Cadillac Desert (55 page)

But that was the
good
news. The bad news was that during periods of drought, with California guaranteed its full entitlement before Arizona received a drop, this incredibly expensive water might often not arrive. The Bureau’s own projections showed “firm” CAP water dwindling from 1.6 million acre-feet at the beginning to 300,000 acre-feet or less in fifty years; only during wet years, or if the upper-basin projects are never built, will there be more. To think of the Central Arizona Project as salvation, then, is not just to stretch things a bit. For those groundwater-dependent farmers who will have to build distribution systems, at least—and there are a lot of them—the Central Arizona Project could spell economic ruin.

Did Arizona’s farmers realize any of this? One of William Martin and Helen Ingram’s graduate students, Nancy Laney, traveled around the state to find out. To her astonishment, most of the farmers didn’t. One of the farms Laney visited was the Farmers’ Investment Corporation, a huge pecan-growing operation south of Tucson that is about as far from the diversion point on the Colorado River as one can be. (Why pecans, which are native to the Mississippi Delta, should be grown on subsidized water in a desert state is another matter entirely.) If it arrives, CAP water will have surmounted a lift of well over a thousand feet and traveled more than three hundred miles to get there. Meanwhile, there is still plenty of water immediately under the farm, less than two hundred feet down. Despite the huge subsidies written into the CAP—as with any Reclamation project, the farmers are excused from paying interest costs—the groundwater is certain to be much cheaper, at least until the aquifer drops several hundred more feet. (The worst areawide decline in Arizona’s water table has been around two hundred feet, and that took decades to happen.) But the farm manager at Farmers’ Investment expressed to Laney his unalterable belief that “CAP water will be cheaper than pumping.” “Water is essential,” he said with religious conviction, adding that he “would back any plan where more water would be available.” He had no idea what CAP water would cost him, but planned to sign contracts to buy it anyway. His state of knowledge and level of blind faith were not unusual. One farmer thought that the water was going to arrive by gravity instead of being pumped many hundred of feet uphill. One believed that there was still enough surplus water in the Colorado River to turn the entire Grand Canyon into a reservoir—something he devoutly wished. Only two of the farmers Laney interviewed seemed to have a sense of things as they really were. One realized that Arizona’s Colorado River water was jeopardized and thought it was high time we “took” Canada’s surplus water to replenish it. The other said that even if it turned out he couldn’t afford CAP water, he was going to sign a contract to buy it anyway, because “contracts are made to be broken.”

“Contracts are made to be broken.” There, in a simple phrase, was perhaps the worst legacy of the Bureau of Reclamation’s eighty years as the indulgent godfather of the arid West. The irrigation farmers not only had come to expect heavily subsidized water as a kind of right, allowing them to pretend that the region’s preeminent natural fact—a drastic scarcity of that substance—was an illusion. They now believed that if it turned out they couldn’t afford the water, the Bureau (which is to say, the nation’s taxpayers) would practically give it away. These farmers were about the most conservative faction in what may be the most politically conservative of all the fifty states. They regularly sent to Congress politicians eager to demolish the social edifice built by the New Deal—to abolish welfare, school lunch programs, aid to the handicapped, funding for the arts, even to sell off some of the national parks and public lands. But their constituents had become the ultimate example of what they decried, so coddled by the government that they lived in the cocoonlike world of a child. They remained oblivious to what their CAP water would cost them but were certain it would be offered to them at a price they could afford. The farmers had become the very embodiment of the costly, irrational welfare state they loathed—and they had absolutely no idea.

In 1984, Congress began to demonstrate why the farmers might not be so foolish after all. Early that year, it voted to lend them $200 million to help build distribution systems—an interest-free loan, as one might have expected, but the sum was only about half of what they would need, and there was a lot of resistance to lending them the rest. But they still weren’t out of the woods. For one thing, the Indian water-rights issue was still substantially unresolved. There was a good chance that the white farmers would have to lease water from the Indians, who could well end up with most of the water in the CAP. The Ak Chin and the Papago tribes had recently settled with the Interior Department for 300,000 acre-feet, about the consumption of Phoenix. The Papago tribe’s water will come directly out of the Tucson Aqueduct—water which the farmers, most of whom had conveniently ignored the Indian water-rights question, had always expected to get. More and more, the CAP was metamorphosing from an agricultural rescue project into an expensive atonement for travesties visited on the Indians, and, perhaps, into a municipal water supply project for Phoenix and Tucson—if
they
feel they can afford it.

“The cities in Arizona are going to get hit even worse than the farmers,” Bill Martin told an interviewer in 1984. “The farmers at least get the interest-free subsidy, which is worth a fortune to them. They also get interest-free loans on things like the distribution systems. The cities get none of that. They pay full fare.

“Here in Tucson, we’re already drawing groundwater out of neighboring basins because we’ve depleted ours, and we pay around $430 per household, which seems like a lot. But most of that, I’d say around $400, is to pay off the water mains, the infrastructure, the bureaucracy. It’s a distribution cost. It only costs us $30 or a little more to pump the water. But to pump CAP water all the way from the Colorado River to Tucson is going to cost at least $250 per acre-foot; that’s what the water is worth when you get rid of all the interest subsidies and so forth. Add $250 to $400, the distribution cost, and people are going to be paying $650 for water. There are families around here who only earn ten or fifteen times that much in a year. So what’s obviously going to happen is people are going to conserve, and use a lot less water, and there will be less and less of a need for the CAP.

“It’s already happening,” Martin continued. “We’ve all gotten water-conscious, even if we weren’t before. Tucson uses a third less water than Phoenix, because up there they still get cheap water from the Salt River Project. Once Phoenix starts paying $600 a year, though, they’re going to conserve just like we are.”

But if the farmers can’t afford the water, and the cities can’t afford the water, then who is going to buy it and justify the whole expense?

“Damned if I know” was Martin’s response.

I
f it seems implausible that Arizona’s farmers will buy here-today, gone-tomorrow water that costs three times what farm economics suggest they can pay; if it seems implausible that cities will want to waste millions of dollars a year buying turbid, alkaline water from the Colorado River when they can pump cheaper, fresher groundwater instead—if all of this seems unlikely, what is even less likely is that Arizona and the Bureau of Reclamation will permit a giant concrete aqueduct to sit empty in the desert, a ruin before its time. For the aqueduct to remain full as long as it can, however, the farmers must receive most of the water; their collective thirst is much greater than that of the cities. (And in 1985, work on the extension aqueduct to Tucson, the only big potential urban buyer besides Phoenix, had not even begun.) What this in turn implies is subsidy, more than is already there in the form of cheap electricity and interest exclusion—subsidy on a rather heroic scale. The question is, how will it be done?

One person who thought he had it figured out was Sam Steiger, a former Congressman from Prescott, a small city up in north-central Arizona. In the 1960s, Steiger was a prototypical Arizona Republican—crew-cut, jut-jawed, archconservative—who nonetheless had little trouble voting for the CAP. “Of course I was for it. Any Arizona politician who wanted any kind of political future had to be for it. Besides, I was on the Interior Committee, which authorized the thing—one of two Arizonans versus five Californians on the committee. If I had voted against it, I would probably have been shot.” In the 1980’s, however, Steiger, no longer in office, had gotten into the water-brokering business, which was becoming a cottage industry in western states whose laws permitted some degree of free market in water rights. Suddenly Steiger had an economic interest in the very condition the CAP would pretend to relieve—scarcity—because he was earning a living helping people with good water rights—mainly farmers—sell those rights to people who could pay top dollar for them—usually subdevelopers and cities. If the CAP suddenly brought in a big volume of water to be sold at vastly subsidized rates—or if CAP water was somehow forced on cities that didn’t really want to buy it—it would create an artificial glut and hurt his business. But that was exactly what Steiger thought would happen: subsidy and political coercion were going to create a “demand” for CAP water which, even in this third-driest state in the country, would otherwise not exist.

“In the first place,” Steiger said during an interview in 1985, “we passed a strict groundwater law here in 1980, one that was supposed to have been passed ten years earlier. The CAP legislation we passed in 1968 demanded it—what was the point of approving the project if the farmers kept sending the aquifer down to hell anyway? When the Carter people threatened to withhold funds for the CAP until the law was passed, it finally went through the state legislature. What that law does, besides restrict pumping, is demand that any developer who sells a new home guarantee the buyer a hundred-year supply of water. Otherwise, he can’t sell. Hell, I can sell you a home and guarantee you that in a hundred years I’ll give you desalted water from the ocean. I’ll be dead then anyway—that’s how ridiculous the provision is. But the way it’s being interpreted by the Department of Water Resources is this: no developer gets his certificate unless he’s signed up for CAP water, and without that certificate he can’t sell his house. The odds that there’ll be water in the Granite Reef Aqueduct in a hundred years are probably lower than the odds we’ll be getting water from the ocean, but the developers are stuck. So are the cities. If a city wants to grow, it has to buy water from the Central Arizona Project.”

That, by Steiger’s reasoning, was how the cities would be forced into the hand. The farmers, he felt, would be corralled by the new law’s restrictions on groundwater pumping; at some point, they would have to rely more on surface water, and the only available surface water would be the CAP. The problem with the farmers, though, is that their demand is, to use that economists’ word, inelastic: charge them too much and they’ll go belly up. So the farmers, according to Steiger, will be brought in with the carrot rather than the stick. In 1984, the first fifty-year contracts for cheap Hoover Dam power expired—the dam was finally paid off. The new contracts negotiated by the Interior Department didn’t raise the rates much, but they did tack on a surcharge of four mills per kilowatt-hour which is to go as a direct subsidy to the CAP. Four mills per kilowatt-hour—a few cents per day—may not sound like much, but multiply it by a couple of million users and it is a fair piece of change: millions of dollars per year. It is an almost poetic irony that most Hoover power is sold in southern California; at last, Arizona was going to get its pound of flesh from California, after involuntarily “loaning” that state water for so many years. A similar, smaller subsidy applies to power sold by the Navajo Power Plant. On top of
that,
the Central Arizona Conservancy District—the imperium created to receive and distribute CAP water—is permitted, by law, to buy cheap Hoover power and resell it at market rates, funneling the profits directly into the project to subsidize the water.

“Add all this nonsense to Congress’s interest-free loan for distribution systems and some other things they’re bound to cook up, and it’s all of a piece,” Steiger said with palpable disgust. “They’ll skin the cat twenty ways if they have to, but they’re going to make the water affordable. Congress will go along, because it will be goddamned embarrassing for Congress to have authorized a multibillion-dollar water project when there’s no demand for the water because no one can afford it. The CAP belongs to a holy order of inevitability. Will Congress bail out the big banks that pushed all those loans on Latin America, when the countries finally default? Of course. Will it make water affordable for Arizona’s farmers? Of course.

“The sensible thing would have been for the farmers to move,” Steiger said. “There are hundreds of thousands of acres of good farmland right along the Colorado River where you’d only have to build short diversion canals and maybe pump the water uphill a few hundred feet. But the farmers got established in the central part of the state because of the Salt River Project. The cities grew up in the middle of the farmland. The real estate interests, the money people—they’re all in Phoenix and Scottsdale and Tucson. They didn’t want to move. So we’re going to move the river to them. At any cost. We think.”

CHAPTER NINE

The Peanut Farmer and the Pork Barrel

A
t the restaurant in the Dillard Motor Hotel in Clayton, Georgia, a little town in a mountainous northern corner of that state, a yellowed old newspaper clipping has been posted by the telephone for years. The story includes a photo showing two men in an open canoe going through Bull Sluice, a Class V rapids on the Chattooga, one of the South’s preeminent whitewater streams. According to the official classification system of the American Whitewater Affiliation, a Class V rapids consists of “extremely difficult, long, and very violent rapids with highly congested routes which nearly always must be scouted from shore. Rescue conditions are difficult and there is significant hazard to life in event of a mishap.” In the photo, the man in the stern of the canoe looks scared to death, but the man in the bow has a look of grim, Annapolis determination on his face—as if he were smoking out a nest of wasps. According to the story, which is dated sometime in 1972, this was the first run of Bull Sluice in an open canoe, ever. Others have their doubts about that—which is, of course, to be expected on a river with this sort of reputation—but most everyone acknowledges that even if they were not the very first, they were among the first.