ByGuy Burgess and Heidi Burgess
ADAPTATION TO ENVIRONMENTAL CHANGE
As observed by the National Research Council's recent synthesis report on greenhouse warming,1 the amount of harm we will suffer from global warming and other environmental changes will be primarily determined by the degree and speed with which society is able to adapt to the changing conditions. Superficially, the western U.S. appears to have enormous adaptation potential--at least for drought. Organizations such as the Bureau of Reclamation, the Corps of Engineers, the California State Water Project, and the Los Angeles Metropolitan Water District have already been able to repeal the climatic constraints on agricultural production and urban growth in the deserts of California, Colorado, Utah, and Arizona. Seemingly, any society which can transform a desert into a thriving agricultural and urban center should certainly be able to build the additional water storage and diversion projects needed to make up for a greenhouse-induced water shortfall. Furthermore, we should be able to supplement any supply-side solutions with an impressive array of water conservation strategies.
However, the simple existence of viable technical options does not assure that these options will be pursued. For years, water resource engineers have identified sophisticated options for improving the overall efficiency and fairness of the existing water distribution system. Most often, however, these options have not been adopted. The reason lies in the complex structure of the water resource decision-making process which has interlinked social, legal, political, and economic components. Society's ability to adapt to greenhouse warming will be sharply limited by constraints imposed by this decision making process.
While some combination of supply-side and demand-side adjustments will certainly sustain the region through any greenhouse stresses, some options may involve serious and unnecessary adverse impacts. The key question for policy makers is how to minimize the social costs of adaptation and how to distribute these costs equitably across the population.
Will society simply muddle along in a reactive, business-as-usual fashion? Or will it proactively pursue technically sound and politically realistic social, economic, and technical options, capable of substantially reducing adaptation costs? We do not advocate a fruitless search for utopia. However, we do recommend efforts designed to identify politically realistic incremental changes which could yield substantial benefits -- a kind of "enhanced muddling"--to increase the efficiency, effectiveness, and equity of adaptation efforts.2
THE CALIFORNIA DROUGHT CASE STUDY
While the regional impacts of greenhouse warming are highly uncertain, several scholars have suggested that drought is a likely impact in the Western U.S. Weatherford, for instance, suggests that greenhouse warming may reduce average annual runoff in the Colorado River Basin by 30 percent.3 If this occurs, California and the rest of the arid West will encounter problems which are similar to, but more serious than, those associated with the current California drought.
The current drought is exemplary in several ways. First, the drought is a large-scale event affecting enough people to populate a respectably large country with the economic might, socio-cultural diversity, and jurisdictional complexity to match. Second, the drought has diminished availability of a critically-needed resource which people have come to regard as their personal property. Third, the drought is exposing deep inequities in existing water resource allocation mechanisms. Fourth, the drought's effects are widely dispersed across time and place. Last, an enormous array of interest groups are actively involved in the search for solutions to issues which are highly emotional, technically complex, and highly uncertain. In these ways and others, the current California drought is similar (but not identical) to other water resource problems which are likely to arise repeatedly in the environmentally sensitive arid West.
Our case study was completed in 1991, the first year the drought's impact was really recognized. While March 1991 was the wettest month in California history, the reservoirs in central California were still two million acre feet lower than they were at the same time the previous year.4 (Two million acre feet is enough to supply the normal needs of ten million people.) This made 1991 the most difficult drought year yet encountered, with the Central Valley Project and the State Water Project undertaking the most severe supply reductions in their histories.5 (Before 1991, California's water managers had avoided the problem by drawing down the state's enormous reservoirs.)
As this paper is being completed in February 1992, half way through the 1991-92 rainy season, the drought persists, threatening even more serious adaptation problems in the year(s) ahead. On February 15, 1992, the Associated Press reported that for the first time in its 50-year history the Bureau of Reclamation's Central Valley Project has had to eliminate water supplies to some customers. The cutoff will affect about 7,000 farms covering one million acres, 1/9 of California's agricultural land. The article also reported that more than halfway through 1991-92 rainy season the northern California snowpack, which supplies much of the state's water remained at 60% below normal.3 Thus 1992 will likely be a sixth continuous year of drought in California.
THE LIMITS OF ADAPTATION
In order to understand the potential difficulties associated with drought adaptation, it is useful to divide the history of water resource development in the arid West (including California) into two distinct epochs. These correspond to Kenneth Boulding's distinction between Cowboy Earth (i.e., the Frontier Era), which was characterized by apparently limitless resources, and Spaceship Earth in which resources are highly limited.
Limitless Cowboy (Frontier) Water
Boulding's Cowboy Earth was characterized by the limitless unclaimed resources of the frontier which individual citizens were free to appropriate for private use. In California, the Frontier Water Era went through two distinct but overlapping phases: Riparian Rights/ Prior Appropriation and Subsidized Water Development. In each of these phases, divisive and politically dangerous zero-sum conflicts, in which oldtimers would be asked to give up some of their water for newcomers, were limited. Instead, newcomers (or oldtimers who needed more water) simply claimed unclaimed water from the frontier's dwindling commons.
Riparian Rights/Prior Appropriation
As white settlers began moving to California, they quickly found that water simply did not fall from the sky whenever and wherever it was needed. The successful settlement of California, therefore, required facilities for collecting water during times of surplus--the winter rainy season, spring snowmelt, and occasional wet years. The stored water could then be used in times of scarcity--the summer dry season and the inevitable drought years. In addition to storage, facilities were required for transporting water from streams and reservoirs to places where it could be used for agriculture, mining, industry, and urban development.
Initially there was plenty of water to go around, provided one was able to afford the necessary storage and diversion projects. The right to use water was allocated on something of a first-come-first-serve basis under either the rules governing riparian water rights or the doctrine of prior appropriation. Under these systems newcomers (who could afford it) were able to claim any unused water.
In some cases, the right to use water was obtained under the Riparian doctrine. Here stream-side landowners were allowed to share jointly and equally in the use of a stream's water by diverting it for agriculture and other purposes. As long as there was enough unclaimed riparian land to go around, this system was able to provide people with the water they needed. This assumed, of course, that the water could effectively be used on streamside lands.
The situation was dramatically complicated by the fact that water was often needed in places not adjacent to the state's relatively few significant streams. For example, water was needed for mining operations located, of necessity, next to ore deposits and not streams. In these cases water was allocated under a different and competing first-come-first-serve system--the doctrine of prior appropriation. This approach to resolving who-gets-what water conflicts closely paralleled the system used to determine who was entitled to the state's mineral sources. Here all you had to do was formally claim the resource and then start taking the steps needed to develop it. Newcomers were welcome. They simply had to get their water (or mineral deposits) somewhere else which usually meant paying more for diversion and storage structures.
As the stream-side riparian lands were taken, prospective farmers needing irrigation water found themselves left out of the riparian system. Not surprisingly, they too began to invoke the doctrine of prior appropriation because it provided a legal basis for diverting water far away from streams. This approach was also taken by the state's rapidly growing cities.
Since the two systems appropriated water in two radically different ways, it is not surprising that they quickly came into conflict with one another. This was a situation, which, not infrequently, erupted into shooting wars. In California demands for the resolution of this problem led to the establishment of the State Water Resources Control Board which, based upon both legislation and court action, effectively administered a merger of the two systems. While still retaining much of the system's first-come-first-serve character, the Control Board also established a hierarchy of beneficial uses (municipal then agricultural then industrial).
The resulting system progressively privatized the water resource commons. It also created a priority system which would decide who would actually get the water in the event that claims exceeded supplies. In general owners of riparian lands had a high-priority claim on limited supplies as did holders of older rights granted under the doctrine of prior appropriation. Here, in the event of a drought, more senior water rights holders would get all of their water before more junior users got any.
This privatization approach only governed water that people wanted badly enough to develop themselves. Everything else remained part of the public commons. This included undeveloped water supplies which also played a critical but largely unrecognized role in protecting water quality and providing wildlife habitat. This approach contrasts with a more highly centralized option (which was not adopted) in which the government would award water rights to those who could put the water to the highest and best uses. This approach, advocated by John Wesley Powell of the U.S. Geological Survey, among others, would probably have been more efficient and more equitable.6 It would also have been much more politically difficult, as severe conflicts frequently developed over what was meant by "highest and best use." Further conflicts were also likely when a new user would propose a higher or better use than an established user. Given these difficulties, the system of riparian rights and prior appropriation was a more workable alternative, at least from a dispute resolution (or political) perspective.
Despite its many problems, this phase of California water development still represents the "good old days" when the seemingly limitless water of the frontier was distributed to settlers in one gigantic giveaway. By-in-large, there was enough water available at affordable prices during this period to fill most people's needs. In other words, newcomers could obtain supplies without having to take them from oldtimers.
Government Subsidized Water Projects
Once all the cheaper sources of water were appropriated, newcomers couldn't afford the major projects that were required to bring unappropriated water to where it was needed. They then turned to the government to finance a series of massive public works projects which made further settlement of the arid West possible. These included municipal projects, such as San Francisco's Hetch Hetchy Reservoir and the Los Angeles/Owens Valley Aqueduct, the U.S. Bureau of Reclamation's Colorado River and Central Valley Projects (CVP) as well as California's own State Water Project (SWP).
These projects complicated California's implementation of the principle of prior appropriation. In general, water rights were held by the big government water projects and not by individual water users. Water is distributed under contract to water districts who then re-distributed it to final agricultural, municipal, or industrial users. The combination of the project's appropriative rights together with the specific language of individual contracts determines distribution priorities. In general, these priorities still adhere to basic first-in-time, first-in-right principles. For example, holders of riparian water rights predating the Central Valley Project were able to negotiate and receive extremely favorable CVP contracts which have made them the last to feel the effects of the drought. For multiple contracts granted at the same time, other prioritization criteria are used. For example, the State Water Project is supposed to give priority to municipal and industrial users (over agricultural users) in times of shortage.7 8
Although these projects were supposed to be self-supporting, the rules governing distribution of the water gave users numerous subsidies, so that water was made available to users at prices far below its actual cost. This, too, was a great way to resolve conflicts. Settlement of the West then proceeded again with everyone getting all of the water they needed. No one yet had to confront the dreaded zero-sum conflict where water could only be obtained by taking it from someone else.
The only losers in this system were taxpayers, the environment (which had yet to be discovered), people whose homes were turned into reservoirs, and those who preferred stream-based over lake-based recreational activities. The winners, in addition to the users of the water, were those who enjoyed the many reservoirs created in an area almost totally devoid of natural lakes, the people who bought and ate the food that was produced with the subsidized water, and the large corporate farms, which generally received better deals that the smaller family farms.
Throughout this era, however, the losers lost relatively quietly. Conflict was minimal as water did not appear to be in short supply and funds were available to get it as needed. Environmental concerns were still largely undervalued (if they were recognized at all) and the political system enabled powerful lawmakers to push through projects with little opposition. These conditions changed, however, in the era of Spaceship Earth.
Limited (Spaceship) Water
The frontier approach began to run into trouble as the California population grew to the point that water actually began to run out. While some unappropriated water may still be technically available, it is harder and harder to reach. The cost of massive long-distance diversion projects required to move distant, unappropriated water, is rapidly becoming prohibitive--especially in this era of limited government budgets.
In addition, people have recently discovered that while water may be unappropriated, it is not unused. What had previously been considered unused water was actually essential to replenish underground aquifers and to support wildlife populations upon which the fishery and tourism industries depend. Beyond this, people discovered that free flowing streams were a major source of recreation. Further, existing water supply systems were adversely affecting water quality, which depends on dilution of pollutants by high stream-flows. Cropland was being destroyed by increased salinity, while humans and other animals were being placed at risk from a broad range of toxic chemicals stemming from the buildup of pesticides.
Thus the systems of riparian allocation, prior appropriation, and large subsidized water projects, which were developed largely as methods to avoid conflict, are now becoming sources of conflict between large numbers of competing users. The age of limited water has transformed the central, "who-gets-what" conflict into a zero-sum dispute in which the only way to obtain more water for private use, or to protect the commons, is to take it from somebody else. Gary Weatherford's phrase for this transition is the "multiple purpose crunch," which is caused when water resources are not expanding while there is increased demand for traditional consumptive and hydropower uses as well as new demands for nonconsumptive uses and instream values.3 Climate change may further transform the situation into a negative sum dispute, in which everyone has to make do with less water.
Further conflicts are caused by the increasing inequity of the system which is both cumulative and hereditary. The system is cumulative in that each allocation approach supplements, rather than replaces, the earlier approach(es). Thus, big government projects supplement the system of prior appropriation, which supplemented the riparian system of allocation. Now all of these operate simultaneously to determine water allocation priorities. The system is hereditary in that the priorities are, with certain restrictions, passed down from one generation to the next. The result is that the earliest water rights are more secure and the water, by and large, is cheaper. (Price differences range from $2.00 to $2,000 per acre-foot!)9 As such price and supply disparities continue to escalate, the continuation of this first-come-first-served favoritism becomes increasingly hard to justify. Justification is also difficult when more than a century divides those who established the initial favored right from those who now enjoy it. Why should one class of newcomer be more favored than another? It is also hard to justify continued reliance on first-come-first-serve principles when new research is establishing that historical practices are damaging commonly held environmental resources.
As society struggles to deal with the current generation of water resource problems, these equity issues are becoming increasingly prominent. The additional strain posed by the drought has raised them to the point where they now constitute one of the state's top political priorities. The key to adapting to reduced supplies with a minimum of adverse impacts and destructive conflict lies in modifying the existing systems to make them more equitable.
Put another way, the existing prioritization system is confronting the era of limited water with far too many institutional mechanisms left over from the days of seemingly limitless water. If not corrected soon, these institutional mismatches will limit the ability of the region to adapt effectively to the current drought and to future greenhouse-induced water shortfalls.
A number of additional factors make the resolution of these limited water conflicts especially difficult. These include:
Differential Geographic and Temporal Impact Distribution
Specific actions affect the environment in a variety of ways, with some individuals or groups emerging as winners and others, losers. If everyone had to suffer from (or enjoy) the full consequences of their actions, then there would be a very strong incentive to quickly curtail environmentally damaging activities. Unfortunately, the impacts of particular activities are often distributed over wide geographic areas with the persons responsible for an activity usually benefitting, while people elsewhere are forced to suffer negative effects. This creates a strong incentive for damaging behaviors. Environmental impacts also can be maldistributed over time with short-term benefits incurring enormous long-term costs. Because of the frequent human bias toward immediate gratification, and the fact that future generations aren't around to complain, actions that are destructive over the long term are frequently undertaken because they have near-term benefits.
High Stakes "Have" to "Have-Not" Conflicts
There is no absolute standard for setting environmental priorities. Instead, environmental priorities and values are continually evolving. Changing values can make past policies, designed to achieve outdated values, part of the problem instead of part of the solution. This has led society to try to prohibit activities that were previously regarded as acceptable. For instance, American society now puts a much higher value on the protection of wildlife habitat than it used to. While full diversion of water from a stream used to be permitted, it is no longer acceptable.
The effect of this value change can be to change "haves" into "have-nots" by denying them previously recognized rights. This produces much higher-stakes conflicts, since people are likely to fight harder to keep what they have and depend on than they will to get something new. (This is because newcomers can always go to some other place, but oldtimers have much more at stake.) Legal principles that protect individuals from ex post facto laws and guarantee compensation when private property is taken for public use can make policy changes regarding appropriate water use even more difficult.
Short-Term Transition vs. Long-Term Sustainability
Short-term transitional costs can make the shift away from damaging environmental practices to less damaging alternatives offering long-term benefits quite difficult. For example, communities supported by clearly wasteful irrigation practices face unemployment, bankruptcy, and collapse if these practices are abandoned. Still, if communities can be helped through the transition to a more sustainable lifestyle, then everyone can benefit over the long term.
Perceived Inequitable Allocation of Sacrifice
Resource allocation works best in periods of surplus. When there is enough to go around, people don't complain as much. However, when shortages such as droughts arise, and some people are forced to do without, previously unrecognized inequities in procedures for allocating sacrifice become apparent. In addition to producing inequitable results, serious inequities also produce animosity and conflict. This undermines popular confidence in environmental problem-solving processes, contributes to escalation and polarization, and makes problem solving even more difficult.
Full Interest Group Participation
Legal changes in the environmental policy making processes have opened the door for active and effective participation by the full range of affected interest groups. This has led to much broader public involvement in the process as individuals and groups seek either to promote changes in existing policies or defend those policies from changes advocated by others. No longer is it possible for a few powerful people to force through a new project. Now any project or policy change is subjected to scrutiny and approval of a multitude of differing interest groups, many of whom are likely to disagree on the value of any proposal. This makes decision making very slow and difficult.
Delay-Default
In cases where environmental conflicts lead to stalemate, the result is not neutral inaction, but the continuation of business-as-usual practices--which might well be one of the least desirable alternatives. This delay-default syndrome is further complicated because defenders of the status quo can often prevail through a deliberate strategy of delay. This strategy relieves them from the burden of persuading others of the merits of their position.
Large Scale
Our increasingly sophisticated understanding of complex environmental interactions has revealed that most environmental problems involve very broad geographic areas. This means that a large number political and legal jurisdictions, as well as interest groups, are likely to become involved in the process. The result is an extremely unwieldy large scale decision making process.
Emotional, Escalated Interpersonal Conflict
There is more to environmental conflict than substantive issues. The reciprocal dynamics of escalation and polarization act to amplify disputes through a positive feedback processes. At times, these process become central, so much so that intergroup and interpersonal hostility overshadow the original substantive issues. Escalation causes issues that were fairly narrowly defined to get broader and broader, annoyance becomes deep frustration, then hostility, then overt hate. Polarization forces parties to take sides, further escalating the conflict and limiting resolution potential. The end result is a much more complicated dispute where the parties cannot work out problems that might have been solved fairly readily before the conflict escalated.
Technical Complexity and Uncertainty
Technical complexity and high levels of uncertainty associated with large-scale environmental conflicts also make resolution difficult. If society is to respond in time to avoid serious adverse impacts, we must act proactively before those impacts actually occur. If we pursue the more common, reactive (crisis planning) approach, we may be unable to avoid substantial damage.
The problem with proactive response, however, is that it requires society to undertake expensive adjustments based upon partial and highly uncertain information. Furthermore, the need for these expensive changes is unlikely to be evident to most observers. It is only through careful scientific measurements and complex analyses that the problems are revealed, and even then considerable scientific disagreement is likely to exist. This places a further requirement upon scientific studies -- they must be understandable and credible, and must deal with the uncertainties in an understandable way.
THE CALIFORNIA DROUGHT RESPONSE
Right now, California is facing the drought with a water allocation system developed in the cowboy era. As pointed out earlier by MacDonnell, this system has worked, but, we would argue, it has not worked as well as it might.7 Hard choices are being made that set priorities through which allocation conflicts are being resolved. Environmental, municipal, industrial, and agricultural priorities are being balanced, though unevenly. Priority is being given to hardship cases, but the number of such cases will only increase as the drought goes on. Thus California is muddling through the crisis for now, but more severe problems will result if the drought does not end soon.
The current adaptation policies have failed to respond as well as they might to three broad categories of problems. These include efficient use of existing water supplies, reallocation of water to those who could use it more beneficially, and environmental protection. Existing policies, for instance, favor traditional consumptive water uses and hydropower at the expense of emerging environmental and in-stream values. Further, holders of older, more senior water rights have tended to emerge relatively unscathed, while those with more junior claims to water resources suffer. Little deference is granted to more efficient use.3
California is now in the midst of a time-consuming effort to develop the new environmental problem-solving mechanisms needed to meet the challenges of water allocation in the era of limited resources. As these mechanisms become more fully developed and implemented, the state's ability to adjust to greenhouse-induced climate changes will be improved. Meanwhile, however, the mismatch between the drought and California's cowboy-era institutions continues.
Current Problems
A few stories illustrate the problems that exist with the current system. One, agriculture consumes 80-85% of California's water, while producing only $18 billion of the state's $764 billion gross product.10 Thus, agriculture can produce hundreds of dollars of output per acre foot of water, while commerce can produce hundreds of thousands of dollars of output per acre foot.
Two, the Bureau of Reclamation's Central Valley Project supplies 20% of the state's water. Of that, 90% is sold at heavily subsidized rates to the Central Valley farmers, who, then use the water to grow highly water-intensive crops such as rice.11 One newspaper story reported how Sudan grass was being grown in the Imperial Valley using 4-6 feet of water a year (more than rice, alfalfa, or any other crop). Last year (during the drought), this crop, which is exported as cattle feed to Japan, used enough water to supply the city of San Francisco.12 Nevertheless, established priorities protect these apparently wasteful agricultural uses. Even in 1991, the California Agriculture Statistics Service estimated that only 5-10% of the state's farm land would lie fallow as a result of the drought.13
Perhaps the clearest demonstration of the inequity of the current system is that many farmers are paying less than $15 an acre foot for water, while several cities are seriously considering paying $1000 (or more) per acre-foot for converted sea water.9 In general, the greater the difference between market-based and public allocation approaches, the more any pricing system is perceived as unfair. Price differences of three orders of magnitude for the same commodity are unheard of elsewhere in the U.S. economy.
There are even gross inequities within the agricultural sector. For example, in March 1991, the Federal Bureau of Reclamation planned to provide farms with 75% of their water if they had had riparian rights on CVP rivers at the time that Central Valley Projects (CVP) was built in the 1930s. Other Project users would get only 25% of their allocation.14 While this is certainly correct from a legal perspective, it raises serious conflicts within the agricultural community.
Another problem is that different communities are faced with dramatically different water conservation demands. This causes many people to feel that they are being unfairly treated. Arguments can be made that conservation goals should be adjusted for family size, local climate (cool coastal or hot inland), yard and garden size, local groundwater conditions, length of residence, investment in water supply and/or conservation systems, etc. Meanwhile penalties for failing to achieve conservation goals, it has been argued, should be adjusted according to the wealth of the violator.
Difficult and contentious trade-offs are associated with every option. For example, it seems absurd to grow rice in standing water in a hot, dry environment. It seems even more absurd when, even with subsidized water, it costs growers ten cents a pound to produce rice, which is valued on the world market at three cents a pound. (The difference is made up with farm price supports.) Still, there are some hardpan soils in the Sacramento valley which cannot, apparently, raise any other crop. If these farms were phased out, nearby towns and poor farm workers would be especially hard hit. Further, the rice fields constitute an important habitat for migrating water fowl.
These problems make it almost impossible to create a system which will be widely regarded as equitable. As long as the system is able to successfully supply everyone with the water, its beneficiaries are reluctant to question the gross inequities. Once the system fails, however, everyone has different needs and values which demand contradictory solutions for which they seek support.12 Another view of the inadequacies of the existing system comes from Senator Bradley (D-NJ) author of the Central Valley Project Improvement Act:
The Bureau [of Reclamation] has failed to acknowledge any concerns other than agri-business' desire for cheap water and has impeded efforts to protect salmon, steel-head, migratory water fowl, and other fish and wildlife damage in the Central Valley Project. Right now, the Central Valley Project is part of the problem in the drought crisis. Given the generous tax-payer subsidies, lavished on water project users, it is essential that we hold those users to the highest standards of environmental protection, economic sense, and water management. They must at least be held to the same standards [as] water users who buy from the state or local agencies."11
The institutional inertia within the Bureau and the forty-year contracts granted by Central Valley Project have not given the Bureau the ability to respond to changing conditions. (Even worse, many State Water Project contracts are for 75 years.) These institutional lags trace back to the day when agriculture was the state's single biggest enterprise. Today, conditions have changed dramatically. However, these changes are just starting to be manifested in changing water resource allocation processes.
The remaining sections of this paper explain the dynamics which limit adaptation potential and the sources of opposition to efforts to control these dynamics. The paper concludes by discussing conflict resolution strategies which will be needed to overcome this opposition.
OBSTACLES TO DROUGHT ADAPTATION
Adapting to drought, or greenhouse warming, is a two-level process. At the first (policy) level, general decisions are made which determine how individual, case-specific allocation decisions will be made. It is at the policy level that rules governing water markets, subsidies, disaster assistance, the protection of endangered species, and water quality protection are made. These policies are then used on the second, case-by-case, basis to determine the quantity of water allocated to individual users and the conditions placed upon the use of that water.
The transition from frontier to spaceship planning is fundamentally a policy level problem. Current institutional structures must be changed to achieve (or more effectively achieve) the objectives listed below.
CHANGES NEEDED FOR A VIABLE SPACESHIP EARTH WATER ALLOCATION SYSTEM
×Strengthen incentives for voluntary conservation,
×Eliminate conservation disincentives
×Penalize waste,
×Revise the traditional rights and duties of water users,
×Establish new obligations to make more efficient use of water,
×Institute market-based reallocation programs,
×Establish new obligations for environmental protection,
×Protect or, at times, phase out agricultural production,
×Integrate ground and surface water management policies,
×Establish large and more efficient mutual assistance pools,
×Determine what government subsidies are and are not appropriate,
×Provide financial assistance to victims of drought or greenhouse warming,
×Control and distribute population growth,
×Deal with risk and uncertainty,
×Balance present and future needs,
×Develop more proactive responses to environmental challenges, and
×Establish emergency procedures which equitably balance interests while making quick decisions in times of crisis.
The ability of California to effectively adapt to water supply problems in ways which limit adverse impacts will be determined by their ability to meet the above goals. Unfortunately however, any efforts to make such changes are likely to encounter strong opposition, especially from those who benefit from the current grossly inequitable system. A discussion of possible adaptation measures and likely obstacles to implementing such measures follows below.
Voluntary Conservation
One adaptation measure for resolving water allocation conflicts in times of drought is to ask people to voluntarily reduce their water use. Such requests appeal to one's sense of civic duty, rather than economic or legal threat. To the extent that such requests are effective, they are politically preferable to methods which force people to change their behavior unwillingly. However if people really need the water badly to maintain a lifestyle, or will be economically hurt by cutting back, mandatory conservation requirements will likely be more successful in obtaining needed cutbacks than voluntary measures.
One important aspect of a voluntary conservation program is the establishment of a more conservation-oriented ethic of water use within the general population. This might be accomplished through a widespread public eduction program which explains the advantages of conservation and what benefits are derived from the salvaged water. However, the success of such appeals for voluntary action depend on the credibility of guarantees that any salvaged water would indeed contribute to the general welfare.
California has relied heavily on voluntary water-use reduction as a primary response to the drought. The state's adaptation potential, therefore, is largely determined by the willingness of users to voluntarily reduce their water use. The surprising success of drought-related water conservation efforts documented by Lloyd Burton8 suggests that substantial changes in public consumption patterns are, indeed, possible. But, as Burton observes, the public's patience is not endless. Several factors are necessary to establish--and to maintain--voluntary household conservation. Absence of these factors are obstacles to successful voluntary conservation programs. Obstacles include:
Absence of a Clearly Established Need
The need for sacrifice must be clearly established if voluntary conservation is to be successful. The long term nature of drought and the relative unimportance of individual rain storms can make this difficult. For example, the Los Angeles Times reports that efforts to obtain voluntary compliance with long-term conservation efforts were undermined by short-term events such as the March 1991 rains. Many citizens (and government officials) assumed these rains eliminated the drought (and the need to conserve) without realizing what little long-term effect the rains really had.15 This is an area where effective education is extremely important.
The Yo-Yo Effect
Water officials are reluctant to keep changing water use targets in response to rains such as those that occurred in March 1991. According to one, "What we don't want to do is yo-yo the public. The public is responding very well in doing what the water people have asked them to do and we don't want to discourage that."16 However, if you don't make adjustments to conservation requests when conditions warrant, you may undermine the public perception that conservation is really necessary. Compliance may then be significantly reduced.
The Free-Rider Problem
Efforts to persuade citizens to make voluntary sacrifices in order to conserve water are continually threatened by the free rider problem--in which some people rely on others to do their work (i.e., "get a free ride"). There is a great temptation to let others conserve, while you sit back and enjoy the benefits of high consumption. The ease of such free-riding makes voluntary action unstable and public perceptions of fairness extremely important.
Conservation Disincentives
Since the motivation behind voluntary conservation tends to be weak, people are likely to stop conserving if it costs them money. They assume that if they use less water, at least their water bill should be lower. But in California, the opposite has occurred. In many cases, consumers have cut back water use so much that the providers have had to raise rates to cover their operating and capital costs. For example, the Los Angeles Department of Water and Power (DWP) is in financial difficulty because people conserved twice as much water as the Department wanted -- 30% instead of 15%. "It has been a superb response, a magnificent display of public spirit" said Jerry Gewe, Manager of Water Resource Planning. But the cutback left the DWP with a $24 million shortfall in water revenues,17 which could not be made up by passing the costs on to consumers without undermining voluntary support. One cannot expect voluntary conservation to work if it only yields higher water bills.15
This problem can be avoided by restructuring utility rates to provide a reserve fund to recover diminished income during times of drought. Opposition to such a change can be expected, however, as this requires overcharging on the basis of highly uncertain drought predictions. According to several studies of consumers' willingness to pay, consumers would be willing to deal with more frequent and severe water shortages provided that they get to keep the money saved by reduced water storage demands.9 This provides a basis for reducing costs by reducing the amount of water that cities store in expensive and perhaps unwanted dry-year insurance pools. In view of the severity of this drought and the prospect of more serious climate changes in the future, however, this option may not be wise, even if it is favored by the general public.
While voluntary conservation can work well, as demonstrated in California in 1991, it has limitations in cases where high water use really is needed, or when it is tied to economic gain. In these cases, mandatory, rather than voluntary conservation may be necessary.
Mandatory Conservation: Waste Penalties
Another adaptation measure that goes beyond voluntary conservation is mandatory conservation, with established penalties for those who fail to reduce demand. One common approach is to establish an inverted block rate structure which puts a surcharge on water bills that fail to show the required level of conservation. This can be done by a computer and nobody escapes. However, this approach raises an obvious equity problem -- the rich can simply pay up and not worry about conserving. Penalties such as service reductions or cutoffs can avoid this problem, but are seen by some as too severe.
Another approach taken in some California communities are "drought cops." Citizens are asked to phone in tips to these special police, who will then respond to the location, search for clear evidence of wasteful water use, and, if appropriate, issue citations. The program not only makes effective enforcement possible with a limited budget, it also provides a mechanism for combating the free-rider problem by giving citizens who feel that they are sacrificing when others are not a clear path of action other than deciding that the rules are meaningless and then reverting to wasteful behavior themselves.18
For mandatory conservation to work, however, there must be some credible enforcement mechanism. Otherwise, people will observe violators and decide that there is no reason why they shouldn't violate the requirement as well. The result can be a collapse of credibility, which is far more important than water lost to a few violators.
Nevertheless, it remains politically difficult to establish and implement waste penalties without incurring opposition from those who feel threatened.8 The legal authority of some districts to implement an inverted rate structure is also open to question. However, unless incentives for voluntary conservation are strong, effective, and long-lasting, some politically acceptable and practically enforceable penalty for waste is necessary for successful drought adaptation.
Revising Water User Rights and Duties
A third adaptation measure involves the revision of basic water users rights and duties. In California, water access is not an absolute property right. Rather, it is usually a combination of a conditional right and a long-term contract through which users are granted the right to use specific quantities of water under certain conditions (often including modest compensation to subsidized governmental suppliers).8 7 The principal problem California now faces is that most of this access was granted in the age of limitless water. The system has serious shortcomings in the "spaceship era" of limited water and even more serious problems under conditions of drought.
The long-term nature of these access rights limits the flexibility that the system needs to respond to changing conditions. This raises two key questions. First, under what conditions is it legally possible to impose mandatory changes on existing conditions of water use? Second, under what circumstances do these changes require compensation as a "taking" under the principle of eminent domain?
The answers to these questions will impose significant constraints on the ability of California to adapt to greenhouse warming. Unfortunately the answers to these issues are nowhere on the horizon. One can expect a protracted period of intense conflict instead.
Efficient Use Obligations
Technically, California limits a person's access to water resources to the amount that can be beneficially used. Waste is supposedly not protected. Traditionally, however, beneficial use standards have been extremely lax, encouraging a "use it or lose it" mentality which often translates into "waste or lose it." One of the least costly strategies for adapting to water shortages involves the transfer of this "wasted" water to other uses. This can be achieved by tightening the beneficial use requirement and then, if the water continues to be wasted, redistributing it to others who will use it more efficiently. But this approach is certain to provoke intense conflict over what the new standards should be. Those hurt are also likely to claim that the new standard constitutes a "taking" requiring compensation. (An alternative approach which would allow water users to sell excess water; this is discussed below.)
For the agricultural sector, beneficial use requirements could set minimal efficiency standards based on acceptable irrigation technologies or flat limits on the amount of water per year per acre. (Burton's paper discusses alternative approaches used by different water districts.)8 Such approaches are likely to encounter opposition based on short-term costs associated with the transition. In general, the solution to this problem is likely to involve the establishment of mechanisms for the long-term repayment of transition costs through diminished water bills. The absence of established and trusted mechanisms for assisting farmers through this transition period is likely to be another adaptation constraint. Additional controversy can be expected over who bears the financial risk associated with such investments and what, if any, subsidies should be offered as additional incentives.
Market-Based Reallocation
Another approach to reallocation is the market, in which holders of surplus water sell it to those who have a greater need for it and hence, who are willing to pay extra for it. This is being done a bit in California, through the recently instituted Water Bank. However, the constraints on its use are such that it has not been very effective. Unlike land, the water in the West has never been truly privatized. Water is the property of the State and its people. Individuals hold only the right to use it. The ability to exchange it with others who may be able to use it more profitably is sharply limited in time (during this drought, transfers have usually been limited to one year), in place (transfers outside of a particular river basin or water district are often prohibited), and in use (transfers from agricultural to municipal or industrial uses are also often limited). Limits are often also placed upon the prices at which water can be bought and sold. These limitations have curtailed traditional market dynamics, causing enormous price differentials between users. In addition, the constraints on free trade largely eliminates a principal mechanism through which mutually agreeable redistributions of water could be negotiated and financial incentives could be mobilized for adopting efficient water conservation measures.
While freer exchange mechanisms are being considered, severe conflicts have developed over four primary issues. Conflict revolves around four primary issues: windfall profits, protection of agricultural communities and family farms, the need to assure access to water for the less wealthy, and problems in representing the environment in any market. Each of these issues presents a significant obstacle to effective adaptation.
Windfall Profits
Current water prices in California range from about $2.00/acre foot (for heavily subsidized agricultural water) to about $2,000.00/acre foot for some municipal water. If agricultural users became more efficient, they could conceivably conserve a substantial amount of water, which they could then sell to municipalities at a much higher rate, thereby making a "windfall profit" While such market mechanisms would, most probably, redistribute water from areas of waste to areas of need, intense conflicts can be expected as resource managers attempt to determine the price at which a necessary incentive turns into an unacceptable windfall profit.
Agricultural Community Protection
Market dynamics also would tend to favor those with water to sell or those who want to buy. Others, including farm workers and local agricultural communities, for example, are likely to be unrepresented and unprotected in any transaction. If farmers sell their water (and hence their farming capability) for a huge profit, those who worked on the farm or in property support businesses in the community would get nothing but unemployment as a reward.
Wealth-Based Allocation
As one of the most fundamental necessities of life, many believe that water should not be allocated on the basis of wealth. If market mechanisms alone set the price of water, it could easily get too expensive for poorer citizens. Successful use of market mechanisms will require some mechanism to assure all citizens at least a certain amount of "affordable" water.
Market Representation of the Environment
Market-based allocation mechanisms tend, by definition, to move water toward money. This moves water away from uses that are not defended by advocates with deep pockets--which usually includes the environment. Institutions charged with environmental protection do not now have the financial resources needed to obtain water through market mechanisms. These resources either need to be found, or a non-market based component of the allocation system is required. Intense controversy can be expected over the nature of any hybrid system or size and sources of any environmental protection fund.
Thus far no one has really figured out how to overcome these obstacles. As a result, efforts to use market-based solutions have been sharply limited. The California Water Bank established during the current drought represents a first major step toward permitting the free exchange of water. Unfortunately, both the buying ($125) and selling prices ($175) were fixed in ways which do not permit them to respond to changing water supply projections. This makes it almost inevitable that supply will not equal demand. As Tom Clark of Bakersville said, "When we went into this thing everyone was fearing that we wouldn't have nearly enough bank water to fulfill demand, while the opposite has happened." Not only is the equilibrium price uncertain, it is also unclear whether or not those in need of water can afford to pay for it. This is especially true for environmental protection. A different approach offered by the Bradley bill would use a 25% tax on water transfers for environmental protection. According to the Los Angeles Times, while the tax may be too steep, it is a concept that can work.19
Theoretically, if water were to be given realistic market price, then the market should also create a variety of products designed to help people do what they need to with more limited supplies. For example a number of more drought tolerant crops such as kanola, buffalo gourde, guayule, or tepary beans might be grown to replace water-demanding crops such as rice. Another example is sweet sorghum which uses one-third the water and one-half the fertilizer of corn, yet yields almost as twice as much ethanol per acre. It also makes animal feed with half the water as alfalfa. But change is difficult, and is not undertaken eagerly.
If the obstacles to market-based allocation can be overcome, market mechanisms offer a solution to many adaptation problems which can leave all parties substantially better off. Conversely, the current lack of agreement on these issues sharply limits adaptation potential.
Environmental Obligations
Adaptation efforts are certain to encounter strong opposition if they do not respond in ways that protect a broad range of environmental interests, including recreation, water quality, and wildlife. Unless these issues can be substantially resolved, there is a high likelihood that efforts to go beyond current, business-as-usual, adaptation responses will encounter paralytic opposition.
Under concepts like the public trust doctrine, California is reassessing the obligations which all water users have to protect environmental values. For example, under this doctrine, the Metropolitan Water District has been ordered to sharply curtail diversions from the Mono Lake basin in order to protect the areas' fragile environment. Areas of debate include the following.
Wildlife Protection
Access to California's water has been granted, until relatively recently, without much consideration of the impacts on wildlife. Even those species of commercial value (for tourism or fisheries) have gone unprotected, as have threatened and endangered species, until recent years. As a result of growing awareness and changing public values, California has been reevaluating these issues in recent years, and under the public trust doctrine, has been retroactively changing traditional water access rights. Not surprisingly, this ongoing process is bitterly contested and will take many years before the disputes are resolved.
Water Quality
Dilution processes make water quality a direct function of water quantity and stream flows. Risk to human health and the health of the natural environment increases as water is used and reused and diverted in ways that limit natural stream flows. Again, California is in the midst of a long and highly contested process of determining the obligations existing water users have for improving water quality, and whether these obligations should require them to decrease the demands that they are currently placing on the system. This process involves setting acceptable levels of mortal risk to humans--a topic certain to be highly emotional and a major flash point should greenhouse warming lead to a permanent drop in overall stream flows.
Recreation
The public continues to place increased value on non-consumptive, instream, recreational uses of water for fishing, boating, etc. Again, traditional, frontier water allocation mechanisms provide no effective mechanism for providing water for these purposes. The establishment of mechanisms for allocating water for stream recreation is closely associated with water quality and wildlife protection debates and remains likewise unresolved.
Agricultural Community Protection and Phase-Out
Perhaps the most difficult adaptation problem involves the temporary or permanent end to the cultivation of some crops in dry areas. While such adaptations might be highly desirable from a societal perspective, they are also likely to devastate local communities. This situation resembles many of other changes sweeping the United States' economy which are requiring workers to begin new careers and, in general, to dramatically alter their way of life. While it would be wonderful to say that these changes are not necessary, the fact is that they are. While proceeds from water sales might effectively protect farm owners from financial ruin, they would provide little, if any, protection to the local businesses and the often impoverished farm workers who are likely to be totally dependent upon agriculture.
If our society is to successfully adapt, it must find ways to help people, including some irrigation farmers and farm workers, through these very difficult transitions in ways which preserve their quality of life and their productive potential. Points of debate are likely to include measures such as percent of area caps on temporary land fallowing during dry years. This will require very difficult equity decisions which balance the priorities of large corporate farms with those of the traditional family farmer. For example, the new water bill would strengthen the 1982 restriction barring farms of 960 acres or more from receiving government water.
Groundwater Management
Another adaptation measure which has been used extensively in this drought period is the pumping of groundwater to replace diminished surface water supplies as needed. The groundwater resources of California and the rest of the West are enormous, providing about 40% of the state's water annually. It would seem only natural that any effort to deal with water resource supply problems would fully integrate ground and surface water management strategies. In California, this is seldom done.
The mechanisms for groundwater allocation in California are dramatically different from those used for surface water. In many cases, the right to unlimited groundwater pumping is a property right. If you own the land you can pump all the water you want--even if your consumption dramatically exceeds the rate at which the aquifer is replenished. You can even pump water fast enough to cause internal damage to the aquifer's geologic structure substantially lowering its long-term productive potential. In the last year, a record 10 million acre feet have been pumped -- enough to supply the needs of Los Angeles for 15 years. The Department of Water Resources, which devoted only 2% of its budget for groundwater research, has been unable to even examine the status of many groundwater basins. Groundwater depletion is also causing massive and largely unstudied subsidence problems. In short, even without the additional pressures of greenhouse warming, general neglect of the groundwater resource threatens to produce areas of overshoot and collapse as the resource is depleted.
As Burton has noted,8 there are areas, such as the Monterey Peninsula Water Management District, where groundwater overdraft problems have become evident and steps are being taken to protect it. There are, however, many more areas where this is not the case.
Mutual Assistance Pools
Drought impacts vary according to geographic location, types and seniority of water rights held, and type of use (municipal, industrial, or agricultural). Successful adaption requires the transfer of resources between areas of temporary or permanent surplus to areas of scarcity. The larger and more diverse the pool of users willing to participate in such transfers, the more likely the it is that surpluses will be available to offset scarcity. This argues for the establishment of largest possible mutual assistance pools crossing geographical, political, and legal boundaries.
There is, unfortunately, tremendous resistance to such measures based upon the fear that the potential donors may permanently lose their water rights to recipients. For example, politically powerful users may be able to argue that the fact donors have water to contribute proves that they don't really need it. In other words, they are not meeting the beneficial use requirement of their water right. While legal steps could be taken to forestall this possibility, those with a chronic need for additional water are reluctant to agree to measures that would further undermine their ability to seek permanent changes in allocation patterns.
One example of this dynamic is the intense opposition of states in the upper Colorado River Basin to interstate water banking plans described by Chuck Howe.9 Such efforts have, however, worked elsewhere, as noted by Lynn Johnson who described a similar successful program in the Potomac River Basin.20
Subsidized Water Projects
Our government has a long and honorable history of using government funds for smoothing the rough edges of our market economy. Government subsidies have enabled poorer citizens to afford things which would otherwise have been beyond their reach. While scandals in which the rich have been subsidized in the name of the poor abound, subsidies are still largely responsible for the West's flourishing agricultural areas, the nation's relatively low food prices, and, especially, the easy availability of off-season fruits and vegetables. Not surprisingly, there has always been intense conflict over who should receive subsidies and how much. It is the outcome of these disputes that will determine what adaption options are, in fact, economically feasible.
Not surprisingly, there has been an effort to resort to the tried-and-true solution of government-subsidized water projects as a way of resolving the current generation of water problems without disturbing existing water users. For instance, the drought has increased pressure to build an improved, more environmentally sensitive version of the Peripheral Canal around the Sacramento Delta, resurrecting a long and bitter environmental debate.21 Beyond this, there are a number of even more ambitious (some would say outlandish) plans being considered. These include diversions from the Pacific Northwest, desalinization of seawater, and even an undersea pipeline from Alaska.22
This time, however, the approach faces an uphill fight. Finding the money to build big, new supply projects in a state with $12.6 billion budget deficit will be extremely difficult.4 Furthermore, the lead time to build new reservoirs may be 10-20 years.19 Water conservation and transfer projects can be implemented more quickly and much less expensively.
Financial "Disaster" Relief
A radically different approach to government subsidies and drought relief does not involve the redistribution of water itself. Instead, the drought disaster could be treated in much the same way as a flood disaster. In floods, you let the water recede naturally, accept the financial consequences, and look to the government or other insurance programs to provide financial relief. According to Los Angeles Times, cotton, rice and sugar beet growers are responding to the drought in exactly this way. For example, one sugar company executive suggested that the government provide five-year low-interest loans for distressed farmers and five-year tax credits for water conservation investments. One strategy for financing such programs is based on the fact that reduced agricultural production due to the drought (or greenhouse warming) should lead to an increase in agricultural prices overall. This increase, in turn, should result in a corresponding decrease in federal price support payments. These savings could then be used for drought relief.
Growth Control
Patterns of urban and industrial growth have enormous water supply implications. Some land-use patterns simply make it more difficult to supply water. This is especially true n the urban deserts of southern California. Here the population growth debate invokes the "last settler syndrome" which leads many people to oppose new development, especially if it is near them. Limiting new water supplies is seen by many as the best way to oppose further growth. Even waste is jokingly advocated by some who sport bumper stickers saying "Flush Twice, Stop Growth!" Another example comes from the debate over bringing State Water Project water to Santa Barbara. Here the opposition is using an almost Malthusian argument -- if more water is brought in, then the population will grow to the point where there is an equally serious shortage.23 Marin County even removed a water pipeline in order to strengthen its growth control based upon water shortage policy.
Just as water may control growth, growth demands water. Therefore, it is common for communities to respond to drought by placing strict limits on new development. While this might seem an easy and obvious solution, it places severe hardship on developers, while simultaneously inflating real estate prices for everyone. This, in effect, causes "new settlers" and the more plentiful "recently grown-up children" to pay a disproportionate burden of the cost of drought.
Should these people be sent out of state? Some no-growth advocates favor the diversion of newcomers toward more ecologically sustainable areas, perhaps toward the major water supplies of northern California or even the more humid Eastern United States. However, this is likely to result in intense opposition from designated growth areas as well as opposition from prospective, new settlers who, in a free society, deeply resent being told where they can and cannot live. All of this tends to make growth redirection an unrealistic approach to the adaptation problem -- at least until water supply shortages become even more severe.
Dealing with Risk and Uncertainty
Successful adaptation requires an ability to sensibly deal with risk and uncertainty. For example, during the first four years of the drought, the State Water Project (SWP) distributed water as if there was no chance that the drought would last into a fifth or sixth year. Only in 1991, when almost all of the water was gone, did they implement severe restrictions which (as the law required) favored municipal users.5 In addition to illustrating how SWP's obligation to give municipal users priority can be subverted, this anecdote raises the difficult question of how much should be saved has a hedge against droughts (or climate change). Some organizations, such as the Environmental Defense Fund, are now complaining that water managers should have instituted water supply curtailments in the first years of the drought as part of an overall effort to avoid later, much more sudden, and severe cut-backs. They cite the fact that the first four years of the drought saw the state delivering more water to California farms and cities than in any other four year period in the state's history. According to Thomas J. Graff, senior attorney with the Environmental Defense Fund's Northern California office, "It's inaccurate to say that this [drought] is purely a function of precipitation. The severity of the crisis is simply the result of mismanagement [land] a conscious decision made by state bureaucrats."5 This statement was made in hindsight however. Planners are understandably reluctant to reduce deliveries that will force farmers to let their fields lie fallow, only to have the rainy season prove that their concerns were both expensive and unwarranted.
So far, California's drought response has been predicated on the assumption that this drought is a temporary phenomenon and the rains will return and fully replenish the reservoirs. As a result, the system is making almost no effort to adapt to a long-term reduction in water supply. This tendency to think in terms of cyclical events, rather than long-term trends, suggests that substantial delays are likely before any serious effort is made to adapt to greenhouse warming, should it occur. Planners will just assume that it is another short-term phenomenon and act accordingly.
Present-Future Balance
One way to resolve distributional conflicts involving the allocation of scarce resources is by "borrowing" or, more accurately, stealing from the future. (Stealing is a more appropriate term, since there is usually neither the intent, nor the capability to return the resources "borrowed.") Many water resource problems can be attributed to the desire of the current generation to maintain its high production/high consumption life-style, even at the expense of future generations. This is relatively easy to do, as future citizens are not present to defend themselves. Similarly, institutional mechanisms intended to protect long-term interest are usually fairly weak. Examples of failures to balance present and future interests include the slow buildup of salts and pesticide residues in agricultural areas, the depletion of and saltwater intrusion into aquifers, and the failure to protect Sacramento Delta spawning areas during the drought, leading to a long term reduction in fish populations.
Emergency Powers
The ability of adaptation measures to minimize costs corresponds to the amount of time spent assessing available options. If California's experience is any guide, many key adaptation issues will be resolved in a crisis atmosphere by officials using emergency powers to by-pass problematic decision-making procedures and interest groups. The structure of these emergency powers is critical in determining which interests are sacrificed and which protected.
One indicator of problems with the existing California system is the very large number of repeated waivers of environmental standards and review processes. Here the system shows signs of the ostrich approach to policy making. Rather than reviewing environmental concerns and making decisions which attempt to balance environmental and other priorities, the system simply, without review, removes environmental questions from consideration.38
For example, the maintenance of water quality standards in the Sacramento Delta is dependent upon maintaining minimal stream flows. Using emergency powers, these requirements have been temporarily waived repeatedly over the last several years. This is likely to result in serious permanent damage to the Delta.3
The emergency powers of the U.S. Secretary of the Interior provides a second example. In mid-March of 1991, a California Congressional Representative requested that Secretary Lujan cut Central Valley deliveries to farmers. Lujan responded by stating that he doubted that he had the power to stop delivering water to farmers who have long-standing rights to it. If, however, he finds otherwise he would "certainly look at making it more equitable."14 An emergency drought bill, which was moving quickly towards passage in mid-March 1991, gives the Interior Secretary the flexibility needed to cooperate with California officials on drought relief measures for one year. This bill would allow U.S. Government facilities to store and transfer water and participate in the state's Water Bank. It would also allow the Interior Department to buy water from "willing sellers" and sell it to buyers at a price that could cover the government's costs. This apparently allows much more pricing flexibility than the state water bank program.14 The bill also allows the Interior Department to build temporary barriers to protect drinking water supplies in the Sacramento-San Joaquin Delta from sea water encroachment.24
Thus, while emergency measures can make important contributions, it is also the critical that they provide a balanced review of all key elements. Even temporary measures, if repeated, can have significant long-term or even permanent effects.
Proactive Response
Another key to successful adaptation is to develop more proactive and less reactive allocation processes. Our political system is inherently reactive. Once a problem becomes manifest, citizens demand change and politicians respond. This is usually the only point where people are willing to make sacrifices. Adaption costs can generally be limited significantly, however, if society anticipates problems and responds earlier.
But proactive response requires enormous sacrifices to be made on the basis of technical predictions, rather than observable conditions. Given the irreducible uncertainty associated with drought and greenhouse warming, it is very hard to state with certainty what proactive measures are and are not appropriate. This is a matter about which there is intense expert disagreement.3
STRATEGIES FOR DEALING WITH THESE CONFLICTS
The ability of the arid West to adapt to greenhouse warming will be directly proportional to its ability to resolve the issues described above. Should this or a similar drought signal the onset of long term precipitation reductions, one should expect the prioritization policies and institutions in place at the time to determine how society adapts to the situation. Society's ability to overcome the obstacles to adaptation discussed above will determine the ease and cost with which adaptations are made. Strategies for overcoming opposition to necessary changes consist of three major components: effective use of technical information, control of escalation, and effective decision making procedures.
Technical Information
A decision can be no better than the best alternative on the agenda. The ability to select between more and less desirable options is limited by the quality of technical information concerning the costs and benefits of each option. According to the old saying, this technical process is about as exciting as watching the dust settle. But it is crucial to sound water management. An editorial in the Los Angeles Times rightly praised Governor Wilson for taking the time to understand the extraordinarily boring technical details of the complicated drought problem before acting and resisting the many appeals for emergency response.17
In order to be useful, technical findings must be credible. If all the parties have their own studies that say what they want to hear, then the value of technical analysis can be almost completely lost. Since efforts to improve the technical information base have enormous political implications, interest groups can be expected to fight hard for the type of technical analysis which will strengthen their position and disparage the credibility of approaches that yield unwanted results. Efforts to overcome this problem will have to be sensitive to the wide participation and social processes necessary for credibility. Sophisticated data management, analysis, and visualization techniques, such as those advocated by Reitsma and Johnson earlier in this volume, also appear useful.20 25
Wise handling of technical information is especially important because one of the most painless ways of dealing with allocation conflicts is to improve the efficiency with which the system is managed. Efficient management of the system is a complex task which is limited by the ability of decision makers to obtain and analyze enormous quantities of information. Recent advances in computer technology and decision support systems make dramatic improvements in information management possible. To the degree to which such systems are implemented, they may be able to find and eliminate unrecognized sources of Waste.20
Technical understanding is also important to sort out good from bad information. Perceptions of inequity can be based upon misinformation (or disinformation) as well as accurate information. One example of bad information being circulated was a newspaper account of a survey commissioned by an association of urban water agencies. The survey reported that one-half of the computer and office equipment companies of northern California would consider leaving the state, resulting in a loss of over 50,000 jobs. One had to read carefully to learn that this prediction assumed that people had to live indefinitely with 30% of normal supplies. All of this seemed calculated to scare the state into major new water supply projects, even though the 70% long-term cuts implied by the survey are pretty much a worst, worst, worst case scenario which would have far more serious impacts if it ever came to pass. Decision makers must have a good understanding of the technical details of various options to avoid making decisions based on bad information.
Destructive Escalation Control
Another step which can be taken to facilitate the resolution of conflict at both the policy and case specific levels involves steps to limit number and magnitude of subconflicts unrelated to the principal substantive issues under dispute. While the origins of these subconflicts are frequently clouded by "'tis/'taint" disputes over who really started what, the underlying dynamics behind these subconflicts are very familiar. Interpersonal dimensions of a conflict escalate to the point where personal hostility, not substantive disagreements, drive many aspects of the dispute. These "people problems," as Roger Fisher26 calls them, have their origins in people's differing values and priorities, which tend to encourage mutual suspicion and distrust. They are further complicated by a history of past, poorly managed conflicts where personal attacks may have hurt some of the current key players. The combination of the old and new issues can initiate an escalating cycle of misunderstanding in which the actions of one party are interpreted in a threatening or hostile way, which provokes counter threats, which beget more hostile attacks, in a never-ending cycle. Once this cycle leads to public assaults on individual egos, the damage becomes extensive and very hard to overcome.
Decision Making
Given the enormous implications of policy decisions in each of the areas discussed above, one should expect the substantive issues in dispute to constitute a major source of protracted and bitter conflict. The contending parties will have fundamentally different moral views which are not reasonably subject to compromise and tradeoff. In each case, the principal dispute will be between advocates of the status quo (usually those who benefit from the system's obvious inefficiencies and inequities) and advocates of change, which may either serve selfish interests, or the general welfare.
When one group succeeds in persuading society to adopt a particular policy, opponents are likely to launch a major repeal effort at the first promising opportunity. Thus, there is never likely to be a "final" resolution. These issues will probably always be a source of conflict. Still, policies will change and the nature of these changes will ultimately determine the costs associated with adaptation to greenhouse warming (as well as many other water resource and environmental challenges).
Many environmental conflict resolution professionals argue that all conflicts are resolvable through negotiation provided that the proper process is used. In our view, this is not correct. Negotiation of a mutually acceptable agreement is just one of the major components of the dispute handling system which can be used to determine water policies and drought responses. Other useful approaches involve the legal system which is necessary to adjudicate legal rights, and the political system, which is necessary to resolve disputes over the administration of public programs and changes in legal rights. Rather than working in opposition to each other, these three dispute resolution institutions are interlinked as a conflict management system. Some disputes are best handled in one way, others in another way. Often, the best approach uses a variety of negotiation, legal, and political approaches in sequence, seeking the most effective and least costly way of resolving each sub-issue.
In each of these three categories (negotiation, legal, and political processes), there are a variety of more and less costly ways of approaching a conflict. For example, Roger Fisher and William Ury,26 distinguish between two different approaches to negotiation -- interest-based negotiation and positional bargaining. The former, they argue, is generally less expensive and more effective.
Fisher and Ury add that people should not be expected to negotiate agreements which they find less attractive than the results they expect to obtain from a full-blown contest of legal or political power (adjusting for transaction costs). This isn't likely to be an obstacle to negotiation if all parties have similar expectations about the likely outcome of a political or legal power contest. In this case, the sensible thing to do is for everyone to negotiate an agreement that corresponds to the expected outcome, but avoids the transaction costs. Negotiation also provides a better setting for working out the details in ways which are more sensitive to individual needs. If escalation makes negotiation difficult, negotiation can be facilitated through the intervention of third parties --usually neutral mediators or occasionally arbitrators.
If, however, the parties have differing expectations about political or legal power, (or put differently, one side thinks they can do better through those mechanisms than they could through negotiation), the only way to reach agreement is to test these differing images in a legal or political power contest.
With respect to water resources in the spaceship age, it is clear that public values and the resulting distribution of social power are changing. However, there is much disagreement over what the new power relationships will be. As a result, many parties think that they can probably do better in a legal or political power contest than they could through simple negotiation. In other words, fundamental questions about each party's alternatives to a negotiated agreement need to be resolved.
Persons interested in resolving these issues need to pursue them through political or legal channels (depending on the nature of the issue), not through negotiation. This is best done sooner rather than later, so adaptation measures, whatever they are, can be initiated. Thus, power contests are part of a constructive process for setting new social priorities. Once these priorities are set, parties can revert to negotiation to iron out the details of any final policy.
The primary challenge to this multi-stage approach is to undertake the power contests in a way which eliminates as many of the destructive elements of these dispute resolution processes as possible. Parties must try to lower transaction costs, time delays, and the level of interpersonal misunderstanding, hostility, and distrust as much as possible. Parties should also structure the process so that it can revert to negotiation as quickly as possible, once the relative power distributions are established. This suggests that power disputes don't necessarily have to be carried to the bitter end. Quicker and less formal processes (such as mini-trials) for determining relative power distributions might be worth exploring. Further, many sub-conflicts may be more tractable, allowing for the quick use of negotiation without associated power contests for some, but not all, aspects of a dispute.
A prime example of the interplay between negotiation and power contests involves July 1991 events surrounding of Bill AB 2090 sponsored by Assemblyman Richard Katz (D-Sylmar). In an initial vote in the California Assembly that the Los Angeles Times likened to a thunderbolt, a coalition of legislators from northern and southern urban areas defeated the long dominant agricultural coalition. At the time our research concluded, the ultimate fate of this bill was still uncertain. Nevertheless, it had undeniably revealed a change in the state's underlying political power structure. That change, which was recognized by both agriculture and urban interests, gave everyone a relatively consistent image of the likely alternatives to a negotiated settlement. At this point, negotiations suddenly became much more attractive. Not only would they reduce transaction costs, they would also allow much more effective fine-tuning of policy changes than is possible during a brute force, adversarial, political power contest.27
California's Three-Way Process represents a promising negotiation effort based in part upon the power changes revealed by the Katz bill. This process is approaching the difficult problems by combining them into a comprehensive framework with trade-off negotiations designed to simultaneously deal with all aspects of the problem. The three-way process is designed to pursue three major objectives in dealing with California's drought problem: 1) meeting the fast-growing demand for water use in urban areas; 2) meeting legitimate irrigation needs; and 3) providing more water and better environmental conditions for fish and wildlife. Since major construction projects for achieving these goals cannot come on line before the turn of the century, the Process is concentrating upon Phase One interim measures and longer term Phase Two efforts involving major construction. The three-way process is also focusing on voluntary measures and mutually acceptable transfers as a way of avoiding conflicts which could kill the whole effort.21
Another major goal of the process is to improve the environmental conditions sufficiently to avoid the listing of new species as threatened or endangered. This causes "great problems for operators of existing projects." Again, this negotiation effort reflects environmentalists' new powers under the Endangered Species Act.21
At the policy level, Californians seem to be approaching the large scale of the drought problem though a strategy of centralized leadership. Senator Bradley's Central Valley Project Improvement Bill, the Governor's three-way process, as well as state and federal emergency legislation, would define the broad policy parameters within which the individual allocation conflicts would be resolved. If successful, these efforts would establish new power relationships which would serve as the basis for the routine negotiation of solutions to case-specific, local problems.
The non-public nature of the three-way process reflects both this leadership philosophy and a low key approach. Participants are proceeding in the belief that their efforts are more likely to be successful if they are undertaken away from public pressure. The key, of course, is whether or not participants in the process will be able to sell any solution to their constituents.
CONCLUSION
Our study suggests that society's ability to adapt to greenhouse warming, and indeed, other environmental changes will be limited by the ability of its conflict- resolution and consensus-building institutions to resolve "who-gets-what" conflicts in zero-sum (winner-loser) situations. The current structure of the existing institutions confers considerable advantage upon defenders of existing, and in many respects, undesirable, allocation mechanisms. Proponents of change must, in order to be successful, be able to build a very strong consensus for their position.
Since our legal, political, and economic institutions will determine the outcome of these debates, one can expect a continuing series of intense conflicts concerning allocation policies in all of these arenas. Areas of inevitable contention include limits on windfall profits from the sale of subsidized water or senior water rights, optimal protection for endangered and threatened species, continuation of agricultural subsidies, groundwater regulation, determination of acceptable levels of water pollution (including stream flow requirements for dilution), and limits on out-of-basin water transfers. One can assume that there will be no final resolution of these issues. Instead, incremental decisions concerning specific actions will be made in ways which favor some groups over others. Losers will likely continue, or perhaps intensify, their opposition to existing policies, while winners will attempt to solidify their gains. Society's ultimate adaptation response will be determined by the cumulative effects of these incremental policy changes. The challenge is to keep the process functioning and moving forward. Destructive conflict dynamics, such as escalation and polarization, must be prevented from transforming these conflicts into lose-lose situations where everyone is hurt and no progress--in any direction -- is made.
Further, significant changes in the water allocation process used in California, and throughout the arid Western United States must continue, even if the drought does not. The drought has emphasized the serious nature of the mismatch between old policies and current conditions. Until this mismatch is resolved, society's ability to respond successfully to this or later droughts will continue to be severely limited.
NOTES
1 Committee on Science, Engineering, and Public Policy of the National Research Council, "Policy Implications of Greenhouse Warming: A Synthesis Panel," 1991.
2 Linbloom, Charles, The Policy Making Process, (Englewood Cliffs, NJ: Prentice-Hall, 1968) pp12.
3 Nash, Peter H. Gleick and Linda, "The Societal and Environmental Costs of the Continuing Callifornia Drought," Pacific Institute for Studies in Development, Environment, and Security, 1991.
4 "Power of the Market," Los Angeles Times, April 29, 1991: B4.
5 Ellis, Virginia, "State Criticized for Worsening Water Crisis," Los Angeles Times, May 5, 1991: A1.
6 Fradkin, Phillip L., A River No More: The Colorado River and the West, (New York: Knopf, 1981).
7 MacDonnell, Larry, "Allocating Water Shortages: A Case Study of the Central Valley Project and the State Water Project in California," (Boulder, Colorado: Program on the Process of Environmental Problem Solving, Conflict Resolution Consortium, 1992).
8 Burton, Lloyd, "Disputing Distributions in a Shrinking Commons: The Impact of Drought on Water Allocation Institutions," (Boulder, CO: Program on Environmental Problem Solving, Conflict Resolution Consortium, 1992).
9 Howe, Charles W., "The Impact of Drought on Water Management Institutions," (Boulder, Colorado: Program on the Process of Environmental Problem Solving, Conflict Resolution Consortium, 1992).
10 "Wilson-and Others-Must Zero In on the 80% Solution," Los Angeles Times, March 11, 1991: B4.
11Bradley, Bill, "U.S. Is Part of the Water Problem," Los Angeles Times, February 24, 1991.
12Jones, Robert A., "Tense Times Among the Brotherhood," Los Angeles Times, April 10, 1991.
13LaGanga, Maria L., "Drought May Idle 600,000 Acres of Farmland," Los Angeles Times, March 29, 1991.
14Morain, Dan, "Lujan Says Lack of Water Imposes Need to Consider Limit on Growth," Los Angeles Times, March 13, 1991: A20.
15 "Crisis Contradictions," Los Angeles Times, June 17, 1991: B4.
16Johnston, Oswald, "House OKs Changes in Water Policy," Los Angeles Times, June 21, 1991: A34.
17 "How to Combat the Drought Next Time," Los Angeles Times, June 24, 1991.
18Elliott, Christopher, "New 'Neighborhood Watch' Keeps Eye on Water Wasters," Los Angeles Times, April 1, 1991: A3.
19 "A Bank With Unusual Liquidity," Los Angeles Times, July 1, 1991.
20Johnson, Lynn E., "Water Supply System Adjustments to Drought," (Boulder, Colorado: Program on the Process of Environmental Problem Solving, Conflict Resolution Consortium, 1992).
21Schuster, G. H. and D. Meral, "Draft Framework of the Three-Way Agreement," 1991.
22Warren, Jenifer, "New Canal Called Vital by Officials From Region," Los Angeles Times, April 9, 1991.
23Corwin, Miles, "Water Showdown Looms in Santa Barbara," Los Angeles Times, June 3, 1991: A3.
24Gleick, P.H., "The Colorado River Basin and the Greenhouse Effect: Water Resources and Water Management," (Denver, Colorado: Pacific Institute for Studies in Development, Environment, and Security, 1990).
25Reitsma, René F., "Decision Support Systems (DSS) For Environmental Conflicts: Tools For Establishing A Base For Negotiation," (Boulder, Colorado: Program on the Process of Environmental Problem Solving, Conflict Resolution Consortium, 1992).
26Fisher, Roger, and William Ury, Getting to Yes: Negotiating Agreement Without Giving In, (New York: Penguin Books, 1981).
27Akst, Daniel, "New Crops May Hold Promise on Drought," Los Angeles Times, July 2, 1991: D1.