I gotta tell you, I feel as if I’ve stumbled into quicksand. I’ve accidently gone up a level of complexity, and can’t draw conclusions that I am sure of (I try to only write here when I trust my thought). I keep reading more complex discussions of California water transfers and markets, which send me to other materials and when I come back to write, my draft posts all trail off into more reading.
I have started to draw some conclusions.
1. There are a few classes of water market advocates.
- Oversimplistic economists who don’t know the water field but worship markets and feel sure that markets are the right answer for everything. I don’t give a shit about them.
- Economists who do know the water field extremely well. I am puzzled by them, because they persistently ignore forty years of evidence that large scale markets keep not happening despite the longterm policy push. They keep thinking that there are policy tweaks that could create a water market, rather than the likelihood that farmers would rather farm than sell water and that the transaction costs of moving water really are that high. They believe in their economic theory more than they believe in what we observe in the world.
- People who just want to get water away from senior rights holders (for environmental or urban use) and don’t care about the equity issues. They think the water rights fight is unwinnable and spending urban money is faster. But they don’t love markets, they just want any tool to accomplish their goals.
2. Despite my own blog writings, I do not see social goals for a market in any pro-market advocacy piece. There are goals for the market itself (lots of easy trades, send price signal, reduce inefficiency) but never anything like “create a stable farming community with high wealth equality” or “keep meat cheap because people like meat” or “put an end to urban landscaping”. There is never a choice of a social goal, then an evaluation of the tools to achieve that, one of which is a market. People who advocate for markets always start with markets, then list the things markets do (but not the ways markets make people’s lives shitty or even design criteria to prevent that.)
Now I will stop and post this, hoping that this leads me back into blogging that I can post. I am still working on the question:
What, out of all the content in the Unbundling Water Rights, could be used here? I’ve heard Tim Quinn say that he hopes for a big push on water markets if the drought continues, so this could be a very active topic next year. What Australian magic can be applied here? My first guess at the answer is “ignore third parties more”.