Being on the right side of neoliberal Water

“Well, art is art, isn’t it? Still, on the other hand, water is water! And east is east and west is west and if you take cranberries and stew them like applesauce they taste much more like prunes than rhubarb does. Now, uh… now you tell me what you know.” Marx, (Groucho)


By ann summers

 

Plenty more to discuss in the coming weeks on Brexit but for today’s puposes, as much as the EU has faciiltated some environmental agreements such as the recent Paris COP21, there still is ”…the need for a mass social movement addressing both the urgent need for climate action and an agenda for social justice”.  

In that spirit it’s important to see such movements not simply in their relation to nature and its degradation but in the larger social ontologies that make the Brexit crisis one defined by labor flows but constrained by environment rather than some state-like entit(ies). And of course it’s not about anti-migrant hatred.

Among strategic resources, water will continue to make regional development complicated regardless of political and demographic strife. There is even water security which can be commodified much like carbon, and the trading of rights and transfers can represent a less tangible but more material example of the problem of commodity fetishism.

Water security has two components. One is the capability for the provision of potable water during emergency situations of varying durations. The other is the protection of the water supply and water system components from natural and man-made threats, as well as deliberate attacks.

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The Flint water crisis is a drinking water contamination issue in Flint, Michigan, United States that started in April 2014. After Flint changed its water source from treated Detroit Water and Sewerage Department water (which was sourced from Lake Huron as well as the Detroit River) to the Flint River (to which officials had failed to apply corrosion inhibitors), its drinking water had a series of problems that culminated with lead contamination, creating a serious public health danger. The corrosive Flint River water caused lead from aging pipes to leach into the water supply, causing extremely elevated levels of the heavy metal. In Flint, between 6,000 and 12,000 children have been exposed to drinking water with high levels of lead and they may experience a range of serious health problems.

And of course it takes more than two liters of water to produce a single liter of bottled water.

The common major problems include:

• Water resources – an insufficient supply, especially where it is needed

• Inadequate water and wastewater treatment systems

• Surface and ground water contamination

• Storm water flooding & contamination

• Financial resources to pay for water and wastewater treatment systems

• Regulatory enforcement

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  • What are the implications of privatizing public water utilities in terms of equity in service provision, resource conservation and water quality?
  • Do free trade agreements erode the sovereignty of nations and citizens to regulate environmental pollution, and is this power being transferred to corporations?
  • What does the evidence show about the relationship between that marketization and privatization of nature and conservation objectives?

Commodification of rights under neoliberal market regimes will continue even as disintegration might occur in regional trade areas like the EU. Water markets are also labor markets especially with massive deterioration of public utility infrastructures because of deferred maintenance (labor cost-shifting) that so clearly define the difference between capitalist models and alternative structures.

Commodification of Water

Through the establishment of private property rights and market mechanisms it is argued that water will be allocated more efficiently.

Bakker[1] describes this market-based approach proposed by neoliberals as “market environmentalism”: a method of resource regulation that promises economic and environmental objectives can be met in tandem.[2]

To this extent the commodification of water can be viewed as an extension of capitalist and market tendencies into new spaces and social relations.[3] 

Marx termed this phenomenon, “primitive accumulation”.[4] For this reason there remains serious doubt as to whether commodification of water can help improve access to freshwater supplies and conserve water as a resource.

Neoliberal policies relying on environmental markets have been reflected in EU disintegration that crosses national borders as in the upstream and downstream riparian cost cooperation discourse for inland waterways and of course shared bodies of water like the Channel between the UK and France. The problem is the shared or common pool resource and all of its associated agreements and regulation of a natural resource.

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Given the complexity of basin and river configurations, there is no international database available that determines the upstream variable for a country pair. Unfortunately, a great number of riparian countries do not feature a clear downstream/upstream relationship: the river can form a perfect border between both countries, or a river can flow from country A to country B, but part of the river may be fed by a tributary source that comes from country B and flows itself into country B. www.feem-web.it/…

Neoliberalism unfortunately fords (or fordists(sic)) many bodies of water, so Brexit will have more risks and rewards.

Why has the left made so little progress five years (2013) after a major crisis of capitalism discredited neoliberalism? Since 2008, neoliberalism might have been deprived of the feverish forward momentum it once possessed, but it is nowhere near collapsing.

Neoliberalism now shambles on as zombie – but as the afficionados of zombie films are well aware, it is sometimes harder to kill a zombie than a living person.

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Now ending its limited run in October 2016
“Water barriers will be most successful if zombies can’t swim, but the definitive text (World War Z, 2006) suggests that they can walk underwater, and that they will slowly spread out under the sea as they seek human prey.”

 

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At the conference in York, Milton Friedman’s notorious remark was quoted a number of times: “Only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.”

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”…and if I speak the good into existence, that instant my dreams will unlock. Money flow like water, I’ll just wait at the dock” (Kendrick Lamar)

 

The problem is that although the 2008 crisis was caused by neoliberal policies, those selfsame policies remain practically the only ones “lying around”. As a consequence, neoliberalism is still politically inevitable…

Capitalist realism is an expression of class decomposition, and a consequence of the disintegration of class consciousness. Fundamentally, neoliberalism must be seen as a project which aimed to achieve this end. It was not primarily – at least not in practice – dedicated to freeing up the market from state control. Rather, it was about subordinating the state to the power of capital. As David Harvey has tirelessly argued, neoliberalism was a project which aimed to reassert class power…

What’s certain is that we are now in an ideological wasteland in which neoliberalism is dominant only by default. The terrain is up for grabs, and Friedman’s remark should be our inspiration: it is now our task to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.

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The following assumptions were made in order to transfer the results to the EU:

  • Existence of a water market including a tradable water entitlement system
  • Water rights through entitlements. In Australia, the water is allocated on the basis of an entitlement system. Establishment of a similar quota system would be necessary by which a limited quantity should be made available to the irrigators and other industry
  • Water basin point of departure for water allocation with no restrictions imposed by administrative borders
  • The Potential for investments in and subsidising infrastructure projects also needs to be considered.

The main costs of establishing any system are determined by the number of water users not how many pieces of paper are issued and the detail associated with each entry. In the longer run, if a robust system is put in place, further costly reform and adjustment will not be necessary. If a government implements a separated system, then many such problems can be avoided and the long-term costs to industry and the environment avoided. The approach is also particularly relevant for those interested in setting up emission trading systems, forest harvesting systems, fish harvesting systems, etc.

In any environment where there is uncertainty and these uncertainties cannot be avoided, entitlements should be defined as shares and periodic allocations made in proportion to the number of shares held. If the transaction costs associated with allocation trading are low, then almost all efficiency benefits can be secured through the use of robust accounting practices. Conceptually, most of the remaining efficiency gains can be realized through the introduction of arrangements for the efficient management of externalities.

Comparing the UK and France shows that despite socialism in some places, there is extensive neoliberal privatization in areas that would normally be socially owned.

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4.15 United Kingdom (UK)

The UK has a sufficient water resources overall, but high population density in many areas makes regional water shortages a potential for as many as 17 million people.

Per capita domestic water consumption is relatively low at 38 gallons a day. The main challenges facing the country are modernization of its distribution and collection infrastructure, metering and conservation, and compliance with coming EU water standards, including potential initiatives related to climate change.

Nearly 100% of the population in the UK is connected to a public water supply, but only 23% of connections are metered.

Thames Water, which serves London, has set a goal to have 100% of the city’s buildings metered by 2020, but goals for other areas of the UK are unclear.

Wastewater treatment coverage exceeds 96% in the UK, with nearly 99% receiving at least secondary Public water supply accounts for 48% of water withdrawals, power plant cooling for 28%, and industry for 12%. Aquaculture accounts for 10%, although this has been declining in recent years, while agriculture (including spray irrigation) accounts for just 0.3% of withdrawals, no doubt due to the plentiful precipitation the region is known for. Water loss in the public supply is estimated to be nearly 21%, a relatively high number for a developed country, which, in part, reflects the advanced age of most of the UK’s water infrastructure, as well as the lack of extensive metering infrastructure to aid in pinpointing leaks and to encourage conservation. The UK has started to pursue desalination as an answer to potential water shortages in the densely populated southeast section of the country. The Thames Gateway Water Treatment plant, with a capacity of 39 million gallons per day, was brought on-line in 2010 at a total project cost of $356 million. The project is controversial, as some believe that wastewater re-use would be preferable from energy use and related greenhouse gas emissions standpoints.

The overall water market is significant, estimated at nearly $13 billion annually, with modest growth expected. Annual capital expenditure for water network rehabilitation is expected to rise steadily from $1.5 billion in 2010 to $2.0 billion in 2016. Overall annual capital expenditure by municipalities for water will range from $2.2 billion to $3.1 billion over the same period. For wastewater, annual municipal expenditure estimates range from $1.3 to $1.7 billion for network rehabilitation and from $2.7 to $3.4 billion overall.

Water and wastewater treatment has been almost full privatized since the adoption of legislation in 1989 which privatized water providers in England and Wales. The legislation did not apply to Scotland and Northern Ireland, but the trend in those areas has been toward privatization as well.   The UK has adopted EU water directives as required, except for the full-cost recovery mandate in Northern Ireland. The Marine Strategy Framework Directive and the Flood Risk Management Directive are likely to consume an increasing share of water development resources in the future, due to the UK’s maritime location and susceptibility to climate change effects.


4.16 France

Even though France’s population is growing, demand for water has been declining, in line with other highly developed areas where access to efficient water saving appliances and fixtures is increasing. Per capita water consumption is currently 74 gallons per day. The main challenges facing the country are bringing hundreds of smaller wastewater treatment plants into compliance with EU standards and meeting future water EU standards, including initiatives related to climate
change.

In France, 99% of the population is connected to a public water supply, and virtually all connections are metered. Wastewater treatment coverage is 80%, with 29% of treated wastewater receiving at least secondary treatment, and 18% receiving tertiary treatment. Nearly one-fifth of the population, mostly in rural areas, relies on decentralized wastewater treatment, such as septic systems.

The private sector provides most of the water (71% in 2008) and wastewater (56%) service in France. The country is home to three of the largest water technology companies in the world, Veolia, Suez, and Saur, which dominate these markets. There is ongoing pressure from municipalities to continue the trends of increasing competition and lower rates. This will be especially important in coming years, as contracts are coming up for renewal in some of the country’s largest cities. Four-fifths of the public water supply is from groundwater sources, with the remainder sourced from surface water.

Public supplies account for 15% of water withdrawals, agriculture for 13%, and industry for 22%. The largest share of water withdrawal, 62%, is used for energy production, including power plant cooling for France’s numerous nuclear facilities. Water loss in the public supply is estimated to be 27%, a fairly significant number.

The overall water market is estimated at nearly $23 billion annually, with annual increases of about 2%. Annual municipal capital expenditure for water is expected to rise steadily from $3.1 billion in 2010 to $3.7 billion in 2016. Municipal capital expenditure for wastewater is also projected to rise from $4.0 to $5.4 billion annually, with the most rapid growth in network expansion and rehabilitation, and for treatment plants.
Water and wastewater technology is highly advanced, in part reflecting the presence of large global water services companies. Aquaviva, a WWTP in Cannes that utilizes membrane bioreactor technology, is the first carbon-neutral project of its kind. These types of projects will become more critical as France and other EU countries strive to meet Kyoto Protocol regulations to combat global warming. France has 82 desalination plants.

The country has a relatively large amount of coastline, along with a major island, Corsica, and shares la Manche (the English Channel) with the UK, so the Marine Strategy Framework Directive is important.


There should be continued renewal of dialectical concepts that help refine the critical analysis of Capital and Nature. No space here for that discussion, but it would be useful to begin to discuss MMT and its critique in coming weeks.

La Revue du Projet: What do you think should belong, in broad outlines in a renewed Marxist approach of ecology?

John Bellamy Foster: This is a huge question and therefore difficult to answer. I would argue that such a renewal should be built on the foundations of Marx’s dialectical analysis of what he called “the universal metabolism of nature,” the “social metabolism” and the metabolic “rift.”

It was based on this dialectical sequence that Marx developed the most radical notion of sustainability ever developed, in his famous statement in volume 3 of Capital, where he stated that no one, not all the people in the world, owned the earth, but that they needed to maintain it for future generations as “good heads of the household.”

Marx saw the social metabolism as the labor process itself. He defined socialism as the rational regulation by the associated producers of this metabolism between humanity and the earth, and in such a way as to enhance human development while conserving energy and maintaining the earth. Marx’s understanding of ecological crisis encompassed not only increasing ecological costs that could impact the economy, but also, more importantly, ecological crisis proper through his theory of metabolic rift, i.e. the disruption and degradation of the earth, outside the value calculus of capital.

He thus was a true ecologist, and did not see these questions merely through the lens of capital. He described anthropogenic climate change in the form of desertification as an “unconscious socialist tendency,” i.e., it was a contradiction so at odds with capitalism and civilization that only a socialist society could solve it, through the creation of a society of sustainable human development.

Standing in the way of Western Marxist understanding of the ecological problem is the fact that Western Marxism as a distinct philosophical tradition was based primarily on the rejection of the dialectics of nature—a concept that was commonly associated with Soviet Marxism, and with Engels rather than Marx.

Hence, the dialectic, in the Western Marxist, view was seen as applicable only to society and not to nature. Science was viewed as mechanistic and positivistic almost by definition. This is the major reason why Western Marxist philosophers have done so badly when turning to the ecological question. Left thinkers like Badiou and Žižek even refer to “ecology” as “the new opium of the masses.”  

Only insofar as the question of the dialectics of nature and society are again taken up, as in classical Marxism, can progress be made in this area. But this requires the healing (or transcendence) of Cold War divisions within the left.

“… the struggle against neoliberalism will require that we construct an alternative model of desire that can compete with the one pushed by capital’s libidinal technicians.”

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What would that look like… would it be a redefining of the commodity or the “…commodification of everything”

steady state economy is an economy with stable or mildly fluctuating size. The term typically refers to a national economy, but it can also be applied to a local, regional, or global economy. An economy can reach a steady state after a period of growth or after a period of downsizing or degrowth.

The problem will ultimately consume the planet regardless of steady-state solutions which shows the potential inevitability to colonize other planets How that happens is a neoliberal problem that still engages class struggle as SpaceX may reveal. en.wikipedia.org/…

Mainstream economics today is based to a large extent on bad ideas.

Economic concepts, from foundational issues like markets, supply and demand and “free trade”, to money and finance, lack any systematic awareness of the physical process of production or the implications of the Laws of Thermodynamics for those processes.

A corollary, almost worthy of being a separate bad idea on its own, is that energy doesn’t matter (much) because the cost share of energy in the economy is so small that it can be ignored e.g. {Denison, 1984 #6184}.

The so-called “production functions” used by all schools of economic thought that build growth models omit any necessary role for energy, as if output could be produced by labor and capital alone—or as if energy is merely a form of man-made capital that can be produced (as opposed to extracted) by labor and capital. en.wikipedia.org/…

Energy as commodity form poses important sustainability challenges with greater renewable industrial energy in a Eurozone grid.

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Ecological crisis: Tragedy of the commons or tragedy of the commodity?

The tragedy of the commons theory explains the behaviours of individual actors in given social circumstances. However, it does not address how historical conditions and the socioeconomic system influence individual actors. In other words, the social context is simply taken for granted. The existing social conditions and relations are regarded as ever-present, universal, and permanent. The model neglects to recognise that human interactions and exchanges with ecological systems change through time and are regulated by particular institutional conditions.

Once examined from a sociological perspective, the tragedy of the commons theory is simplistic and one-sided in that it attempts to explain human social behaviour, or human agency, without a thorough understanding of the historical social organisation.[7] This simplification results in a mystification of the modern systems of production and consumption and the historically specific ecosystem effects.

In contrast, the tragedy of the commodity approach emphasises the role of the growth imperative of capitalism and commodification in producing the institutional rules by which nature and, for example, the commons are governed and historically transformed. Ecological systems are never altogether free of social influences. Rather, they are shaped by social conditions including norms, traditions, economic rules, the organisation of labour, politico-legal arrangements, etc.[8] The social actions that have emerged with capitalist development are dominated by what Adam Smith called “the propensity to truck, barter, and exchange,” matched with a crude utilitarianism, where individuals follow pure self-interest without social constraint. Unfortunately, these actions are often incorrectly ascribed to innate human behaviour.[9]

Thus, what might appear to the casual observer to be a system governed by base greed and human instinct is in fact largely directed by the drive for capital accumulation and what Immanuel Wallerstein called the progressive “commodification of everything.”[10] Among other outcomes, the commodification process results in a social metabolic order — socio-ecological interchanges and interrelationships — that produces unsustainable social and ecological consequences.

In a society organised around the logic of capital, human activities tend to be directed toward the production of commodities. That is, capitalism can be understood in a broad sense as a system of generalised commodity production. The institutional arrangements result in particular social arrangements and generate distinct types of human social action. The commodity serves as a basic unit to understand the larger culture-nature relations and capitalism itself. It is a base element of capitalist market processes…

The way forward, toward a more sustainable world, requires radical changes in the social conditions that have historically shaped the productive and consumption system of capitalism. Collective action must take back public commons and put them in control of the people who most closely interact with them and depend on them for community well-being. In order to be successful, these actions must (in effect) de-commodify nature.

Commons must be decentralised and democratised, rather than, in the standard neoliberal view, privatised. Farmland and fisheries must be socially organised to advance nourishment and health. Forests must be valued as reserves of biodiversity, clean water, and culture. Economic activities must be embedded within society as a whole and the universal metabolism of the biophysical world, allowing for the continuation of reproductive processes, nutrient cycles, and energy flows that support all life.

Human society must transcend the logic of capital, creating a new social metabolic order that increases the quality of life and enhances the potential for ecological flourishing and universal human freedom.

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capital costs are not the costs of capital, and in terms of labor, Public Service Employment is necessary
“The notion of a government running out of its own fiat currency is nonsensical. In spite of this, the illusion that public debt can be a problem persists.” www.cfeps.org/…

 

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One Response to Being on the right side of neoliberal Water

  1. pete says:

    Flint Michigan sits between the 4th and 5th largest fresh water lakes in the world. Yet they can’t seem to get potable water there.
    In some places in the American west it is unlawful to catch and retain rainwater that falls on your house or land. Someone else already owns the rights to it.
    Between decreasing rainfall and snowpack on the west coast and the depletion of the Ogallala Aquifer on some of our most productive farmland (not to mention some of the contaminates we’re putting back into it).
    I haven’t mentioned saltwater intrusion from over pumping here in Florida. Plus sea level rise and melting icecaps.

    The problem is we need less taxes and fewer regulations to help the job creators. Oh, and a wall, a yuge wall.

    I heard of a politician explain recently that Florida (The Sunshine State) doesn’t have more solar panels because it’s also the partly cloudy state.

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