EclectEcon

and most other places, for that matter. Mis-pricing of water. From the NYTimes (reg req'd), courtesy of Brian Ferguson,

For three decades, water has been indispensable in sustaining the rollicking economic expansion that has made China a world power. Now, China’s galloping, often wasteful style of economic growth is pushing the country toward a water crisis. Water pollution is rampant nationwide, while water scarcity has worsened severely in north China — even as demand keeps rising everywhere.

Florida and Hawaii (and many other places) have similar problems: water is priced too low, so people overuse it. And unless prices are adjusted upward, people will continue to overuse it. And that will only lead to a much more difficult adjustment the longer the overuse persists.

More from the article:

What happened? The list includes misguided policies, unintended consequences, a population explosion, climate change and, most of all, relentless economic growth. In 1963, a flood paralyzed the region, prompting Mao to construct a flood-control system of dams, reservoirs and concrete spillways. Flood control improved but the ecological balance was altered as the dams began choking off rivers that once flowed eastward into the North China Plain.

The new reservoirs gradually became major water suppliers for growing cities like Shijiazhuang. Farmers, the region’s biggest water users, began depending almost exclusively on wells. Rainfall steadily declined in what some scientists now believe is a consequence of climate change.

Don't you wish that just once people would recognize that setting the price of water equal to zero (or way too low) causes these problems?