Kansas Needs Water Markets, Not More Water Bureaucracy

Originally published at Kansas Policy Institute. 

Kansas has a serious water problem, especially in the west. But more government is unlikely to solve a problem that government policy helped worsen.

The Kansas Geological Survey has documented decades of groundwater declines across the High Plains Aquifer, including the Ogallala region. Long-term drought plays a role, but this is also an incentives problem. The former is beyond the control of agriculture and other water users; the latter is something we can change to ensure the water that does exist supports Kansas families. 

Kansas water is governed through permits, administrative boundaries, pumping rules, and government approval. These rules often weaken the reward for conservation and make it difficult to move water to different users.

A farmer who saves water should be able to keep, lease, or sell that value. Instead, rigid policies can trap water in existing uses and leave government officials deciding how it should be allocated. That is not a functioning market.
Kansas should move toward clearer, stronger, and more transferable private water rights. Privatization does not mean allowing one corporation to own every river or aquifer. It means recognizing enforceable rights to defined amounts of water and allowing those rights to be voluntarily exchanged without harming other users.

Prices would then communicate scarcity. When water becomes harder to obtain, its value rises. That creates stronger incentives to conserve, invest in efficient irrigation, adapt farming practices, rotate crops or even shift water toward uses that produce greater value.

Australia provides a useful, though imperfect, model. Its water markets allow users to buy and sell water rights permanently or temporarily. That flexibility has helped farmers and communities adjust during drought instead of waiting for politicians to allocate scarce supplies.

Kansas also has local evidence that better incentives can work. In the producer-led Sheridan 6 management area, irrigators significantly reduced water use while protecting agricultural production. Farmers responded because they had flexibility and a direct stake in preserving the resource.

Privatizing municipal water systems is a question that should be considered. Private businesses can fail just as public utility monopolies do, though a failed private business will close while a government one won’t. The more important first step is to strengthen private water rights, expand voluntary transfers, improve measurement, and remove unnecessary government barriers.

Kansas cannot regulate its way to more rainfall or refill the Ogallala with another spending program. More subsidies and bureaucracy may delay hard decisions, but they will not correct the incentives that encourage overuse. Nothing is free, including water policies that hide scarcity from users and shift costs to taxpayers.
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Clear property rights, honest prices, voluntary exchange, and private innovation will not eliminate water scarcity. They will help Kansans manage it far better than another layer of government. Kansas needs less political control over water and more freedom for farmers, families, entrepreneurs, and communities to conserve, trade, and innovate.