Monday, April 4, 2011

Went Down to the Levee and the Levee Was . . . Actually, Pretty Full

Even if you've never been to California, chances are you already know lots of things about it. The beautiful beaches, the majestic mountains and deserts. The Hollywood celebrity culture and the film industry. The wines of Napa and Sonoma counties. And the fact that the star of Red Sonja was our governor for the better part of a decade. But there's something you may not know about California: it's obsessed with water. When we have a dry winter, we hear dire warnings of crop failure in the Central Valley and Los Angeles being swallowed up by the Mohave. If we have a wet year, we hear grumblings from those who believe they're getting less than their fair share. And since this past winter has been the wettest in some time and Gov. Brown has declared an end to our drought, the grumblings have already started. This article from the Whittier Daily News, as well as this one from the San Diego Union Tribune, inform us that consumers should not expect their water rates to do down. And both Dan Walters (in this Sacramento Bee editorial) and George Skelton (in an LA Times piece) lament the loss of surplus water as Sacramento dithers over the construction of "off-stream storage" centers.

Those of us who've observed the inverse relationship between government's involvement in a market and its dysfunction shouldn't be surprised that California water policy is so bass-ackwards. That 80% of the state's water is consumed by agriculture is, itself, the result of government interference in the market; the history is detailed in the wonderful Cadillac Desert, and we're willing to bet that the free market would not choose places like the Imperial Valley for growing fruit, cotton, or alfalfa. The water infrastructure of California is largely a product of sleazy pork-barrel politics: federally funded construction of dams of dubious utility (and sometimes dubious structural integrity), and massive irrigation subsidies for farmers and ranchers. And, as others have demonstrated, the convoluted regulatory apparatus that emerged to allocate water resources as California's population expanded has proven utterly inadequate to the job. We're not optimistic about the prospects for a free-market alternative to this monstrosity being attempted in California, but, as they've found out in Chile, Mexico, and Australia, it would be pretty sweet.


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