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Water shortage does not equal water scarcity

I liked this column by Chris Brown for the Ludwig von Mises Institute because it echoed some points I made in two previous posts: Water shortages and water-trading between states and Scarcity is not shortage. Some excerpts (italics in original):

The government has blamed the shortage of water on drought and climate change. And while droughts may be created by a shortage of water, water shortages are created by an abundance of government rein.
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Instead of economical pricing there is political pricing, where pressure groups and special interests are given “rights” to use water during droughts, and at subsidized pricing. Businesses are able to use water for irrigation in the name of boosting GDP, while individuals are asked (or forced) to consume less and less. Government as the friend of the little guy is simply a myth.

Of course one may argue that water is a scarce resource, and, therefore, naturally there may be shortages. Yet all resources are scarce; water is no different from wheat or copper in this respect. Shortages do not exist in a free market because of the price system, including the profit-and-loss mechanism.

Posted in Economics, Environmentalism, Property rights