Hello, friends. Let’s start with the Introduction, starting on page 7, going through page 10, stopping at the header Building Blocks. We can go back to the summaries once we understand the material, if we still want to.
Professor Young writes clearly and well. I can’t improve on his text by summarizing or explaining it. I hope you’ll read it yourself and come back to give your own impressions.
It is feels almost circular to point this out, but this work is all about capitalism and markets.
The primary insight of that experience is that progress comes from building the institutional conditions that enable markets to flourish. In Australia, the gains came from implementation of a sequence of reforms that simplified the system and gave users every incentive to consider selling their water to someone else. As the systems used to define water rights were improved, the value of the rights increased. Water trading became the norm, and profits increased. In the first decade of water reforms, the internal rate of return from holding a water right averaged well over 15% per year (Figure 1).
Success is increased GDP and profits to people who were lucky enough to hold rights at the beginning. This work takes those goals as self-evidently good; it doesn’t build a case for them. If you are interested in other goals (human flourishing, consistent food production, deep ecology) you won’t see them included here. This is a proposal very rooted in capitalist trade: historic instruments of trade, turning water use decisions into economic decisions, pricing risk, incentivizing investment. Nothing wrong with that, but I’ll hold the bias in my mind as I read along.
We’ll go through the six core concepts in detail later. After that came four characteristics, pg 9. I liked the first two characteristic of robustness and hydrologic integrity. Our current system doesn’t have those, so they’d be an improvement.
The third characteristic favors the already rich:
Efficient management of supply risks so that those who need access to a very reliable water supply have the opportunity, at an appropriate cost, to secure it.
The fourth characteristic again commodifies water. This is the very goal of this proposed process, so of course it does. I keep noting it so that I remember to think critically about it, rather than uncritically accept this characteristic as a good thing.
Incentives that encourage people to search for more efficient ways to save and use water and also, to invest in resources that use water.
Another concept directly applicable to water is the idea of double-entry book keeping, which requires everyone to operate under a simple rule: if one account is to be credited, another account has to be debited.
Dude. You have got to be a hardcore economist to attribute conservation of mass to double-entry book keeping.
Your turn, y’all. What did you see in the first couple pages of the introduction?