Why Privatizing the Water Supply = Most Regressive Taxation Ever

First of all, “privatizing” and “water supply” should never appear together in a sentence that doesn’t start with “Don’t even think about…”.  Just my opinion.  There may be some cases in larger cities where an internal water department has so mismanaged the balance sheets that outsourcing seems like the most viable option, but even then, I’d be concerned.  A public utility, a basic human need, the stuff that makes up 2/3 of the Earth’s surface and 2/3 of us in private hands?  I’m not talking about premium bottled water here, but the two parts hydrogen to one part oxygen coming from our spigots.

The context here in Allentown is important.  As things stand, the water service brings in between $10 and $15 million a year. That’s not enough to cover the fire and police pensions looming over the City’s coffers, and we’ve been told time and again by the Mayor that a private lease deal is the only way out.  Without raising taxes.

Without raising taxes.

Why not raise taxes, then?  Because we have a chamber of commerce and other powers who don’t want taxes raised.  We have a Mayor who wants to be able to run for Governor without having to explain why taxes were raised.  We all get it.  It’s a proxy war for fiscal conservatives and not-so-progressive liberals against the growing demands that communities share burdens like this in common.

Pretend I rent a house or apartment in Allentown.   Pretend I have a wife and two kids, and my wife and I both work full time jobs, but after rent, utilities, childcare and staples, we have no disposable income.  Water gets privatized, and for the first five years, we don’t see any huge change in rates.  Then the increases start, which my landlord passes on to me dollar for dollar.  And dollar for dollar and dollar for dollar.  I bear the entire burden of the increase, and after all, I used the water.

But if we kept the water public and managed rates ourselves in the public interest, and paid the pensions off with increased progressive taxes, I’d be able to afford water, and I’d know that I was paying a proportionate share of the fire and police burden, as I was able, as was my landlord.

Let’s not pretend that water rates won’t go up in private hands, or that passing off those increases to tenants (or homeowners!) isn’t saying “here, you pay for the fire and police pensions.”   We all use the fire and police, and the crap deal Mayor Pawlowski’s old boss got for the City is an equal burden on us all.

As a friend reminded me today, the people most strongly against any tax increases are people who have money to burn (or higher offices to seek).  That doesn’t mean we ought to burn it for the sake of burning, but if I’m a landlord making serious bank and my tenants are basically being taxed on water in my stead to pay for services rendered to everyone, something is seriously wrong.  It’s one of the most regressive situations I can imagine.

When I was a kid, one of my favorite shows was Zorro on the old Family Channel.  Speaking out against the evil Alcalde, female lead Victoria once said “He would tax the air we breathe if he could.”  Alcalde’s bumbling lieutenant responds, “Actually, I think he’s working on that.”   It’s amazing to me that heroes in the vein of Zorro and Robin Hood, were they with us today, might more often than not find themselves opposed to so-called liberals in collusion with the monied powers.

A water tax on poor and middle income people to cover the cost of Alcalde’s militia fire and police pensions sounds like a job for someone.

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One comment

  1. We have had privatised water companies here for some years now, and the very thought of it initially filled us all with the same dread you have. However, using lack of investment in the infrastructure by successive Governments as an excuse to sell-off water companies we went ahead. Now our water companies are owned by Spanish and French companies and in one case, I think, a Japanese company. It’s kept quiet, of course, but we don’t own our water anymore. It’s freaks me out to think about it..

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