Some Dimensions of Water Policy

Unlike private water development, in which market considerations have always been uppermost, public development programs have major aims in addition to those of economic efficiency. Irving K. Fox, vice president of Resources for the Future, maintains that this has been true from the nation's early years. The comments that follow are adapted from his address to a joint meeting of the Columbia Basin and Missouri Basin Interagency Committees last June.

When the first major river basin program was prepared at the beginning of the nineteenth century under Albert Gallatin, Secretary of the Treasury in the Jefferson and Madison administrations, a basic objective was to unify the nation through an improved system of transportation facilities. The North would be linked with the South and the Seaboard with the area beyond the Appalachians.

Another basic objective of water development from that time until this has been to open up and develop the West, and by the "West" I mean the portion of the nation unsettled and undeveloped at any given time. Gallatin was interested in opening up the area west of the Appalachians. Senator William Windom of Minnesota, in his report on transportation routes to the Seaboard in 1874, was also concerned with opening up and developing the West, and by that he meant primarily the area of the Mississippi drainage. His report stated that through implementation of the plan proposed, "the products of the West would, in a short time, be more than quadrupled . . . the Valley of the Mississippi would feed the world." Senator Francis G. Newlands of Nevada, when he sponsored the Reclamation Act at the turn of the century, was concerned with developing the West, and by that he meant the arid West. Today, if I interpret Senator Ernest Gruening of Alaska correctly, his objective is the same. Through the construction of Rampart Canyon Dam he seeks to promote development of Alaska.

A third objective of public investment in water resources development has been to provide a stimulant and a competitive force to private industry. Senator Windom saw the canal and public railway system as the only effective means of regulating the private railroads. In more recent years, and especially during the Franklin Roosevelt and Truman administrations, power development and primarily hydroelectric power development by public agencies has been considered an important means of regulating the power industry.

From Senator George W. Norris of Nebraska to Senator Robert S. Kerr of Oklahoma, a fourth objective of water resources development has been to uplift the economy of a depressed region. This was an underlying purpose of the Tennessee Valley Authority and of the study of the Arkansas White and Red River Basins. Closely related has been the perennial interest of congressmen and senators in having projects built within their districts as stimulants to the local economy. This practice, often decried as a "pork barrel," has been an important consideration in determining how public investments in water development would be made.

From the very beginning, investments in basin development have demanded economic justification. The following comment from the Gallatin Report (1808) has long intrigued me: "[W]whenever the annual expense of transportation on a certain route, in its natural state, exceeds the interest on the capital employed in improving the communication, and the annual expense of transportation . . . by the improved route, the difference is an annual additional income to the nation." There is still other evidence that long before the federal government set down evaluation procedures in the "Green Book," public officials, including congressmen and senators, felt the necessity of justifying river basin programs on economic grounds.

Historically, it would seem that river basin development has been planned to meet a variety of objectives many of which have been of a quite intangible nature. When these objectives struck a sympathetic chord within the population, as they did when the canal system was being planned and as they did at the time of TVA, public support has been forthcoming. I suspect that in the future, as in the past, public investment in river basin development will be determined by a combination of economic and non-economic considerations.

The river basin work of the Corps of Engineers can be traced back to approximately 1820. The states were rapidly becoming involved in canal-building operations. The disastrous economic consequences of some of this state investment dampened state interest to such an extent that it is reflected today in the limited water resource programs of many state governments.

When the federal government became deeply involved in river basin work there developed in step-by-step fashion the concepts with which we are familiar today. At an early date it was recognized, particularly on the Mississippi and the Missouri, that the project-by-project approach should be displaced by a river system approach, because of the relationships of one project to another. The progressive leaders such as Gifford Pinchot, Theodore Roosevelt, and WJ McGee, emphasized the importance of dealing with the river system from headwaters to the sea as a single unit.

Also the concept of multipurpose development began to emerge. As early as the Erie Canal—a state enterprise—water power development was integrated with navigation development, and water power revenues were a significant source of income. Flood control, navigation, and drainage were intertwined in early work on the Mississippi. In the twentieth century the multipurpose approach was displaced by what we now call the comprehensive river basin approach, demonstrated most dramatically by TVA.

Over the years there has emerged a theory of river basin planning, the elements of which may be identified as follows:

—Objectives and criteria to govern river basin planning should be specified by the legislature and the executive before planning is undertaken.

—Within the framework of these criteria and objectives, professional personnel will prepare a single "best" plan for each river basin.

—Because of interdependencies within a basin and the relationships among the many purposes served, there must be a highly integrated planning mechanism responsible for river basin planning.

—It is desirable for river basin planning and development machinery to be relatively standard throughout the country, because of the important obligations of the federal government in this field.

I doubt that there is much disagreement with the basic features of this theory. Nevertheless, there have been difficulties in implementing it, and I maintain that these stem from a fundamental weakness: the theory fails to take account of all the realities; I fear it oversimplifies the task we face.

What are those realities? Not only economic considerations but relatively intangible ones which do not readily fit into planning criteria determine what government does in the way of water development. In the future we can see such factors as recreation values and aesthetic considerations influencing patterns of water development.

The legislative and executive branches of government cannot specify in advance objectives and criteria that can serve as operational guides in arriving at a single "best" plan for each river basin. Water involves regional development. Water provides recreation. Water is transportation. Water is agriculture. Water is hydroelectric power. The interests benefiting from these various services are not in agreement with one another on the value of each. Congress and the President reflect these widely differing views. Under such circumstances, Congress adopts general policies and objectives, and avoids deciding upon specific objectives and criteria. Thus, through the give and take of congressional negotiation these individual projects and programs may be approved even when there is no clear agreement on the objectives and criteria implicit in their design. This kind of result is characteristic of our governmental system. On the whole, this is a good thing. I cannot believe that the Congress will hamstring itself by adopting objectives for river basin development that will be so specific and definitive that the planning of projects will be a mechanical process.

• The engineering and economic analyses upon which we rely in designing projects reflect in large measure the objectives and values of the individuals conducting the studies. This is not to imply that economic evaluations are useless or that engineering plans lack precision. Engineering and economic research has improved and will continue to improve river basin planning, but it can never completely eliminate the judgment factor in project design.
• Each region has its own physical, economic, and social conditions which in turn determine the best type of institutional arrangement for river basin planning. In spite of their relatively uniform procedures, the federal agencies have seemed to recognize this. The way a federal agency functions in the West is quite different, for example, from the way it functions in the East.

If, as I am suggesting, we are not able to implement the theory of river basin planning as given, how can we develop a structure for planning that will take account of the realities and best serve the public interest?

In searching for a new approach we should distinguish between the responsibilities of political representatives in government and those of the career civil servant. In particular, the establishment of objectives and assessment of values which cannot be readily measured through established engineering and economic procedures should be a function of the political process. It is with this assumption clearly in mind that I suggest that a river basin planning structure should meet the following criteria:

—Planning should illuminate alternative objectives and alternative value judgments in such a way that the choice among these can be made through the political process. This is the essence of democracy. One of the real dangers to our society is that the public out of reverence for the specialist—the engineer, the physical scientist, or the economist—will leave to him not only the task of analysis but the actual determination of objectives and values.

—Where engineering and economic judgments are made, there should be built-in checks. In the private enterprise system competitive forces provide them. In governmental activities the checks must be provided in some other way.

—Planning institutions must be adapted to the social, economic, and physical situations of each region.

Some of the elements of such an approach to river basin planning are already close at hand; others appear more distant.

• Wherever objectives of the program are not entirely clear or wherever difficult-to-measure values such as aesthetic considerations are involved, alternative plans should be presented for public reaction and the final choice made by responsible political representatives. Both the evaluation criteria (Senate Document 97) and the alternative plans announced for the Upper Missouri implementing the criteria constitute a major step in this direction.
• Strong, ably staffed state and local agencies concerned with water resources planning are needed to represent interests that are different from those of the federal agencies. In urban and metropolitan regions particularly, urban planning should consider the implications of water resources development possibilities and the urban interest should be fully represented in water resources planning. No system of interagency coordination or state representation in the planning process can be fully satisfactory unless the state representative is backed up by an adequate staff of state and local personnel. Strong state and local agencies provide one of the built-in checks to which I have referred.
• Regional programs should be developed independently of the river basin program for some of the purposes served through river basin development, particularly recreation, transportation, and electric power. For these purposes the river basin is not an appropriate geographic area for planning programs. The studies being conducted cooperatively by the Federal Power Commission and private industry, and Interior's plans for a transmission grid in the West appear to be moves in this direction. It may be that, through the leadership of the new Bureau of Outdoor Recreation, state and federal agencies will move toward regional plans for the development of recreation areas. This does not mean that transportation, recreation, and power planning would ignore water development potentialities; rather that it would consider them in relation to all other potentialities. This procedure would provide another built-in check and would promote the consideration of alternative plans.
• For federally financed programs an independent periodic sample audit of water development engineering and economic analyses might be undertaken as planning proceeds. At the present time the General Accounting Office audits the expenditure of funds from a procedural point of view. Since the federal government is now investing well over a billion dollars a year in river basin programs, a different type of audit might also be desirable. In this the judgment of field personnel responsible for river basin planning would be tested against the judgment of competent people who do not have a vested interest in the results of the planning effort. Such a group need not have the authority to overrule the planning agency but its findings could be made available to the public, the Congress, and the Executive. This would provide an additional built-in check on the planning process.
• Policies that require a significant sharing of costs by the direct beneficiaries should be encouraged. A willingness to pay some of the costs of providing the benefits received is a useful measure of the desirability of a given program and thus a good check on the validity of the planning process. This may be difficult in such fields as flood control and navi-5 gation where there is a long tradition of federal support, but in the newer field of pollution abatement it is particularly important to limit federal subsidies if we are to deal with the pollution problem effectively at a minimum of cost. Here careful study needs to be given to a system of effluent charges based upon the quantity and quality of the effluent discharged to a stream.
• Experimentation with different types of river basin planning institutions should be encouraged to achieve adaptation to regional situations. This, surely, is the significance of the Delaware Basin Compact Commission. I doubt that it is a suitable device for all regions of the country, but it may be well adapted to the Delaware. Other possible arrangements merit consideration and trial.