Winning the Water Wars: California can meet its water needs by promoting abundance rather than managing scarcity

By Steven Greenhut

In his new Pacific Research Institute book Winning the Water Wars, journalist and R Street Institute western region director Steven Greenhut writes that California can end its decades-long battles over water and meet the needs of its current and future population by promoting abundance rather than managing scarcity.

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• Language: English
• Publisher: Pacific Research Institute
• Release date: Jul 6, 2020
• ISBN: 9780936488080

Book preview

Additional Praise for Winning the Water Wars

Steve’s analysis and proposed solutions for California water issues are spot on and commendable. Hopefully, the policy and opinion leaders (including the governor and legislature) will review this book and act on it. California’s water ‘crisis’ is solvable and Steve has given us all a good road map to follow.

—Dick Ackerman, Senate Republican Leader, 2004-2008

"Winning the Water Wars arms both the ordinary Californian and the seasoned water warrior alike with the knowledge necessary to hold politicians and interest groups accountable for ensuring our water needs."

—Dean Andal, former member of the Assembly and Board of Equalization from Stockton

Steven has done tremendous work encapsulating the long-standing California water wars. If you want to learn about the origins of the water wars, he has that for you. If you want a primer on water policy, he has that. Solutions? He has that, too. Steven does a great job persuading the reader that we are not staring down a zero-sum game where there must be winners and losers. There can be enough water for everyone, including our scaly friends. The problem is a lack of political will. As a Central Valley policymaker, I found this book invaluable in my ongoing education on water policy.

— Jesús Andrade, Stockton City Council member

Steven Greenhut shows how California water policy is expanding poverty in the state, and thereby inequality, at the same time that proponents claim a commitment to reducing poverty and inequality.

—Wendell Cox, principal, Demographia

Winning the Water Wars: California can meet its water needs by promoting abundance rather than managing scarcity

by Steven Greenhut

September 2020

ISBN: 978-0-936488-07-3

ISBN: 978-0-936488-08-0 (e-book)

Cover art: O’Shaughnessy Dam, oil on panel by David Zenger (2020).

Photo credits: Photos by Steven Greenhut, unless otherwise noted.

Chapter introductory maps from Bulletin No. 3 The California Water Plan, published by the State of California, Department of Water Resources, May 1957

Book design: Dana Beigel

Pacific Research Institute

680 E. Colorado Blvd., Suite 180

Pasadena, CA 91101

Tel: [phone]

Fax: [phone]

www.pacificresearch.org

Nothing contained in this report is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

©2020 Pacific Research Institute. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopy, recording, or otherwise, without prior written consent of the publisher.

To Donna, Laura, Diana, Teresa and Lillian

When the well’s dry, we know the worth of water.

—Benjamin Franklin

And it never failed that during the dry years the people forgot about the rich years, and during the wet years they lost all memory of the dry years.

It was always that way.

—John Steinbeck, East of Eden

CONTENTS

Foreword by Steve Forbes

Introduction: A Policy of Water Abundance

Chapter One: The Endless Water Wars

Chapter Two: A Battle Over California’s Future

Chapter Three: From ‘Can Do’ to ‘An Age Of Limits’

Chapter Four: The Projects that Created an Empire

Chapter Five: A Drought of New Ideas

Chapter Six: A New Era of Infrastructure Building

Chapter Seven: More Water Through Innovation

Chapter Eight: Lessons from Israel

Chapter Nine: Putting a Price on Water

Chapter Ten: Toward a New Water Policy

Glossary

Resources

Endnotes

Photo Credits

About the Author

Acknowledgments

About Pacific Research Institute

FOREWORD

BY STEVE FORBES

News flash!

California has no water shortage.

You’ll rub your eyes in disbelief but despite the perennial headlines about California’s chronic water problems, the state gets plenty of water from rainfall to meet all its needs—and then some.

That’s why this well-researched, carefully written book is a stunning revelation—and will have a powerful and much needed impact on ultimately solving a crisis that has been utterly unnecessary and has caused residents, farmers and businesses so much harm that could have been avoided with some basic, eminently sensible policies.

Winning the Water Wars calms, and persuasively navigates you through the treacherous seas of California water policy.

Start with basic facts. The Golden State’s annual rainfall is 200 million acre-feet a year (an acre-foot is 326,000 gallons). Of the amount left for human uses, 10 percent goes for residential (including those much-maligned swimming pools), industrial, commercial and governmental uses. You read that right—only 10 percent. Another 40 percent goes for agriculture. The other 50 percent? You won’t believe this—it is deliberately flushed out into the Pacific Ocean!

Ostensibly, that 50 percent employed for free-flowing environmental purposes is supposed to help endangered species of fish like the Delta smelt. But as this book bluntly shows, this use of water has not improved the prospects of those at-risk fish. In fact, the author demonstrates that there are better ways to help these aquatic creatures but almost all of them involve a water policy based on abundance.

So why are sensible measures—new reservoirs, water tunnels, desalination plants, and wastewater recycling facilities—not taken that would solve California’s water needs? Even worse, why are some powerful pressure groups trying to shut down certain existing infrastructure systems?

Here we get to the big shocker of Steven Greenhut’s literally vital book. Extremist groups misuse the banner of environmentalism to cloak their real agenda: They don’t like people. They see humanity as a blight or at least a threat to the state’s natural environment...[they] envision a rural West that largely is turned back to nature.

If not reversed, these policies will exacerbate California’s highest-in-the-nation poverty rates by driving up the cost of virtually everything.

Greenhut has an enlightening chapter on Israel, which on paper—located in a desert (unlike most of California) with low rainfall—should be in worse shape than California. Starkly, it is just the opposite because the Jewish State pursues many of the very measures, particularly desalination plants, that the Golden State largely eschews.

A key factor in why extremists have gotten away with their activities is the sheer complexity of the topic which leads to jargon-filled studies with dense prose. The issue involves engineering, public-finance mechanisms, conservation strategies, politics, hydrology, geology, property rights, and federal and state law.

But the bottom is clear: California needs to build more reservoirs so that it has enough water for use during the dry years.

The book quotes John Muir, the iconic naturalist and father of the national parks, who called for storage reservoirs at the foot of mountain ranges so that all of the bounty of the mountains may be put to use. What a contrast to current California policymakers who embrace modern nostrums that dams and surface storage are an assault on Mother Nature.

Environmentalists have so twisted the state’s priorities that many Californians believe water rationing is an unavoidable reality. They don’t realize that what California is doing actually has little success with endangered fish species and has actually impeded the restoration of habitats.

Greenhut also argues that California desperately needs to modernize its water-conveyance systems and expand its remarkable infrastructure of dams and water canals—the creation of a previous generation of Californians that saw a limitless future rather than an age of limits.

Winning the Water Wars also hits on another big change that would do wonders: California needs to improve its pricing systems so that markets rather than bureaucrats send water to where it’s most needed.

Of course, existing extremist special interests will attack Greenhut’s findings with distortions and falsehoods. Ultimately they won’t succeed precisely because the author has produced a thorough, balanced, well-researched, well-documented and persuasive masterpiece.

To solve its water problems, California’s leadership must actually want the state to grow and prosper. It must embrace the can-do spirit that transformed the state from an arid backwater into one of the world’s economic powerhouses.

INTRODUCTION

A POLICY OF WATER ABUNDANCE

It is easy to forget that the only natural force over which we have any control out here is water, and that only recently. In my memory California summers were characterized by the coughing in the pipes that meant the well was dry, and California winters by all-night watches on rivers about to crest, by sandbagging, by dynamite on the levees and flooding on the first floor.

—Joan Didion, author, from her 1977 essay, ‘Holy Water’

California is no stranger to water shortages and even to severe droughts. The latest one dragged on for six years and dominated capitol discussions throughout its tortuous run. It was a genuine crisis, and the state’s go-to approach was to prod residents into improving their already impressive levels of water conservation, although voters did eventually pass a water bond that partially funded some water-infrastructure improvements. Too often, people look at California’s water shortages and say, Well, that’s what you get when you build big cities in the desert. Or, people simply need to use less water and stop wasting it in swimming pools.

In reality, only a small portion of the state is in an actual desert. While California generally is arid, it is not uniformly that way—and swimming pools use only a miniscule percentage of the state’s water. Didion is right that they are emblematic of a lifestyle that some people despise—commonly misapprehended as a trapping of affluence, real or pretended, and of a kind of hedonistic attention to the body.¹ But those pools are literally a drop in the bucket. California actually receives enough water through rain, snowpack and groundwater to fully meet the needs of its still-growing population.

Total urban water (residential, commercial, governmental) uses comprise around 10 percent of the state’s total water supplies, so taking a conservation-heavy approach only creates diminishing returns—and has a de minimis or insignificant effect on water supplies.² If the state’s water wars were about numbers—how to store enough water to meet the needs of a specific population—rather than ideology, then California would have met its future needs long ago and water shortages would largely be a non-issue even during droughts.

In fact, it was easy to conclude—based on a lot of statements they made during the drought—that some state officials and many environmentalists saw extreme conservation and water rationing as an end in itself. They clearly were using the drought to promote the kind of policies they’ve always favored, and weren’t about to let a good crisis go to waste. These activists and leaders didn’t seem particularly interested in developing more water supplies, which would mean embracing new water-infrastructure projects and some of the other investments and market-based reforms detailed in this book. They didn’t acknowledge that half of the state’s water flows out unimpeded to the sea, but typically blamed agricultural and urban users (and Mother Nature) for the shortages. They view water storage, which remains one of the most effective means to plan for future drought years, as a blight.

To their credit, California residents stepped to the plate and achieved stunning water-use reductions by exceeding then-Gov. Jerry Brown’s aggressive conservation goals, but it never seems to be enough for the professional scolds. The goal of this book is to highlight the core problem: a state water policy that is more focused on boosting fish populations and which uses water availability as a means to limit growth and force changes in the way we live. I point to various ways to meet the state’s water needs. There’s too little focus on increasing water supplies (through a variety of projects and approaches) because, frankly, that’s not often the goal of those who make public policy. As U.S. Rep. Tom McClintock, R-Roseville, likes to say, Droughts are nature’s fault. They happen. But water shortages are our fault. They are a choice we made when we stopped building adequate storage to meet the needs of the next generation.³

I suggest an all of the above approach to water policy. There are many ways to feed more water into our state’s plumbing systems. Some are more politically feasible or cost-effective than others, but the goal should be a policy that creates water abundance, through a multiplicity of approaches. In most cases, simply building more surface and groundwater storage facilities is the least costly and most beneficial option—but it’s also the one most fraught with political pushback from powerful environmental interests who almost always oppose storage projects, especially through building or expanding dams and reservoirs. We also desperately need more market mechanisms, such as a better means to price water.

Sometimes, projects that are less cost-effective are a reasonable choice because they face fewer political hurdles. When evaluating alternatives, all the costs need to be calculated to choose the best alternative. For instance, the true and total costs of many water-storage projects are hidden (through bonds and taxes). Nevertheless, the end goal should always be adding water into the system. More cost-effective projects always are better than less cost-effective ones, obviously, and they should be funded properly by end users rather than general taxpayers. But water policy always is about compromises. There’s no getting around the power of liberal interest groups to derail sensible water projects. However, conservative water mavens sometimes oppose reasonable projects that add water to the system (desalination) or which fix troublesome water-conveyance issues (the proposed Delta tunnels) because they want to first build more storage. We’re dealing with a political world of real-life choices and frustrating obstacles. We shouldn’t let the perfect be the enemy of the good. The goal should be abundance—and end-users should, as much as possible, pay for the actual costs of the water.

Sadly, there’s a burgeoning movement that wants to decommission some of our existing water-infrastructure systems and move us in the opposite direction—toward a precarious state of scarcity. It’s part of a growing nationwide movement to demolish dams and free the rivers from their dammed shackles. Some of those policies are driven by a sincere desire to restore wild and scenic rivers (and dam removals sometimes do make economic sense), but a lot of it is driven by an ideology that sees humanity as a blight or at least a threat to the state’s natural environment. This approach reveals a utopian vision. Many prominent environmentalists envision a rural West that largely is turned back to nature. This is not an exaggeration, nor does it bode well for the future of our state. This book highlights the thinking of those who advocate such policies.

We need to face reality. Many environmental groups and their political allies prefer a policy of scarcity, backed by state-imposed limits and edicts, and enforced by inspectors—and they’ve skillfully refocused (through politics and tireless litigation) the state’s water priorities toward these ends. They’ve derailed many proposed water-infrastructure projects and imposed so many legal and regulatory hurdles on new ones that it often renders them cost-prohibitive or creates decades-long lead times to build them. Many environmental groups function as litigation machines that gear up to stop or slow any water project. (As an aside, Earthjustice’s logo is: Because the Earth needs a good lawyer.) It’s just what they do, even if it’s not what their good-natured supporters always realize. Yet continuing along this path will further erode Californians’ quality of life, undermine the farm economy that feeds the state and the nation, and exacerbate California’s highest-in-the-nation poverty rates. These slow-growth, high-price policies are particularly regressive—they harm the poorest people the most by driving up the cost of virtually everything.

To understand how to fix the problem, it’s vital to understand how we arrived at our current predicament. State water policy is intertwined with the history of California, so the background—how the state developed its water-rights system and built the giant systems of dams and aqueducts that store and move around our water—says much about who we are as Californians and how our legislative priorities have changed over the years.

In this book, I try to provide enough of the history, geography and other background information (punctuated by photographs, maps and graphics) so any lay reader can navigate some of the water-policy choices before us. I look at many of the different proposals and ideas for creating more water supply, from increasing surface storage capacity to building ocean desalination plants to commissioning wastewater recycling facilities. I also look at other ways to improve water supply, through a more accurate water-pricing system that would facilitate water transfers and trading. Such a system would also reduce bad choices and wastefulness that mainly occur when a commodity is available at below its market price (such as growing water-intensive crops like alfalfa in the Southern California desert). As always, the marketplace works wonders provided subsidies don’t distort the price signals and the government doesn’t become too much of an impediment through burdensome or antiquated regulations.

Many environmental groups function as litigation machines that gear up to stop or slow any water project....Yet continuing along this path will further erode Californians’ quality of life, undermine the farm economy that feeds the state and the nation, and exacerbate California’s highest-in-the-nation poverty rates.

Environmental concerns and fish populations are important, but the state’s approach to declining habitats—by basically flushing more water unimpeded through the rivers—has not improved the health of endangered species, especially salmon and Delta smelt. Officials often misdiagnose the problem—or ignore other likely causes for species decline that don’t fit their narrative. There are better approaches to helping fish, but almost all of them involve—and here’s the term again—a water policy based on abundance. California officials can indeed provide more water to help farms, businesses, urban water users and wildlife if they recommit to engineering policies that increase water supplies rather than force us to re-engineer our lives in the face of mandated scarcity. Make no mistake about it, many environmentalists and lawmakers prefer the latter approach.

This book looks at the public-policy conundrum, the history of water infrastructure and offers real-world solutions—as well as a few interesting but unlikely-to-occur thought experiments. We need to think about all options. This book offers an optimistic way forward and is unabashed in its view that human beings, and the farms that feed us, are blessings and not a curse. I strongly endorse conservation, habitat restoration and environmental improvement, but won’t apologize for putting people first or for measuring the results—and not just the intentions—of any specific environmental laws and policies.

California’s annual rainfall ranges from 150 million-acre-feet in a dry year to 300 million-acre-feet in a wet one. The California Department of Water Resources says the average is 200 million-acre-feet a year overall. After evaporation and absorption by foliage, that leaves between 60 million-acre-feet and 100 million-acre-feet of accessible water. Most estimates suggest that of that remaining total, roughly 50 percent of the water is diverted for free-flowing environmental uses, 40 percent is used for agriculture and 10 percent is for urban users.⁴ (The California Water Plan puts environmental uses at approximately 48 percent and agricultural uses at 42 percent.) Of the urban-use number, 5.7 percent is for residential uses and 4.3 percent is for commercial, governmental and industrial uses. The raw amounts and percentages vary dramatically annually, based on annual rainfall.

Environmentalists argue that the 50-percent number is overstated because it includes water flowing on wild and scenic rivers that are protected by state and federal regulations – and includes water that protects critical habitats and Delta water quality. Their argument is that the water isn’t wasted, and that the environmental water provides myriad benefits.⁵ But their complaint strikes me as an attempt to take many environmental sources of water out of the formula simply as a means to downplay the sizable amount of water the state puts off limits to human uses. In addition, many environmentalists keep trying to expand those scenic river designations, which would take even more water out of productive use.

We obviously can’t use every drop of river water and I’m not saying that using water in rivers is wasted, but the state’s water problems can be solved around the margins by capturing much more water before it reaches the sea. The Metropolitan Water District of Southern California refers to the big gulp, little sip concept—e.g., during big storm events, the goal is to capture a little more water and store it for dry years. In less than 90 days—from Dec. 1, 2015, to Feb. 28, 2016—almost 200 billion gallons of water has been flushed out through the San Francisco Bay, wrote Mike Wade, executive director of the California Farm Water Coalition, in an Orange County Register column.⁶ That would supply almost 3.5 million Southern Californians with enough domestic water for a year. This took place as part of mandated water flows to protect fish habitats—the result of regulatory decisions that prioritized concerns about fish populations over water-storage concerns.

The state also squanders trillions of gallons of water during storm years, given that these urban systems are not designed (and it’s not always cost-effective) to capture excess water. When you look at the Los Angeles River being between 50 percent and 70 percent full during a storm, you realize that more water is running down the river into the ocean than what Los Angeles would use in close to a year, Mark Gold, a faculty member at the UCLA Institute of Environment and Sustainability, told the Los Angeles Times.⁷ Fox News reported that during a February 2019 storm, 80 percent of water in urban areas flowed unused into the ocean.⁸ That’s a major infrastructure issue, too. Even environmentalists are supportive of storm-water capture.

An acre-foot is 326,000 gallons—as much water as it takes to cover an acre of land a foot deep. An average California household uses between one-half and one acre-foot of water per year for indoor and outdoor use, according to the Water Education Foundation. The average family is using a declining amount of water each year.⁹ Keep those figures in mind as you think about the problem and read this book.

Even though the state’s population has doubled since the state and federal governments built any serious water-storage infrastructure in the 1970s, the state’s water scarcity actually can be solved with a few strategies and targeted investments (and ones that cost much less than some of California’s other big-ticket and seemingly pointless priorities, such as the $80-billion-plus bullet train). The question is more about priorities and political will than engineering or public finances.

It all comes down to a simple choice: Does the state want to build the infrastructure and embrace the other innovations and policies needed to provide us all with plenty of affordable water? Or does it prefer a world of scarcity and skyrocketing prices, where government planners issue rationing edicts and farmers must let vast acreage go fallow?

We live in a democracy, so the choice ultimately is ours.

CHAPTER ONE

THE ENDLESS WATER WARS

The people of California, indifferent to the bountiful gifts that nature has given them, sit idly by waiting for rain, indefinitely postponing irrigation, and allowing every year millions and millions of dollars in water to pour unused into the sea, when there are hungry thousands in this and in other countries pleading for food and when San Francisco and the Bay Cities, the metropolitan district of California, are begging for water.

—Col. Robert Bradford Marshall

The Marshall Water Plan, 1919

In the midst of one of the worst droughts in California history, I attended a crowded meeting at the Oakdale Irrigation District east of the Central Valley city of Modesto in April 2015 where state and federal officials explained why they had scheduled a pulse flow—a large release of water from the New Melones Reservoir to help a few steelhead trout swim from the Stanislaus River toward the Pacific Ocean. Officials were also looking at partially draining Lake Tulloch, a small lake surrounded by upscale homes in the nearby Sierra foothills for a similar reason.¹

Steelhead, a trout with an orange flesh resembling salmon but with a milder taste, could, at this writing, be purchased online from Walmart for less than $13 a pound. Not that those particular fish would have made the 100-mile trek to the ocean, where they might have been snagged by commercial trawlers and sent to a food retailer. As a biologist who counts fish on the Stanislaus River for the irrigation district explained, these creatures almost certainly would have been eaten by some invasive species—e.g., a bigger, non-native fish such as striped bass—before getting far downstream.

The gathered farmers and homeowners at that meeting were upset that officials from their own government were unwilling—or unable—to adjust these fish-oriented water rules at a time when California residents, businesses and agricultural enterprises were facing life-altering, state-mandated cutbacks on their water use. Public outrage caused a delay in the pulse flow, but it took place eventually after the furor subsided. Apparently, these state and federal water regulations were inflexible even during a historic drought.

The irrigation district’s general manager, Steve Knell, complained about the false dichotomy of pitting fish against people. He argued that both needs can be met, but that state officials need off ramps during drought years that allow some water-flow rules to be eased. The tension between fish and people, people and fish, Knell noted, takes us away from negotiated solutions.² But that tension won’t subside as long as activists oppose any compromises as they demand that more of the state’s water resources be used to protect fish populations, during drought years or not. It also won’t subside as long as the decisions over water—how much to store and who gets the bulk of it—are based more on environmental politics than markets. That meeting struck me as an allegory for California’s ongoing water wars.

The Don Pedro Powerhouse at the foot of the Don Pedro Dam

provides hydroelectric power throughout the region.

The Don Pedro spillway gates were opened in 2017 for the first time in 20 years to release overflowing waters from the storms.

Last May, 25,000-acre-feet of water was flushed out of the Melones in an attempt to promote fisheries, wrote Jack Cox, chairman of the Lake Tulloch Alliance in nearby Copperopolis, in his written testimony to the irrigation board. The value of this water was $21 million. According to (the biology firm) Fishbio, the total number of fish pushed down the river was nine fish—at a value of $2 million-plus a fish.³ The average weight of a steelhead trout is 27 pounds. At $74,000 a pound, that’s pricey even for a government known for its $640 Pentagon toilet seats.⁴

Such an inexplicable misuse of resources was not an anomaly during a drought that lasted for six years and dominated state capitol priorities throughout its run. A year later, with the state still in the thick of that water crisis, the Modesto and Turlock irrigation districts held a series of public meetings to discuss their strategies to help fish swim around the Don Pedro Dam in Tuolumne County in the Sierra Nevada foothills. It’s the state’s sixth-largest reservoir and a fishing and boating paradise.

The fish passage, a possible condition for a federal hydropower license, could cost several hundred million dollars, according to a Modesto Bee report.⁵ It would involve mechanized ladders, trucking, canals or other methods for getting the oceangoing fish to and from possible spawning areas. Other reports pin the costs at $70 million to $150 million to help 500 to 1,000 salmon a year. The price per fish ranges from $70,000 to $300,000 depending on the project selected and number of salmon that ultimately are helped by the final project.⁶

Supporters "say it could enhance spawning and rearing habitat on a river