of Earth and Ocean Sciences: 

"Its a huge problem. These glaciers are basically toast. They won't be around by the end of the century, or they'll be around in such insignificant amounts that it won't be a big source of water. You've got to start thinking about adaptation here." 

Tim Barnett of La Jolla, CA's Scripps Institution called them "fossil water and when it's gone, it's gone. If you really are glacier-fed in a warming world, you're up the creek without a paddle, no pun intended." 

Maude Barlow agrees calling a dwindling global water supply the new century's most threatening ecological, economic and political crisis, one not properly being addressed. 

"There is no water (surplus) in the Great Lakes. The only place one could go (for what's needed) is up north and all those rivers are flowing north, so you'd have to be undertaking huge engineering projects to reverse the flow" (south). So this notion that we have lots of water sitting around is absolutely false." 

Barlow and others worry whether Canada can ban bulk exports because WTO and NAFTA define water as a tradable good. NAFTA also calls it an investment, and a provision in the agreement requires "proportional sharing" of energy resources.  

America considers water among them so could cite Canada for a violation if it won't sell. In addition, under NAFTA's Chapter 11, US corporations could sue for financial losses. In 2001, a California company sued the Canadian government for $10.5 billion because British Columbia banned commercial bulk water exports. 

WTO provisions prohibit export controls for any "good" that by definition includes water. Imposing them could be challenged as a non-tariff barrier - even for sound environmental reasons and a resource as vital as water. 

Under NAFTA's Article 309, similar to GATT's Article XI, contracting parties are prohibited from restricting the export of goods. At issue is whether water is a "good," but WTO says it is. Further, the US Supreme Court ruled water an article of interstate commerce.  

In Sporhase v. Nebraska ex. rel. Douglas (1882), the Court called a Nebraska law prohibiting commercial water exports unconstitutional under the dormant commerce clause - a legal doctrine inferred from the Commerce Clause in the Constitution's Article I, expressly granting Congress the power to regulate interstate commerce, not the states. 

The Court called groundwater an article of interstate commerce subject to congressional regulation. Since none prohibit it, profiteers can sell it like toothpaste, toys, or tomatoes. 

Worse still, WTO and NAFTA provisions are supernational, overriding national laws on trade, rendering protective ones null and void. Water is thus a tradable commodity, no different from others, unless new provisions replace existing ones.  

What the Supreme Court ruled for interstate commerce, NAFTA and WTO did for international trade, so it's unclear how to stop it even though one argument could be that water in its natural state (in lakes, rivers and underground) hasn't become a tradable good, and GATT's Article XX prescribes "natural resources" exceptions to treaty obligations that might let WTO members control water exports for environmental protection.  

Yet the language is vague, and GATT/WTO decisions interpret Article XX to mean limited and conditional ones, placing a heavy burden of proof on parties invoking them, thus pitting a nation's right to protect its environment and control its water against the rules of international trade. So far, corporate profiteers have the upper hand, especially since America, Canada, and many other nations go along.  

But as Maude Barlow wrote in her book "Blue Covenant: The Global Water Crisis and the Coming Battle for the Right to Water:" 

The "global justice movement is demanding a change in international law to settle once and for all the question of who controls water. It must be commonly understood that water is not a commercial good....but rather a human right and a public trust." Binding law is needed to codify it to obligate all nations "to deliver sufficient, safe, accessible and affordable water to their citizens as a public service."  

Corporate control must be prevented, and global water justice efforts must take the lead. Various initiatives globally are making headway. "Momentum is growing everywhere for a right whose time has come," but it won't arrive easily up against powerful opposition. 

Stealing Canada's Water Wealth 

Canadian attorney John Carten runs the web site waterwarcrimes.com, covering the plan to highjack Canadian water, involving powerful insiders trying to make billions of dollars through bulk water exports, some entirely illegal. 

A feature article headlines: "The Politicians Plan to Steal Canada's Water Resource Wealth," explaines that Canada has abundant water, especially in Quebec in the East, and British Columbia (BC) in the West. The temptation to profiteer is overwhelming. The way chosen is by monopoly control, "the investors behind the bulk water export business hatch(ing) a bold and devious two step plan: 

1. Obtain a source of abundant water for export from the British Columbia Government. 

2. Use the environmental movement and the public media in Canada to (ensure that) policy makers in the Governments of Canada and British Columbia" ban competition. 

Targeted was "the joint venture project of two small companies, one American, Sun Belt Water Inc. based in Santa Barbara, California, and one Canadian, Snowcap Waters Ltd. based in Fanny Bay, BC and the small Vancouver based company, Aquasource Ltd." 

Investors established WCW Western Canada Water Enterprises Ltd. to run things, hired PR flacks and corrupted environmentalists to hype fear about unrestricted bulk water exports, so the solution was prohibiting it with an exception - the rights WCW already had giving it an exclusive franchise. 

"The plan was brilliant, it was devious, and it would have been hugely profitable, and incidentally, tax free for many of the (political and business) insiders who held their interests offshore." They acquired an exclusive license to export "fresh water taken from....behind the dam at Ocean Falls on terms that were completely illegal - courtesy of insiders" in the BC government. 

Next comes transporting it to America, using supertankers to deliver it 1,500 miles south to southern California and northern Mexico. However, they're limited, expensive, can only service coastal areas, and they can't deliver enough "to satisfy the long term solution to the water issues of the American southwest and Mexico," given the population size and substantial commercial needs. 

Eliminating competition also involved "brib(ing) the governing political Social Credit Party (to get the BC government) under the leadership of Bill Vander Zalm (to create) a multitude of regulatory hurdles in the path of the competitors that slowed them down but did not completely kill them so, eventually the Government used brute force (in addition to violating) the Canada US Free Trade Agreement, the GATT and the Water Act (to impose) the illegal moratorium on bulk water exports that denied all competitors the ability" to get a license. 

It failed because: 

-- it was illegal;  

-- WCW became greedy and tried "to gouge the first US customer, the Goleta Water District, by pricing its water at 50% more than the American competitor, Sun Belt Water Inc;" and 

-- Canadian political and business insiders "announced that Sun Belt (wouldn't get) access" to Canada's water; only WCW could supply it. 

Sun Belt collapsed. Goleta refused to do business with WCW, and after a few years it went bankrupt "although it had raised over $100 million to finance its business" and had powerful backers. 

A cover-up followed that was bogus on its face, including claiming a bulk water export business wasn't viable, when, in fact, California planned far more costly desalinization efforts that "use horrendous amounts of energy, create huge environmental issues with salt residues and produces a vastly inferior brand of water with so much mineral content that it is not healthy to drink on a long-term basis." 

The North American Water and Power Alliance (NAWAPA) plans to revive the scheme through a new way to export Canadian and Alaskan water to the American southwest and northern Mexico. 

Its web site describes it as: 

"a project for diverting to the western US and northwestern Mexico water from rivers in Alaska and Canada which now flow into the Arctic Ocean. In addition to providing irrigation water to arid parts of North America, NAWAPA would also generate considerable amounts of power and provide some subsidiary benefits such as stabilizing the level of the Great Lakes."  

"The project was formulated by the Los Angeles engineering firm of Ralph M. Parsons Company (to) deliver 120 million acre-feet of water annually; 78 million to the US; 22 million to Canada, and 20 million to Mexico." 

About 85% of the water would go to agribusiness that already consumes more than its share, causing growing shortages for others. NAWAPA doesn't explain, but its scheme involves privatizing a public resource, using it wastefully, and exploiting it at a cost far more than what governments would charge. It also about stealing Alaskan and Canadian water, aided by corrupted politicians, the way giant businesses always operate in America, Canada and most elsewhere when governments go along the old fashioned way - bought and paid for through political bribes. 

Stephen Lendman is a Research Associate of the Centre for Research on Globalization. He lives in Chicago and can be reached at lendmanstephen@sbcglobal.net. Also visit his blog site at sjlendman.blogspot.com and listen to cutting-edge discussions with distinguished guests on the Progressive Radio News Hour on the Progressive Radio Network Thursdays at 10AM US Central time and Saturdays and Sundays at noon. All programs are archived for easy listening. http://prognewshour.progressiveradionetwork.org/

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