Thursday, April 2, 2015

Taking a Long Shower and Thinking About the Water "Shortage"

By Robert Wenzel

As I have written in the past, water is just like any other commodity, if you price it below market clearing levels, you will have shortages,

If you allow market prices, shortages disappear. When you have market prices, incentive is provided for development of new sources of water and the price acts as a disciplinary force against "waste."

Most officials in government jurisdictions through out the globe fail to get this and will attempt to impose rationing when their below market price schemes on various commodities result in major shortages. (SEE:  Venezuela Turns Into a Socialist Nightmare and Toilet Paper: The US vs. Venezuela)

But I live in California, where the very unpredictable Jerry Brown is governor. And I do mean unpredictable.

Brown once dated the superstar singer Linda Ronstadt. He also once attended a Jesuit seminary and planned to become a priest. During his seminary period he engaged in a practice called "taking the discipline," which involved wrapping wire around a leg to produce discomfort that was thought to increase spiritual awareness and penitience.

Chuck McFadden in his biography of Brown, Trailblazer, wrote "Brown on occasion wrapped the wire so tightly  that he limped, according to fellow novitiates."

Early in his political career. he was a trustee for the Los Angeles Community College Board. While in that position, according to McFadden, he suggested "an airborne campus strike force to curb violence" that would employ "no-nonsense tactics" against student protesters. "It would have a fleet of jets, and members of the strike force would be equipped with crowd-control devices such as tranquilizer guns, wood pellet guns and [this was before the water 'shortage' ] water cannons."

Like I said, with Brown, you never know what you are going to get. And so, with water being priced below market levels, and to make things worse, controlled by local governments, rather than the private sector, water levels have been falling in the state during the current dry years.

Yesterday, Brown, as Governor acted, and declared the "first ever statewide mandatory water reductions." "Hello, Venezuela," I thought to myself. But when I turned to the governor's press release, it said this:
The Governor's order calls on local water agencies to adjust their rate structures to implement conservation pricing, recognized as an effective way to realize water reductions and discourage water waste.
Yes, there was a lot of  nonsense in the release and the water sector should be privatized, but that said, it is quite impressive that Brown recognizes the problem as a pricing problem.

I say, "Jerry Brown for President of Venezuela!".

Robert Wenzel is Editor & Publisher at and at Target Liberty. He is also author of The Fed Flunks: My Speech at the New York Federal Reserve Bank. Follow him on twitter:@wenzeleconomics


  1. They don't call him "Governor Moonbeam" for nothin'.
    And yeah, he can really shock you sometimes (in a good way). I remember on one occasion he stated "Prisons aren't there to rehabilitate. They're there to PUNISH". I found that curiously refreshing.

    1. Prisons are there to keep cops, guards, wardens, prosecyters, judges, stenographers and court secretaries from having to find honest work.

      The goal of the court system should be victim restitution and conflict resolution, not nebulous moral nonsense like "justice" or "punishment".

    2. Does restitution not require the concept of justice? Why pay back what is owed? Is it not because that is the just thing to do?

      How do we know which way a conflict resolution should be decided? Are we not aiming for the just outcome?

  2. Brown can be unpredictable but I don't ever remember it in a good way. The issue about prisons is who they are punishing and I believe the answer is very troubling. Regarding the "drought" in California, the original press release RW refers to showed Brown near Donners pass standing in a brown grassy field bemoaning the lack of snowpack. Buried further down in the story the reporter revealed that part of the reason for the lack of the snowpack was the warm weather resulting in rain rather than snow. Conditions are actually wetter at this time in the rain season compared to last year. I didn't see this part of the article in subsequent news releases. Brown is lying as usual and using fear to promote government spending on special interest groups at taxpayer expense. The water monopoly which results in lack of market prices blinds us not only to the real demand for water but also to the real supply.

  3. I find the complete absence of a discussion about the fascist approach to water distribution at least as interesting as the senselessness of including Governor Moonbeam in the issue.

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