EDITOR,

The July 4 Second Thoughts column, “Blame game no substitute for water management,” was a refreshing reminder of the attention our water systems demand. I believe, though, that our allocation of water does not need to be so complex.

Water is a unique commodity in that the signaling mechanism of the price system is not fully employed. For most normal goods, prices increase as demand increases, and this prevents shortages as both consumers reduce their consumption and suppliers increase supply.

For example, prices of roses increase before Valentine’s Day, and as you may have noticed over the Fourth of July, prices of beer seemingly increased, as you may have been so fortunate to pick up a 12-pack of Newcastle for less than $19. But shortages and rationing tend not to be a feature of these goods for the reason that prices increase/decrease with wide latitude to prevent disruptions to the market.

What the water agencies need is the political will to increase prices of water so as to oblige consumers and farmers to prevent wasteful consumption. Interestingly, this may come soon enough for alternate reasons. As Gov. Arnold Schwarzenegger helplessly tries to fill the budget hole, one of his solutions is to borrow (raid) the cash balances of the water agencies. With few other options, the water agencies will likely have no choice but to raise rates.

Though it won’t be a popular move, it may yet have some positive impact on our dwindling water supply.