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The Case Against the Commodification of Water and for Retaining it in the Commons

The answer to the world’s water crisis rests on the twin foundations of conservation on one side and water justice on the other. No global corporation that must be competitive to survive can operate on those two principles.

It is evident that the world is abandoning the notion of water as a Commons, moving instead toward a corporate-controlled freshwater cartel with private companies – backed by governments and global institutions – making fundamental decisions about who has access to water and under what conditions. It is unlikely that there will come a time when there is no private involvement in water. Nor are most critics saying there is no place for private companies in finding solutions to the coming global water crisis. However, there is a desperate need for public oversight and control of the world’s declining water stocks and for elected governments and citizens, not corporations, to make the decisions about this shared Commons before it is too late. Simply put, the answer to the world’s water crisis rests on the twin foundations of conservation on one side and water justice on the other. No global corporation that must be competitive to survive can operate on those two principles.

There are three major problems with the abandonment of water as a Commons and the adoption of water as a commodity.

There is no incentive to conserve water or stop water pollution

The first problem is that there is no profit in conservation. In fact, it is to the distinct advantage of the private water industry that the world’s freshwater Commons are being polluted and destroyed. Even if individual corporate leaders do not take pleasure in the global water crisis, it is exactly this crisis that is driving profits in their industry. The “dead hand” of the market will favor those companies that maximize profit and, in the water business, that means taking advantage of a dwindling supply that cannot meet a growing demand. Further, with governments, industries, and universities investing so heavily in the burgeoning water clean-up technology industry, there is less and less incentive at every level to emphasize source protection and conservation. Once a massive and expensive clean-up industry is in place, economic and political pressure will come to bear on governments and global institutions to protect it. Technology, controlled by corporations, will drive policy.

Already global trade rules to promote the water technology industry are in place. The World Trade Organization (WTO) promotes and protects the trade in “environmental services,” encouraging cross-border trade and investment in private water clean-up companies. As in all tradable goods and services, governments are encouraged to relinquish public control of water treatment to the private sector and have to ensure that any rules they have in place are the “least trade restrictive” possible. This means that the rules and regulations meant to protect the public and the environment must not hamper private business, and the pressure is on governments to “cut red tape” and lower their standards. As well, under the “National Treatment” provision of the WTO, governments cannot favor domestic water companies and will have to open up their bidding process to the water technology transnationals that are getting more powerful all the time.

Nature has no one to buy it for ecosystem survival

The commodification of water is really the commodification of nature. If water in the future will only be accessible to those who can pay for it, who will buy it for nature?

The second major concern around the commodification of water is that with no regulatory oversight or government control, there will be no protections for the natural world, and a need to safeguard integrated ecosystems from water plundering. As it is now in most parts of the world, governments have little knowledge of where their groundwater sources are located, or how much water they contain. Consequently, they have no idea how much pumping they can maintain or if current water mining operations are sustainable. The more private interests control water supplies, the less government and public interests have to say about them. The commodification of water is really the commodification of nature. If water in the future will only be accessible to those who can pay for it, who will buy it for nature?

An added strain is put on rural and wilderness water Commons by the water needs of urban centres, especially the burgeoning mega-cities of the global South – needs increasingly being supplied by draining rural and wilderness lakes, rivers and aquifers. Agriculture, especially irrigated industrial farming and livestock production, typically put the single largest demand on surface and aquifer resources. In water-scarce regions, irrigation can consume well over three-quarters of total water withdrawals. If governments maintain control of water systems, they can try to protect rural ecosystems, although it is true that governments are under competing pressures. But if, as is increasingly the case, water transfers are in the hands of private brokers who are competing with one another for dwindling resources and the process is unregulated by governments, there will be few protections in place to stop the destruction of watersheds and ecosystems and the species and plant life they sustain.

Only the rich will have clean water, a flagrant violation of human rights

No corporation is in business to deliver water to the poor. That, say corporate leaders, is the job of governments. People who cannot pay do not get served.

The third problem with the commodification of water is that water, and water infrastructure – from drinking water and sanitation utilities services, to bottled water, clean-up technologies and nuclear-powered desalination plants – will flow where the money is, not where it is needed. No corporation is in business to deliver water to the poor. That, say corporate leaders, is the job of governments. People who cannot pay do not get served. Already, wealthy countries like Saudi Arabia and Israel are dependent on expensive water purification technologies for their day-to-day living, while equally water-starved countries such as Namibia and Pakistan cannot afford such technology, and so their citizens suffer from severe water shortages. Bottled water is the exclusive prerogativNovember 6, 2008n many parts of the world. World Water and Flow Inc, two companies on the verge of a bulk water transfer business, are looking to send their first shipments, not to the parts of the world where people are dying for water, but to Las Vegas and Los Angeles in the case of World Water, and Saudi Arabia and the United Arab Emirates in the case of Flow.

Further, as in every major industry sector, the water industry is becoming very powerful in lobbying and advising governments and global institutions on water policy. The big service companies have enormous clout with the World Bank and the United Nations as well as with their own governments. Big utility corporations such as Suez and Veolia actually influence World Bank decisions as to where funding for water services should go. Studies show that they now set the agenda in terms of prioritizing the contents, regions and cities where investment in the water sector will flow. Because of the corporate need to make a profit, donor-funded investments have not concentrated on the areas of greatest need, be it by country or by city where the greatest number of poor live. Rural communities have suffered as well from lack of attention because of their inability to create a profit for the water companies. As a consequence, sub-Sahara Africa and South Asia have been the focus of only one percent of total promised private sector water investment.

A Commons approach to water, on the other hand, would act in the reverse in each of these areas, protecting water, watersheds and species, and all people.

OnTheCommons.org