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00:00THIRST." CHARLES, CALIFORNIA HAS ONE HECK OF A PROBLEM AND CALIFORNIANS ARE ONLY BEGINNING TO WAKE UP TO THAT REALITY NOW. HOW SHOULD THEY BE THINKING? CHARLES: GOOD MORNING. THEY ARE WAKING UP SLOWLY. THAT IS PART OF THE MISTAKE. HOW SHOULD THEY BE THINKING? WE ARE IN YEAR FOUR OF THE DROUGHT. THE DROUGHT MIGHT LAST TWO MORE YEARS OR SIX MORE YEARS. IT COULD LAST A DECADE. WE COULD HAVE SIX AND SEVENTH GRADERS WITH NO MEMORY OF REAL RAINSTORMS. PART ONE IS YOU NEED TO FIGURE OUT HOW TO MAKE IT THROUGH THE NEXT FEW YEARS, THE SHORT-TERM. HOW TO KEEP BUSINESS GROWING AND THRIVING, HOW TO KEEP THE FARMS WORKING. HALF THE PRODUCE IN THE UNITED STATES COMES FROM CALIFORNIA. MUCH MORE IMPORTANT , CALIFORNIA NEEDS TO REINVENT ITS WATER SYSTEM, WHICH IS INCREDIBLY ELABORATE AND COMPLEX, TO ACCOUNT FOR THIS KIND OF DRYNESS. THE SYSTEM THAT EXISTS DOES NOT WORK VERY WELL AND THEY NEED A LONG-TERM RE-IMAGINATION AND THEN THEY NEED TO TEACH THE REST OF US WHAT THEY LEARNED ABOUT HOW TO MANAGE SCARCE WATER. STEPHANIE: WHERE ARE THEY GOING TO GET THE MONEY TO DO THIS? IF CALIFORNIANS ARE ONLY WAKING UP NOW, CLEARLY BUDGETS AND LAWS HAVE NOT BEEN PASSED TO AFFORD SOME SORT OF REVAMP. CHARLES: I AM NOT SURE MONEY IS THE MOST IMPORTANT THING. IT DOES NOT COST ANY MONEY TO TAKE A SHORTER SHOWER. A THIRD OF THE WATER UTILITY SUPPLY IN CALIFORNIA, THAT IS DIFFERENT FROM AGRICULTURAL WATER, A THIRD OF THE WATER UTILITY PLY -- SUPPLY GOES TO LAWN WATER. IT DOES NOT COST ANY MONEY TO STOP WATERING YOUR LAWN. IT DOES COST MONEY TO SUBSTITUTE BETTER LANDSCAPING, BUT THE TRUTH IS, IT COSTS A LOT OF MONEY TO FIND NEW WATER FOR CALIFORNIA. WHAT YOU NEED TO DO IS SAY, HOW DO WE MAKE THE WATER WE'VE GOT ECONOMICALLY PRODUCTIVE AND AS ECONOMICALLY PRODUCTIVE AS POSSIBLE? ERIK: WHY NOT JUST PUT A PRICE ON IT? WHY NOT JUST ALLOCATE A MINIMUM AMOUNT OF WATER THAT EVERY CALIFORNIAN NEEDS TO SURVIVE AND TAKE THE ODD SHOWER, BUT NOT CAR WASHING, FOR EXAMPLE, AND NOT NECESSARILY WATERING YOUR LAWN AND JUST CHARGE CALIFORNIANS FOR EVERYTHING THEY CONSUME ABOVE THAT MINIMUM? CHARLES: THAT SYSTEM KIND OF EXISTS FOR THE UTILITY WATER PEOPLE. THE ISSUE IS THAT 6 THE WATER IN CALIFORNIA GOES TO FARMS AND THERE IS A VERY COMPLICATED 100-YEAR-OLD SYSTEM FOR WHO GETS THAT WATER, WHETHER THEY PAY, HOW MUCH THEY PAY. WHEN I TALK ABOUT REINVENTING THE SYSTEM, THAT IS WHAT I TALK ABOUT. ERIK: I MEANT CHARGE EVERYBODY . NOT JUST IN SANTA CRUZ OR PALM SPRINGS. OF COURSE, MOST OF THE WATER GETS CONSUMED BY AGRICULTURE, BUT I SEE MANY ARGUMENTS -- AND YOU WOULD KNOW BETTER THAN ME -- THAT THE AGRICULTURAL CONSUMERS ARE NOT PAYING A FAIR MARKET PRICE OR WHAT SHOULD BE A FAIR MARKET PRICE. CHARLES: THEY ARE NOT. IF THEY START PAYING MORE, WE WILL START PAYING MORE FOR FRUITS AND VEGETABLES. WHAT HAPPENS IF YOU CHARGE FOR WATER IS PEOPLE FIND WAYS OF SAVING IT. IT IS LARGELY FREE. I AM A BIG FAN OF BRINGING SOME ECONOMICS TO WATER. THE PROBLEM IS THAT THE ROAD LAWS THAT ENTITLE PEOPLE TO WATER AND SO WHEN I TALK ABOUT REINVENTING THE SYSTEM, YOU HAVE TO START WITH A CLEAN SHEET OF PAPER AND FIGURE OUT WHO IS GOING TO BE HURT AND HOW YOU TRANSITION. YOU CANNOT JUST WAVE A MAGIC WAND. WHAT I THINK IS INTERESTING IS THE JERRY BROWN, AT THE HEIGHT OF HIS POPULARITY AS GOVERNOR, AND THEN YOU TALK ABOUT THE CEO OF DISNEY, THE CEO OF GOOGLE, THE CEO OF APPLE, FACEBOOK, TWITTER, SOME OF THE MOST PROMINENT COMPANIES AND PROMINENT COMMUNICATIONS COMPANIES IN THE WORLD ALL HEADQUARTERED IN CALIFORNIA -- THERE IS NO CONVERSATION OR ATTENTION TO THE PROBLEM FROM THOSE PEOPLE. STEPHANIE: I'M GUESSING THEY ALL HAVE SWIMMING POOLS THAT THEIR HOUSES. CHARLES: IT IS EVEN MORE THAN THAT. WHEN YOU PRESS ENTER ON A GOOGLE SEARCH, TWO TABLESPOONS OF WATER IS USED. STEPHANIE: TWO TABLESPOONS OF WATER IS USED EVERY TIME I HIT A GOOGLE SEARCH? CHARLES: EVEN ON YOUR IPHONE, JUST YES. STEPHANIE: THAT IS PRETTY COOL. CHARLES: GOOGLE USES IN NORMAN'S QUANTITIES OF WATER TO RUN ITS SERVER CENTERS, APPLE DOES, DISNEY DOES. INTEL REPORTS ALL OF ITS WATER USE AROUND THE WORLD. THOSE PEOPLE COULD STEP UP AND SAY TO THE GOVERNOR, AS COULD THE LARGE FARM COMMUNITIES AND IRRIGATORS, WE NEED A CONVERSATION ABOUT HOW TO FIX THE SYSTEM. THEY SEEM OBLIVIOUS. ERIK: BEFORE WE RUN OUT OF TIME, WHERE WOULD YOU HAVE THEM LOOK? WHERE IN THE WORLD GETS WATER RIGHT? WHAT JURISDICTION, MUNICIPALITY, COUNTRY? CHARLES: THE QUICKEST PLACE TO LOOK AS AUSTRALIA. AUSTRALIA LOOKS VERY MUCH LIKE CALIFORNIA, ECONOMICALLY AND CLIMATE WISE. AUSTRALIA HAD A TEN-YEAR DROUGHT ACROSS THE ENTIRE COUNTRY AND THEY HAD TO REINVENT THEIR WATER SYSTEM. THEY CUT THE AMOUNT OF WATER PEOPLE AT HOME USED IN HALF AND THEY REIMAGINED JUST WHAT YOU WERE TALKING ABOUT -- THE ECONOMICS OF HOW WATER IS SUPPLIED TO BIG USERS. MUCH CLOSER TO HOME, THE CITY OF LAS VEGAS HAS A LOT TO TEACH SEC, LOS ANGELES, SAN DIEGO BECAUSE LAS VEGAS LIVES WITH THE AMOUNT OF WATER THAT WAS ALLOCATED IN 1935 AND THEY ARE A LITTLE BIGGER THAN THEY WERE. THERE ARE LOTS OF LESSONS, EVEN CLOSE TO HOME. ERIK: I HAVE SPOKEN TO SOME FARMERS IN THE CENTRAL VALLEY AND THEY CONSTANTLY POINTED FINGER AT THE ENVIRONMENTALISTS AND THE SMELT IN THE SACK AROUND JOE -- IN THE SACRAMENTO RIVER DRAINAGE. WHAT DO YOU SAY TO THOSE FOLKS? CHARLES: WHAT I SAY IS THAT IF YOU SET UP A WATER SYSTEM, THE SYSTEM IS NOT RIGHT. IN THE SHORT-TERM, THEY MAY HAVE A REASONABLE ARGUMENT, BUT IN THE LONG TERM, ALL THAT TELLS YOU IS THAT THE SYSTEM IS BROKEN , YOU ARE FACING FARMERS OFF AGAINST THE SMELT. THE FARMERS ARE PUMPING SO HARD OUT OF THE GROUND THAT IN MANY PLACES IN CALIFORNIA, THE GROUND IS FALLING AN INCH A MONTH. THE SYSTEM NEEDS

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California Drought: Is It Too Late to Fix the System?

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