Monday, March 16, 2009

Are you thirsty, or are you hungry?

One morning on the radio, I heard a commercial expressing the plight of the California farmer.

Before continuing, I should explain something to those of you who do not live in the southwestern United States. You might think that our economy is shaped by oil and petroleum products, but in reality there's a liquid that's even more valuable to us southwesterners - water. Water has influenced the development of the southwestern United States for over a century, and will continue to influence it far into the future.

For example, California is a huge agricultural producer. However, you need water to grow crops, and that can be an issue - especially when California is heading toward drought conditions like it is now. If you want to hear heart-warming stories about the plight of the California farmer, go to Example:

California family farms and rural communities depend on a reliable supply of agricultural water. Without water, farms cannot survive, small businesses that provide material and services to farms are hurt and communities suffer. Many of the farms and communities in the San Joaquin Valley rely on water from the Central Valley Project.

The implied message here is that we don't have enough water, and that water for the farms may run out.

Actually, that's only partially correct. In reality, the issue is that water for the farms may not be available at the current price.

Ah, the current price. Or, as the Environmental Working Group puts it:

At a time when California water is scarce and expensive, taxpayers guarantee Central Valley farms a cheap and abundant supply worth up to $416 million a year.

But isn't that water needed for farming? Umm...:

In a state where water has become an increasingly scarce commodity, a growing number of farmers are betting they can make more money selling their water supplies to thirsty cities and farms to the south than by growing crops....

"It just makes dollars and sense right now," said Bruce Rolen, a third-generation farmer in Northern California's lush Sacramento Valley. "There's more economic advantage to fallowing than raising a crop."

So farmers get water on the cheap, then resell it at a profit. Needless to say, the Environmental Working Group isn't pleased.

Some environmental groups say...[t]he problem should be fixed by retooling a decades-old formula that gives farmers a break on their contracted water, even in times of scarcity, they say.

"Essentially these farmers are getting water for a subsidized price and selling it to taxpayers at an elevated rate," said Renee Sharp, senior analyst with the Environmental Working Group, an Oakland-based nonprofit that tracks farm subsidies. "On the other hand, the more often water agencies are scrambling to buy water, the more they get interested in some creative solutions, like conservation."

But on the other hand, Californians depend upon food, and any move to remove the subsidies for California farmers would more than likely result in a grocery price increase for Californians, as well as reduced demand from Californians and others throughout the world which could exacerbate employment issues in the Central Valley.

But on the other hand, if this reduces the illegal immigrant population in California as jobless workers return to their home countries, then there will be a reduced demand for public services, which could save Californians tax money.

As you can see, it's a complex issue.

Ignoring the environmental and homeland security issues for the moment, it pretty much boils down to a simple question: is it more important to quench your thirst by providing cheap water, or is it more important to satisfy your hunger by providing cheap food? Even in the magical land of California, you can't do both.
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