Here we go again. Another multi-billion-dollar water corporation is claiming they can help a struggling community.
“Desperate government is our best customer,” said the chairman of a financial firm specializing in infrastructure privatization back in 2008 during the Great Recession.
York, Pennsylvania, certainly is desperate. Like many other places, it’s facing tough financial choices during the pandemic.
But what American Water is proposing—a so-called “public-private partnership” to buy up York’s wastewater system—won’t help.
We know that because privatization rarely saves public dollars. Not only that, it also hurts the local economy by lowering wages and benefits for workers. And that’s to say nothing of the ways it can limit flexible policymaking.
All of that and more is covered in our new policy brief, “Restoring and Reimagining Investment in Public Water.”
We reviewed the existing research and found that:
- Many U.S. water systems are aging and need lots of work to ensure they meet health, safety, and environmental standards.
- The federal government has dropped the ball. Federal support for water infrastructure has declined 77 percent in real terms since its peak in 1977.
- Private water corporations often cut corners to reduce operating costs, harming water quality or service quality, or both.
- Many of the systems that need the most investment serve marginalized, low-income communities, many of which are communities of color.
This is why the Biden administration and Congress must increase federal investment in local water systems. Luckily, legislation being discussed—the Water, Affordability, Transparency, Equity and Reliability (WATER) Act—would do just that.
In Pennsylvania, local and state leaders could do the right thing by raising revenue from those who can afford to pay. This isn’t a radical position. Nearly two-thirds of Americans agree that the very rich should pay more in taxes.
Pennsylvania could start by taking away corporate subsidies for American Water, which already has plenty of money. The corporation profited $621 million in 2019. Making money is just what they do.
Which is different than what governments do: ensuring that everyone has access to essential public goods like water.