While we all understand the market distortions caused in the United States by government subsidies for irrigation water, Michael Campana raises an interesting question about the international implications. Quoting a talk at the XIV World Water Congress by Paul Stanton Kibel of the Center on Urban Environmental Law (“CVP” is the Central Valley Project in California):
[S]ome countries, Brazil in particular, are upset because they feel that export crops like cotton (in Brazil’s case) are receiving subsidies from the US because of cheap CVP water. They claim that the cheap water represents ‘foregone revenue’ on the part of the Federal government, which is disallowed by the WTO. Kibel said that other exported crops like pistachio nuts and a few others might also come under the purview of the WTO should someone file a claim. So also might other crops like rice (China and India) that are grown in the Sacramento Valley.
He’s right. Those are subsidies. IID is especially good at exporting our $/water to other countries (but they are patriots!!)
I would be curious to see a list of countries that don’t subsidize agriculture in water use or other similar resource needs. And in places that require irrigation for farming, they would have two choices – subsidize water use by farmers or let someone else grow their ag products. I don’t think any country really wants to go down that road.