“Blue Gold”: T. Boone Pickens and the Privatization of Water

Imagine a future where water is more valuable than gold – where corporations have control over the public’s water sources, and everyone has to pay a premium for access. It’s a scary thought for most of us, but for T. Boone Pickens, it’s a dream he’s banking on.

When Pickens, a billionaire oil tycoon, purchased eight miles of bare scrubland in the Texas panhandle recently, some people were confused: there’s no oil in them there flatlands. What he’s interested in, though, isn’t black gold, it’s blue gold: water, contained within the Ogallala Aquifer partially located under the ranch. His plan was to build a pipeline from the aquifer to larger cities, selling the water as a commodity that, at least in his mind, would undoubtedly be in demand during times of drought.

While it seems like there should be some kind of law against doing such a thing, the groundwater laws in Texas and many other states make it easy to get away with. When the laws were put into place, water was so abundant and readily available that no one ever considered the idea that people might try to buy and sell it in this way. So when it was time to vote on allowing the creation of Pickens’ water district, the only people required to vote on it were the people who live on the land: Pickens, his wife and three employees.

From Bloomberg News:

Pickens “has pulled a shenanigan,” said Phillip Smith, a rancher who serves on a local water-conservation board. “He’s obtained the right of eminent domain like he was a big city. It’s supposed to be for the public good, not a private company.”

Pickens and his allies say no shenanigans are involved. Once the district is created, the board will be able to issue tax-exempt bonds to finance construction of Pickens’s planned 328-mile, $2.2 billion pipeline to transport water from the panhandle across the prairie to the suburbs of Dallas and San Antonio.

Pickens was recently in the news for spending big bucks on wind farms. His move toward investing in alternative energy doesn’t mean he’s an environmental activist, though: he’s in it for the money. While there’s nothing wrong with businesses making profits off products, policies and practices that are beneficial to the environment, Pickens’ past and present ventures make it clear he’s no friend to the earth. In fact, he’s admitted that he’s taking advantage of public fears about climate change, and he’s obviously not too concerned about the environmental impact of draining the Ogallala Aquifer.

Amidst current awareness about global warming, he feels confident that he’ll soon be making big money off the business of selling water. Population growth, prolonged droughts and the production of certain biofuels continues to put a tremendous strain on water resources, and Pickens doesn’t see why he shouldn’t pad his bank account as a result.

The Ogallala runs through an area of America that’s already threatened. Annual withdrawal from this aquifer is already outpacing the recharge rate by 300%. The amount of groundwater in the aquifer has been steadily declining in recent years. The government also faces a hurdle that billionaires with access to oil might be able to jump more easily: the rising cost of energy needed to pump water from the aquifer is making it tougher to access it. The USDA laments that “even in areas where the pumping depth is economical, geology limits pumping access as the water table declines”.

Undoubtedly, a public water crisis is brewing. While other countries have been suffering a lack of water for years, America has remained largely insulated from the problem. We’re only beginning to experience the effects of a water shortage, partially due to unscrupulous deals made by bottling companies like Nestle along with America’s dependence on bottled water. The more people buy bottled water, the less money goes into the public water system. Corporations with dollar sign fairies dancing in their minds see it as an opportunity to grab and wield control over the supply. In a country dominated by a ‘winner takes all’ capitalist attitude, that sets us up for trouble.

What exactly would the corporate privatization of water mean to the public? For one thing, water would no longer be considered something that all people have a right to. It would be a commodity, bought and sold by private individuals and companies, based on availability and the public’s willingness to pay. Corporations tend to value profits over service. Obviously, we can’t live without water. We’d be at the mercy of the people in control.

T. Boone Pickens isn’t the only one grabbing up water rights. In fact, most of the companies that are buying land with access to aquifers are foreign. Major players here and abroad include Viviendi, Perrier, Suez, Bechtel and Monsanto. Right now, only 5 percent of the water supply is in corporate hands, but that could change at any time, especially as the World Bank and other organizations push for privatization.

The only obstacle that remains in Pickens’ and other investors’ path is finding buyers. Several water districts have already refused to sign up, mostly due to pressure from political and environmental groups campaigning against the privatization of water. The Sierra Club is one of them, and their efforts to educate the public in Texas might just pay off. Until the day that Texas gets so dry officials are desperate for water and willing to do just about anything to get it, that is. Then a ball may be set in motion that will change public water access as we know it. We can only hope that other solutions are put forth before that becomes a reality.

Link [Bloomberg News] + [USDA] + [Sierra Club]

Photo credit: Time Magazine + Sierra Club