Will Las Vegas Drown... In Water Debt?

Have you ever heard of a hidden tax? It's a tax you pay when you buy something, but you don't realize you're paying it. One of your suppliers paid it, and transferred that cost to you – in the price. Most often, we never notice – until the tax, and the price, goes way up.

What if, somehow, a new tax was imposed by a far away power – on something you absolutely had to have? What if this “tax” was a huge tax on water? In fact, what if it was even worse than any tax? What if it was interest on debt?

This isn't some imaginary exercise, however. People, communities, and nations all over the world have found themselves drowning in debt. One could even argue that usury has become an imperialist tactic – and that financial looting is happening everywhere. So, why don't we just stop borrowing? It's complicated. But sometimes, we feel that what we need is worth the risk of borrowing money for it. Of course, sometimes, the decisions are made for us.

Everyone who has ever lived in the desert knows that the most valuable resource in the desert is water. It's the only thing you can get a whole community “fight'n mad” upset over. Nobody ever wants to run out of water. Not ever...

The fear is so elemental, so beyond reason; that water shortages may be the ultimate weapon to con a community. We all know that we will pay whatever it costs to have water. When it comes to water, we're no better off than a junkie. And we know there are people salivating over business deals like that. They want to be Southern Nevada's “supplier” – so they can charge any price – for rural Nevada's water. That's right. This “plan” looks like someone is scheming to steal from the right hand to overcharge the left. And this won't just be an up front charge. Prices are subject to change.

Just think about other forms of credit. You don't just pay back what you borrow. And there isn't just interest. There's fees. There's hidden fees. And there's refinancing fees. SNWA's estimate of 3.5 billion dollars is just the principle for the Groundwater Development Project. You can be rest assured that the banks involved will work every trick in the book to make the true cost far higher.

What a scam.

What a multi-billion dollar, economy crushing scam!

Yes; it's true I don't want the watergrab to happen because I feel that the act of a community stealing the natural wealth of it's neighbors to artificially sustain unsustainable growth is just wrong – inherently amoral. But I also fear for Las Vegas. Because I see another banking loan scam coming that would ultimately financially ruin Las Vegas. Everyone remembers the housing bubble, fueled by senseless loans that ultimately crashed the world economy. Well, they can't run that scam any more. Nobody has any more money. So, the next scam is to loot their community's money.

It is likely that there have been a number of powerful international bankers, over the course of the years, who've lost a lot of money in Las Vegas (gambling). Some of them might have even gone away angry. Couldn't it be possible that someone among these powerful bankers finally just said; “My turn.” Or then again, maybe this is just another step in a systematic looting of the world.

Is Las Vegas under attack? I'm not certain. But there are terrifying signs...

There is this boondogle of a watergrab going on – right under under everyone's feet. It will cost billions. (I have a good idea of how many billions now. I'll let you know in my next post.) And though Las Vegas doesn't need the water, Southern Nevada Water Authority (SNWA) intends to start construction next year.

An unelected “Authority” (and some Clark County Commissioners) are going to plunge Southern Nevada into billions of dollars in debt for water they don't really need – when the area doesn't really have that much money.

What's wrong with this picture?

It would take a drought of disaster capitalism proportions to get this through. (Either that, or a mega-greedy attitude that Las Vegas should just keep doubling in population every few years – forever – or at least for the rest of the investors' lives.)

We already know that most Las Vegans don't really want to see that much more growth in Las Vegas. And we can already surmise that no Las Vegans want to pay billions for water for some other community. So; there is no need - at least not at this cost.

The SNWA watergrab is not popular. “We the people” wouldn't vote for it. When you look at it that way, the SNWA watergrab is in fact an act of usurping the citizens' sovereignty. The watergrab is undemocratic. We wouldn't vote for it!

But that's OK. Some County Commissioners will decide for us. ...And if somebody were to pay them a bunch of money (under the table), maybe they will decide against us.

What's at stake is the future of Las Vegas and Nevada. Both of our economies will be devastated when this (robbing Peter to pay Paul) water scheme doesn't work out. Someday, we may look back and see this as an attack.

(I'm starting to suspect a conspiracy here.)

Other American cities have come under attack already. Not a violent attack, but just as destructive as a violent attack in the long run. They owe billions. They've had to make ludicrous cutbacks. People are sick, and dying without health care. Children aren't getting an education. Critical services, such as police and fire departments have had to cut back. Everyone involved is in debt... because their community is in debt.

Maybe it's just our turn now... Oh yeah... It already is.

Most Third World countries are far too familiar with conquest by debt. Europe and America are next. Portugal, Italy, Greece, and Spain have already been looted by international investors (banks). All that's left for these countries is debt and deconstruction. But that's not how the banks see it... They're just maximizing their profits.

I used to think that SNWA was going to privatize and overcharge it's customers. I don't think that anymore. Straightforward water privatizing is so 20^th century. We wouldn't fall for that. (But we might fall for a water project.)

I now realize that banks don't have to privatize municipalities.

All they have to do is socialize the costs.

Las Vegas is small time compared to these Banksters.

But they're still a big catch.

Something smells very fishy about this whole project.

We want to make win-win decisions.

This smells lose-lose-game over.

What If The Watergrab Is Not Really About Water?

What if it's about money?

Why would a (quasi)municipality want to undertake a financially risky, devastatingly destructive, hideously expensive, and unpopular expansion project when it's customer base has shrunk significantly in the past few years?

This doesn't make sense. Southern Nevada Water Authority (SNWA) plans to start construction next year on a project who's cost is approaching SNWA's total assets at present.

...And of course, that's before the construction cost overruns.

...And of course, that's before the new loans to pay off the cost overruns

...And of course, that's before the hidden fees and penalties.

...And of course, that's before the refinancing fees.

The SNWA Groundwater Development Project is so massive, so expensive; it would be almost like building Las Vegas' total water infrastructure all over again. The watergrab is projected to cost “about” 3.5 billion dollars. SNWA's total assets at present are about 4.7 billion dollars.

That's a whole lot of money for some construction company. Maybe Halliburton, KBR, or Bechtel (the multi-national corporation that was kicked out of Bolivia by rioting citizens for mismanaging and price gouging a water project there) has already provided the estimate? They haven't told us who will build this, have they? Maybe we might get suspicious if the companies involved are known for padding contracts?

If there is collusion, you can bet there are some very high paying jobs waiting just on the other side of the revolving door for some of those SNWA executives.

And we all know that SNWA doesn't have the cash to pay for this huge project. So where are they going to get the money? Borrow it, of course. And some bank must have already given SNWA an idea of how much the financing costs are. So, why haven't they told us what banks are involved?

What if the bank involved is JP Morgan Chase, UBS, Goldman Sachs, or Bank of America? Since 2008, these banks have earned a scary reputation of unscrupulous financing. JP Morgan Chase, for example, was recently fined 228 million dollars for running a bid rigging scheme involving municipal bonds in 18 states. Did you get that? Municipal bonds!

Have the people of Las Vegas already forgot about the financial “crimes” that led to the housing crisis – and Las Vegas' present economic state? No. Of course not. Maybe that's why we don't know who SNWA wants to borrow from.

I'm not just making this up. All across the country, communities are being driven into crushing debt by greedy multi-national banks.

All it takes is a few corrupt officials – and a whole lot of bribe money.

In this Max Keiser video interview; Matt Taibbi shows an example of a small community that wanted to upgrade it's sewers – ending up with billions of dollars in debt.

This video has about three minutes of related information before the actual interview. Max Keiser is a bit over the top, but it's worth the information about whole communities being driven to debt servitude for the next generation.

…

The original cost estimates of the sewer upgrade were $250 million. With all of the contract padding and finance costs, the bill ended up at $3 billion, 12 times the original cost!

For more information; Matt Taibbi's report Looting Main Street explains how the nation's biggest banks are ripping off American cities with the same predatory deals that brought down Greece.

Is Southern Nevada above this kind of thievery? Nope. In fact, they are ripe for the picking.

And worse, the crushing debt would practically guarantee that the hoped for growth to pay for the Groundwater Development Project won't be as robust as anticipated. In other words, there won't be a need for more water – and those who don't leave Las Vegas will have to shoulder the whole bill.

Can We Survive All This – Happier Than We Are Now?

It has been said that if you want to make an omelet, you'll have to break a few eggs. True, but you definitely don't want to break all the eggs – and kill off the chickens.

Collectively as a civilization, in many ways, that's exactly what we are doing. For example; our extractive industries are racing to extract most of our planet's resources. And then they're planning on getting even richer price gouging when the supply gets low. There are so many cases of industries turning into rackets that we've passively accepted this as merely what capitalism looks like. Many executives just don't see enough financial incentive for their companies to be sustainable, safe, or even responsible. They want to be above the law. Hell, they want to write the laws! The foxes are now telling us how to run the chicken coop. This is not only dysfunctional, it is ultimately economic suicide. But it doesn't have to be that way. Humanity can do far better. We just have to fix our flawed system processes.

Consider this; what is the most basic flaw of our civilization's economic and political systems?

I would suggest it is our collective inability to utilize common sense.

Short-term self interest has driven our society toward corporate anarchy. Consequently, our society is unable to democratically adapt to a changing reality with objective, rational plans.

Take for instance; consider how our lust for money has clouded our capacity to maximize our happiness to such an extent that humanity runs the risk of self-induced extinction.

Humanity has still not effectively addressed our obsession for money. I suspect this is so because we have never actually tried.

When money was invented, nobody sat around thinking about how we should best create a better future with it. Nobody sat in planning meetings to figure out what type of society we should create with money. The whole monetary basis for all of our planet's major economies just sort of happened. The fundamental basis for our world economy, money, was never designed to maximize our happiness. Money was, and is, just an overrated tool. Money is just paper.

Of course, using money was far easier than trading chickens for medical services. And, of course, money represented wealth. So, people tried to accumulate as much of it as they could... Whether capitalist, communist, or socialist – in a nutshell; this is our economic system... That's right. No overall plan. No sustainable objective. Not even any logical methodology for determining the wisest course. Let's face it; nobody has really thought this all through to any kind of logical conclusion. Humanity is simply running amok to accumulate colored paper.

Which leads to disasters such as this:

…

This is insane. This type of behavior in a society is literally insane, profoundly self-destructive, and ultimately suicidal.

Draining water from the desert has obvious results: death... mass death, economic devastation in the effected areas, and unsustainable Ponzi scheme growth.

So, why would Southern Nevada Water Authority (SNWA) want to do something like this?

Let's see... SNWA is a quasi-municipality at a time where municipalities across the nation are privatizing. Hmm... could it be that SNWA secretly wishes to privatize also? If so, having water rights to huge swaths of Rural Nevada water would fetch them a much higher asking price – likely billions more, in fact. And moreover, there just might be some high paying jobs on the other side of that revolving door too.

Could it be that SNWA is just trying to drive up their asking price – when they eventually decide to privatize? Could it be that SNWA is essentially speculating with Nevadans' water?

In a way, this watergrab is already a form of privatization. That's right, if this watergrab effort is permitted, Southern Nevada's private entities will end up with water that has been the commons for all from time immemorial.

It is very likely that this watergrab is just another step towards quasi-privatization of much of our State's groundwater.

Think about this: What's to keep any private company that takes over SNWA from price gouging? Nothing. Sure, Nevada water law doesn't permit them to sell State water. But so what? All they have to do is sell the delivery of the water. It is very likely that SNWA is taking the first steps towards overcharging Nevadans for our own water.

The amazing irony of all this is that Nevada water law is written to expedite this exploitation. Nevada water law is essentially written; “the first to exploit our water can have it all to themselves for free.” SNWA has to apply for the water, or somebody else will take it.

This is a sign. This is a sign of a dysfunctional system. We need to fix this. It is of utmost importance. But unfortunately, our economic and political systems are so broken that it is very likely that we can't really fix anything without fixing everything.

The inertia of our (historically cobbled together) economic system is on a crash course at full speed to convert everything of any real value into money. (Need I remind you, money is only paper.) Massive profits have become more important than the survival of at risk plants, animals, ecosystems, even our own species – even all life on the planet.

No individual wants this.

We wouldn't vote for this.

But we're all caught up in the game.

This game has been compared to running a rat race with a monkey on your back, but it's the only game we know. Humanity has forgotten what worked for tens of thousands of years. We now believe that “greed is good” – because we don't comprehend anything else. On the other hand, ask even the dimmest among us, and they understand “supply and demand.” If supply becomes scarce, prices will rise. And if demand grows, prices will rise. Everybody knows that. We're all caught up in the game. But it's the people willing to manipulate supply and/or demand that we have to watch out for.

Massive profits are most often accumulated by utilizing two strategies; increasing scarcity and/or increasing growth. Here; we see both scarcity of water in the desert and growth in Southern Nevada. There are schemers who must see this as an opportunity to take advantage of others' desperation. Is there a conspiracy? We'd be fools to blindly trust otherwise. But initially, I think this was more of a trend – a trend we all too often see.

Historically, we have seen a trend (such as people moving to Las Vegas), turn into an industry (construction, etc.), now turning into a racket (crisis water supply).

…

And who pays? Well, check out the movie Chinatown. It's as if SNWA executives watched this movie about corruption and greed over and over again to plan the watergrab. The plays are all there. The names have been changed. There is, of course, a legitimate facet to who pays and who benefits from this water project. New residents to Southern Nevada will bear some of the expenses – and so they should. But existing residents will also bear billions of dollars in expenses for a pipeline network they don't need. Current residents of Las Vegas already have all the water they need. But like in the movie Chinatown, they've been panicked into thinking there is a shortage. What's worse is the economic benefits of Southern Nevada growth won't be shared evenly. Existing residents won't get new development in their neighborhoods. No, older neighborhoods will be left to rot – as they pay higher and higher taxes and fees to pay for water development in newer parts of Southern Nevada.

So, who benefits? The pro-growth supply/demand manipulators I warned you about earlier. The speculators. The developers. The Southern Nevada construction industry (which was morphing into an endless unsustainable growth racket). And those who can sell the one thing that is most precious in the desert – water.

Right about now, the pro-growth manipulators reading this will start in with the name calling. Most likely they will call me a Luddite, a tree hugger, or maybe a granola-head. They don't want people to realize that personally all I want is what is best for all of us in the long run. On the other hand, the pro-growth types tend to be more short-sighted and self-interested. Of course, the pro-growth types like to think of themselves as captains of industry, not selfish manipulators of our economy... And some of them own newspapers.

Our economic system is critically dysfunctional. This is all a big Ponzi scheme. Humanity takes from nature. We take from future generations. We take from our neighbors. We take from our customers. And if we can help it, we don't give back. That's just the way it is. We've got to maximize our profits.

In this dysfunctional system, the biggest exploiters are (temporarily) the biggest winners. Our businesses often promote those with psychopathic traits – to maximize profits. And once in position, the economic pressures on an executive push them to make psychopathic decisions – to maximize profits. Corporations are not models of democracy. They are effectively dictatorships. Corporate CEOs are not models of morality, they are fallible people with one overriding mission; increase the company's profits. It's that bad. Worse even. If any of these executives gain a sense of morality, it doesn't make any difference. Someone else will step in to take their place in a heartbeat.

All of the people of Nevada are being played. The endgame of this process is a hellish mess – with two overcrowded, overpriced, unsustainable, mono-culture mega-cities (near Las Vegas and Reno), and a vast uninhabitable desert that will ultimately become the toxic dump site for the nation... Things could get that bad. In fact, the trend has been going that way for well over 50 years.

We wouldn't vote for this...

Humanity doesn't want scarcity. We want abundance. But abundance doesn't concentrate money. SNWA could desalinate ocean water – which would mean more fresh water for Nevadans and Californians. (SNWA could desalinate water offshore for Californians, in exchange for more water from the Colorado River.) The environment crushing watergrab wells and pipelines are simply not necessary – and they're more expensive. However, an abundance of water means less scarcity, and therefore less profits. Besides; SNWA has spent hundreds of millions of dollars on this project. Politically, they can't admit that the money was wasted. They simply can't back down now, even though the price of desalination has dropped precipitously.

Collectively, Nevadans are unable to utilize common sense on this water issue – because our “leaders” are afraid of losing their jobs.

So, what do we really want?

I would suggest that we really want to maximize our happiness. And not just this quarter, not just this fiscal year; but for the rest of our lives – and for the lives of those we leave behind too.

What we really want is the collective opportunity to make the most sensible decisions. Our elected representatives have failed us. Our corrupt electoral system forces them to sell out to the highest bidder. What we need is more direct democracy.

What we really want is the intelligent management of the Earth's resources, based upon science – not Fox “News” style sell-out pseudo-science.

What we really want is more common sense.

Why should this even be remotely controversial?

...Because some companies' short-term profit margins might suffer.

... that's it.

... that's it!