See ➝.
For another version of this piece, see Andrea Muehlebach, “On Possession, Use, and Financialized Infrastructure,” Fieldsights (March 29, 2019). ➝.
Melinda Cooper and Angela Mitropolous, “The household frontier,” Ephemera Theory and Politics in Organization 9, no. 4. (2009): 363–368, ➝.
Karen Bakker, “Neoliberal Versus Postneoliberal Water: Geographies of Privatization and Resistance,” Annals of the Association of American Geographers 103, no. 2 (2013): 253–260, 254.
Jo-Shing Yang, “The New ‘Water Barons’: Wall Street Mega-Banks Buying Up the World’s Water,” Commodity Trade Mantra (2014), ➝.
Laura Bear, “‘Alternatives’ to austerity: A critique of financialized infrastructure in India and beyond,” Anthropology Today 33, no. 5 (2017): 3–7; Jamie Peck, “Austerity Urbanism. The Neoliberal Crisis of American Cities,” Rosa Luxemburg Stiftung, May 2015, ➝.
This expression was used by Carl Waßmuth, a structural engineer, in conversation with the author in March 2016.
It is often cheaper for governments to borrow from banks—but it would mean that their debt would be on the books, and thus add to public debt (anathema in the age of austerity). Borrowing from private investors (with private investors going to banks for loans) is more expensive but moves debt off the books (preferred under regimes of austerity). The latter represents a form of hidden, off-balance-sheet financing that comes with often decades worth of debt due to contractually guaranteed returns for investors.
Kate Bayliss, “The Financialization of Water,” Review of Radical Political Economy 46, no. 3 (2013): 292–307.
Cailtin Zaloom, “Finance,” Cultural Anthropology, August 7, 2017, ➝; Cooper and Mitropolous, “The household frontier.”
Mike Beggs, Dick Bryan, and Michael Rafferty, “Shoplifters of the World Unite! Law and Culture in Financialized Times,” Cultural Studies and/of the Law 28, no. 5–6. (2014): 976–996. Andrew Leyshon and Nigel Thrift, “The Capitalization of Almost Everything,” Theory, Culture & Society 24, no. 7–8. (2007): 97–115.
Cooper and Mitropolous, “The household frontier.”
The transformation of Berlin’s public water utility (BWB) into a joint-stock company was anathema to unions when it proposed in 1994. See Klaus Lanz and Kerstin Eitner, “D12: WaterTime case study- Berlin, Germany,” WaterTime, January 31, 2005, ➝; Alexis Passadakis, “Die Berliner Wasserbetriebe: Von Kommerzialisierung und Teilprivatisierung zu einem öffentlich demokratischem Wasserunternehmen. Studie im Auftrag von Sahra Wagenknecht,” Vereinigte Europäische Linke (2006): 17–22, ➝. The Berlin Senate therefore created a quite unusual but more politically palatable nested corporate structure in 1998—a complicated holding called Berlinwasser Holding AG that allowed Veolia and RWE to partake in the BWB, which was still a public law company (Anstalt öffentlichen Rechts).
Jamie Peck and Heather Whiteside, “Financializing Detroit,” Economic Geography 92. no. 3 (2016): 235–268, 246; Laura Bear, Navigating Austerity: Currents of Debt Along a South Asian River (Stanford: Stanford University Press, 2015); Bear, “Alternatives’ to austerity.”
As Gerlinde Schermer laid out in many pamphlets and papers over the years, private investors were at least initially guaranteed profits according to an “R + 2” formula (which de facto resulted in an annual profit rate of around 8%—a rate similar to the profit rates enjoyed by privatized water companies in England and Wales. See also R. Beveridge and M. Naumann. “Global norms, local contestation: Privatisation and de/politicization in Berlin,” Policy and Politics 42, no. 2 (2014): 275–291, 282.
Alexis Passadakis, “Die Berliner Wasserbetriebe”; Beveridge and Naumann, “Global norms, local contestation.”
The city was ruled by the rot-rot (SPD/CDU) coalition. Opposition was the PDS party (now called the Party of the Left, Die Linke) and the Greens (Bündnis 90/Die Grünen).
Sebastian Heiser, “Berlin: Die geheimen Wasserverträge,” Informationsfreiheitsgesetz, October 30, 2010.
Beveridge and Naumann, “Global norms, local contestation.”
Author interview with Gerlinde Schermer, October 30, 2014.
The Wassertisch chose this route because popular initiatives were at the time prohibited from intervening into ongoing budgetary issues pertaining to the city. This limitation was eventually overturned by Berlin’s Constitutional Court.
As Water Table ally and Green politician Heidi Kosche would later argue, 45% of Berlin’s water costs were in fact made up of “fictive costs.” Heidi Kosche, Endabrechnung Wasserprivatisierung (MdA der Fraktion Bündnis 90/Die Grünen im Abgeordnetenhaus von Berlin, 2014).
Ibid.
“Fictive costs” are a common problem with PPPs. For a detailed investigation of the decline in infrastructural investments under the PPP-model in Germany and beyond, see Jana Mattert, Laura Valentukeviciute, and Carl Waßmuth, Gemeinwohl als Zukunftsaufgabe: Öffentliche Infrastrukturen zwischen Daseinsvorsorge und Finanzmärkten, (Heinrich Böll Stiftung, 2017), 36–37, ➝.
Kosche, Endabrechnung Wasserprivatisierung.
Beveridge and Naumann, “Global norms, local contestation.”
See ➝.
Author interview, Berlin, August 25, 2019.
See also Bear, Navigating Austerity; Alexa Färber, “Low-budget Berlin: towards an understanding of low-budget urbanity as assemblage,” Cambridge Journal of Regions, Economy and Society 7, no. 1 (2014): 119–136.
Laura Bear, Navigating Austerity.
Max Weber, “Stock and Commodity Exchanges,” Theory and Society 29, no. 3 (2000 {1984}): 305–338.
Klaus Lederer, “Die Teilprivatisierung der Berliner Wasserbetriebe: Erfolgsmodell oder Abwicklungsfall?,” Journal for Public and Nonprofit Services 34, no. 4 (2011).
Data found on a pamphlet written by Gerlinde Schermer and distributed to her colleagues in Berlin’s parliament. Received by the author in September 2015.
Laura Bear, writing about financialized infrastructure in India, speaks of three layers of predation on the part of the private sector. First, it benefits from investing and trading in infrastructure bonds, thus “making profits from the ruins generated by fiscal austerity.” Second, it benefits from the outsourcing of public work and selling of public assets. And third, companies running or constructing infrastructure gain guaranteed profits through taxpayers’ revenues. All of this is rendered invisible through contracts that are invisible to the public. See Bear, “Alternatives’ to austerity.”
Ulrike Von Wiesenau, “Zwischenbilanz des Berliner Wasserrates,” Neue Rheinilche Zeitung, 2019, ➝.
Beveridge and Naumann, “Global norms, local contestation.”
Von Wiesenau, “Zwischenbilanz des Berliner Wasserrates.”
The Wasserrat (Water Assembly) was founded in 2013 as a forum for all those interested in promoting the democratic participation of Berlin’s citizens in the newly remunicipalized BWB.
The Blue Communities project was initiated by the Council of Canadians and the Canadian Union of Public Employees in 2009, and encourages municipalities to support the idea of water as a common good and to recognize water and sanitation as a human right. Concretely, this means promoting publicly financed, owned, and operated water and wastewater services and banning the sale of bottled water on municipal facilities and events. See “Blue Communities, The Council of Canadians,” ➝.
See “ÖPP/PPP (4.0): Die Gesetzesvorschläge der ‘Expertenkommission,’ der Bauindustrie, der Banken und von Bundeswirtschaftsminister Gabriel Eine Analyse der Gesetzesvorschläge für die Sommerakademie Attac 2015,” August 5, 2015, ➝.
Laura Bear, Navigating Austerity.
Author interview with Waßmuth, March 18, 2016.
Ibid.
Financialized infrastructure became a “public object of knowledge” in a 1994 World Bank report on Infrastructure for Development, which explicitly argued that infrastructure was a private rather than a public good that ought to be consumed by populations like any other commodity. See Bear, “’Alternatives’ to austerity.”
Author interview with Carl Waßmuth, March 18. 2016.
Mattert, Valentukeviciute, and Waßmuth, “Gemeinwohl als Zukunftsaufgabe.”