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San Diego Water Rules

June 24, 2009 in Economics - General, Public Policy | 2 comments

Southern California is in the midst of a drought.  What is the city doing to conserve water?  They are resorting to new rules and ‘water cops‘.

  • Apartments, Condos and Businesses can water: Monday, Wednesday & Friday
  • Homes with odd-numbered addresses can water: Sunday, Tuesday & Thursday
  • Homes with even-numbered addresses can water: Saturday, Monday & Wednesday
  • Apartments, Condos and Businesses can water: Monday, Wednesday & Friday
  • On your watering day, you may only water before 10 a.m. or after 6 p.m.
  • Landscape irrigation using sprinklers is limited to no more than ten minutes maximum per watering station per assigned day.

Isn’t there an easier way?  Of course.  The answer is to raise the price of using water.  I’ve broached this idea in two previous posts.   Charging more for water (especially during a drought) will accomplish the same goal as these arcane rules set out to do: reduce water demand.

Watering at night or early in the morning saves water because less water evaporates at this time of day. If water is more expensive, people will voluntarily water early or late in the day to save water.  Further, a higher price of water compel people to 1) water less and 2) plant vegetation that requires less water such as succulents.  This way people will water when they please, but will water less often and with less water.

Economists believe that getting prices right will lead to efficient market allocation; in the case of water conservation, economists are almost certainly correct.

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How did the national debt get so big?

May 8, 2009 in Public Policy, Taxes | 3 comments

The book Cadillac Desert discusses the development of dams, aquaducts, and irrigation canals to slake the thirst of cities and farmers in the Western U.S..  While these projects did eventually deliver the water they promised, they did so at huge costs to taxpayers.  In the words of former congressmen Robert W. Edgar:

“The old-boy network comes to you,” says Edgar, who was elected to the House of Representatives in 1974, at the age of thirty-one.  ”They say, ‘You’ve got a water project in your district?  You want one? Let us take care of it for you.’  Then they come around a few months later and get their pound of flesh.  You actually risk very little by going along.  You get a lot of money thrown into your district for a project that few of your constituents oppose.  In return, you vote for a lot of projects your constituents don’t know or care about.  Not many of my constituents are going to base their vote for or against me on whether or not I supported Stonewall Jackson Dam in West Virginia.  Then everyone wonders why we’re running such big federal deficits, and they cut the social programs, which must be the culprit.”

  • Robert W. Edgar, U.S. Congressman from 1975 to 1987.

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Should Water be Free?

March 17, 2009 in Economics - General | 2 comments

No matter the price, John Keesecker of Food and Water Watch argues that selling water for profit is a bad idea.

Keesecker: ”I think when folks see water being privatized, they see a price being put on something that’s essential.” - Marketplace.

Should water be free?  Water is a necessity.  Without it, you cannot live.  In an egalitarian society, is giving away water for free the best way to ensure that poor people receive the water they need to survive?

No.  Free water is a horrible idea.  Water is a scarce resource.  When water is free, individuals will not have an incentive to invest in water saving technologies.  For instance, if fixing a leaky pipe in your house costs $1000, you’re much more likely to pay to fix the leak if you also have to pay for the wasted water.  When water is free, you may put off fixing the pipe perhaps indefinitely.

If price of water rises and becomes unaffordable for some poor people, do we just leave them ‘out to dry’?  

If we want to redistribute money to the poor, giving cash transfers would be preferable to selling water at a 0 price.  With cash transfers, the poor could choose whether they wanted to spend their money on water or other necessities such as food and shelter.  If cash transfers are not feasible, a voucher program could be instituted.  Poor individuals already receive vouchers for food and a “water stamps” program could be similarly successful.  

A significant, positive price on water combined with some form of redistribution system should please most parties.  Environmentalists will be happy that a positive price on water will compel individuals and businesses to conserve water; social liberals will be happy that the poor will be able to purchase the water they need; and fiscal conservatives will be happy that the “water stamps” program will have a fixed budget as opposed to an open-ended program of handing out water for free.

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Toilet water is cleaner than bottled water?

August 12, 2008 in Public Policy | Permalink

The New York Times Magazine has an interesting article about reclaimed water (“A Tall, Cool Drink of…Sewage“).  Reclaimed water is basically toilet water which has been recycled to the point where it is safe to drink.  In many dry areas–such as my home of Southern California–the water supply is dwindling.  To counter this, San Diego County is building the Western hemisphere’s largest desalination plant.  Orange County, however, has decided to build a sewage-treatment plant near Fountain Valley to increase the supply of water available for OC residents.

Although there is a psycological aversion to water made from sewage, reclaimed water has been shown to be safer than bottled water.

“Yes, the water entering the sewage-treatment plant in Fountain Valley is 100 percent wastewater and has a T.D.S. — a measure of water purity, T.D.S. stands for total dissolved solids and refers to the amount of trace elements in the water — of 1,000 parts per million. But after microfiltration and reverse osmosis, the T.D.S. is down to 30. (Poland Spring water has a T.D.S. of between 35 and 46.) By contrast, the ‘raw’ water in the Anaheim basins has a T.D.S. of 600.”

This is why “environmentalists, river advocates and California surfers — the sort of people who harbor few illusions about the purity of our rivers and oceans — generally favor water recycling.”

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Solving California’s Water Shortage

July 16, 2008 in Public Policy | 3 comments

Forbes reports that “California is perpetually portrayed as suffering from a shortage of water. Case in point: Gov. Arnold Schwarzenegger recently declared a statewide drought, telling citizens to prepare for rationing.”  As any economist would tell you, the solution to the water shortage problem is simple: raise the price of water.

The largest culprits of receiving subsidized water are California farmers.  As the San Francisco Chronicle reports (“Big Farms…“), some farm districts received water at a price which was 2% of price paid by Los Angeles residents.

Creating a market for water free of government subsidies will eliminate water shortages in California.

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