Has anyone ever wondered why California faces a shortage of water
coming out of the pipes, but NOT of water sold in bottles in the
supermarket? Have any of you wondered why cities are placing
restrictions on the use of water coming out of pipes, but not on water
that comes in a bottle?
The fact is, farmers in California's semi-arid Central Valley are
having their water subsidized. Prices deter consumption, and the lower
the price, the less deterrence there is, which means more consumption.
Thus, rice and cotton, which require plenty of water, are grown for a
profit in the Central Valley.
By contrast, supermarket shelves are stocked with plenty of bottled
water because supermarkets do not subsidize customers. They charge the
price that they will believe maximizes profit, and thus this acts as a
deterrent to consumption. So there is less wasting of bottled water;
few people use bottled water to water their lawns.
And the reason water subsidies will continue is because the people in
charge of water supplies in California want to maximize the farm vote,
so they set as low a price as possible, even though this leads to
waste. By contrast, sellers of bottled water want to maximize profit,
so they set the price as high as possible, even though this leads to
conservation.
|
