When Austin's metropolitan area has added another 1 million+ people?
That's a 40% increase. A 40% increase in water use if individual rates of use remain constant.
They can't, of course. Under our water rationing system, the City will have to resort to ever more draconian measures. The more draconian the rationing rules, the greater the dead-weight losses:
- The harsher the rules, the harder they will be to enforce. This means the City will have to spend ever more money to ensure compliance. That's waste.
- The more stringent the rules, the more leakage, so to speak. People will have a greater incentive to cheat. There are diminishing returns to a command-and-control system.
- The more stringent the rules, the greater the loss imposed on people who put a high value on that last gallon of water. People don't value water equally. Some people just don't have any need for more than the amount necessary to cook their food, shower, and flush their toilets. Others really, really like to wash their cars once or week or keep their yards in tip-top shape. The stringent rules impose losses on the people in the second category but not people in the first. The more stringent the losses, the greater the economic inefficiency. Let the people who put a high value on the water pay for it (and, incidentally, hand the City more money to spend on other things).
Water rationing is not a stable, long-term solution. Start pricing it right now; the longer we wait, the harder it will be to start later.
