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Monday, October 26, 2009

More Privatization in Chicago?

a If the residents of Chicago thought the parking meter debacle went well, they may be in for a new round of privatization. This time the city's water system may be leased.

If the parking meter deal put a bad taste in your mouth, try swallowing this:Chicago is considering leasing its water system to help fix the budget.

The new boss could charge whatever they want for water, CBS 2's Roseanne Tellez reports.

Could it happen here in Chicago? It already has nearby. Homer Glen in Will County relies on Lake Michigan water, but the supply comes from a German-owned firm. Locals say there's a lot more than water going down the drain.


The parking meters are the most visible effect of privatization in Chicago, but the parking meter debacle is merely the most visible. Cook County Board Presidential candidate Tom Tresser told me that he fought a similar effort to privatize a park and sell it to the private school Latin High School in 2007.

Most people report that this rush to privatize is occurring because the city is cash strapped. Is that the reason? Of course, Mayor Daley isn't saying much. The privatization of the park to Latin High School occurred two years ago when things were booming and so that effort certainly couldn't be explained by a cash crunch.

One insider offered me a different motivation. In their view, privatization is occurring because the powers that be within the city government believe that it's much easier to shake down private firms than it is to run schemes within the city government. In fact, this view may have started with the city's Hired Truck Scandal. In that scandal, city officials shook down private trucking firms for millions in order to get contracts. Privatization cuts out the middle man and puts the city in direct contact with private firms. Furthermore, private firms are much more difficult to track. There's no Inspector General. They aren't required to give their taxes and other records to the public. So, corrupt city officials would have direct access to corruption, if of course, that was their motivation.

One thing that can't be argued is that privatization more often than not fails miserably to help the citizens of the municipality. The parking meters now cost exponentially more. In the story linked, another town is referenced that also leased their water to a private firm and the water bills have risen dramatically. Had the city leased the park to Latin High School it would have been used for that school's soccer field and thus unavailable to the residents of the city. We should thus view all attempts at privatization with skepticism.

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