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Wednesday, October 22, 2014

We would like to thank Stratfor for the following article. 

The Similarities Between Germany and China

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By George Friedman
I returned last weekend from a monthlong trip to both East Asia and Europe. I discovered three things: First, the Europeans were obsessed with Germany and concerned about Russia. Second, the Asians were obsessed with China and concerned about Japan. Third, visiting seven countries from the Pacific to the Atlantic in 29 days brings you to a unique state of consciousness, in which the only color is gray and knowing the number of your hotel room in your current city, as opposed to the one two cities ago, is an achievement.
The world is not getting smaller. There is no direct flight from the United States to Singapore, and it took me 27 hours of elapsed travel to get there. There is a direct flight from Munich to Seoul, but since I started in Paris, that trip also took about 17 hours. Given how long Magellan took to circumnavigate the world, and the fact that he was killed in the Philippines, I have no basis for complaint. But the fact is that the speed of global travel has plateaued, as has the global economic system. There is a general sense of danger in Europe and Asia. There is no common understanding on what that danger is.
I was in Seoul last week when the news of a possible wave of European crises began to spread, and indications emerged that Germany might be shifting its view on austerity. It was striking how little this seemed to concern senior officials and business leaders. I was in the Czech Republic when the demonstrations broke out in Hong Kong. The Czechs saw this as a distant event on which they had opinions but which was unlikely to affect them regardless of the outcome.
There has been much talk of globalization and the interdependence that has flowed from it. There is clearly much truth in arguing that what happens in one part of the world affects the rest. But that simply was not evident. The eastern and western ends of the Eurasian landmass seem to view each other as if through the wrong side of a telescope. What is near is important. What is distant is someone else's problem far away.

Germany and China as Economic Centers

There is symmetry in this view. Europe cares about Germany and Asia about China. In some fundamental ways these countries have a substantial amount in common. China is the world's second-largest economy. Germany is the world's fourth-largest exporter. Both countries are at the center of regional trade blocs -- Germany's formal, China's informal. Both trade on a global basis, but both also have a special and mutual dependency on their regions. China and Germany both depend on their exports. Germany's exports were equivalent to 51 percent of its gross domestic product, or about $1.7 trillion, in 2013, according to the World Bank. China's exports equaled 23.8 percent of a larger GDP, or about $9.4 trillion.

The two countries at the center of their respective regional systems have both been extremely efficient exporters. The United States, by comparison, exports only 14 percent of its GDP. But it is precisely this ability to export that makes both Germany and China vulnerable. Both have created production systems that outstrip their capacity to consume. For Germany, increasing consumption can be only marginally effective because it is already consuming at near capacity. For China, there is more demand, but much of it is among the roughly billion people who lack the purchasing power to the buy the goods China produces for the regional and global market. China's society lives on a steep cliff. On top of the cliff is a minority who can purchase goods. In the deep valley are those who cannot -- and also cannot readily climb the cliff. Thus, like Germany, China's effective demand cannot absorb its exports.
Therefore, economic viability for both Germany and China depends largely on maintaining exports. No matter how much they import, their exports maintain domestic social order by providing a significant source of jobs right away, rather than in some future scenario involving the rebalancing of their work forces. For Germany, which has memories of massive social dislocation in the 1920s, maintaining full employment cuts to the heart of the country's social order. For China, whose Communist Party was shaped by the rising up of the unemployed in Shanghai in 1927, maintaining full employment is a bulwark in defense of the government. Both countries look at unemployment not only in terms of economics, but also in terms of social stability and governmental survival. Therefore, exports are not simply a number, but the foundation of each country.

An Economic Model's Shortcomings

The problem with an export-based economy is that the exporter is the hostage of its customers. Germany's and China's well-being depend not only on how they manage their economies, but on how their customers manage their own economies. If the customer's economy fails, the customer cannot buy. It doesn't matter whether the problem is a policy failure or a cyclical downturn -- the exporter will pay a price. Both Germany and China exist in this precarious position.
Germany and China are dealing with the fact that their customers' appetites for goods are declining -- whether because of price competition or because of economic decline. Europe is in economic turmoil. Southern Europe is suffering from massive unemployment, and the rest of Europe is experiencing slower economic growth, no growth, or even decline. Demand in this market is essential to Germany, and it is difficult to maintain demand under these circumstances. It is not surprising, then, that the German economy appears to be moving to recession.
China's problem is different from Germany's, if somewhat more hopeful in the long run. The 2008-2009 global financial crisis decimated China's low-end export sector. The crisis halted the decadeslong low-cost export boom that the Chinese government had kept alive well beyond its natural life span through years of systematic wage repression and wasteful subsidies, both direct and indirect, to manufacturers. As a result of the crisis, the portion of China's GDP tied to exports collapsed almost overnight, from 38 percent in 2007 to just under 24 percent now. This collapse has forced Beijing to keep the economy on life support through massive expansion of state-led investment into housing and infrastructure construction. The housing boom is showing signs of having finally run its course.
Beijing is pinning its hopes, in part, on a revival of China's export manufacturing might -- not of the low-cost, low-value added goods that were once the country's mainstay, but increasingly of the kind of value-added goods proffered by more-advanced export economies such as South Korea and Germany. However, this evolution is a long-term goal, not one that can be realized in one, two or even five years. In the meantime, Beijing will struggle to maintain stable growth and high employment in the face of an anemic low-end export sector, a deflated housing and construction bubble, less-than-robust domestic consumption, and inadequate services and high-end manufacturing sectors.
Germany's and China's regional partners may not, in the long run, benefit from German and Chinese export power. It is interesting that in general, everyone fears the major readjustment that might be coming. Germany's power and ability to flood markets are seen regionally as problems that need to be corrected. At the same time, Germany's regional trade partners understand the instability that readjustment would bring and are content, particularly among the corporate and financial communities, to maintain the current order with Germany at the center. The same might be said for China. When I spoke of China's weakness, there was no longer any resistance to the idea, as there was a few years ago. At the same time, no one was eager to see a changing of the guard. The western and eastern parts of Eurasia were each built around the power of a single country: Germany in the west and China in the east. Each region understands the economic price it pays for German and Chinese power, and each region understands that pivoting around these two countries provides an element of stability.

Variables in East Asia and Europe

Another wild card exists in each region. In Europe, it is Russia. In East Asia, it is Japan. Russia has already become active in asserting itself. It is not challenging German power, as Russia is not an industrial competitor with German exports. Rather, the country is an exporter of energy needed by Germany and Europe, and it is a significant, if regional, military power. In Eastern Europe where I travelled, the discussion frequently turned on the question of whether Germany and Russia had reached some sort of secret accord that was playing out around the Ukraine crisis. If there is an agreement, then the region will have to dance to the Moscow-Berlin tune. If there is no deal, then no one wants to see Germany destabilize. But there is also a sense that there is nothing to be done about it.
In East Asia, there was also a sense that Japan is reappraising its postwar pacifism and preparing to take a more active military role in the region. Concerns about Japanese remilitarization were much less visible in Singapore than in Korea, and it is not an overwhelming concern anywhere. But there was still the feeling that as China enters an unpredictable phase economically, it enters one socially and politically as well. All of Japan's forays among the small islands to China's east may portend more aggressive moves. My own view -- that China is not nearly as capable militarily as it might appear -- was at once acknowledged and brushed off. In the region, risks can't be taken. Japan was seen as the wild card. Still the world's third-largest economy, with a substantial military establishment already, Japan might find it necessary to be a counterweight to China. There is as much enthusiasm for this in East Asia as there is for Russian aggressiveness in Europe.

Seeing Both Sides of Eurasia

A trip to both East Asia and Europe allowed me to see two things I never quite noticed before. The first is the symmetry between the two ends of Eurasia. Both are built around a strong exporting power that is now in very dangerous waters. Neither export powerhouse is loved in its home region, but few regional trade partners are eager to deal with the risks that instability might bring. And in each region there is an actor just off stage that is flexing its muscles and potentially changing the way the regional game is played.
The second thing I noticed, which I don't think I would have seen without flying first to Singapore, then to Europe and then to South Korea, is the degree to which the two ends of Eurasia are decoupled. We talk about global interdependence, and it is real. But while, whatever the economic dynamics, each region is intellectually aware of what is going on at the other end of Eurasia, each sees the other as distant and ultimately unconnected from its concerns. They are aware of each other, but not concerned about each other, as each region plays its own game. What makes this ironic is how similar the two games are.
The primary question that people on both sides of Eurasia asked was, "What is the United States going to do?" I was always asked about the decline of the United States and then, in the next sentence, asked about what the United States will do in Ukraine, Iraq or the South China and East China seas. There is a sense that Europe and China are far apart, but the United States is near. There was also a frustration that the United States is not prepared to play roles that would serve these regions' best interests and instead insists on pursuing what is seen as its own foolish ends. It was good to hear this, as it assured me the world has not completely uncoupled.
Distance does seem to disconnect people. Money might flow in milliseconds, and flights can be made in (too many) hours, but human lives are built around what is nearby and therefore familiar. Each region saw itself as unique. I might have been startled by how much they have in common, and Europe's and Asia's fates might be similar. But I have the sense that despite all we say about a small planet, similarity is not the same as being linked.


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Tuesday, October 21, 2014

If you wonder why Barack H. Obama or Barry Soetero is still in the White House, read the link below.

http://rt.com/usa/197680-immigration-blank-cards-obama/

He is still there as the ACTING President, and doing what he was selected for, and that is the destruction of the United States of America.  He is doing that real well. 

Friday, October 17, 2014

Water As a Human Right


Privatization Everywhere

It is happenning evrey where.  The rich want more and more.  They want to live off of our blood, sweat and tears.  What is our own they want, and then have us pay for it.  Please see the following article:

Euro-wide citizen’s petition launched in Ireland amid fears that Irish water services could be privatised

A Europe-wide ‘right to water’ campaign, which aims to attract a million petition signatures including 30,000 from Ireland, was launched at the IMPACT biennial delegate conference in Killarney, County Kerry today (Thursday). The initiative was recently accepted under the EU’s European Citizen Initiative (ECI), a new legal tool introduced as part of the Nice Treaty, which forces European institutions to consider issues that win the necessary public support.
The ‘right to water’ campaign calls on the European Commission to recognise water as a human right, exclude water and sanitation services from EU internal market rules, and legislate to ensure water and sanitation assets remain in public control even where private companies operate them. The launch comes amid fears, voiced at the IMPACT conference earlier today, that the establishment of a new national water authority called Irish Water could eventually lead to the privatisation of Ireland’s water and drainage services.
Delegates at the IMPACT conference expressed strong opposition to water privatisation and unanimously backed motions calling for Irish Water to remain in public ownership. IMPACT national secretary Peter Nolan backed reform of water provision but said the best way to prevent privatisation was for local authorities to retain legal and operational control of capital assets. He said Irish Water should be established as a not-for-profit organisation with a strategic role in raising investment funds, developing infrastructure, and ensuring that local authorities met robust standards of water quality and value for money.
Despite Government assurances that it intends Irish Water to remain in public hands, unions believe plans to rationalise water assets in a single organisation will make future privatisation more likely, particularly once water charges trigger a lucrative income stream.
IMPACT national secretary Peter Nolan questioned the funding and charging assumptions underpinning the Government’s plans and argued strongly that local authorities should retain control of the water infrastructure. “Water is a human right and you don’t have to be suspicious of the Government’s intentions to see the obvious risk inherent in its plans. Once Irish Water is established, with an income stream from water charges, the temptation to privatise would be immense, particularly if economic circumstances change for the worse and Ireland comes under international pressure to sell more State assets. In any case, Irish Water would be ripe for privatisation by any future Government that chooses not to make a commitment to continued public ownership,” he said.
The European Citizens’ Initiative was launched at the conference by Jerry Van Den Berge of the European Federation of Public Service Unions (EPSU). He said the European Commission currently favoured ‘marketisation’ of water despite international opinion shifting against privatisation, mainly because of concerns over quality, price and value for money. “Over two-thirds of the EU’s water is supplied by local authorities, water has returned to public ownership in Paris,Vienna and Hungary, and Holland has passed legislation preventing water privatisation. Even in the USA 85% of water services are run by municipal companies,” he said.
Speaking at the launch, IMPACT deputy general secretary Kevin Callinan said: “The European Citizens’ Initiative can help determine the principles and values that underpin the Europe we want, not simply a Europe that serves the interests of international finance and global capitalism. IMPACT is taking part in this Europe-wide initiative in order to deliver a strong message to the EU Commission and governments that citizens value water, and that public ownership protects water as a human right.”
Among other things, the campaign calls on the European Commission to:
* Exclude water and sanitation services from EU internal market rules
* Exclude water and sanitation services from trade agreements
* Legislate to ensure that water resources remain in public control even where private contractors provide services
* Put measures in place to help prevent disconnection of households unable to pay water bills
* Ensure that protection of water services prevails over commercial priorities
* Insist on transparency and openness where private companies provide water and sanitation services
* Support companies that invest in water partnerships with developing countries and
* Recognise water as a human right.
Earlier this year, the Irish Congress of Trade Unions (ICTU) pledged to resist any proposal to privatise the Irish water sector and called for investment and strategic planning in the sector. In a submission to the Government’s consultation on the establishment of Irish Water, ICTU said infrastructural problems with Ireland’s water networks were a product of years of under investment by successive governments. “Given the disaster we witnessed following the privatisation of Eircom, the privatisation of the former state banks and the recent difficulties associated with the privatisation of the bin collection service in Dublin, we believe that any attempt to privatise the water sector or any of its component parts will also be resisted by citizens,” it said.
The IMPACT conference also passed motions calling for jobs, pay and working conditions to be protected if the Government presses ahead with its plans to transfer water operations from local authorities to Irish Water.


 

It never fails, i.e. the exploitation of the Haitian people by Haitians at the behest of the US Government.  If you want to know what the New World Order will look like just visit Haiti. Here is an article from Global Research web site that visits upon the Haitian increased prices for fuel.

 

"Haiti: Gas Price Hike Fuels Misery and Anger – Cost of Living Has Quintupled Since the 2004 US-Backed Coup d’État

Global Research, October 15, 2014
President Michel Martelly and Prime Minister Laurent Lamothe have decided to dramatically raise government-fixed fuel prices in Haiti over the next six months despite the plummeting price of oil on the world market and the Haitian Senate’s refusal to approve their budget for the 2014-2015 fiscal year. The price hikes, announced by Finance Minister Marie Carmelle Jean-Marie, took effect on Oct. 10, 2014 and will rise in three or four increments.
According to the proposed budget still not approved by the Senate, a gallon of gasoline will rise from its current cost of $4.38 (200 gourdes) to $4.70 (215 gourdes) until December; in January 2015, it would jump to $4.99 (228 gourdes); finally, during February and March 2015, it would be set at $5.32 (243 gourdes) a gallon, a 21.5% increase overall.
A gallon of diesel over the same time period would increase from $3.54 (162 gourdes) to $3.87 (177 gourdes) to $4.03 (184 gourdes) and finally to $4.20 (192 gourdes) in March 2015, an 18.5% increase.
Kerosene will rise from $3.52 (161 gourdes) a gallon to $3.74 (171 gourdes) to $3.92 (179 gourdes) to $4.05 (185 gourdes) in March 2015, a price hike of 14.9%.
Taken all together, the Haitian government will raise the fixed price of fuel on average 18.3% over the next six months, although the price for a barrel of oil has fallen from $104 a barrel in June to about $81 a barrel today.
Ironically, since 2008, Venezuela meets most of Haiti’s petroleum needs under the PetroCaribe contract, whereby Haiti pays about 60% of its oil bill up front, while the remaining 40% can be paid over 25 years at 1% interest.
Despite this advantageous deal, the Martelly/Lamothe government, rather than passing on the savings, is in effect taxing the Haitian people to raise revenues to fund their corruption and profligate ways.
In general, the fuel price hike will further impoverish the Haitian people and degrade Haiti’s environment. Already, 70% of the population lives in extreme poverty; 75% to 80% are in the chronic and endemic unemployment; minimum wage workers earn less than $120 a month working 40 hour weeks; and more than five million Haitians, half the population, are food insecure. All indicators of the Haitian Institute of Statistics and Information (IHSI) show the cost of household food basket is increasing. The rise in petroleum prices will be a heavy burden for the Haitian masses, who already live in abject poverty.
The soaring cost of petroleum-based fuels will force many people to turn to lower cost charbon, which is charcoal made from trees. This will accelerate deforestation in a country which has already lost more than 98% of its forests, resulting in desertification, erosion, and flooding, particularly of poor urban neighborhoods as happened recently in Cité Soleil as well as Tabarre.
The cost of transit on Haiti’s colorful tap taps, taxis, and buses, fixed by the government, will also rise. The public transport drivers’ union is already preparing a protest against the government’s fare hikes.
Ironically, in 2003, as the U.S. government (with the support of the then konpa singer Michel “Sweet Micky” Martelly) was fomenting a coup d’état against the government of President Jean-Bertrand Aristide, the cost of gas was about 60 gourdes to 70 gourdes a gallon. There was not yet any cheap PetroCaribe oil flowing into Haiti. But the Haitian government subsidized the price of gas to alleviate the misery of the masses.
Today, the forces which collaborated in the 2004 coup d’état are in power and the cost of living in Haiti has quintupled. People are living in increasingly desperate poverty and fleeing the country in record numbers to seek work elsewhere.
Senator François Annick Joseph of the Artibonite, who is with the Organization of People in Struggle (OPL), says that the Martelly/Lamothe government has no concern for the population. He has called on Venezuela to revise the PetroCaribe agreement so that the funds generated by it are not misused by the government, whose officials are merely enriching themselves at the population’s expense.
“Shake up this government,” he recently advised the Haitian people. “Shake it up until it falls down.”

Wednesday, October 8, 2014

Argentina Dares to Call a Spade a Spade
Naming Western Greed Economy As “Economic Terrorism”

By Peter Koenig

October 07, 2014 "ICH" - “Today you pretend making a coalition against the Islamic State of Iraq and the Levant (ISIL), but in fact you’re their allies,” Those are the frank words by Cristina Fernandez Kirchner, the Argentinian President, spoken in a calm and secure voice at the UN General Assembly last Friday, 3 October 2014.

Similarly, she referred to the western financial system as economic terrorism, as in vultures – the vulture funds that thanks to New York judge Griesa have put Argentina – a solvent country, willing and capable of paying their debt, in default. He ruled that the vulture funds, Griesa’s clients and paymasters, needed to be paid in full, i.e. 100%, equal to US$ 1.5 billion, when close to 93% of all creditors agreed on a restructured reimbursement rate of about 20%.

Without any international right to interfere in the affairs of a sovereign country, Griesa would allow the vultures reaping in a profit margin well in excess of 1,000%. --- Paul Singer, king of the ‘vulture capitalists’, knows no merci. He is in bed with Wall Street and Griesa – and with whomever other financial hooligans who share his greedy endeavors. Greed is their prayer. It’s knocked around the world. Exploits poor nations, makes them poorer, and keeps them dependent on the powers of money, being well aware that the poor are too weak to defend themselves.

Except for Argentina. Her able President Christina Fernandez, speaks not only for her country, when she talks about victims of economic and financial terrorism, but for all those African, Latin American and Asian countries which are oppressed by the killing boots of Wall Street and the IMF. It cannot be said often enough – the IMF is a mere extended arm of the US Treasury and the FED.

Vulture capitalism exerted by these usual villains and the European Central Bank, a mere puppet of Wall Street and led by a former Wall Street banker, are responsible for the economic collapse of the western economy. They have driven countries like Greece, Portugal, Ireland, Spain – and lately also Ukraine – into misery.

They have stolen their social safety nets, pensions, employment, housing, education, health care, water supply and other public infrastructure – by privatizing public capital for their private benefits. They could do so thanks to the connivance of corrupt leaders they first put in place with sham elections – or no elections at all.

Case in point is Greece, where the Parliament decided to dismiss the socialist Prime Minister George Papandreou, who attempted to launch a referendum in December 2011, asking the people whether they wanted the troika’s (IMF, ECB, European Commission) imposed second ‘rescue’ package of € 130 billion (after a first one on € 110 billion) that would drastically increase Greece’s sovereign debt and force literally a killer austerity program upon its people. At the onset of the manufactured crisis, in May 2008, Greece’s debt to GDP ratio was a manageable 105%. In 2014 the ratio is 175%.

Under the structural adjustment program social health care was basically abolished. Many cancer and other chronically ill patients were deprived of their free medical attendance, unemployed and destitute could not afford to pay full price for their medication and treatment – and quietly died.

Under extreme pressure from Germany and France – the infamous tandem Sarkozy / Merkel called Papandreou to meeting in Nice at the beginning of November 2011, literally ordering him to withdraw the referendum – or else. Papandreou went home, canceled the referendum on 3 November and resigned. He was promptly replaced by Parliament – without a public vote – by the neoliberal Lucas Papademos, former deputy head of the ECB and – a former Goldman Sachs executive, who allowed the dance of debt and destruction to continue.

Argentina would not allow such financial terrorism on its shores – not since they dared to counter the economically suffocating peso-dollar parity in 2001, allowing the country to start breathing and growing again; a highly distributive GDP growth allowing to cut poverty from above 60% in 2001to below 10% today.

The same escape from the western kleptomania was – and still is – open to Greece and all those southern European countries in the fangs of greed capitalism. But their leaders and finance ministers are goose stepping to the financial marching orders of Washington’s money masters, Wall Street, FED and IMF.

Ms. Fernandez did not mince her words. She also talked openly about the western military terrorism, “You killed many innocent people in Iraq and Afghanistan under the name of war against terrorism,” or as the new refrain goes – “Making war for Peace”. She referred to the West in general and to Washington in particular, for whom war and conflicts, weapons sales, is a means of economic survival, as the US economy depends to more than 50% on the military / security industrial complex and related industries and services.

Shamefully, many western leaders and representatives left the assembly hall when Ms. Fernandez spoke, of fear they may be associated with her views if they listened to her calling a spade a spade. Perhaps they feared the ridiculous western sanctions, if they don’t behave. It is sad to see spineless world leaders; so-called leaders (sic), who bend over backwards to please the powers that utterly exploit them, stealing their natural resources, putting their people and the environment in peril.

A terrorist is whoever does not conform to the western doctrine, whoever insists on national sovereignty – whoever defends their national interests over the voracious interference of Washington and its European puppets – and their killing bulldozer, NATO.

The UN should make it an obligation and expression of mutual respect that every country leader and representative attending the UN General Assembly must listen to all the speeches. Each country has a message to give – a message that in one way or another concerns all of us, as we are all connected as humans in a solidary union, regardless of political alliances.

The latest economic terrorism inflicted on Russia by the US supported Wall Street et al financial cabal is the down manipulation of the ruble vs the US dollar and other ‘western’ currencies. The ruble has lost 22% of its value since the beginning of 2014 and 15% in the last quarter alone. Call it ‘sanctions’ – if you will - for not bending to the political demands of Washington on Ukraine. The western MSM would like you to believe it has to do with the chaos and continuous murderous atrocities in Ukraine’s Donbass area, for which – of course – Russia is made the culprit, not Kiev’s gang of thugs, a Nazi government, created and funded by Obama and his western puppets.

Russia is now forced to buy dollars and Euros – what they least want and need – to stabilize her currency, the ruble. Buying dollars – playing even more into the sledgehammer of the empire – is certainly the last thing Russia wants to do.

Currency manipulation is only possible due to the predatory US dollar system, where all international transactions have to be channeled through Wall Street and cleared through the privately owned BIS – Bank for International Settlements, whose owners are a similar lot of financial shenanigans as are those owning the FED. The expected outcome is a devalued ruble, shunned by investors.

Little do they know that this usual western shortsightedness is but accelerating the process of Russia and China issuing a new combined currency, delinked form the dollar-euro fiat money and its SWIFT exchange system. In fact, it has already begun. The Central Bank of China has recently offered a hand to the EU, inviting the Euro as one of several currencies that will no longer need the western clearing system for transactions with China.

President Fernandez puts the finger right on the wound when she refers to the entire western monetary system as vulture economics. She knows that such an economy is bound to falter and be replaced – gradually as may be – by one that is based on fairness, integrity and that respects nations’ sovereignty.

Peter Koenig is an economist and former World Bank staff. He worked extensively around the world in the fields of environment and water resources. He writes regularly for Global Research, ICH, the Voice of Russia, now Ria Novosti, The Vineyard of The Saker Blog, and other internet sites. He is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed – fiction based on facts and on 30 years of World Bank experience around the globe.

Why Water Privatization Is Wrong


Recently I was communicating with a long time friend Peter Koenig of Switzerland. Peter Koenig is an economist, and was a former World Bank staff member. He worked extensively around the world in the fields of environment and water resources. He writes regularly for Global Research, ICH, the Voice of Russia, now Ria Novosti, The Vineyard of The Saker Blog, and other internet sites. He is the author of Implosion – An Economic Thriller about War, Environmental Destruction and Corporate Greed – fiction based on facts and on 30 years of World Bank experience around the globe.
Recently I asked him his opinion of water and sewer privatization, and the following is his response:
“To privatization --- there is not much to say, other than what I said already.

It is a crime against humanity to privatize public goods and public assets, give them to a private operator so he makes a profit on the back of the very people to whom the public asset belongs, i.e. the infrastructure of a water and sanitation system - or health care, or education, for that matter. they were paid for with public funds.

 

Privatization of water - is taking a public good, which is water - and selling it for a profit, but the profit doesn't stay in the public domain, but transfers into the private domain.

 

A private enterprise has no real interest in conserving and preserving the resource either, as his main interest is a quick profit - as is characteristic for capitalism and even worse for neoliberalism - the world dogma we are condemned to live with today.

 

Since its public, it can be used at will; nobody is responsible for the good's conservation and protection, especially if a corrupt 'leader' as given the concession of exploitation to a private operator.

 

This is the 'curse of the commons' - nowhere more obvious and visible than with water.

 

Privatization of water and sanitation - or education and health services - takes a public service out of the public domain, where it belongs to the 'commons' and levies profit yielding tariffs. First, (the) priority of such privatized public services are not (for) the needy, (or) the poor, who cannot pay tariffs that allow a hefty profit - so the private service provider will serve first those who can pay. The poor in the end will be left out.

 

This, in fact, logical phenomenon becomes even more critical as the resource is becoming scarcer and scarcer, as is the case with water. Not that the resource water as such becomes scarcer - the amount of water on our planet is constant - but drinking quality water is becoming scarcer, as more unregulated industries pollute water bodies, surface, and underground.

 

These are a few arguments why water - and education and health services - should never be privatized, but should remain in the public domain. There are many ways of improving services, rendering them more efficient - other than privatizing. For example, running a public enterprise for water like a commercial enterprise, where staff is evaluated, judged and paid according to performance, so salary wise they are at similar levels as are private enterprises. 'Profits' go into reserves for new investments and rehabilitation.

 

Another way, often used in developing countries, but not exclusively, is what is called 'twinning'. A public enterprise establishes a two, three or four year contract with another public enterprise - maybe from another country - in your case form perhaps from another state, or other county...? - that operates under similar conditions but has a well working operation.

Training programs are designed, visiting tours with capacity building, technical assistance teams from the 'twinning' operator.... when the targets are fulfilled, the contract ends; when it takes longer, it will be extended - or it can be gradually phased out.

 

The objective is that the public enterprise that seeks to improve its services, at the end is capable of accomplishing its duties at a highly improved rate.”