Unquenchable: America's Water Crisis and What to Do about It.

• Author: Sutter, Daniel
• Position: Book review

Unquenchable: America's Water Crisis and What to Do

about It

By Robert Glennon

Washington, D.C.: Island Press, 2009.

Pp. xii, 414. $27.95 cloth.

In the 1920s, Ludwig von Mises sparked a debate among economists about the feasibility of socialism, claiming that without market prices, central planners cannot rationally allocate resources (Socialism: An Economic and Sociological Analysis, translated by J. Kahane [Indianapolis, Ind.: Liberty Fund, (1922) 1981]). The history of central planning in the Soviet Union, China, and elsewhere has proven Mises correct. The United States has tried central planning in some areas, with a similar lack of success. Robert Glennon's new book Unquenchable demonstrates the failure of the political allocation of water. The United States faces a water crisis because the fastest-growing states in recent decades have very limited supplies of water. Yet through a variety of measures, the public sector effectively guarantees that it will meet the demand for water at a nominal price. The expectation (or right) of low-cost water supply creates a kind of open-access resource. The familiar tragedy of the commons ensues, and water supplies are now barely adequate in many parts of the country. With the inevitability of periodic drought added to the equation, it is only a matter of time until a major U.S. city runs out of water.

Glennon carefully documents the many elements of the nation's inefficient water system that are setting the stage for a potential future calamity. Groundwater is available on an open-access basis because anyone has a right to extract groundwater beneath his property, and in many states no authority exists to require permitting or metering of wells for personal use or irrigation. Surface water in western states is allocated under the prior-appropriation doctrine, in which the "first in time" user has a right to divert water, but only for his own use, not a full right to the water (including, for example, a right to resell it). Farmers and irrigation districts can thus use water only for agriculture, and therefore they do not have to bear the opportunity cost of more valuable industrial, commercial, and residential uses of water. The Bureau of Reclamation and the Army Corps of Engineers have built numerous projects across the country at taxpayer expense--including hundreds of dams, the All-American Canal, the Central Arizona Project, and the Central Utah Project--to deliver water to users at a fraction...