The basic building block for all life on Earth, water is the most plentiful natural resource on the planet; in fact, over two-thirds of the Earth is covered by water. However, 97 percent is held in the oceans, while only 3 percent is freshwater. Of the freshwater, only 1 percent is easily accessible as ground or surface water, the remains are stored in glaciers and icecaps. Moreover, freshwater is not evenly distributed across land surfaces, and there are a number of heavily populated countries located in arid lands where fresh water is scarce.
Water also regulates the temperature of the planet and cycles essential nutrients through the land, air, and all living things. The flow of water through the atmosphere, biosphere, lithosphere, and hydrosphere is called the hydrologic, or water, cycle. Thus, water is both the most abundant natural resource on our planet and a fundamental element of life whose preciousness requires diligent management.
Philosophies guiding management of water supplies changed during the 20th century. Until the second half of the 1900s, water management was governed by the goal of moving water to where it was most needed, particularly for irrigation of agricultural lands. Rivers, lakes, and other bodies of water were also used to carry away wastes from municipal and industrial uses, because it was believed that the pollutants would disperse in the water. In the past three decades, the focus of water management has shifted to considerations of municipal, agricultural, and industrial supplies, water quality, and the protection of aquatic ecosystems.
Many argue that privatization, rather than state-control, produces the most equitable, environmentally friendly, and economically sound system for managing both the distribution and consumption of water. Water rights which are transferable from one individual to another are the fundamental building blocks of such a system. Rather than government controlling access to water, in a private system individuals buy, sell, and trade water rights, just as we do with property rights today. However, critics charge that private water markets will undersupply consumers and lead to unequal distribution, skewing towards those with more means. Yet, in practice, this seems not to be the case.
Interestingly enough, privatization benefits are actually most visible in developing countries. People living on the margins, without recognizable property or water rights, are able to access clean drinking water for a small cost because local water vendors have responded to the many failures of government supply. In West Africa , for example, small, disposable bags of clean drinking water called sachets are available throughout the region for only a few cents. Many foreign companies are also responding to this increased demand, shipping large amounts of bottled water to consumers who need it most.
In creating a realistic market for water, price increases will effectively treat water as a finite and precious resource, reflecting all costs associated with its use; therefore, individuals will adapt, innovate, and find creative ways to trade and conserve. When prices do not reflect scarcity, it can result in waste, inefficiency, and environmental degradation.
