interviews
Water and the American West
by Richard Frank
October 25, 2021
This interview with Richard Frank, professor of environmental practice at the UC Davis School of Law and Director of the California Environmental Law and Policy Center, was conducted and condensed by franknews.
frank | Can you tell me a little bit about the story of water and how it's tied to the West, and to California in particular?
Richard | A friend of mine who's a Court of Appeals Justice here in California wrote an opinion on a water law dispute and started it with the quote, "the history of California is written on its waters." And I think that the point is true of the entire American West.
Water policy and legal issues are inextricably tied to the development of the Western United States; water is the limiting factor in so many ways to settlement, to economic development, to prosperity, and to the environment and environmental preservation.
Can you talk about the difference between groundwater and surface water– and the policies that regulate each?
There are really two types of water when it comes to human consumption. There's surface water: that is the water that is transmitted by lakes, rivers, and streams. Then there is groundwater, and a substantial amount of water that Americans and the American West rely on is groundwater. That is water that is stored in groundwater aquifers, which are naturally occurring groundwater basins. Both groundwater and surface water are critical to the American West and its economy and its culture.
Traditionally a couple of things are important to note, first of all, water is finite. Second, water gets allocated in the Western United States generally at the state level. There's a limited federal role. Primarily, policy decisions about who gets how much water for what purpose are made state by state.
I think allocation is really interesting in that it's more state-level than federal. How was water and the allocation of water in California designed? Is it a public-private combination? What goes on in terms of the infrastructure of water?
Another very good question. The answer is it depends. Most of our water infrastructure is public in nature.
Again, in the American West, the regulation of water rights is generally done at the state level, but the federal government, historically, has a major water footprint in the American West because it has been federal dollars and federal design and management that really controlled much of the major water infrastructure in the American West — you know, Hoover Dam, and the complex system of dams and reservoirs on the Colorado River in California, with the Central Valley Project that was built and managed by the federal government with Shasta Dam on the upper Sacramento River as the centerpiece of that project. But we also have a California State Water Project, the key facility being the Oroville Dam and reservoir on the Southern River that is managed by state water managers. If we were starting over, that kind of parallel system would make no particular engineering or operational sense.
But, we are captive to our history.
And then you have these massive systems of aqueducts and canals that move water from one place to another throughout the American West. They are particularly responsible for moving water from surface water storage facilities to population centers. In the last 50 to 75 years, these population centers have really expanded dramatically, so you need massive infrastructure to deliver water from those storage facilities, the dams, and reservoirs, which generally are located in remote areas to the population centers. So it takes a lot of time and energy to transport the water, from where it is captured and stored to where it is needed for human use.
California has faced continuous drought – what measures is the state taking now to manage water?
Just to frame the issue a little bit — we have, as I mentioned, a growing population in the American Southwest at a time when the amount of available water is shrinking due to drought and due to the impacts of climate change. We have growing human demand for residential and commercial purposes and at the same time, we have a shrinking water supply. That is a huge looming crisis.
And it is beginning to play out in real-time. You see that playing out in real-time. For example, several different states and Mexico rely on Colorado River flows based on an allocation system that was created in the 1920s, which is overly optimistic about the amount of available water. From the 1920s until now, that water supply has decreased, and decreased, and decreased. Now you have interstate agreements, and in the case of Mexico, international agreements that allocate the finite Colorado river water supplies based on faulty, now obsolete, information. It is a real problem.
What measures do you take now, knowing this information?
If you look at the US Drought Monitor, it is obvious the problem is not limited to the Colorado River. We are in a mega-drought, so cutbacks are being imposed by federal and state water agencies to encourage agricultural, urban, and commercial water users to cut their water use and, and stretch finite supplies as much as possible through conservation efforts.
In California, we have the State Water Resources Control Board, the state water regulator in California, and they have issued curtailment orders. Meaning, they have told water rights holders, many of whom have had those water rights for over a hundred years, that, for the first time, the water that they feel they are entitled to, is not available. Local water districts are also issuing water conservation mandates; the San Francisco water department is doing that, in Los Angeles, the metropolitan water district, is urging urban users to curtail their efforts.
And then agriculture. Agricultural users — farmers and ranchers — have had to get water rights in many cases through the federal government, as the federal government is the operator of these water projects. They have contracts with water users, individual farmers, ranchers, or districts, and they are now issuing curtailment orders. They're saying, we know you contracted for X amount of water for this calendar year, but we are telling you because of the drought shortages we don't have that water to supply. Our reservoirs are low at Lake Shasta or at the Oroville Dam.
When you drive from San Francisco to LA on the five, you see a lot of signage from the agricultural farming community about water. There's apparently some frustration about this. What are the other options for them?
About 80% of all human consumed water goes to agriculture. That is by far the biggest component of water use, as opposed to 20% used for urban and commercial, and industrial purposes.
Over the years, ranchers and farmers, and agricultural water districts assumed that the water would always be there — as we all do.
And the farmers and ranchers have, in hindsight, exacerbated the problem by bringing more and more land into production. You see on those drives between San Francisco and Los Angeles, particularly in the San Joaquin Valley, all these orchards are being planted. Orchards are more lucrative crops than row crops — cotton, alfalfa, and rice. But, if you are growing a row crop, you can leave the land fallow in times of drought.
We don't have to plant. If the water stopped there, or if it's too expensive to get, it may make economic sense, but if you have an orchard or a vineyard it's a high value, those are high value crops, you don't have that operational flexibility and they need to be irrigated in wet years and in dry years. Now, you see these orchards, which were only planted a few years ago, are now being uprooted because the farmers realized that they don't have the water necessary to keep those vineyards and orchards alive. For ranchers, the same thing is true with their herds. They don’t have enough water for their livestock.
The water shortage has never been drier than it is right now. Farmers and ranchers are being deprived of water that they traditionally believed was theirs and they're very understandably, very unhappy about it. They see it as a threat to their livelihood and to the livelihood of the folks who work for them. Their anger and frustration are to be expected, but it's nobody's fault.
To say, as some farmers do, that it is mismanagement by state and federal government officials, I think is overly simplistic and misplaced in the face of a mega-drought. Everybody's going to have to sacrifice. Everybody's going to have to be more efficient in how they use water. All sectors are going to need to be more efficient with the water that does exist.
Looking at this percentage breakdown of water use – is it actually important for individual users to change their water habits?
Well, every little bit helps. When you're talking about homeowners, about 70% of urban water use is for outdoor irrigation. So we're talking parks and cemeteries and golf courses and folks' yards. You know, that used to be considered part of that American dream and the California dream — you would have a big lawn in front of your house and behind your house. Truth be told, that has never made much sense in an arid environment. That's where the water savings in urban areas is critical in the way it really involves aesthetics rather than critical human needs, like water for drinking and bathing and sanitation purposes. There is a growing movement away from big lawns, and away from the type of landscaping that you see in the Eastern US — there is no drought in the Eastern United States. As Hurricane Ida and other recent storms have shown, the problem is too much water, or rather than too little in most of the Eastern United States. So it really is a tale of two countries.
We just need to recognize that the American West is an arid region. It has always been an arid region, we can't make the desert bloom with water that doesn't exist. We need to be more efficient in how we allocate those water supplies. And it seems to me in an urban area, the best way to conserve and most effective way is to reduce urban landscaping, which is the major component of urban water use.
You also write about water markets and making them better – for those who don’t know, what is the water market?
Water markets, that is, the voluntary transfer of water between water users, is more robust in some other Western states. Again Arizona and New Mexico come to mind. California somewhat surprisingly is behind the curve. We are in the dark ages compared to other states. Water markets are kind of anecdotal. There is not much of a statewide system. It is done at the local level, through individual transactions without much oversight and without much transparency. And I have concerns about all of those things.
I believe conceptually watermarks are a way to stretch scarce, finite water resources to make water use more efficient. I can, for example, allow farmers or ranchers to sell water to urban uses or commercial usage or factories in times of drought.
Farmers sometimes can make more money by farming water, than they can by farming crops.
There are efficiencies to be gained here.
The problem in my view is really one of transparency. The water markets are not publicly regulated, and some of the people who are engaging in water transactions like it that way, frankly, they want to operate under the radar.
In my opinion, water markets need to be overseen by a public entity rather than private or nonprofit entities. We need oversight and transparency, so that folks like you and myself can follow the markets to see who's selling water to whom, for what purpose, and make sure that those water transfers serve the public interests and not just the private interests.
There have been a number of stories in the New York Times and the Wall Street Journal and the Salt Lake City Tribune about efforts in some parts to privatize water transfer. Hedge fund managers are buying and selling water, as a means of profiting. And it strikes me that when you're talking about an essential public resource — and in California, it is embedded in the law that public water is an inherently public resource, that water is owned by the public and it can be used for private purposes, but it is an inherently public resource — the idea of commoditizing water through the private, opaque markets is very troublesome to me. I think it represents a very dangerous trend and one that needs to be corrected and avoided.
Why is California so behind?
There's no good reason for it. It's largely inexplicable that since the state was created on September 9th, 1860, we've been fighting over water. In the 19th century, it was miners versus farmers ranchers. In the 20th century, with the growth of urban communities, the evolution of California into one of the most populous states with 40 million Californians, it has been a struggle between urban and agricultural uses of water.
In the second half of the 20th century, there was a recognition that some component of water had to be left in streams to protect ecosystems, landscape, and wildlife, including the threatened and endangered wildlife. That suggestion has made agricultural users in California angry. You will see those signs that allude to the idea that food and farming are more important than environmental values. I don't happen to believe that's true. I believe both are critically important to our society. But the advocates for the environment have a proverbial seat at the water table. So that's another demand for water allocation that exists.
Do you maintain optimism?
Yes. I think it's human nature to look on the bright side. I try to do that through research scholarships and teaching. There are models for how we can do this better in the United States. Israel and Saudi Arabia and Singapore are far more efficient with their water policies and efforts. Australia went through a severe megadrought. They came out of it a few years ago, but they used that opportunity to dramatically reform their water allocation systems. That's an additional model. I think most people would agree in hindsight that their previous system was antiquated, and not able to meet the challenges of climate change and the growing water shortage in some parts of the world.
Here in the United States, we can learn from those efforts. There are also some ways to expand the water supply. Desalination for one. Again, Singapore and Saudi Arabia have led the world in terms of removing the salt content from ocean water and increasing water supply that way. In Carlsbad, California, north of San Diego, we have the biggest desalination plant in the United States right now, and that is currently satisfying a significant component of the San Diego metropolitan areas’ water needs. It's more expensive than other water supplies, but the technology is getting more refined, so the cost of desalinated water is coming down at a time when other water supplies, due to shortages and the workings of the free market are going up.
At some point, they're going to meet or get closer. Unlike some of my environmental colleagues, I think desalination is an important part of the equation.
In a proposal that came up in the recall election, one of the candidates was talking about how we just need to build a canal from the Mississippi River to California to take care of all our problems. That ignores political problems associated with that effort, as well as the massive infrastructure costs that would be required to build and maintain a major aqueduct for 2000 miles from the Mississippi to California. That's just not going to happen. Some of those pie in the sky thoughts of how we expand the water supply, I think, are unrealistic.
interviews
A Failed Lending System
by Alan Collinge
September 30, 2020
Alan Collinge, founder of StudentLoanJustice.org, was conducted and condensed by franknews.
Alan | I have a bachelor's, a master's, and an engineer's degree. I began looking deeply at the student loan problem because of my own student loan issues, and in 2006 I decided to dedicate myself to this work full time. The debt crisis, unfortunately, has only become worse since those days.
frank | And how do you articulate what the problem is?
The problem is that student loans have been exempt from the most fundamental consumer protections — some of which are called for in the constitution. Unlike every other loan in this country, student loans do not have bankruptcy protection. Student loans do not have a statute of limitations. Fair Debt Collection Practice laws, Truth in Lending laws. Even state usury laws have been restricted or eliminated for most student loans.
The founding fathers themselves were savaged under the predatory British banks and merchants. They understood the importance of bankruptcy protections. And indeed, if you look at Article I, Section 8 of The Constitution, the founders call for uniform bankruptcy laws ahead of the power to raise an army, declare war, and even coin currency. But student loans have been essentially stripped of this protection.
Within that failure, what do you seek to do as an organization?
Well, for the first 15 years of our existence, we were fighting only for the same bankruptcy protections as every other type of loan. It hasn't worked, unfortunately. Congress failed us.
When I started this, student loan debt stood at $400 billion. There is now $2 trillion in outstanding student loan debt. Some of the official numbers are lower than that, but those numbers do not include a lot of the interest charges or private loans — home equity loans, for example —that families take out to pay for college. With these taken into account, we are well over $2 trillion of college debt. Now, in addition to the return of standard bankruptcy rights, we are advocating for all federal student loans to be canceled.
The student debt crisis is a national threat. We now know that the default rate for the class of 2004 was around 40%, and students in 2004 were borrowing only a third of what students today borrow. By our best estimates, before the pandemic, 80% of borrowers were never going to be able to pay back their student loans. Today, when 50 million people are losing their jobs, many of which will not return, it seems like it is time for all federally owned student loans to be canceled.
Does the increase in college accessibility and the inability to declare bankruptcy go hand in hand?
That is a good point. College accessibility has increased dramatically since the 1970s, when some of these consumer protections were rolled back. Around 30% of the population was going to college then, and now around 60% of the population is attending college.
There are better ways to make it more accessible. We should fund community and state colleges to a point where people can take on little to no debt.
So how did these consumer protections get stripped away?
My theory might be slightly controversial. There's something called the Powell Memo that Lewis Powell authored as a special advisor to President Nixon. He wrote it as a result of watching the cultural revolution of the 1960s. Mr. Powell outlined a series of steps that conservatives should take to prevent what happened in the 60s from ever happening again. He advocated for the changing of the guard across the country. He says that monied and conservative interests should infiltrate colleges, media, NGOs, and think tanks in order to sow the seeds of their ideology.
Sallie Mae was established months after the Powell memo was published, and in the 1970s we began removing bankruptcy protections.
In 1998, federal student loans became forever impossible to discharge in bankruptcy, and, astonishingly, this exception to discharge was extended to private student loans in 2005. This gave the lenders carte blanche to hound borrowers for the rest of their lives. This led to a huge boom in lending for colleges. This is also when the colleges began to really raise their prices.
While Sallie Mae began as a government-sponsored entity, they decided to go private around the mid to late 1990s — this around the same time they acquired the largest loan collection companies and largest guaranty agency in the country. This government-sponsored entity essentially morphed into a fully for-profit, privately held monopoly over the student loan market.
And what are the consequences of stripping these consumer protections away?
It’s an incredibly predatory system. People can have their wages garnished for defaulting on loans. Senior citizens and the disabled can lose their benefits. People can be fired from public employment. They can lose their professional licenses, and in some cases, they can even lose their driver's licenses if they default on federal student loans. It is a sort of one, two punch. There are no consumer protections, and on top of that, there is also a draconian, mafia-like collection regime.
After 15 years of working on this, you have a bill in the House and a bill in the Senate that aims to restore protections.
At long last, we have good legislation. We have two bills right now: S.1414 in the Senate, and HR 2648 in the House. Dick Durbin is the sponsor in the senate, and Jerry Nadler and Republican John Katko are the sponsors in the House.
There is no good reason that this bill shouldn’t pass. The sticking point is the Republicans in Congress, to be quite frank. Right now our number one goal as a group is to get a Republican senator to co-sponsor this legislation.
Outside of Congress, we have conservative support from places like the Cato Institute, The National Review, David Brooks, the conservative commentator at the New York Times, AND conservative scholars at George Mason University. These places agree that bankruptcy protections must be returned to student loans, but because of the way the industry has courted Republicans, as well as Democrats for that matter, we are stuck.
Politically, do you feel like either party has a good grasp and effective communication plan to tackle this issue?
Again, 80 percent of people, according to the Department of Education, will likely never be able to pay their loans. That is 44 million people in the country walking around, losing sleep over their student loans. And these people vote far more than average. 44 million votes can turn a loss into a landslide; even a third of that can turn a loss into a landslide. This is an electoral bonanza, the likes of which we have never seen before. In any other issue in this election — healthcare, defense, civil rights, etc — the battle lines are drawn and it is hard to move many people from one side to the other. It is the wild west with the student loan issue. Neither party has gotten their arms around this thing, and frankly, no sitting member of congress wants to touch it because it is such a big problem that has continuously been kicked down the road.
We started a petition calling on the president to cancel student loans through an executive order.
In Congress, if you pass legislation that costs the taxpayer anything, you have to come up with funding to support the legislation. So in order to cancel $1.7 Trillion in student loans through congressional legislation, you have to find that money. That requires cutting an equal amount from other areas, raising taxes, or adding to the national debt. That is just never going to happen. Congress will never pass legislation that cancels student debt fully. If they pass legislation it will be limited; there will be many strings attached, and ultimately, very few borrowers will actually see their loans canceled.
However, the president has the executive authority to demand the Department of Education to cancel all the student loans that it owns, which is about 85 percent of all student debt. The president can do that without needing one dime of tax appropriation or any congressional approval, and, I might add, without adding one penny to the national debt. The taxpayers already paid for these loans. There is no good reason that they need to pay twice! That is the solution we are pushing for, and we have over 700,000 signatures from people who span the political spectrum. I estimate that 40% of student loan borrowers are politically independent, and about 20% identify as Republicans. This really is a huge voter bonanza for whichever candidate steps up to solve it by executive order.
Are you hopeful that politicians will acknowledge that and act on it?
I am very happy to report that last week, Elizabeth Warren and Chuck Schumer have adopted our strategy and are now championing it. They introduced a Senate resolution calling on President Trump to cancel "up to $50,000" in federally owned student loans by executive order. While their plan is frankly vague, and a bit suspicious this close to the election, it is very encouraging to see that the concept of federal loan cancellation by executive order proposed. I believe we have really started something good here.
I can only hope that both parties will converge on this solution. There is no better opportunity than this pandemic to reset this failed lending system, massively stimulate the economy, free the 44 million Americans from the jaws of this nationally threatening lending system, and replace it with a more rational and just funding model for higher education in this country.