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Tunnel Vision in California

by MICHAEL PERELMAN

Is it not true that virtually every large public works project suffers from serious cost overruns?  Will the ballot initiative inform voters about the actual probable costs of this project?

Is it not true that the first Governor Brown, Jerry’s father Pat, constructed the first California Water Project with the understanding that large recipients of water would repay the state for the costs of delivering water?  Is it not true that they reneged on that promise?  Will the greatest recipients of water really pay their fair share this time?  Without some certainty, should the ballot initiative reflect the risk that the state will not be able to collect adequate repayments for its water?

Without guarantees of adequate repayments, should the ballot initiative reflect the risks?  For example, in light of the first reneging of the payment obligations, the state had to turn to other sources of funding.  It took money from the Tidelands Oil Fund to cover the failed promised payments, which required the California State system and the University of California system to initiate tuition hikes, which set off decades of spiraling tuition.invisiblehandc

Does it make sense to send the water to the Central Valley to grow crops that would be unprofitable without huge federal payments and subsidized water?  For example, cotton is not particularly suited for semi-arid land.  Besides, such federal and state subsidies seem to violate trade agreements such as the WTO and NAFTA.

Could one make the case that importing cotton from Africa, where farmers have trouble competing with highly subsidized American growers, might help to stabilize parts of the continent, which would reduce the incentives for continually increasing the costly level of the US government’s military entanglements in that part of the world?  Might cutting back on subsidized cotton production in the Central Valley be the first step in reducing military involvement in Africa?

Such a suggestion might admittedly seem to be a stretch but it serves as a reminder that the consequences of such a huge undertaking as the twin tunnels will have significant unintended consequences that will be unlikely to be presented to the voters in a ballot initiative.

The questions disregard a much larger question regarding the need to conserve water supplies, both locally and statewide.

Michael Perelman teaches economics at Cal State at Chico. He is the author of Railroading Economics and The Invisible Handcuffs of Capitalism.

 

 

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