California’s Water Policy Is Central Planning With Better PR

From Owens Valley to the Sacramento Delta, who controls water controls California

Water and Power

LOS ANGELES — California’s water allocation system is among the most complex, litigated, and politically sensitive regulatory regimes in the United States. It determines who grows food in the Central Valley, who surfs in Santa Cruz’s clean water, who drinks in Los Angeles, and who farms in the desert south of Fresno. It is also, by any honest assessment, a system that allocates water based on historical priority claims established in the 19th century rather than on contemporary economic efficiency or environmental sustainability.

Prior appropriation — the “first in time, first in right” principle that governs much of California’s surface water allocation — gives the oldest water rights the most protection during shortage. Agricultural users who established rights in the 1800s have senior claims over urban users who established rights in the 1950s. The economic value of the water, its environmental cost, and its best use are not the primary factors in the allocation. History is.

The Agricultural Subsidy in the System

Central Valley agriculture uses approximately 80 percent of California’s developed water supply to produce 13 percent of the state’s economic output. Some of this agriculture is high-value and genuinely water-efficient. Some of it is cotton, rice, and alfalfa grown with subsidised water in a desert, crops whose water intensity makes them economically rational only because the water is priced below its true scarcity cost. This is water policy as agricultural subsidy, achieved not through appropriations but through the price signals that prior appropriation removes.

The Pacific Institute, the Reason Foundation, and the Environmental Defense Fund have all produced analyses of California water policy that converge on similar conclusions from different ideological starting points: market pricing of water, with protections for low-income households and environmental flows, would allocate the resource more efficiently than the current system. The Pacific Institute water policy programme documents the alternative frameworks. The political economy of changing prior appropriation is formidable. The surfable rivers and clean coastal water that surfers depend on are downstream of those political economy decisions.

SOURCE: https://bohiney.com