Blue Gold

by Jeff Fleischer

(Mother Jones, January 14, 2005)


In 1995, a vice president of the World Bank famously declared that, as the wars of the 20th century were fought over oil, so the wars of the 21st would be fought over water. In the decade since, potable water, scarce even then, has become even more so thanks to pollution, industrial development in nations like China — and especially the process whereby giant firms like Vivendi, Suez and Bechtel increasingly buy up impoverished nations’ water supplies, taking sorely needed water and selling it at a profit, all with the blessing of transnational organizations like the World Bank and World Trade Organization.

As Maude Barlow explains, this process isn’t sustainable. Barlow is national chairperson of The Council of Canadians, a nonpartisan public watchdog group working to fight against global trends in privatization and deregulation, and co-founder of the organization’s Blue Planet Project. She’s also the co-author, with Tony Clarke, of Blue Gold, a 2002 international best-seller about the world’s growing water crisis. While in San Francisco recently, Barlow spoke with about how governments are ceding control of their water supplies to the private sector and what can be done before the public’s water supply dries up for good. How have international trade agreements encouraged the privatization and commercialization of the world’s water?

Maude Barlow: Water was included, as a good and later as an investment, in the very first trade agreement in the world, when Canada and the U.S. signed a free-trade agreement that later morphed into NAFTA. The GATT definition of a good includes water. There’s now negotiations to put water, as a service, into the General Agreement on Trade and Services, which is a proposed international agreement on services. So the World Trade Organization and NAFTA — and bilateral agreements, because water is also included in a lot of bilateral agreements — are ways to enforce a corporate discipline, if you will, over governments that want to maintain public control of their water. Basically, once you privatize it, it’s very, very hard to turn back. And once you’ve started the sale of commercial water, both the receiving country — if it’s in a trade agreement with you — and the corporations involved have inherent rights in these agreements that don’t exist if you don’t sign them. Besides trade agreements, what other factors caused commercialization to grow so rapidly?

MB: Well, I think the reality of the scarcity and the pollution of the world’s surface water has just suddenly become real to people. And whereas 20 years ago you couldn’t imagine getting most of your water from bottles, it’s just become an accepted part of people’s lives now. On planes, in restaurants, everybody drinks bottled water; you carry it around in your pocket. So it came first from scarcity, people needing access to clean water in their lives. And then the view that it was an okay thing to start commodifying water and using it in this way. Of course, behind all this are the big corporations. They’ve been aggressively promoting and marketing their water as better, as cleaner, as purer, as safer — which it is not. And it is to their advantage to let the public systems of the world’s water deteriorate while they get to make huge amounts of money off people’s need for clean water. Historically, how were corporations able to change the perception of water from a basic right to a commodity?

MB: This started with the privatization of municipal water services. It was encouraged when water was declared a commodity or a good in the trade agreements. It started to be considered and talked about as a good and a need — not a human right — by the World Water Council when it was founded in 1997. The World Water Council is basically the World Bank, the other regional development banks and the development agencies of the northern governments. It set itself up as a global high command of water existing for its own benefit, to commercialize and commodify water. They have a big forum every three years, where they invite governments to come and observe, and the governments pick up this language of water as a commodity, such thatgovernments really didn’t think about this language 10 or 20 years ago, now they’re getting together and saying, “There’s this U.N. millennium plan and we have to be helping the developing countries bring on water, and how do we do that?” They’re all buying into this commodification notion, which is all very new and has happened very quickly — and, I believe, has been driven by corporate interests. It’s important to remember that it’s a very small, incestuous circle — these water companies, the World Water Council, the World Bank, the World Trade Organization, the IMF. There’s a lot of money to be made from the commodification of water, and these people know that whoever controls water is going to be both very rich and very powerful. So why do governments cede control to this privatization system instead of, say, selling their water to the public themselves?

MB: Really, the same reasons that governments have bought into the whole concept of neoliberalism. Governments that used to protect their citizens and provide them with health care and water services and education no longer are allowed to do that if they’re poor and owe a debt to the developed world. Through structural adjustment programs, the IMF and the World Bank basically forced developing countries to abandon those relationships with their people, whether it’s health care or energy or state enterprises, because the funding was going to be cut if they didn’t. It’s been to the advantage of the powerful in northern countries, who are more and more controlled by their own big-business communities, to adopt this language. So it didn’t start with water, but water just kind of fell in there when they started talking about everything as a commodity. When you start commodifying things like social services, energy, forests, fish and even air — because you’re now trading air-pollution credits and so on — it’s not a big step to say “why is water different?” One of the first questions I often get asked in hostile interviews is why water is different than forests or fish. And one of my answers is well, actually, we should be protecting our forests and fish, too. However, we can restock fish, we can find alternatives to energy, and we can even replant trees. But there’s only so much water, and the more we destroy, the less access we have to potable water and the more desperate the situation becomes. How does third-world debt play into this conflict?

MB: Of course, if the third-world countries didn’t have a debt to the north — and as you know, they send more as debt payment to the north than we send them in trade and aid together — they would be in a position to start delivering not-for-profit services, including water, health care and other services. But as long as they remain in that desperate situation, having to pay even just the interest on the debt payment, they are totally at the mercy of the IMF, the World Bank, the United States, Canada and Europe. A few years ago, the World Bank was [mereley] encouraging water privatization, but now they’re saying it’s a condition of any aid that you privatize water, and we’re going to negotiate the agreement and tell you the company you’re going to use. So countries are forced to take the conditions under which they can get the money to deliver water to their people. Would eliminating third-world debt necessarily solve this problem?

MB: It would be a huge step toward it, either canceling or at least seriously renegotiating the debt. If the first world was really interested in delivering water to the poor of the world, we would also have a tax on financial speculation. If the World Bank can afford to pay these great big water companies to come in and run a water service — because it’s their money; the companies aren’t investing — if they can afford to bring a private company in to do this, they can afford to train public-sector workers to deliver water on a not-for-profit basis.

I look at Japan and the Philippines. Japan has a highly skilled public workforce delivering clean water, on an island, to millions of people. Tokyo itself is nearly the population of Canada, so it’s amazing what they do. But the World Bank goes to the Philippines, so close to Japan, and says, “You’re going to have to take these private companies” instead of saying, “Let’s bring a bloc of these wonderful public-sector experts from Japan over and transfer this technology on a not-for-profit basis.” It would be cheaper. It would have a longer-lasting effect. It would mean water would get delivered to everyone on a not-for-profit basis, which means you could deliver it to way more people. And we could start to really move toward solving the world’s crisis. Then that extra money could go into rebuilding infrastructure, because 90 percent of all the wastewater in the developing world goes untreated into rivers and lakes and streams and wetlands. So the infrastructure to stop that pollution is desperately needed. What are some examples of governments in the developing world that have tried to break free from this system?

MB: Well, Uruguay’s a good example. A country that just had an election, brought in a center-left government, and just had a vote Oct. 31 about their water. They voted two-thirds to say that water is a fundamental human right, which requires a constitutional amendment. Their government’s position now is that it’s required to deliver water on a not-for-profit basis, but they’ve got these corporations there. So this is going to be a really interesting test of what they can do. Will they kick the company out, as Bolivia did when they kicked Bechtel out? You get governments like that of South Africa, where when they amended the constitution after apartheid ended, they brought water in as a basic human right. But then they brought Suez [a private firm] in to deliver it, so it was only a human right if you could pay for it. I think the government there is under tremendous pressure now to reconcile their constitutional amendment that says it’s a basic right and the fact they were forced to bring in a for-profit company.

There are other governments, Suharto’s in Indonesia was one of them, that worked very closely with some private water companies to skim off money from the people the way the water companies did. There’s no question there’s collusion. But let’s face it, it’s often collusion that’s watched and condoned by the World Bank, by the American government, by our government in Canada. Certainly by the government of France, which promotes its water companies in the most outrageous venues and situations. So there’s no question that there’s sometimes a symbiotic relationship between corrupt governments, these companies and the World Bank. We’ve talked about the developing world, but how much control do the governments of industrialized countries– the U.S., Canada, Europe — have over their own water supplies?

MB: Much less than they think they do. For one thing, the pollution is taking place at such an accelerated rate that we’re all mining our groundwater, and the actual water systems are being mined far faster than they can be replenished. Our prairies are going to be experiencing really deep drought, as are yours, within the next 10-20 years; a permanent kind of drought, so our scientists tell us. So it’s not just a so-called third-world problem. Confronted with this reality, our governments are starting to ask questions about who should have access to water and who should pay for it and all that. They’ve bought into the ideology of neoliberalism or economic globalization or market capitalism.

When you take a new problem — you always had all the air and water you needed; it was never a problem — and suddenly you’re confronted with a water-scarcity problem, and the thinking and ideology you already have starts to fit itself around this. So I don’t think it’s a big jump for governments in industrialized countries to start to see reasons to commodify and privatize water. And as soon as you take water out of its natural state — bidding on it, trading it for commercial purposes or selling it — it is then a commodity clearly defined under these trade agreements and that’s it — you’ve lost control over it. So governments in the developing world have been forced into privatization by the World Bank, regional development banks and the IMF. Countries in the northern, industrialized world are coming at it through another door. I’ve always said free trade is to the north what structural adjustment is to the south, and water is getting caught in that web. Are there positive steps the industrialized nations could take at this stage that could then spread to the rest of the world?

MB: Absolutely. We’re calling in Canada for a national water act, which would outline the protections needed environmentally, really put limits on the use and abuse of our water from industry, remove water from the trade agreements and exempt water from all future trade agreements. We also believe that if we can get water defined as a human right — which it is, but if we can get it recognized — in some kind of binding treaty at the United Nations, it would be a strong challenge to the existing situation in these trade agreements.

It would be a very powerful tool for people to be able to say to their governments, “You’ve signed an agreement saying that water is our human right, so therefore you can’t charge us.” It’s not a semantic question, this human need or human right. If it’s a human need, it can be delivered by the private sector on a for-profit basis. If it’s a human right, that’s different. You can’t really charge for a human right; you can’t trade it or deny it to someone because they don’t have money. And we need laws at every level of government, from the most local to international, on the current abuse of water. All of us are going to have to change our relationship with water.

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