Fools And Your Money

In 2007, parts of Nevada were declared “Disaster Areas” – due to drought. That drought was the most severe in the Southwest in its 100 year historical record... But this wasn't what got the mass media's attention. The big story was how Lake Mead, near Las Vegas, was at the lowest water levels in 40 years... Of course, Las Vegas still had plenty of water; but someday, they to might have to deal with a drought disaster.

Southern Nevada Water Authority's way of dealing with this impending crisis was to bring back the watergrab – of Lincoln and White Pine Counties' groundwater.

SNWA had tried this watergrab scheme back in the 90's – but were stopped. Even the people of Las Vegas wouldn't put up with it. The act was just unacceptable. It was seen as destroying your neighbors, so that you can be richer. It was seen as destroying an ecosystem larger than some of the smaller states, to keep the big bucks coming into Las Vegas.

So, SNWA gave up on the watergrab... for a while. But the drought, and the realization that Global warming is beginning to significantly effect the Southwest's climate gave them a new excuse. The new excuse for the watergrab boils down to this: Something has to be done about Global warming. Therefore, SNWA will take water from the rest of the State.

Of course, this makes no practical sense. Taking water from a drought stricken area to support growth in another drought stricken area will only make things worse overall in the long run.

The department of Agriculture has published a study that shows “Global warming in the West will likely get worse in the next 25 to 50 years, with intensified drought, continued declines in annual mountain snowpacks, and about a 20 percent reduction in runoff in Colorado and the Great Basin.”

The outlook isn't good. A 20 percent reduction of the flow of the Colorado River must sound pretty frightening to those who profit off of growth in Las Vegas. But what the media in Las Vegas often ignores is that the drought also effects the Great Basin. That's right, Las Vegas isn't the only place at risk. The rest of Nevada is even worse off. And Las Vegas should still care about that.

The valleys of the Central Great Basin may appear somewhat barren. But they are full of life. A study by the Desert Research Institute has shown that the Mojave Desert absorbs comparable amounts of greenhouse to temperate forests. Deserts inhale carbon dioxide at a far greater rate then expected. The valleys of Nevada hold very important ecosystems capable of counteracting Global warming.

If we allow the watergrab, we will allow SNWA to kill off vast swaths of old growth desert. Which, of course, will make Global warming worse. Which, of course, will further complicate Las Vegas' water predicament. It seems that SNWA doesn't really care that much about Global warming after all. But they should.

Global warming has already begun to effect far more than the Western U.S. The number of reported tornadoes in half of this year has exceeded the 10 year average for an entire year. There has been flooding in the Midwest. There have been hundreds of fires in California. This Spring saw Cyclone Nargis devastate Myanmar, where almost 80,000 people died. And scientists predict a 50/50 chance of the North Pole losing it's ice cap this summer.

It has become imperative that we do everything within our power to stop Global warming.

Yet, the scientific community has known about Global warming for well over 50 years. So, why has it been so difficult to do something about it?... The answer lies in our economic system – which is based upon unbridled greed. Maybe it isn't just a coincidence that Global warming coincides with explosive concentration of wealth for a few? Maybe it isn't just a coincidence that Exxon made $40 billion in profits last year while spending millions on global warming skeptic propaganda? And moreover, maybe the corporatist effort to privatize everything, including water, isn't good for the environment either?

Corporatism without standards, without boundaries, without laws; becomes a race for the bottom – a stampede towards corporate anarchy. You may have heard of the term “Disaster Capitalism.”

The fact is; those at the top of the power structure are using perceived disasters as opportunities to increase their wealth and power. Our system forces the “captains of industry” to act like pirates. These industry leaders, and corrupt politicians are nefariously implementing policies that would never be passed during less stressful times.

It looks like the drought is the disaster SNWA has been waiting for to scare people into allowing the watergrab.

By Nevada law, the water SNWA covets can't be sold at a profit. So, on the surface, it would seem there isn't a profit motive for taking the water. But remember; Enron didn't drill or refine natural gas. Enron didn't generate power or own power lines. Yet Enron made a multi-billion dollar killing delivering electric power. Very likely, someone has already figured out a way to siphon off profits from “delivering” the water.

Even so, there are those in Las Vegas who would pay any price for more water.

Any price?... Apparently, we're willing to pay any price for oil right now. And America's economy is suffering greatly for it.

We have to remember that SNWA executives don't really care how much the water will cost. The residents of Southern Nevada will ultimately pay for it all. Could it be that SNWA executives don't care if the watergrab is a bad investment?

One of the main reasons the pipeline network is such a bad investment is because it cannot be built incrementally – as needed. To reduce environmental damage, SNWA needs to take water from over a vast area. Which means the whole Groundwater “Development” Project has to be completed to be useful. This means the commitment of billions of dollars – and likely, billions more for cost overruns.

And what happens if Las Vegas doesn't grow as expected? This could happen. Las Vegas' economy is heavily dependent upon the price of oil. And the price of visiting and shipping goods to Las Vegas is skyrocketing. The mortgage crisis has shown us that Las Vegas' economy is not recession proof. There is a possibility that this pipeline could be built to support growth that just won't happen.

And what happens if the expected water isn't there? The USGS estimates that there is groundwater in the Central Great Basin, but they never drilled any wells. Moreover, even if there is water to be taken; there is no guarantee the water will be drinkable. There are a number of oil wells in the Central Great Basin. Which means that there is more than just water underground here. Once the water starts pumping, it could become contaminated with oil.

There is one more great risk SNWA is taking with the watergrab. The desert is a very fragile environment. Water is the most important resource here. In fact, water is the limiting factor of life in the desert. Deputy General Manager of SNWA, Kay Brothers said; “We recognize that our efforts to reduce Southern Nevada's reliance upon the drought-plagued Colorado River cannot come at the expense of Nevada's environment.” What if the Federal Government holds SNWA to that statement? The blatantly obvious truth is that SNWA cannot pull a river of water out of a place that has no rivers without consequences. Those consequences could include turning the Central Great Basin into a giant dust bowl. The Federal Government someday may not allow that.

These and other risks make the watergrab a very risky project. Which makes one wonder why SNWA executives are so committed to gambling with billions of Southern Nevada's dollars. Aren't there alternatives? Yes... Of course, there's conservation. But let's assume that eventually Las Vegans will learn to conserve water. What else?

There's desalination. Currently there are 15,000 desalination plants worldwide generating between 10 and 13 billion gallons of fresh water per day. For SNWA to claim that desalination is not practical is almost laughable. Moreover, the price of desalination just keeps getting cheaper. The company Siemens has come up with a desalination technology for Singapore that uses half the energy of reverse osmosis. And a University of Ottawa PhD student claims to have developed a prototype desalination system that is 600 to 700 percent more efficient than current technology.

But, SNWA executives don't even want to talk about desalination. Are they privy to some secret technical information about desalination that the rest of us don't know about? I doubt it. If there's anything being kept secret, it's most likely the law of supply and demand. If SNWA makes more fresh water, a greater supply means they won't be able to charge as much.

There is another alternative to the watergrab that is already cheaper than desalination. SNWA could pay to recycle other cities' water in exchange for a bigger allotment of the Colorado River. Presently, desalination is 50 to 400 percent more expensive than water recycling. Which means that SNWA could offer significantly more recycled water in exchange. It would likely be too tempting for other Southwestern cities to pass up on an offer of 50 percent more, or even twice as much water than what they get (and have to treat) from the Colorado River.

There is even more good news. A team of researchers at the University of California, Davis has genetically engineered crop plants that can grow with 70 percent less irrigation water. If SNWA could subsidize the farms that utilize these drought resistant crops, and purchase the unused water, everyone would have enough water.

Unfortunately, we can't expect bureaucrats and executives to make the best decisions. The Las Vegas Review Journal reports that snowpack in the Colorado River basin was 122 percent of normal this year. The extra water for Lake Mead will mean that the lake level will drop by only 5 feet... Now think about that. With 22 percent greater than average snow pack, Lake Mead is still dropping? This blatantly shows that Lake Mead's water elevation isn't just an environmental problem. This is also an administrative problem. Bureaucrats are allowing Lake Mead to be drained. And SNWA is opportunistically using this crisis in administration as a propaganda tool for the watergrab.

But why?

Let's consider the price of water. The Southern Utah Spectrum reported the Virgin Valley Water District water at $8,600 an acre-foot. And in Heber Valley, Utah the price is $12,000 an acre-foot. That's far more expensive than what the California Coastal Commission estimates the price of water produced by desalination plants at - $1,000 to $4,000 per acre-foot. One would think the choice is obvious.

But... Let's look at this from a SNWA executives' point of view. Coyote Springs Development has already agreed to pay $5,000 an acre-foot, just to “deliver” their own water from Geyser Ranch (in Lake Valley, Nevada). SNWA has applied for 200,000 acre feet in this watergrab. If we just estimate the gross profits utilizing the Coyote Springs $5,000 an acre-foot price; that calculates out to a billion dollars a year! A BILLION DOLLARS a year!

Nevada Senator Bob Beers has posted, on his blog:

“My idea is to amend federal law to allow the Southern Nevada Water Authority to buy ranches downstream from us on the Colorado River, fallow them, and draw into Nevada their water allotments, through our Lake Mead water intakes, whose capacity is double today's requirements. This plan harms no one, solves Clark County's water shortage, and costs very little compared to the costs already incurred in the earliest stages of sucking Northeastern Nevada's water table dry – much less than costs yet to come. My plan avoids the sure environmental ruin of the current plan, is much cheaper and faster, and is a market solution...

SNWA steadfastly refuses to discuss my idea, or to explain what is wrong with it. I have been advocating this plan for more than a year, with nothing but SNWA’s cold shoulder. The reporter noted, correctly, that my proposal made a lot of sense...

(Later) The reporter explained that she had talked to Pat Mulroy, and my plan wouldn’t work. The reasons were “too complicated” ...

It’s almost as if there are some politically powerful entities out there who SNWA is catering to who would profit from building the pipeline to Northeasten Nevada, and who don’t care if the whole idea is stupid, expensive and environmentally damaging.

By the way, SNWA this week increased their underestimate of the pipeline’s cost to being equivalent to the entire Nevada State Government’s annual general fund. This is double the underestimate from two years ago”

Could it be that the executives (and maybe the board) of SNWA are in on some kind of a scheme? One sure sign of a corrupt bureaucrat is that they are more concerned about their next job than the one they have. The revolving door of government to private careers has been a corrupting influence for decades. To investigate this potential corruption, all we have to do is follow the money. And the pipeline construction monies are the first billions available.

Guess what? The construction money will go to companies that almost entirely exist to secure government contracts to perform work formerly done by the government. Two of the pipeline contractors; CH2M Hill and KBR, have made billions off of the Iraq and Afghanistan conflicts.

In case you didn't know; the BBC has reported that “around $23 billion may have been lost, stolen, or just not properly accounted for in Iraq.” Congressman Henry Waxman, who chairs the House Committee on oversight and government reform, has said “It may well turn out to be the largest war profiteering in history.”

CH2M Hill has annual revenues of about $4.5 billion. From 2002 to 2004 CH2M Hill made over $1.5 billion in Iraq and Afghanistan. But if you check their website, CH2M Hill barely even mentions Iraq. Why aren't they bragging? Maybe they have nothing to brag about?

One of the contracts CH2M Hill had in Iraq was to provide support to the Public Works Sector program office. The joint venture oversaw work done on public works and water projects.

A General Accounting Office report shows that by July 2008:

Only 36% of targeted potable water has been achieved.

0% of targeted sewage treatment capacity has been achieved.

Only 50% of repair to dams and canals has been achieved.

And only 8% of land irrigation has been achieved.

In Iraq; gastro-enteritis, brucellosis, hepatitis, and typhoid fever are common among children due to bad drinking water. No wonder that oversight project wasn't mentioned on the CH2M Hill website.

And the other watergrab contractor, KBR (formerly known as Kellogg, Brown, and Root) has been reported (by Rolling Stone magazine) as the “undisputed master of milking the system.”

A former Army civilian official has told the New York Times that when he refused to sign off on more than $1 billion in questionable charges, KBR went over his head. He was suddenly replaced, and the billings were approved.

KBR has dodged paying $500 million in Social Security and Medicare taxes by operating a shell company in the Cayman Islands.

And the Washington Post reports that KBR has been accused of providing contaminated water to U.S. soldiers in Iraq.

You have to wonder; couldn't SNWA executives have picked more reputable partners in this project? You have to wonder; maybe they didn't want to. Maybe, just maybe, these are the perfect partners for a corporate feeding frenzy.

Much of SNWA's money has come from BLM land swaps. What that means is that federal land sales are subsidizing the watergrab. What that means is that; in a way, Nevadans, and the American people will be subsidizing this pipeline.

But, most Nevadans and the American people have no say concerning the pipeline. Doesn't that sound like taxation without representation?

SNWA has approximately a billion dollars – that could be much more wisely spent than on a pipeline into the desert. Smaller projects; such as desalination plants, water recycling, and support of low water use crops could be incrementally accomplished, as needed, to support the population of Southern Nevada.

Some of SNWA's money could even be used to help out with the immediate financial crisis in the State of Nevada. There are things Nevadans need much more than a watergrab.

But we won't be getting anything if we don't take back our power.

Organize.

Las Vegas should consider firing their SNWA executives.

Nevadans should force real reform of Nevada water law.

And White Pine and Lincoln counties may wish to consider secession from Nevada.

For if White Pine and Lincoln counties were a part of Utah, Nevada water law would not apply – and the watergrab would be over.