Citing a 2004 study by the Southern Nevada Water Authority, the report said scaling back development to manage diminishing water resources could translate into a loss of $18.6 billion in tax revenue and $4.7 billion per year in lost wages. Water-based recreation bringing in more than $1 billion annually could also be damaged.The crazy part of these so-called losses is that they are hypothetical; they are based on business as usual projections of what would have happened if Las Vegas continued to grow (at past rates) into the future -- presumably using more water in doing so.
The fallacy, as anyone familiar with Wall Street (or tax revenues) will know is that the past is a poor guide to future performance. SNWA has not experienced these losses because they were based on future projections.
In fact, the current real estate crash has probably resulted in far-larger losses in tax revenues than any "failure to develop" scenarios. (This article says that Las Vegas home prices have fallen by 28 percent in the past year.)
Bottom Line: Beware of anyone advocating policies based on extrapolated trends. They are just as likely to tell you that -- at "current rates" -- you are going to walk into a wall.