Turns Out It Is Not 85 Percent

Paul Rosenzweig
Thursday, June 2, 2022, 11:01 AM

A recently published paper from three George Washington University students refutes a commonly cited statistic about ownership of critical infrastructure and offers a more accurate portrayal of public and private ownership.

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How much of the United States’ critical infrastructure is controlled by private owners? For many years, American leaders have repeated the statistic that 85 percent of all critical infrastructure is owned by the private sector. They use this mantra as an implicit justification for a set of policy choices that lean toward private-sector control—as they should, if those statistics were accurate.

But the statistic itself seems to be the product of nothing more than early good-faith estimates. As I’ve noted on Lawfare before, the 85 percent figure has no clear factual grounding, despite the frequency with which it is cited. As far as one can tell, the earliest source of the 85 percent figure is the 2002 National Strategy for Homeland Security, which offers no source or citation for its conclusion. 

It is frustrating, to say the least, to make policy with bad data, with no data at all or with data that is merely based on good-faith conjecture. How much more valuable would it be if critical infrastructure security were, in fact, based on an accurate picture of the ownership of that infrastructure.

Well, hallelujah. Three students at George Washington University’s Elliott School of International Affairs (full disclosure: I advised them on their project) have now conducted a first-of-its-kind, in-depth analysis of critical infrastructure ownership. Their paper, entitled “Fact and Fiction: 85% and Critical Infrastructure,” is now available, and it’s well worth your attention. The authors examined three sectors—water and wastewater, nonnuclear energy, and food and agriculture—to assess their ownership. What they found will not surprise anyone—that the ownership structures are very sector specific and that an assessment of the extent of private-sector ownership coverage depends very much on how the issue is defined.

Here’s a simple example, taken from the paper’s executive summary: “[I]n Florida, 77% of utilities are owned by the private sector, while only 23% are owned by the public (including federal and local). That said, the 23% that are owned by the public sector service 92% of the population.”

Now that’s the kind of data that one can really use at a granular level to make policy! If, as I’ve said before, form follows function, then the structure of the laws, regulations and guidance a country puts in place will depend greatly on how regulators think the market is structured. With this paper, policymakers may start to understand much more about that structure. I commend the entire paper to your attention as a useful, fact-based inquiry into critical infrastructure ownership.

Paul Rosenzweig is the founder of Red Branch Consulting PLLC, a homeland security consulting company and a Senior Advisor to The Chertoff Group. Mr. Rosenzweig formerly served as Deputy Assistant Secretary for Policy in the Department of Homeland Security. He is a Professorial Lecturer in Law at George Washington University, a Senior Fellow in the Tech, Law & Security program at American University, and a Board Member of the Journal of National Security Law and Policy.

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