Welcome guest-writer Tim Dieker. Tim is a father, fire spinner, and student of history. He's also a hermit with no website or e-mail, so leave your comments here! ;-)
“The wars of the next century will be about water” (qtd. In Barlow 1). With those chilling words Ismail Seregeldin, Vice-President of the World Bank in 1999, offered people a glimpse into the 21st century. Water scarcity is a growing global issue, and many world leaders (both elected and otherwise) believe the answer to concerns such as these lie in the free market system, arguing that a privatized water system ensures superior conservation, higher quality and expanded service, especially in the Global South.
Water is a vital resource, and is becoming increasingly scarce. Over a billion people in the world have no access to clean water, and twice that number lack sanitation services. The majority of these people live in the global South. At the same time global water consumption is rising more than twice as fast as the population explosion (Barlow 2), while in many areas of the world, freshwater supplies are beginning to run low. Because of this, there has been a growing movement to turn water into a commodity, and move away from idea of water as a necessity to the World Bank’s conceptualization of water as an “economic good” (Grusky 15). Thus, global markets have taken an interest in water supply and distribution. Since the 1980’s, global institutions like the World Bank, along with a handful of multinational corporations, have increasingly pushed to commidify the remainder of the world’s water.
The number of large multinationals that have leapt into the water market have enjoyed dramatic growth, as well as massive profits. In the early 1990’s the three largest private water firms worked in twelve countries, and served roughly 50 million people. By 2004, they were established in well over a hundred countries serving 300 million people (Barlow and Clark 16). Suez Lyonnaise des Eaux and Vivendi, the two largest firms, are both in the top one hundred corporations in the world, and control over 2/3 of the private water market (Bakker 330). Interestingly, although conservation is often touted as a reason to privatize, most of the industry’s expansion has occurred in the global South, not in the first-world nations where most water waste occurs. Maude Barlow, author and Senior Advisor on Water to the 63rd President of United Nations General Assembly in 2008-2009, notes “. . . a mere 12% of the world’s population uses 85% of its water, and the 12% do not live in the third world” (54). Thus privatization in the developing world addresses only a fraction of the world’s water usage and ignores waste in wealthy nations with already privatized systems.
Another oft-cited reason for privatization is that it will bring increased investment in water services to areas in need. However, most of this investment comes not from foreign companies, but from the users themselves. Prices have to rise in order to, as noted activist Vandana Shiva noted, “support a commercial operation” (Shiva 12). Or in the words of an executive for Suez, “People are to pay regarding what they consume” (qtd. in Flow: For the Love of Water), and of course, enough to make a healthy profit for the company involved.
In perhaps the worst case example of corporate mismanagement and national exploitation, the water systems of Cochabamba, Bolivia were privatized in 1999 and sold to a water consortium named Aguas del Tunari, in which American firm Bechtel held a majority stake. This move proved so unpopular that residents began what has come to be known as the “Water Wars,” a massive protest movement against privatization. The 1999-2000 “Water Wars” in Cochabamba radically altered Bolivian and, indeed, global politics.
Almost 75% of Bolivians live below the poverty line, making it the poorest of the poor nations of South America (Foshee et al. 10). In spite of this abject poverty, the World Bank, and its Director, James Wolfensohn, “. . . argued that giving public services away inevitably leads to waste, and said that countries like Bolivia need to have a ‘proper system of charging’” (Schultz 29). This was the firm, contradictory stance from organizations like the World Bank and the International Monetary Fund, who’ve previously said water is a common resource of the people. The World Bank’s stance that private markets were the quickest and best way to provide and expand water services was reflected in the fact that for many nations, like Bolivia, debt relief loans from the Bank and the IMF were granted on the condition that water systems be privatized. In Bolivia the Bank demanded that the systems of Cochabamba and the municipal area of El Alto/La Paz both be taken over by private industry (Bakker 330).
As a result, many consumers in Cochabamba saw their water bills go up 200-300% to prepare for the company’s arrival even before any kind of improvements to the system. For the poor, this meant often choosing between water and other necessities. Indeed, as Sara Grusky, co-director of the Globalization Challenge Initiative noted, “Although the minimum wage stood at less than $65, many of the poor had water bills of $20 or more” (19). In spite of only having access to water a couple hours a day at best, and even then with almost no pressure, the citizens of Cochabamba were paying water bills that roughly equal to water bills for a small home in some parts of the United States. Meanwhile Aguas del Tunari projected profits for the year of $58 million dollars (Barlow and Clark 17).
The contracts the government of Bolivia signed were implemented through Law #2029, passed in October of 1999. It was a law that came to represent all that was wrong with “global free trade” to the Bolivian people. Indeed, when one examines the details of the law and the contract, free trade doesn’t seem to be as big of a concern as monopolistic control of the resource. For example, Law #2029 stated that “. . . the private companies are the only ones who can distribute water. All of the autonomous water systems are handed over to them without paying anything to the people who invested in having their own systems” (Olivera 16). Meters were installed on people’s hand-dug wells, and collection agents were sent to people with cisterns and other traditional water collecting systems, ordering villagers to get a permits to collect the rainwater--now legal property of Aguas del Tunari.
From "The People United: The 1999-2000 Cochabamba “Water Wars” and Their Continuing Impact" by guest-author Tim Dieker.
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| Global water consumption is rising more than twice as fast as the population explosion. |
Water is a vital resource, and is becoming increasingly scarce. Over a billion people in the world have no access to clean water, and twice that number lack sanitation services. The majority of these people live in the global South. At the same time global water consumption is rising more than twice as fast as the population explosion (Barlow 2), while in many areas of the world, freshwater supplies are beginning to run low. Because of this, there has been a growing movement to turn water into a commodity, and move away from idea of water as a necessity to the World Bank’s conceptualization of water as an “economic good” (Grusky 15). Thus, global markets have taken an interest in water supply and distribution. Since the 1980’s, global institutions like the World Bank, along with a handful of multinational corporations, have increasingly pushed to commidify the remainder of the world’s water.
 |
| Many consumers in Cochabamba saw their water bills go up 200-300% to prepare for the company’s arrival even before any kind of improvements to the system. |
Another oft-cited reason for privatization is that it will bring increased investment in water services to areas in need. However, most of this investment comes not from foreign companies, but from the users themselves. Prices have to rise in order to, as noted activist Vandana Shiva noted, “support a commercial operation” (Shiva 12). Or in the words of an executive for Suez, “People are to pay regarding what they consume” (qtd. in Flow: For the Love of Water), and of course, enough to make a healthy profit for the company involved.
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| This move proved so unpopular that residents began what has come to be know as the "Water Wars," a massive protest movement against privatization. |
Almost 75% of Bolivians live below the poverty line, making it the poorest of the poor nations of South America (Foshee et al. 10). In spite of this abject poverty, the World Bank, and its Director, James Wolfensohn, “. . . argued that giving public services away inevitably leads to waste, and said that countries like Bolivia need to have a ‘proper system of charging’” (Schultz 29). This was the firm, contradictory stance from organizations like the World Bank and the International Monetary Fund, who’ve previously said water is a common resource of the people. The World Bank’s stance that private markets were the quickest and best way to provide and expand water services was reflected in the fact that for many nations, like Bolivia, debt relief loans from the Bank and the IMF were granted on the condition that water systems be privatized. In Bolivia the Bank demanded that the systems of Cochabamba and the municipal area of El Alto/La Paz both be taken over by private industry (Bakker 330).
As a result, many consumers in Cochabamba saw their water bills go up 200-300% to prepare for the company’s arrival even before any kind of improvements to the system. For the poor, this meant often choosing between water and other necessities. Indeed, as Sara Grusky, co-director of the Globalization Challenge Initiative noted, “Although the minimum wage stood at less than $65, many of the poor had water bills of $20 or more” (19). In spite of only having access to water a couple hours a day at best, and even then with almost no pressure, the citizens of Cochabamba were paying water bills that roughly equal to water bills for a small home in some parts of the United States. Meanwhile Aguas del Tunari projected profits for the year of $58 million dollars (Barlow and Clark 17).
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Ashwin Desai explains, "By telling a woman who's got nothing," that she must give up her "meager amount of money, what is she going to do but go to the river and take that dirty water and die of cholera? And then you say people don't know how to practice hygiene. " |
Continued next Tuesday as the people of Bolivia rise up in protest...
Could you be so kind and share some links to other sources that carry info on this theme just in case you happen to know any of them.
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