Happy New Years Smelt!

As threatened, a federal judge ordered reductions in pumping water from the Sacramento Delta; see previous post. Each day of reduced pumping cuts supplies by the amount of water 10,000 households use in one year. This will stay in place until enough runoff "shows up". If you are a southern California farmer, prey for rain!
Farmers, unsurprisingly, are changing to higher value crops that use less water:

"A lot of guys are saying, 'Do I hunker down and try to wait this out somehow, or do I really change what I do?' " Borba said. To be sure, Borba and other influential Valley players are pushing the state and federal governments for a Delta fix that would bring them more water in the future.

But Borba wouldn't have succeeded in the farm business without knowing how to adapt. So cotton and tomatoes, which need about 3 feet of water a year, are giving way to wheat and safflower, which get by on 18 inches. He's laid thousands of acres of drip irrigation. Three years ago, he replaced 750 acres of annual crops with almond trees, which yield enough revenue to justify even high-priced water.

Water has always been valuable to farmers. But at the prices charged for deliveries from government canals, it hasn't always been precious. So farmers could turn a profit even growing thirsty, relatively low-value crops like alfalfa hay and cotton, of which Borba grew 9,000 acres as recently as 1999. Next year, he plans just 900 acres of cotton.

Borba pays at least $80 an acre-foot for Delta water. [...] Borba's water price is subsidized. ... In water-short years – as 2008 is expected to be – Borba turns to more costly alternatives: groundwater and purchases of water from farmers who have alternate supplies or aren't subject to cutbacks.

San Joaquin Valley farmers planted 1.3 million acres of cotton in 1995, but just 455,000 this year, the least since 1946. For 2008, plantings in Fresno County are projected to drop an additional 25 percent to 40 percent. Wheat acreage, by contrast, is up at least 20 percent this winter, according to seed brokers. Part of that trend has to do with commodity prices, but the cost and availability of water plays a major role as well, said Borba and others.

In the drought years of 1990 and 1991, farmers in the giant Westlands Water District, Borba's area, pumped 600,000 acre-feet of water, about three times the region's sustainable yield. "This year, we'll probably do 700,000," Borba said.

Farmers don't have to buy groundwater from anybody, but it still isn't cheap. Pumping costs alone run $80 to $150 an acre-foot, depending on the price of electricity or diesel. Sinking a new well to the 1,800-foot depth often required here can easily cost $1 million.

He stops now at what is, in a seeming paradox, both one of his thirstiest fields and a hedge against water shortages: an orchard of almonds. Almonds need about 4 feet of irrigation a year. What's more, in this part of the Valley, they have to be irrigated with Delta water because the trees don't tolerate the naturally occurring boron in the groundwater.

After an initial investment of about $10,000 an acre to plant the trees and nurture them to bearing age, an almond orchard yields revenues of $3,000 to $5,000 an acre vs. $1,000 to $1,500 for cotton. That extraordinary return – the result of high prices maintained by steady global demand – justifies almonds' water use. Borba has planted a fifth of the 2,300 acres he owns to almonds. The rest of his 10,000 acres is either leased or farmed for other landowners. Even in a very dry year, he figures he can keep the orchard alive by concentrating the farm's full allotment of Delta water on the almond orchard. He'll use groundwater on the rest.

But heavy groundwater pumping can go on for only so long before the wells begin to fail. As shortages continue, more land is likely to go unplanted altogether. "It will accelerate the trend, which is to fewer acres and higher-value crops," said Richard Howitt, a professor of agricultural economics at UC Davis.[Hey, that's my adviser!]

Almonds and other so-called "permanent" plantings, including grapevines, fruit and nut trees, are generally the last crops to go unwatered. Trees and vines represent a huge capital investment, and farmers will pay extraordinary prices for water to keep them alive. Borba farms about 2,000 acres for landowners who have planted all their land to almonds. The Delta allocation covers only a fraction of the trees' needs, so Borba has already lined up 1,000 acre-feet for the crucial 6-inch watering after next fall's harvest. The price: $400,000. This fall, water for almonds elsewhere in Westlands was even dearer: $700 an acre-foot. "$700 is nuts," Borba said. But it also makes business sense. Without the late-season water, the trees' yield in the following year could drop by twice the value of the water.

As water has grown scarcer, and as the acreage in almonds has grown, a bustling market in these deals has developed.

Bottom Line: Farmers will survive more expensive water by using it smarter. After years of stupid-cheap water, it's a relief to see more-sensible prices -- and actions.

Ocean of Plastic

In one of the few places on Earth where people can rarely be found, the human race has well and truly made its mark. In the middle of the Pacific Ocean lies a floating garbage patch twice the size of Britain. A place where the water is filled with six times as much plastic as plankton. This plastic-plankton soup is entering the food chain and heading for your dinner table.

Read more and then ask yourself "paper or plastic?"

Scientists versus Normals

Hedonism

At year's end, when the nights are long, we tend to get introspective. Sitting alone in NYC (for various reasons), I have even more reason to be so. I am thinking about the choices I make in life, the goals I want to pursue, and the people I want to have nearby me. Who am I and what social environment do I want to live in? I am passing from one phase to another (finishing a PhD), and these questions are relevant to where I end up next and what I end up doing.

In the Omnivore's Dilemma, Michael Pollan points out that many of "us" have too many food choices, and we have a hard time resolving the "dilemma" of what to choose, what to eat. By "us", I mean the BoBo (Bohemian Bourgeois) types who have BOTH eclectic tastes and the means of fulfilling them. The dilemma extends beyond food to sex, drugs, friends, jobs, etc. Where do we live? What do we do? With who? So many options are open, and so few constraints are present that it's a wonder that we don't all just sit, paralyzed, unable to choose -- surfing life like we might surf channels on the TV.

Some of us get a "posse" and pursue that posse's goals, whether it be rock-climbing, PhD studying, or polyamourous, S&M experimenters. Others can fall back on a traditional culture (Christian, Korean, Office Worker, etc.) But those who are really confronted with the reality of the choice (as I see myself) need to find an internal balance in order not to fall.

A friend was surprised to hear that I was not a swinger (Dude, you blog about sex!), but his surprise made me think of the times when I have said "I am a hedonist." Now, what does that mean? To me, it means pursuing something without worrying about the consequences. It's like 120 days of Sodom, or Cheech and Chong, or the fat guy in Monty Python who eats "just a little mint, wafffer thin". In other words, if I were a hedonist writer of this blog, I would pursue sex without limit or remorse, use drugs until I couldn't take any more and eat and drink as if food were the only thing in life. (The Seven Deadly Sins are back.)

I don't do these things, and most people do not. The reason is that we have other goals to pursue: I want to do things, contribute and be productive. Hedonism is about consumption, without limit and without remorse. It's about careless sex, drug overdoses and throwing up or throwing out food that doesn't fit the palate. The worst case of all (to me) is the person who "lives for the weekend" because they hate their day jobs, they dream of a better life and they store up all that passion and frustration into a ball of energy that will get dissipated -- one way or anther, destructive or not. These people are unwilling to consider the consequences of what they do because they must do what they do to survive, to feel some control over their life, to have hope when they are sitting at their desks, frustrated and desperate.

Pulling back for a moment, let's consider the reasons behind the "mass" affliction of hedonism. In the past, hedonism was a problem of the aristocracy. What to do with all the time and money? Duals, taking baths in milk, invading countries, engaging artists to "create" -- all of these were attempts to feel alive and motivate life. The proles were out there, slaving (literally) to stay alive; they were lucky to get more than a life "nasty, brutish and short". It's well known that the post-WW2 prosperity led the hippie generation to rebel against hard work, nuclear families, etc. These kids questioned everything and caused great change. But where are we today, now that they have shown us the possibilities of "true freedom"? We are a bit at sea, wondering what to do. Some, younger people have reverted to traditional roles, many have managed to consume their way into sufficient debt that they truly have no choice but to work to pay off that debt.

For those of us lucky enough to have freedom of action, we are back to the hippie/aristocracy/BoBo dilemma: How do we choose our levels of sex, drugs, etc? As I mentioned before, pursuing these as primary goals leads to imbalance (at least to me), and thus we need to pursue them as secondary goals, subject to something more meaningful. As any mother will tell you, after the kids comes, everything goes on the back-burner. Since I am not a mom, I have economics as my primary goal -- not studying it, not writing about it, but DOING it. My plan for 2008 (and beyond) is to improve the economics of resources (water, oil, fish, timber) and underdevelopment (corruption, black markets, etc.) and to put everything else on the back burner. My goal is to save the world through better economics.

My dad complains when I discount the ramblings I post off to others. Although this post is more narcissistic than normal, perhaps it can be useful to you. Where is your life going?

Bottom Line: A life of hedonism is a life unbalanced. If you are not constrained by tradition, financial slavery or other obligations (kids, family, etc.), then choose and pursue a productive goal that can give you purpose and accomplishment. Sex, drugs, water and all the other indulgences will be that much sweeter.

Dodgy Water Managers

Interesting story of lying at elections and holding unauthorized meetings to manipulate the public water supply. Corruption in low places is sad, if only because there are so many of them.

Westlands Buys Wetlands

Westlands Waster District (opps, Freuded again!) has bought some wetlands in Northern California. As I have written, Westlands is a rich, politically-savvy waster of water in Southern California. They want to use these wetlands to offset the harm they are doing by taking water from the Delta. While better than nothing, these offsets are just as dodgy as carbon offsets.

Bottom Line: Westlands should not use water because their soil is a hazardous waste dump; paying more for the water (via offsets) isn't going to make a bad idea better, but it will be useful politically (see, we're making an effort!). Sadly, Gaia continues to weep.

Water tight? Raise prices!

Down in San Diego, tight water supplies have led politicians and planners to raise prices for new water meters. By making these more expensive, they are slowing housing growth. The article is interesting for the "growth at all costs" views of those opposed to the higher prices.

What? Stop growth?!? It's the end of the world! No -- the end of the world gets closer as water supplies get tighter. As I wrote here, SD residents are not good at conserving water voluntarily, and water managers are too wimpy to raise water prices to levels where people cut back to avoid financial pain. The only way they've come up with to restrict growth in demand is by restricting the number of people who can get access to water. Very crude and totally ineffective wrt current users but better than nothing.

Bottom Line: San Diego has a very small local water supply. Ever since WW2, SD has grown on imported water. Given others' competition for imported water, that supply is also limited. SD has to stop growing or do a lot more with the water it does have. One way is to make SD farmers pay more for water, i.e., the same as SD homeowners.

Working Together

This story does not only apply to Christians

A holy man was having a conversation with the Lord one day and said, "Lord, I would like to know what Heaven and Hell are like."

The Lord led the holy man to two doors.

He opened one of the doors and the holy man looked in. In the middle of the room was a large round table. In the middle of the table was a large pot of stew, which smelled delicious and made the holy man's mouth water.

The people sitting around the table were thin and sickly. They appeared to be famished.

They were holding spoons with very long handles that were strapped to their arms and each found it possible to reach into the pot of stew and take a spoonful. But because the handle was longer than their arms, they could not get the spoons back into their mouths.

The holy man shuddered at the sight of their misery and suffering.

The Lord said, "You have seen Hell."

They went to the next room and opened the door. It was exactly the same as the first one.

There was the large round table with the large pot of stew which made the holy man's mouth water. The people were equipped with the same long-handled spoons, but here the people were well nourished and plump, laughing and talking. The holy man said, "I don't understand."

It is simple," said the Lord. "It requires but one skill. You see they have learned to feed each other, while the greedy think only of themselves."

Bottom Line With resources, as with soup, we can all get along better if we learn to share. How do we do this? First of all, we cannot just wait for people to be nice to each other. ("If men were angels, no government would be necessary," says James Madison.) Our job is to design governments and policies that facilitate angelic behavior, so the cooperative are encouraged and the selfish thwarted.

Ethanol Sucks --- Again

This comes from the folks at AEI-Brookings (not exactly liberal cowards...)

Ethanol production in the United States has been steadily growing and is expected to continue growing. Many politicians see increased ethanol use as a way to promote environmental goals, such as reducing greenhouse gas emissions, and energy security goals. This paper provides the first thorough benefit-cost analysis of increasing ethanol use beyond four billion gallons a year, and finds that the costs of increased production are likely to exceed the benefits by about three billion dollars annually. It also suggests that earlier attempts aimed at promoting ethanol would have likely failed a benefit-cost test, and that Congress should consider repealing the ethanol tariff and tax credit.

Robbing Peter's Water

A company is proposing to pump (mine is more correct) groundwater in New Mexico to put into the Rio Grande. The water would help NM meet its water obligations. It would also destroy the water supply of many, local residents.

This is a stupid idea, and I bet the NY company behind it is looking to get paid big $$ for "helping" the state. Moving water from one bucket into another takes energy and results in wastage. In this case, it will also reduce local supply without any compensation (that's an externality) and transfer $$ from NM to NY. Luckily, it looks like the residents will defeat it -- as they did with another proposal by the same company a few years back. Good.

If It Works, It's Not Dangerous

In this paper, two Harvard economists

examine the effect of safe experience on a warning’s impact by comparing warnings received after having safe personal experience with those received before people start making choices....When an early warning coincides with the beginning of a decision making process, the warning is both weighted more heavily in future decisions (the primacy effect) and induces safer behavior that becomes the status quo for future choices (the initial history effect)...The results imply that, even after being adequately warned, some people may continue to take risks simply because they incurred good outcomes from the same choice in the past.

How does this relate to sex, drugs and water? If you have unsafe sex and avoid pregnancy or STDs, you are more likely to do it again and dismiss warnings as "unfounded". If you use drugs and have a good experience, the same will happen. If you drink tap water and things are fine, you will be unlikely to switch to bottled water; if you are told by mom that bottled water is safer, you may never try tap water.

Bottom Line: We build a bias in favor of our experience, no matter that experience's probabilistic frequency. This means we may get surprised by pregnancy; OTOH, we may never experience the "downside" of drugs if the warnings made about them are unfounded. On the policy side, early warning can have a strong, positive effect. The problem is when it is unfounded. If so, the legitimacy of the whole system suffers.

Laughing at Tom

I just read an article reviewing a judge's decision to cut water pumping from the Sacramento Delta to Southern California by 30%. The reason I am laughing is that Tom Birmingham, the oh-so-clever lawyer and leader of Westland's water district, is making apocalypse noises, like these:

"I truly believe this water crisis is going to make the power crisis pale in comparison."
Birmingham believes the double-whammy will mean a hit to the state's economy "well in excess" of $1 billion.
"We expect there will be a significant amount of land fallowed."

You know what, Tom? What's going to happen is that urban areas are going to get their water and districts like yours -- in dry places with nasty soil -- are going out of business. And that's a good thing. (Birmingham once said that Westlands produces $1 billion a year. Maybe that's what he is talking about.)

More importantly, California's economy is worth $1.7 trillion. What's $1 billion of that? less than a rounding error.

Bottom Line: Scarce water means less wasted water. The farmers who go out of business will not be the grape growers, the almond farmers, the spinach folks (or the pot farmers). The ones who go out of business should have gone out of business years ago. They are in Westlands, and I am laughing at Tom's own goal comments.

PS: Westlands will get a lot of money for their "paper" water, so don't feel sorry for them!

Water Conservation

Last Friday, I presented some ideas from my dissertation at the meeting of member agency managers of the Metropolitan Water District of Southern California. (These are the guys who get the water to about 18 million people down there.) The managers do a good job, no doubt, and they are certainly trying to cope with tighter supplies, but I found their group-think and path-dependency to be sooo terribly frustrating. In other words, they have a hard time changing the way they do things, and one reason is that they do not want to make a move that deviates from their peers.

The reason all this matters is that supply is tight, and demand appears to be "rigid". The traditional solution to shortage is building dams and pipes to get more water -- in the long-run. In the short run, the solutions are asking people to use less (voluntary conservation) and/or rationing people to some fraction of their historic use. These solutions are not working for Southern California right now: Building new infrastructure is extremely difficult and voluntary conservation is not working.

At the meeting, I was amazed to hear a discussion in which most member agencies said they were trying voluntary conservation -- and not getting good results, e.g., "we are down 3-4% against last year but we do not know why." The inside of my head was reverberating with screams (raise prices!), and by the time I got up to present my idea -- rationing water through auctions, I was passionately convinced that these guys had to try something, anything new to break out of their reference framework.

I didn't get a standing ovation, but I did have their rapt attention. I am not sure if they will try any type of pilot project (as I suggested), since their objections and caveats appeared more readily than their enthusiasm, but at least I gave it a shot.

Economists have suggested higher prices as a solution to shortage for years. We see the effects of price on supply and demand everyday, across millions of products and services. Yet, somehow, water managers do not seem able to put price on the table as a tool to solve their problems. As long as water costs $0.01 for 5 gallons, people are just not going to pay attention to how much they use. "Convincing them that conservation is important" (as some suggested on Friday) will do nothing if it is not backed up with a simple signal that water is valuable.

Bottom Line: Water is a commodity like any other. Give people the first x gallons (as a lifeline entitlement) and then make them pay to water the yard, wash the car, grow alfalfa in the desert, etc. Only when price signals scarcity will people treat water as the precious good it is.

Gray (market) water

Homeowners in the Southeast are reacting to drought by reusing their gray water (from the kitchen sink) to water their yards. That sounds reasonable, but this caught my eye:

It's not clean enough to drink, but it contains less nitrogen and fewer pathogens than "black water" or toilet waste.

Still, it is capable of carrying enough bacteria to trigger typhoid fever, dysentery, hepatitis and other gastrointestinal or viral problems. Laura Leonard, a spokeswoman for the North Carolina Division of Environmental Health, said gray water can have about the same amount of fecal coliform bacteria as whole wastewater.

I call BS! How do you get fecal coliform from kitchen sink water? Is the Department protecting its jurisdiction?

Bottom Line: We need flexible thinking when water is in short supply. The government needs the most flexibility.

Global Warming Upside

Water exports: Bottle the Delta

Up in way, dark Northern California, they are debating whether to allow a water bottling plant to tap the local aquifer. This one, proposed by Nestle Waters North America, will "create" hundreds jobs and $23 million of additional revenue. Putting aside these useless projections (jobs move, $ revenue is gross, not net...), the most interesting characteristic is $26.40/acre foot of water that Nestle would pay for water.

That's less than one penny per hundred gallons. Can you guess why these companies love the bottled water business? Let's also note that Nestle's "mining" of the aquifer is unlikely to benefit local water users.

Meanwhile, this story reports that state water contractors commissioned a "secret" cost estimate to build the Peripheral Canal. (A good idea, as I argue here.) The sad part is that they need to study a major public works project ("giant straw to steal NorCal's water") in secret when everyone agrees -- given the choice to export water -- that a canal is better for the Delta. I hope the debate gets more mature than this!

Bottom Line: Water exports can be good for locals sellers and distant buyers, but they need to share the gains from trade fairly evenly. Nestle is ripping the locals off. The peripheral canal will help the locals by making the Delta more stable.

Cowardly Water Agencies

Today's news reports that San Diego residents are using more, not less water -- despite calls for water conservation. The problem extends to all of Southern California, where water use is growing. Water managers claim that people are "paying attention" to conservation messages, but that other factors may be responsible for higher use. I call bull. If you need people to use less water and they are not, you are not succeeding in reducing water use. Managers plan to spend $ on advertising, public awareness, etc.

When will they get a clue? As I said just days ago, people will not use less water if it's cheap. (I guess I need a bigger audience :)

Bottom Line: Treat water like gasoline -- when the price goes up, people will use less of it.

Water Wars -- East and West

It comes as no surprise that the American Southeast, known more for its swamps and kudzu, is now having water problems. The reason is this: A past of "too much" water has hidden the Bureau of Reclamation's bad water policies. Now that there is not (fight between farmers and cities, deja vu all over again), the inadequacy of Bureau (and other agency) policies is clear.

Speaking of that, The Economist has a good update of Water in the West. Here's the relevant bit:

Farmers use the great majority of the West's water, which they get at bargain rates. Even in California, by far the most populous state in the region, four times as much water is poured onto farmland as runs out of taps or is sprinkled over lawns. Farmers in the Imperial irrigation district, east of San Diego, pay $17 per acre-foot of water (that is, enough to flood an acre of land a foot deep, equivalent to 1.2m litres). In San Diego a household that used the same amount in a year would pay $1,311.

Bottom Line: Few places in the world do a good job at managing their water. The most common cause is treating water as a "common-pool" good (take what you want, we can all share) when it is really a "private" good (the water I get is the water you do not). Poor management under common pool guidelines eventually results in shortage. When this happens, institutions that previously "worked" cannot cope, and people fight. Look for the pattern -- you'll see it everywhere.

Water Politics

This editorial predicts that politicians will add so many bits of lard to the water bills under consideration in the California legislature that voters will veto all of them (in referenda). This happened before -- when the Peripheral Canal died under the assault of partisan bickering.

Bottom Line: Political "solutions" to water problems often end up including a lot of unnecessary pork put there in the hope that the need for "water security" will carry them through. When the load gets too heavy, voters revolt; if they do not, we still get a lot of crap. (See also "national security" legislation.)

Bureaucrats Inaction

In this sad story, we see how multiple agencies managed to avoid saving endangered fish they were charged with protecting. (They did, in fact, take actions that killed the fish.) This is important, because fish kills in the Sacramento Delta are the reason a judge ordered the pumps that send water to Southern California to be turned off. Looks like these bureaucrats just endangered SoCal's water supply too. Brilliant.

Women Responsible for Drooping?

According to this blog (must be true!), estrogen in the water supply is responsible for growing impotence (or is it infertility?) in men. I can see a day where men will take Viagra as a daily supplement to "maintain the body's natural balance."

This is actually a real problem. I heard someone say a few years ago that men who drink water from the Sacramento Delta have low sperm counts. (According to this, it's because of pesticides; much better.) If there is anything that will get (male) politicians to pay attention to water quality, this is likely to be the issue.

Bottom Line: We drink water all the time. We test for some contaminants, and others make themselves known, eg, giardia. The problem is all that other stuff that gets into our water and is either undetected or impossible to remove (economically). Does this make the case for bottled water? Hmmm....

Local Warming and California Snow

A recent symposium reviewed the current status and anticipated problems from local warming in the Sierra Nevada. Lake Tahoe has already had a 0.5F temperature increase, which has allowed invasive fish to take hold.

Even if we take radical action now, we are committed to a 2-4F increase in temperature.

The biggest effect (already being felt) is a reduction in snow "stored" at high elevations. This is bad for skiing but really bad for water storage -- if water is not stored as snow, it runs into streams and overwhelms dams. The "more dams" solution is popular, but I am suspicious that they will just be expensive handouts to farmers who should get used to less water. (Cities use 1/4 the water farmers use; they will be fine.)

Bottom Line: Forget global warming, think local warming. We're already in it, and it's time to change some old, bad habits.

Water supply falls. Do prices rise?

California had a drought last year, and this year looks no better. As water gets scarcer, agencies are looking for new supplies, and these suppliers are looking to get paid. Just as you would expect with any other commodity (gas, wine, tickets), the price goes up when demand is greater than supply. That brings us to this great headline, "Southern California plans to buy farmers' water; RATES TO GO UP IN SHORTAGE" [CAPS in original] from this Associated Press story, which goes on to inform us that:

The water sale is being brokered by the state Department of Water Resources, which will look to farmers to voluntarily offer parts of their water supply for sale...

It was unknown how many farmers would sign onto the deal and how much money they would ask for the portions of their supply... Water district officials also did not know how much water user rates would increase as a result of the purchase...

Even if the MWD secures the additional water from farmers, it may still have to ration water supplies among the local agencies that it serves if the shortages persist, agency officials said.

In other, shocking news, water agencies are trying to buy water from willing sellers, but are unable to limit buying by raising prices. Instead, they are resorting to across-the-board limits (one dollhouse per customer, please) to make sure that everyone gets their fair share. [end sarcasm]

But wait, I speak too soon. What is it about farmers selling water? I thought they need it to make food? Not so fast, observes one columnist:

MWD will purchase additional water from Yuba County, in the Sacramento River Valley, and from the Central Valley. Yuba lists among its attributes "thriving farmland." The Central Valley boasts of supplying "fully one-quarter of the food America eats." Nevertheless, the MWD says, both areas are willing sellers. Selling water, after all, can be less dicey and more profitable than growing crops.

Down in San Diego, they really have things figured out. According to this piece, if the price rises, people will use less water. Wow, I love this:

If we truly want people to conserve water, especially during times of lean supply, then local water agencies should let market forces dictate the price of water. Doing so would be both efficient and effective. As water supplies dwindle, its price will go up and people will use less, thereby eliminating the need for expensive and largely ignored public education campaigns urging people to save a precious resource.

It is as common-sense a solution as exists: If folks want to have lush, green lawns as opposed to the xeriscaping more appropriate to a semi-desert, they should pay the real cost of the water needed to accomplish it. The same goes for farmers who want to plant cotton or rice in an arid region rather than crops more appropriate to our climate.

Admittedly, a market-based approach to water rates will require a radical restructuring of the way this state distributes and prices water. But until consumers feel the pain of water shortage where it hurts most ---- their pocketbooks ---- don't expect them to take calls for water conservation seriously.

Bottom Line: Water, in shortage, must be allocated by some kind of price/auction mechanism. We must break the unholy vow to never raise prices for water. Rationing schemes are more complicated and put the water where it shouldn't be. Note that I am in favor of setting aside a basic quantity of water per capita FIRST and then allocating the rest by (market) pricing.