In celebration of Earth Day 2010, I am dedicating this post to … money. Or, more accurately, economics and how the “dismal science” is used in conversations about water resources. I think it is useful to understand the ways in which economics is used, because it helps to draw out connections between water management techniques that might not be apparent otherwise. Note that I am not writing here about different movements within economics (although that might be interesting at another time), but about the use of economics and economic concepts in water resources management. This post describes three primary uses of economics, although these are undoubtedly too few, too broad and too narrow. My observations are certainly not unique, and many of you have thought about these categories before. I would love to hear your comments below.
While most water disputes in the United States have historically been located in the west, there are an increasing number of eastern disputes as well. In fact, the US Supreme Court issued two new decisions in late January regarding interstate water litigation, and both were located in the east. One of those cases opened the gate for non-state entities to participate directly as parties in interstate litigation before the Supreme Court, while the other seems to have closed the gate at least partially on interstate groundwater disputes.
In an earlier post, I discussed the errors contained in certain criticisms of the proposed California water bond to be voted on in November 2010. Those criticisms were centered on the provision that allowed investor-owned public water utilities to receive bond funding for projects to benefit their customers, who make up 20 percent of all Californians. Critics asserted (incorrectly) that the provision could lead to “privatization” of California’s water.