There’s
been a lot of talk lately about the role of government
regulation within a
capitalist system. Can oversight
and
strict accountability coexist with a laissez-fair market? And should a
balance be struck between
private enterprise and public good?
Those are tricky questions that beg complex answers, but what if we
switch the subject of the discussion from economics to natural
resources—more
specifically, what if the shorage wasn’t dollars, but
gallons. What if water rights were treated
as private property
and traded like commodities? What would private water ownership
look like, and—more importantly—would such a system promote efficiency
and
conservation?
You
only need to look South to see this type of system in
action. In the March 14 edition of the New York Times, Alexei
Barrionuevo writes about the situation in Chile’s Atacama desert, and
how
private water rights are impacting the country’s citizens and
changing its
landscape. With a private property
approach
to water resources, Chile has allowed water rights to be bought and
sold with minimal government or environmental regulations. The
result is a private ownership system
that allows for a consolidation of
water rights on a scale unheard of in the
United States. As
Barrionuevo’s
article points out, 80% of water rights across a large
swath of southern Chile
are owned by Endesa (a Spanish-owned electric
company), and in the Atacama
desert (one of the driest regions in the
world) some towns have sold up to 75%
of their water rights to large
mining companies. In Chile, farmers fight with
large—often
international—conglomerates
over rivers and natural
reservoirs, and every time the conglomerate wins,
another small town or
agricultural community dries up.
Chile’s
water rights trading system was created during Augusto
Pinochet’s military
dictatorship during the 1980s, and it provides a
great example for what happens
when the government doesn’t just
abdicate responsibility for controlling natural
resources, but actually
hands over controls to the highest bidder. Proponents of Chile’s system
argue that
the free-market model promotes efficiency by allocating
water based on economic
use, but it’s clear that this “for-profit”
system ignores an important aspect:
Although
water can be a
commodity—something to be bought and sold based on the balance of
supply and demand—that is not its only identity. Ultimately, no
one can
forgo water and survive: It’s not just a “want,” it’s a basic
need.
So
what does the situation in Chile have to do with our situation
here at
home? Well, just like Chile, we too
are dealing
with a water crisis, and our water demands—both
literal and virtual—are
continuing to grow, even as our water resources are threatened by
pollution,
waste, and inefficient collection and delivery
systems. Nevertheless, we have managed to strike
a balance
between private and public needs. In
the United States, three fourths
of water systems are public, guaranteeing
citizens access to clean,
affordable water. In
many communities throughout our country,
tying cost to use (in the form of
tiered-rate structures) has
encouraged a more conscientious approach to water
use. But a lot
more needs to be
done.
We
must grapple with the same dilemma Chile faces—how
to
support the continued growth of an economy dependent upon a finite
resource. California farmers are
already in the cross
hairs of this issue: with fewer water allocations and a
weakened
consumer base, these farmers must learn to do more with less. And the
solution—for
farmers and for all of us—will
not be found in
reduced operational costs (in the form of decreased crop yields
or
lay-offs), but using water more efficiently.
So
the question is not, “can water rates promote water
conservation?” We
first need to determine whether we are
committed to fair, equitable, and
cost-effective water distribution
that rewards conservation where possible, but
does not deny access in
the process. Within that context, I think it’s
fair to then ask,
“should water delivery be a for-profit
undertaking?”
(Click Here to Read
Barrionuevo’s
article.)