The drought this year has reduced China's normal rainfall by 40 to 60 percent. Photo: otrocalpe (flickr)

Crisis is lurking on the world's most valuable commodity: water. The answer, a former U.S. official says, is raising its price.

Peter Orszag, President Barack Obama's former budget czar, tells the story in a Bloomberg View column by looking closely at China. That nation's water goes mainly to its coal and hydroelectric power plants. As China’s Ministry of Water Resources says, "In 2010, coal-fired electricity in China used more than 30 trillion gallons of water, or about 20 percent of the country’s total consumption." The problem with this is that water sources are limited. While China is using its available water for electricity, climates are changing and reducing the amount of available fresh water. The drought this year has reduced China's normal rainfall by 40 to 60 percent, and the water that's left is going to crops and people, not coal plants. This, in turn, has rattled global diesel markets as China has grasped for alternatives to coal energy by relying more on diesel powered generators. Disturbances in the water market ripple throughout the world economy.

To fix this, Orszag suggests a three-step process for China and the rest of the world to follow when thinking about the way we use our water.

First, China needs to do a better job blocking pollution and expanding awareness of the dangers of climate change. According to the World Bank, "about 90 percent of the aquifers underneath major cities in China are polluted. More than 300 million Chinese lack access to safe drinking water." The first step to using water more efficiently is making sure the water we have is water we can use.

Second, China needs to allocate its water more productively. Currently, the water in China is not evenly divided between regions. Orszag explains that 80 percent of the country's water supply is south of the Yangtze River, though only about half the population lives there. The rest live in the North China plain, which encompasses Shanghai, Beijing, and less than 15 percent of the nation’s water. With such an imbalance, the per-capita amount in the North evens out to only about one-quarter the level considered to be the minimum amount to live on. Plans are underway to balance this with a desalination plant in the Tianhin-Binhai development zone and a re-routing plan to channel more water from the South to the North, according to The Guardian.

Third, China and other nations need to raise their water prices. At a first glance, this seems impractical. Reactions from comments on Orszag’s article were primarily negative. They argued that water is not a commodity, but a natural right for each person, and therefore shouldn’t be marked with a price. Orszag, anticipating this, suggests giving everyone a set amount of free, fresh water for basic necessities. Any water desired beyond that point would come with a tariff. This way, people will use water carefully, avoiding waste.

Orszag finds that this three-step strategy can be applied to almost any nation. The strategy could be used in the U.S. where water is heavily subsidized and in Europe where water pricing systems vary between countries that lack water and those that have an abundance.

"Just as we need to price carbon in order to avoid a climate crisis, we need to price water to avoid a water crisis," Orszag writes.

A view of Chesapeake Bay from above. Photo: Crazy Diamond (flickr)

The Chesapeake Bay and Puget Sound are so polluted that they should be "put in the intensive care unit," according to a recent Frontline episode.

Poisoned Waters reveals that immense amounts of pollution have affected the ecosystems of both estuaries in their most basic capacities. On the surface, Puget Sound and Chesapeake Bay may look pristine and beautiful — but underneath, the effects of toxic waters are visible and disturbing.

In Chesapeake Bay, the once-thriving oyster industry has practically disappeared, although the state government recently developed a plan to revitalize the oyster population. Frontline reports that the crab industry is headed towards the same fate. David Kirwar, a Chesapeake Bay crabber, says that he only catches about half of what he did 25 years ago, describing the situation as a "tragedy." Local journalist Tom Horton said that overall "you're talking about billions of dollars of economic impact with oysters, crabs, shad, striped bass; the decline in the fisheries have just been dramatic."

Frontline says pollution caused by urban sprawl, agriculture, animal farms, and industrial sites are just some of many factors that are "slowly eating away" the bay. Jay Manning, Director of Ecology for Washington State, tells Frontline, "It's about the way we all live. And unfortunately, we are all polluters. I am; you are; all of us are."

Idle mining cars on a train track in La Oroya, Peru. Photo: Max Opp (exoppholdsvaer) (flickr)

La Oroya, Peru, is one of the ten most polluted places in the world, according to the Blacksmith Institute, a New York-based global health agency.

The pollution is caused by a smelter owned by Doe Run Peru, which melts and purifies metals from the mountains surrounding La Oroya. The process is highly toxic: It's estimated that the smelting process emits 890 tons of sulfur dioxide every day.

Today, the area is plagued by acid rain and pollution, among other health and environmental problems. A recent article by the New York Times cited a 2005 study by Saint Louis University that estimated that 97 percent of children under six in La Oroya have lead poisoning, which can cause seizures, anemia as well as problems with the brain and kidneys.

Financially, however, the community needs Doe Run Peru since the majority of residents rely in some way on the smelting plant to earn a living, says the New York Times. About 3,000 people work in the actual plant, and other thousands make a living from selling food to workers and cleaning uniforms.

Community members say they want environmental conditions to improve, but cannot afford to see the jobs go elsewhere. They share their opinions in this video from the U.S. environmental law firm Earthjustice.

Photo: World Bank Photo Collection (flickr)

Today China announced several plans to help fulfill its promise to make the Beijing Olympics a "green" event. Plans include halting construction projects, banning the use of 3.3 million vehicles, shutting down inefficient coal boilers, and cutting emissions from the heaviest polluting industries in the months leading up to the Games.

Although a well-intentioned effort, many are concerned this won't make a difference a mere four months before the Games. With China's levels of ozone and particulate matter five times higher than World Health Organization safety standards, some athletes are worried about permanently damaging their respiratory systems. The world recordholder in the marathon, Haile Gebrselassie, announced he won't run this year out of concern for his health.

The Beijing Environmental Protection Bureau, however, is not concerned. It counted 67 “blue sky days” in Beijing from January through March — the highest count in nearly a decade. China isn't clear on what this means, but as Tim Johnson, the Beijing bureau chief for McClatchey Newspapers, says “When Chinese officials talk about 'blue sky' days, they don’t mean days when the sky is really blue. They mean days when sunshine can penetrate the haze and create a shadow. The sky is still an icky gray."

China may be making a considerable effort to improve air quality during the Summer Games, but their efforts might be better spent on longer-term solutions. Many former Olympic cities used the Games as an opportunity to fix longstanding problems. But in China's case, it looks as if those 3.3 million cars will go right back on the roads.

Photo: Steve Bailey (flickr)

My attention has recently been drawn to the increasing opposition students, consumers and activists are having to bottled water. A US-based group called Think Outside the Bottle is beginning an advocacy campaign to bring awareness to some of the more dire consequences of our thirst for bottled water, and even government agencies are beginning to act to reduce their consumption.

“City and state governments are looking at the economics of banning bottled water. Citing environmental concerns and a misallocation of resources, Los Angeles; San Francisco; Ann Arbor, Mich.; and the state of Illinois have banned the use of public funds to purchase bottled water for city and state functions…In June, the US Conference of Mayors adopted a resolution to bring attention to the negative impact of bottled water and promote local sources."

The director of a consumer rights group called Food and Water Watch has noticed that people of all types are showing increased awareness about issues involved with bottled water, according to the Christian Science Monitor. "I overhear small children in the grocery store telling their mothers not to buy it."

The negative impacts of bottled water are undeniable, but as a fact sheet the Monitor put out for World Water Day illustrates, the politics of water internationally are extremely complicated. In many parts of the world, bottled water is the only sanitary way to access the resource, and at the moment there is no alternative. The lesson? In places where the water is drinkable, drink it!