My good friend Ruth has started blogging and, in what can only be likened to a “butterfly from the chrysalis” moment, we get to see the thoughts her previous employment have rendered her unlikely to utter. Her latest post looks broadly at the Emissions Trading Scheme and questions the strategy of levying a financial charge on those who pollute as a way of reducing that pollution.
Ruth says that;
what REALLY ends up happening is that those who get the so-called “right” to manage what was a common asset make gizillions of $$ out of it, behaviour doesn’t change, and we (“we” as in humanity) seem to be racing each other to use the resources up as quickly and profitably as possible. Meanwhile the “few” seem to be quietly divvying out licences to make money out of the next lot of public goods, off the back of the “many” consumers who are either oblivious or content to let this commodification of the commons take place.
I rarely disagree with Ruth but this time I might just do so. Not in relation to the ETS, but in relation to water rights, our continuing over extraction of the water reserve and the intensification of dairy farming in arid climes.
I was reminded of a letter I wrote recently to the Christchurch Press, regarding a proposed irrigation scheme in my back yard, North Canterbury. As I said;
I write with respect to the current application for the Hurunui Water Project. I am involved in a large water extraction and storage scheme in North Canterbury and, as would be expected, am a proponent of the concept of flood flow storage. I’ve also seen the work that the interested parties have done leading up to this application – while I support the scheme, I believe our regulatory framework misses, almost entirely, the point of resource allocation.
In correspondence about the proposed scheme, project manager Amanda Loeffen has made the somewhat contradictory statements that dairying isn’t the focus of the scheme but that around 40% of potential users have looked at the prospect of dairy conversions.
Many people are of the view that dairying, being such a high volume user of water, has no place in a drought prone and difficult climate such as North Canterbury. At a broader level however, we live in a regulatory environment where the right to take an asset can be granted, but no conditions can be put on its use.
In North Canterbury we have some excellent examples of efficient water use and some travesties – farmers using overhead irrigation on marginal value crops in dry (and often windy) North Canterbury summers. Until such time as the framework is changed to reflect the use of the resource, and to incentivise greater levels of efficiency in use, any allocation model is inherently flawed.
While charging for water usage is anathema to most rural folk, it’s hard to see any valid argument to justify granting the use of a scarce resource without charging for it. History has shown that there is little will to drive efficient resource utilisation unless those who use the resource pay for their consumption.
Making this sort of change will take broad stakeholder buy-in, and an acceptance that future users, as well as those of today, should be considered. For the sake of our environment, our economy and our collective future, we have no option.
So.. there’s times when commoditizing a resource might just be the smart approach to ensure some of that resource stays around for our kids… and their kids…. and their kids…