December 27, 2015--Water cuts could create economic 'tsunami' for Colorado Basin (Arizona Daily Star)

To understand how a future Colorado River water cutback could hurt the economy, start with this fact: The seven river basin states, by themselves, make up the fifth largest economy in the world, a speaker said at a recent water conference. Then, consider that the economic output of the areas within those — including Arizona — that depend on the river for water equals that of Australia. So if this region doesn’t adapt to a cutoff with significant conservation, acquisition of new supplies or both, “the economy will implode on itself,” said Jeremy Aquero, an economic analyst who spoke at a recent Colorado River conference. “The effect will look more like a tsunami than ripple on a pond.” Between them, the seven basin states have an annual Gross Domestic Product of $3 trillion to $3.5 trillion per year, Aguero said. That puts the region between the sixth-ranked United Kingdom, at $2.86 trillion GDP in 2015, and the fifth-ranked Germany, which hit $3.8 trillion GDP in 2014 and $3.37 trillion in 2015, according to International Monetary Fund statistics supplied by Aguero. Looking at only the areas within the seven states that use river water, their total GDP is $1.4 trillion, he said, citing figures from an Arizona State University study this year. But economic impacts in areas that use river water would have a significant ripple impact in parts of those states that don’t use the water, he said. In Utah, for instance, 11 industries and other economic sectors including agriculture, mining, government, transportation and warehousing consume goods and services produced by the others. “If you disrupt agriculture, manufacturing or housing because of a water-induced interruption, the implications will reach well beyond that specific industry or that specific location,” said Aquero, a principal analyst for the Las Vegas-based consulting firm Applied Analysis. He spoke at the recent 70th annual conference of the Colorado River Water Users Association in Las Vegas. “A comprehensive, master-planned approach to the river is both necessary and appropriate,” he said. To view the full article visit the Arizona Daily Star.