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The
cashier runs your jug of pure mountain spring water over the scanner,
the bar code is read, and $1.69 appears on a screen in front of you.
You now know the value of water, end of story.
Of course it’s not that cut and dry (or wet.)
Economics is one of the fuzzy sciences with too many variables
and nuances to always give sane answers.
Supply and demand should relate to price and cost, but the
price of a good or service can have little or no relationship to its
value. (Is a $25,000,000
ball player really worth 1,000 times more than a $25,000 8th
grade math and science teacher?)
Water
and most other components of natural systems provide more examples of
goods with skewed values. While
essential, they have little or no value in our economic system.
This is understandable as historically the supply of natural
capital was far greater than the demand.
Natural resources have fueled our growth.
Water, air, trees and minerals, essentially free for the taking,
are converted into tangible assets with value: food, lumber, energy,
etc. Without clean water,
breathable air, forests, and swamps to stabilize, purify and provide
habitat there would be no economy. But
our economic system never put them on the ledger. so they have little
value, an accounting error that makes the Enron scandal pale by
comparison!
Over
the years it has become increasingly obvious that the supply/demand
curve has shifted as the human population has risen almost exponentially
while the quantity and quality of the natural resources that we depend
upon have been on an opposite tack.
Not
having an adequate supply of potable water is not an option.
There are two ways to assure that we have a sustainable supply of
water: manage the watershed, or engineer solutions.
The
case for managing the watershed is much more than tree hugging or anti
growth sentiments. It is
based on economics. It costs
less and brings with it a myriad of other economic benefits: water
supply, flood and drought mitigation, pollution control, fish and
wildlife nursery and habitat, and recreational uses.
In 1997, New York City ran the
numbers and saved its citizens over $5 billion by deciding to
protect the natural systems of their watershed rather build mechanical
systems to do the same thing: provide clean drinking water.
Nature showed its value and was a sound economic investment.
The
cost of designing and building engineered solutions (aquifer storage and
recovery wells, desalinization plants, reservoirs, etc.), as well as
their maintenance, needs to be compared with the cost of watershed
management. The costs of
system failures due to age, human error, acts of God, natural disasters
and even human ill-will must also be factored in to the equation when
evaluating watershed management strategies and engineered solutions.
When
all factors are entered into the ledger the choice seems clear.
We can pay now to preserve the watershed and reap the benefits
for generations to come, or we can continue our present course hoping to
be able to design solutions that will solve the problems of our making,
spending many times the amount that conservation would cost and
committing future generations to forever pay to operate, maintain and
rebuild our “solutions.”
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