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The race to buy up the world's water

newsweek.com

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Re: The race to buy up the world's water

#21

Post by stretchwithme »

lurchpop wrote: post #12
stretchwithme wrote: post #5

The market is the only mechanism that can allocate scarce resources equitably. And the only alternative is politics. In California, those with influence have secured water for agriculture at below market rates, water delivered with infrastructure built by taxpayer dollars. When people can get a resource for less than the cost of delivering it, they use it with less discretion. And the prices of the things they produc…

Not entirely true if you're talking about a poor area whose market can't bear a price which makes supplying them profitable. The article also mentions that conservation is forced disproportionately on the poor given the examples of Cal in the 80s.

forced by who? nature?

it is not the well off that created conditions of scarcity. They've only figured out ways of remedying scarcity by innovating and trading.

Sure, the are many instances where people have been dispossessed of their land or resources. But this is hardly the free market. It is the ultimate expression of the idea that might makes right and that who gets what should be determined politically.

Re: The race to buy up the world's water

#22

Post by jacquesm »

stretchwithme wrote: post #5

The market is the only mechanism that can allocate scarce resources equitably. And the only alternative is politics. In California, those with influence have secured water for agriculture at below market rates, water delivered with infrastructure built by taxpayer dollars. When people can get a resource for less than the cost of delivering it, they use it with less discretion. And the prices of the things they produc…

> Private ownership is not the cause of all of the political wars over water. It is their solution.

That bullshit gets trotted out with some regularity but it is clearly nonsense.

Have a read here and draw your own conclusions:

http://en.wikipedia.org/wiki/2000_Cochabamba_protests

If someone owns a resource they have an interest in extracting maximum value out of it, not in preserving it.

I've seen the case made for private ownership of air and water and I think it is utter rubbish. What we need instead is good stewardship of our natural resources, a way to extract tax on the depletion of natural resources instead of on production of value.

Re: The race to buy up the world's water

#24

Post by dctoedt »

stretchwithme wrote: post #11
tbrownaw wrote: post #10

Earlier quoted context omitted.

> The market is the only mechanism that can allocate scarce resources equitably. The market allocates according to ability/willingness to pay. This is perfectly fine in general, but doesn't work so well when "ability" enters the picture for something considered a necessity.

That's true of everything. I'd much rather pay for what I need from a competitive marketplace that is constantly driving down the cost of everything than leave it up to monopolistic government to hand out the privilege of drinking water. The market works damn well for the vast majority of things with which government has not blessed with its involvement. Water is no different than most things. In fact, it falls out o…

> The free market is people peacefully trading with each other.

Then few if any free markets actually exist.

Some traders are indeed "peaceful." The brute fact, though, is that that many market participants actively seek out ways:

A) to inhibit competition, or even prevent it completely, for example by anticompetitive business practices; and/or ...

B) to make the public pick up the tab for costs while keeping revenues for themselves -- think pollution costs and bank bailouts, to name just two examples; and/or ...

[EDIT:] C) in some cases, to flat-out lie, cheat, and steal.

FOOTNOTE: As I understand it, economists refer to B as privatizing profits while socializing costs, a.k.a. "externalities."

These human tendencies to do A, B, and C above appear to be fundamental facts of life. Left unchecked, they can have a corrosive effect on markets.

There's ample room for evidence-based debates about how best to deal with these tendencies. But it doesn't seem to have done much good to insist that free markets are a cure-all -- it's reminiscent of the old economist joke whose punch line is "we'll just assume we have a can opener."

> Most government is coercion. I don't see how more of it is a solution.

It's certainly true that when government regulation is driven by untested ideology, or by private interests, it can make things worse by discouraging private initiative and effort. (Some of the ways market predators try to do A and B above is by encouraging government actors to enact legislation and regulations that favor them.) We've certainly seen that happen at various times in various places.

But governmental regulation, selectively applied, can also be at least a partial solution, to the extent it can help keep market predators from doing A, B, and C above.

Re: The race to buy up the world's water

#25

Post by papaf »

stretchwithme wrote: post #5

The market is the only mechanism that can allocate scarce resources equitably. And the only alternative is politics. In California, those with influence have secured water for agriculture at below market rates, water delivered with infrastructure built by taxpayer dollars. When people can get a resource for less than the cost of delivering it, they use it with less discretion. And the prices of the things they produc…

The market is the only mechanism that can allocate scarce resources equitably.

The article is surprisingly good and mentions that the economic argument is not so clear cut because the demand is inelastic. People still need to drink whatever the price.

But if someone owns a resource, they have an interest in preserving it.

There is also anecdotal evidence given in the article that this doesn't automatically happen. Privatised water utilities have cut down on staff and maintenance in order to maximise profit (since maximising profit is their reason for existing).

Re: The race to buy up the world's water

#26

Post by tinotopia »

Someone wrote: post #17
stretchwithme wrote: post #11

Earlier quoted context omitted.

That's true of everything. I'd much rather pay for what I need from a competitive marketplace that is constantly driving down the cost of everything than leave it up to monopolistic government to hand out the privilege of drinking water. The market works damn well for the vast majority of things with which government has not blessed with its involvement. Water is no different than most things. In fact, it falls out o…

"water is no different than most things" is precisely what this article (and the UN; the right to water and sanitation was added to the human rights awhile ago) disagrees with. Would you apply the same logic to oxygen instead of water? Even accepting that water is no different than say cars, I disagree with the peacefulness of the free market. The free market is all about competition. In this case, competition drives…

> Would you apply the same logic to oxygen instead of water?

Markets are a means of managing scarcity. Oxygen is not scarce, at least not if you're at sea level and you don't mind it mixed about 5:1 with nitrogen and a bunch of other gases.

For use in places where oxygen is scarce — like on top of a tall mountain or in an unpressurized aircraft at high altitude — you'll find that the stuff is very commonly bought and sold.

Re: The race to buy up the world's water

#27

Post by mmaro »

jacquesm wrote: post #22
stretchwithme wrote: post #5

The market is the only mechanism that can allocate scarce resources equitably. And the only alternative is politics. In California, those with influence have secured water for agriculture at below market rates, water delivered with infrastructure built by taxpayer dollars. When people can get a resource for less than the cost of delivering it, they use it with less discretion. And the prices of the things they produc…

> Private ownership is not the cause of all of the political wars over water. It is their solution. That bullshit gets trotted out with some regularity but it is clearly nonsense. Have a read here and draw your own conclusions: http://en.wikipedia.org/wiki/2000_Cochabamba_protests If someone owns a resource they have an interest in extracting maximum value out of it, not in preserving it. I've seen the case made for…

If you're trying to extract the maximum value out of a resource you own, why would you not preserve it?

Re: The race to buy up the world's water

#29

Post by hugh3 »

ars wrote: post #16

Do your part to conserve water: Use plastic, not paper. Don't recycle. If you have a septic system replace it with a sewer. Do not buy local, but from wherever is able to most efficiently grow the crop. Making paper uses tons of water. So does washing the plastic for recycling. Water is far more precious than energy/oil right now. A septic system wastes all it's water, but a sewer system recycles almost all of it. Gr…

Or just live somewhere where there's plenty of water.

Water falls from the sky, and in many parts of the world it's not a scarce resource at all.

Re: The race to buy up the world's water

#30

Post by ovi256 »

mmaro wrote: post #27
jacquesm wrote: post #22

Earlier quoted context omitted.

> Private ownership is not the cause of all of the political wars over water. It is their solution. That bullshit gets trotted out with some regularity but it is clearly nonsense. Have a read here and draw your own conclusions: http://en.wikipedia.org/wiki/2000_Cochabamba_protests If someone owns a resource they have an interest in extracting maximum value out of it, not in preserving it. I've seen the case made for…

If you're trying to extract the maximum value out of a resource you own, why would you not preserve it?

ITT: people who do not understand the tragedy of the commons.
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