David R. Henderson  

In Like Flint and Out Like My Cousin Vinny

J.S. Mill and Extreme Pornogra... An Ivy League Admissions Offic...

David A. Graham argues that firms that make charitable contributions create long-term problems.

For those who haven't been paying attention to the news lately, the government of Flint, Michigan totally messed up, selling lead-laced water to Flint residents for 16 months, despite repeated objections from local residents complaining about the water. The Michigan Department of Environmental Quality and the federal government's Environmental Protection Agency messed up too. For more details see Shikha Dalmia, "Flint's Water crisis isn't a failure of austerity. It's a failure of government."

In a recent article at The Atlantic titled "The Private Sector Is Now Providing Basic Services to Flint," David A. Graham writes:

A coalition of some of America's biggest companies is organizing a trucklift for Flint, promising to deliver 6.5 million bottles of water to the city in order to provide clean drinking water for schoolchildren through 2016. Walmart, Coca-Cola, Nestlé, and PepsiCo say they will deliver 6.5 million bottles to Flint, enough for the city's 10,000 students.

Graham admits that the generosity shown by Walmart, Coca-Cola, Nestlé, and PepsiCo in donating water to schools in Flint, Michigan is good in the short run.

He also admits the problems with government, writing:

Failures of government and the effective disenfranchisement of Flint voters produced the crisis

But he has a problem with it in the long run. As Mona Lisa Vito asks Vinny Gambini in My Cousin Vinny, after she helps him win a case: "So what's your [his] problem?"

Graham's problem is much like Vinny's, who "wanted to win [his] first case without any help from anybody." Graham writes:

But the big water donation might raise even more uncomfortable questions. Walmart, Coca-Cola, Nestlé, and Pepsi aren't just charitable organizations that might have their own ideologies. They're for-profit companies. And by providing water to the public schools for the remainder of the year, the four companies have effectively supplanted the local water authorities and made themselves an indispensable public utility, but without any amount of public regulation or local accountability. Many people in Flint may want government to work better, but with sufficient donations, they may find that the private sector has supplanted many of government's functions altogether.

This is quite striking. Graham looks at government institutions straight in the eye and admits that they have failed. He also admits that private charity has succeeded. But they aren't regulated. OMG. He doesn't argue that the private firms are giving poisoned water, the way the government did. (I correct myself: the government didn't give poisoned water; it sold poisoned water, and is insisting that Flint residents keep paying for it.) He also worries that the private businesses aren't accountable. Really? So Graham thinks that if somehow the water they gave ended up poisoning people, they wouldn't be liable? Isn't he confusing private firms with government monopolies?

HT@ Robby Soave.

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COMMENTS (8 to date)
BorrowedUsername writes:

This case seems overwhelmingly complicated. I agree that government was involved in the terrible errors that ended. Is there a rule of thumb for when it's governments fault and when it's incompetent leaders faults? Seems like a "limited government" governor was responsible for the failures. This was literally claimed to be an effort to save money for the government.

I get the argument that it should never have been in the government's hands to begin with, but that's like a first principle argument to blame basically everything the government has any hand in on the government.

It's also unclear if a private company would be held liable in this case. You don't know what the agreement allows and the GOVERNMENT would have to enforce that liability.

Sol writes:

Actually, Flint didn't sell its residents poisoned water. It sold them water which was safe (*) for people when it left the water treatment plant, but which was corrosive enough to react very badly with the ancient lead pipes used to deliver water all over the city.

(*) There are separate accusations that the river water had Legionnaires’ disease bacteria in it which the treatment plant didn't filter out properly.

Charley Hooper writes:

Imagine the outcry if these corporations went to Flint and offered to sell water for $100 a gallon.

Instead they are "selling" it for $0 per gallon.

So, Mr. Graham, is there a price between $0 and $100 that you would consider acceptable? Or is there no way these corporations can win?

ThomasH writes:

This is the same criticism that is often made of foreign assistance (which I do not necessarily share) that foreign assistance can prevent the development of capacity of a local government to vaccinate children, develop curricula, collect data, or whatever the assistance provides.

Rick Bohan writes:

Because, of course, WalMart, et al can be counted on to continue to provide safe water at low or no cost even after the PR value runs out, right?

David R. Henderson writes:

@Rick Bohan,
Because, of course, WalMart, et al can be counted on to continue to provide safe water at low or no cost even after the PR value runs out, right?
I’ll put aside your sarcasm and address the issue. You and I both seem to agree that a major (probably THE major) reason those companies do this is for its PR value. We both agree that this will run out. Then, it seems, we both agree that Walmart and others will stop doing this. So that means Graham’s long-run problem goes away. They won’t be there in the long run.

lemmy caution writes:

"In like flynn" refers to statutory rape charges against errol flynn in 1942


Floccina writes:

I would like to see this company:
United Utilities Group PLC (UUGRY)
Or some similar company offer to sell better piped water to the citizens at a lower price than the city was charging.

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