By Blair Ewalt
In 2010, U.N. Secretary General Ban Ki-moon stated, “More people die from unsafe water [each year] than from all forms of violence, including war,” and as water scarcity increases in the coming decades, our methods for controlling the aqueous resource must evolve with the growing world population. Access to clean water is a fundamental human right that the government should enforce in order to maintain resources and protect the public.
The privatization of water utilities may lead to a spike in price, waste, and make access more difficult. One economic principle that dates back to the 1960s, the Averch-Johnson effect, states that when private companies operate as a regulated utility, they are more inclined to raise their costs to levels beyond the actual worth as utilities are demand inelastic. In turn, a negative externality arises; the overpricing of utilities outprices individuals, negating their undeniable human rights.
Bottled water is also largely inefficient as the process takes, according to The Young Turks, approximately 86 liters of oil and three liters of water to produce one bottle and move it to a retail shelf. Many of the bottling companies rely on groundwater to fulfill their needs, tapping overstressed groundwater basins that are being drawn from faster than they can replenish themselves. One such basin is the Californian Central Valley Aquifer System, which the corporation Nestlé has been drawing from unsustainably for the last three decades. According to the University of California – Irvine, overstressing these basins leads to a decline in water quality and the subsidence of land. A “tragedy of the commons” subsequently forms when the right to water is privatized as the good is exploited by all, but protected by none. The water controlling body must be liable to the public, not just to shareholders.
The opposition to public water utilities spars from a long history of poor provisional policy. The American Water Works Association avers, in the coming decades the U.S. will need to invest one trillion dollars in water utility infrastructure in order to sufficiently provide clean water to a growing population. At the current and historical rates charged, this investment is unattainable; however, if utilities were to price water to reflect true value, it would be attainable. Maintaining low rates is attractive to the customer, but hinders capital improvement.
Water usage should be priced in brackets in a system that favors individuals before large capital projects and discourages over usage. As individuals, people should have to pay a flat fee that covers personal daily estimated water use, from there a marginal fee for every unit of water used. When the amount used passes a threshold, higher rates will be implemented. This system accounts for the needs of all individuals, without hurting the poor. One externality that might arise from the system is that farmers would shift from raising meats to yielding crop.
The only system that accounts for human rights is a system of government regulation that would ensure water quality is adequate and resources are effectively used.