China is a huge country, we all know. It also has, according to The Economist, priced water “far from market levels.” The economist argues that a huge reason for China’s enormous water scarcity problem is the inefficient use of water, which is mostly due to below market level water prices:
By increasing supply, the government is failing to confront the real source of the problem: high demand for water and inefficient use of it. Chinese industry uses ten times more water per unit of production than the average in industrialised countries, according to a report by the World Bank in 2009. A big reason for this is that water in China is far too cheap. In May 2014 Beijing introduced a new system that makes tap water more expensive the more people use. But prices are still far from market levels. Officials turn a blind eye to widespread extraction of un-tariffed groundwater by city dwellers and farmers, despite plummeting groundwater levels.
Raising the price would cut demand and encourage more efficient use. It should also help lure industry away from water-scarce areas where prices would be set at higher rates. Arid areas that are forced by the government to pipe water into desiccated cities like Beijing could offset their losses by charging higher tariffs.
I don’t pretend to have the exact answer. But I have to ask an economic question here. Isn’t water about as inelastic a product as you can get? Wouldn’t you pay whatever asked for water? If so, raising or lowering the price wouldn’t have a big impact on its use.
In Inevitable, the solutions are not so easy. People need water. People will pay what it takes for water. People will pay what it is necessary for other inelastic products that water produces: medicine, food, energy, etc. Also, when panic sets in, there will be the “inevitable” race to the bottom in the form of hoarding.
So, what is the ultimate answer to water scarcity? First, we need to acknowledge it. Because the novel tells the story of what happens when the failure reaches a crisis. And by that point, no amount of price control or de-regulation will portend a desired outcome.
Inevitable will be free this weekend at the Kindle store. I hope as many people as possible download this book for free! Just click here to check out Inevitable:
Your world’s water supply is reaching its finite end. Aquifers are drying, and water is being divided between production of food, medicine, and agriculture. When America found itself on the brink of Malthusian catastrophe, population control was installed for the greatest good for the greatest possible number of people.
For Benjamin Zachary the country did only what was necessary. As any other twenty-one year old, Ben expects to receive his Fairness In Nature And Life Act (FINAL) letter from The Office of Population Management. But he grows suspicious and nervous when he fails to receive his letter within weeks after his birthday.
Ben soon learns that his fears are well-founded as he is being accused of a crime he did not commit for a second time – this time by The Office, itself. He is wanted for immediate trial by Panel Hearing. Ben struggles to face his own death, knowing that he has little chance of defeating The Office at its own game. He has no lawyer to represent him, no knowledge of the rules of the hearing process, and he finds that the Panel that is going to decide his fate is hand-picked by his adversary, Office Director Dante Ringer. His only hope is his friend, Patricia Mullins, whose cold acknowledgment of The Office’s necessity juxtaposed with her feelings for Ben, twist her into conflicting directions. As Ben and Patricia fight to overcome The Office’s powerful organization, they learn the only way out for Ben is at the expense of others.
Up against a nearly unlimited government agency created to deal with a dramatic environmental crisis, Ben and Patricia fight against the Inevitable.
Water scarcity is a big problem for the Colorado River Basin states out West, including Arizona. And Arizona seems to be well aware of it as they are now holding a contest pushing for innovative ideas:
A $100,000 prize awaits the group that comes up with the most innovative campaign to push water scarcity into the forefront of public conversation.
The Water Consciousness Challenge is the first phase of the New Arizona Prize offered by the Arizona Community Foundation in collaboration with The Arizona Republic and the Morrison Institute for Public Policy. Underwriting for the program comes from the Tashman Fund and the Lodestar Foundation.
When I wrote Inevitable, my cynical side let me imagine that there was no innovative solution. Other than the population control installed which serves as the centerpiece setting for the novel. I hope you engineers, entrepreneurs and scientists can come up with something better.
The prologue of Inevitable explains how water scarcity poses a broader problem set than simply a lack of drinking water. We’ve written on this blog numerous times about how water scarcity ultimately touches nearly every industry we rely upon. Energy is a big one. We’ve also written about how in a global economy, no matter where this problem first surfaces, it will affect us all. Now, we see how water scarcity is causing problems for the Iraq oil industry:
A multi-billion dollar common seawater injection scheme designed to boost production from the giant export oilfields in Iraq’s south is snarled up in red tape and acrimony.
Don’t forget, America still gets much of its oil from the middle east, and that includes Iraq. Still not convinced, just remember that if water scarcity is affecting oil production in Iraq, there’s no reason to believe numerous other countries in the middle-east and beyond won’t soon have the same problem.
Politico’s front page story on its newspaper today reported on the effect the California drought is having on the food industry there:
Thanks to the historic drought in California, prices may spike for the specialty rice used in the popular Japanese dish. Production of the rice, which is grown primarily in the Golden State, is expected to drop by 25 percent this year.
California — and the Sacramento Valley in particular — is the nation’s primary source for the high-quality short- and medium-grain rice used in sushi and is a major supplier of the rice for other countries, too. But the state’s 2,500 rice growers this year planted just 420,000 acres, about a quarter fewer than usual, because farmers weren’t allowed to use water for more, according to the California Rice Commission.
A theme on these news stories is that at first glance you may chuckle. But, look closer. The water drought is affecting the price and availability of food for one of the largest economies in the world – the State of California. Nothing funny about that. Its time to start taking the water crisis seriously or the future will look a lot like Inevitable where food and water rationing are only a prerequisite to the imposition of term limits on life.
We previously mentioned how the Ice Bucket Challenge was raising awareness of water scarcity issues. However, we can add a great attempt to do the same. Check out the RubbleBucketChallenge brought to you on Facebook by a poster in Gaza:
In Gaza we don’t have water and when we have water, we can’t make it ice since the electricity is off most of the time. So my cousin Hafiz, My nephew Khalid and I used remains of a destroyed house to participate in this challenge.. I am not nominating anyone for this challenge but I am asking you all to show solidarity with Palestinians and to participate in this challenge..
Thank you in advance
Gaza is just one of many locations dealing with a water crisis. War is enough to put any country in this position, with drastic effects on its citizens.
I wrote Inevitable to raise awareness of this problem, but this Facebook post may do more than any book I could write.