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Corporate Multinationals and Grand Rapids water system

February 17, 2011

Yesterday, on WGVU radio it was reported that Grand Rapids Mayor George Heartwell is still considering the privatization of the City’s water system.

We have reported in the past that privatization of the City’s water system has been on the table since the fall of 2010 when the Mayor made his first public comment about this issue. The City is still confronted with budgetary issues and continues to consider privatization of the municipal water a way to save money.

In the WGVU radio story Heartwell did clarify where he stands on the matter of privatization by saying, “I have no interest in selling the assets as some other cities have done. I think it’s very important for the city to retain the infrastructure. But I’m very willing to look at privatizing management. If they can manage the costs at a reasonable level and have a profit in doing that, because that’s important for them. I think it’s worth exploring.”

The WGVU reporter also noted that the two companies that the City is negotiating with are United Water (a subsidiary of Suez) and Veolia, two of the largest privatized water corporation in the world.

Suez has a long track record of environmental degradation since they also are involved in coal mining and liquefied natural gas. On the matter of water privatization Suez has been one of the world’s leaders with contracts to run municipal water systems in numerous countries.

According to Food and Water Watch, there is, “A growing international campaign is challenging the policies and practices of Suez, citing the corporation for a range of abusive practices that place profit over the human right to water. These include:

  • Refusing to extend services to poor neighborhoods
  • Cutting off water if people are unable to pay
  • Non-compliance with contractual requirements for maintenance and investment
  • Raising rates to unaffordable levels; and
  • Threatening legal action when contracts are terminated

For more information on Suez water rights abuses you can download a factsheet.

The other corporation Veolia is the largest water and wastewater company in the world. According to Food and Water Watch they have contracts to operate water and wastewater systems in roughly 650 North American communities. Veolia also operates in 32 US states.

A recent Public Citizen 38-page report on Veolia documents numerous instances of corruption, shutting off people’s water when they can’t pay, diminished services and mistreatment of workers.

In addition to the absurd levels of power that these corporations have over public water systems they also use their wealth to influence legislative policy. According to the Center for Responsive Politics, Veolia spent $115,000 on lobby at the federal level in 2010. Suez has averaged around $130,000 in PAC money they have given to candidates since 2006 which included $2,000 to Michigan Congressman Fred Upton.

Clearly, both of these corporations have a history of influencing public policy and an awful track record of running municipal water systems. Mayor Heartwell claims that if these negotiations move forward with either company that the public will have a chance to comment. However, it would be better for people to voice opposition now and work towards stopping the privatization of Grand Rapids water.

 

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