Australia’s water woes

GREG WOOD/AFP/Getty Images Felix Salmon weighs in on the unintended consequences of water pricing: [P]ricing water can have interesting and not necessarily intended effects. In Australia, for instance, water rights can be traded. When the country was hit by drought, the price of those rights rose, and wheat growers started selling their water rights to ...

595264_080429_australia2.jpg
595264_080429_australia2.jpg

GREG WOOD/AFP/Getty Images

Felix Salmon weighs in on the unintended consequences of water pricing:

[P]ricing water can have interesting and not necessarily intended effects. In Australia, for instance, water rights can be traded. When the country was hit by drought, the price of those rights rose, and wheat growers started selling their water rights to the vineyards, because doing so was more profitable than growing wheat. And that, in turn, contributed substantially to the rise in global wheat prices.

GREG WOOD/AFP/Getty Images

Felix Salmon weighs in on the unintended consequences of water pricing:

[P]ricing water can have interesting and not necessarily intended effects. In Australia, for instance, water rights can be traded. When the country was hit by drought, the price of those rights rose, and wheat growers started selling their water rights to the vineyards, because doing so was more profitable than growing wheat. And that, in turn, contributed substantially to the rise in global wheat prices.

The world would be better off right now if Australia’s wheat growers had continued to grow wheat, and if Australia’s wine growers had simply produced less wine. But that’s not how the market incentives played out.

Well, the problem is about to get worse. The Australian government announced today it is buying $2.9 billion worth of water rights from farmers in an effort to safeguard drinking-water supplies. People have been predicting for years that water would become more precious than gold. Now, drip by drip, it’s happening.

More from Foreign Policy

A Panzerhaubitze 2000 tank howitzer fires during a mission in Ukraine’s Donetsk region.
A Panzerhaubitze 2000 tank howitzer fires during a mission in Ukraine’s Donetsk region.

Lessons for the Next War

Twelve experts weigh in on how to prevent, deter, and—if necessary—fight the next conflict.

An illustration showing a torn Russian flag and Russian President Vladimir Putin.
An illustration showing a torn Russian flag and Russian President Vladimir Putin.

It’s High Time to Prepare for Russia’s Collapse

Not planning for the possibility of disintegration betrays a dangerous lack of imagination.

An unexploded tail section of a cluster bomb is seen in Ukraine.
An unexploded tail section of a cluster bomb is seen in Ukraine.

Turkey Is Sending Cold War-Era Cluster Bombs to Ukraine

The artillery-fired cluster munitions could be lethal to Russian troops—and Ukrainian civilians.

A joint session of Congress meets to count the Electoral College vote from the 2008 presidential election the House Chamber in the U.S. Capitol  January 8, 2009 in Washington.
A joint session of Congress meets to count the Electoral College vote from the 2008 presidential election the House Chamber in the U.S. Capitol January 8, 2009 in Washington.

Congrats, You’re a Member of Congress. Now Listen Up.

Some brief foreign-policy advice for the newest members of the U.S. legislature.