The Next Crisis No One Is Talking About

Mark Twain once remarked, “Whiskey is for drinking; water is for fighting over.”  If the convergence of water scarcity factors currently shaping up comes to pass, this could be the century of water wars.

No doubt, a devastating water crisis is approaching.  While the world once possessed a massive supply of fresh water, human mismanagement of this precious resource has resulted in an abundance of scarcity issues.  Rivers, lakes, reservoirs, and below ground aquifers are drying up…and those that haven’t are so polluted proper water treatment would cost a fortune.

Without fresh, drinkable, water humans cannot live.  Moreover, just a temporary water supply disruption would wreak havoc on the economy.  If the water supply were cut off to your city what would happen?

It’s probable that within one week the whole place would verge on disaster.  The sewage problem alone would be horrific.  On top of that, if water resources were cutoff to the vast irrigation network that supplies agricultural fields and makes the desert bloom, food production would crash and chaos would follow.

Yet no one is talking about this looming crisis…

Water Scarcity in the United States

Each year, as water resources diminish, drought conditions spread.  Massive uncontrollable fires and dust storms are increasing in frequency and duration, desertification of once arable land is rising, and usable agricultural land is decreasing.  In the near future, it’s likely that water shortages will result in dramatic population migrations and political conflicts.

Take Lake Mead, for instance.  It supplies about 85 percent of the water used in Las Vegas.  Unfortunately, since 1998, the water level in Lake Mead has dropped over 50 percent.  If conditions continue as they have, it’s projected that Lake Mead will completely dry up around the year 2021.  Las Vegas will be left parched and gasping for water.

Then there’s the Ogallala Aquifer, a massive underground water resource that extends from South Dakota to Texas.  It’s rapidly being drained at a rate of about 800 gallons per minute.  Years ago the aquifer had an average depth of about 240 feet; today the average depth is just 80 feet.  If this continues the Great Plains will become the Great Desert.  In fact, according to Dr. Kevin Mulligan, professor of Economics and Geography at Texas Tech, many areas of the Great Plains that are dependent on the Ogallala Aquifer will run out of useable water by the year 2030.  America’s breadbasket will dry up and blow away.

Here in the Los Angeles Basin we find ourselves just one earthquake away from disaster. If the big one hits, the massive complex of aqueducts and pipelines that funnels water thousands of miles to the thirsty southern California cities could be damaged, cutting off flow to 17 million people…nearly half the state’s population.  But even without a massive earthquake California only has a 20-year supply of fresh water left.  What then?

Regrettably, these problems are not limited to the western states…the south is dealing with its own water scarcity issues too.  For decades, Alabama, Florida, and Georgia have been fighting over water rights claims to Lake Lanier.  Several years ago a federal judge ruled that Georgia has few legal rights to this water resource, which is the main water supply for Atlanta.  In 2007, following a long dry spell, and severe water rationing, the state government ran out of solutions…except for holding hands with ministers on the steps of the state Capitol to pray for rain.  At the time it seemed to have worked.  But, once again, Atlanta is suffering from drought conditions.  Perhaps, this time, the heavens will not be so compliant.

Even the water resource rich Great Lakes states are feeling the heat of water scarcity.  In 2007, Lake Superior, the world’s largest freshwater lake, dropped to its lowest levels in 80 years.  To protect their precious resource, the eight states in the Great Lakes region have signed a pact banning the export of water to outsiders – even other U.S. states.

Nonetheless, the water scarcity problems facing the United States may be minor compared to some other countries…

The Next Crisis No One Is Talking About

In India, for example, it is estimated that 75 percent of the surface water is contaminated by human and agricultural waste.  Shockingly, this is because roughly 100,000 tons of human waste is deposited each day by approximately 665 million people without toilets in fields of potatoes, carrots, and spinach, on banks of rivers used for drinking and bathing.

Yet India’s experience is not unique.  In underdeveloped countries 90 percent of wastewater produced is discharged untreated into local waters.  Obviously, the effects to health and hygiene are appalling.  According to the World Health Organization, 80 percent of all sickness and disease worldwide is related to contaminated water.

China suffers from its own water pollution and scarcity issues too.  If you can believe it, 80 percent of all major rivers have become so polluted they no longer support aquatic life. What’s more, 90 percent of all groundwater systems under major cities in China are contaminated.  This may be why more than two-thirds of Chinese cities face water shortages.

Of course, we could go on and on. Africa, the Middle East, Latin America, Australia, and even Europe suffer from water scarcity issues.  Currently, one-third of the world population lives in water stressed countries.  By 2025 this will increase to two-thirds of the world population as five times as much land will likely be under extreme drought.  Remarkably, this is after the land percentage of Earth suffering from serious drought more than doubled between 1970 and 2005.

Clearly, a colossal water crisis is quickly taking shape.  Though, right now, no one is seriously talking about it.  We expect this to change in the near future as the problem becomes impossible to ignore.  Likewise, where there is crisis there is opportunity.  Here at the Economic Prism we’re currently scouring out the water resource field for opportunities to profit from the convergence of water scarcity issues burgeoning across the planet.

We’ll be sure to keep you apprised on what we discover.


MN Gordon
for Economic Prism

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