By Ed Uehling
Las Vegas is awash in problems, which I believe are created by:
1. Past prosperity that was easy
2. Government predominance-Out-sized
a.) Too many rules — there are rules for everything
b.) Too many fees, penalties, fines, taxes
c.) Government for government—whenever faced with the dilemma of
whether to provide for the public or for government employees, the
politicians invariably choose the latter. When the choice is between
interests of the people or contractors, the people get a better shake
— maybe even 50-50, but when the choice is between the people and a
sacred cow (person with “juice” as we say in Vegas) or a major special
interest group (especially the hotel-casinos) the people have no
chance regardless of the shamelessness of the demand forwarded by the
special interest/sacred cow.
d.) Lack of rewards for politicians who create well-being and economic
development. In China, local officials are promoted based on the
economic performance (i.e., percentage increase in GDP). While this
sole criteria has its problems (e.g., environmental issues and
trampling of private property rights), it establishes, at least, a
goal that governs behavior in positive ways since there are
correlations among free enterprise/markets, economic prosperity, low
rates of criminal activity and social tranquility. In contrast, US
politicians get results from 1) and acute ability to lie without
appearing to do so; 2) campaign money; 3) vote buying through
rewarding non-productive members of society (especially bureaucrats,
persons convinced of their own victimization, and other sociopaths—in
fact, the American public invariably falls for a good sob story).
e.) The belief that the government is actually capable of instigating
economic prosperity or even jobs. This has been proven false in
virtually every society since mankind’s beginnings. It is
mathematically impossible to 1) take money from
more layers of government, each of which takes a percentage of 10-50%,
and 3) expect a local bureaucrat, who is likely to have never made it
in the free marketplace, to know how that money can be invested so
that it creates more jobs and/or economic activity than the original
one, would have produced. Despite all the contrary evidence through
the centuries, this religious-like belief in government competence
flourishes in America and Las Vegas.
f.) The loss of belief among the public, political leaders and even
casino ownership and management since 2008 in
tourism/gaming/conventions as the best possible industry that a town
can have. That industry is the largest in the world, perfectly fit for
the US, non-polluting, extraordinarily diverse, requires the exact
skills that the population of Las Vegas has, and would produce more
wealth and jobs with little or no investment unlike every other
“diversification” idea which has been floated. It is especially
discouraging to hear casino executives and owners say that Las Vegas
reached its peak in 2005-6 and that it will never be the same again.
This is the only problem — a very serious one — that is not caused
fundamentally by government incompetence and malfeasance.
The Southern Nevada Water Authority (SNWA) and its three purveyor
institutions in the Valley (Las Vegas Valley Water District, LVVWD;
and the cities of Henderson and North Las Vegas) are the poster
children of this government ineptness. These agencies don’t just stop
at incompetence, excessive self-serving rules and charges, conversion
of all the value of a scarce resource, water, into their own salaries
and benefits, government for government, lies and deceit, and job
1. Charge $xxxx per acre foot of water for which SNWA’s raw material
cost is zero and for which the pumping and purification is
approximately $150 per acre-foot.
2. Pay zero in property taxes, unlike private utilities performing
3. Have established a rate schedule which is unrelated to reality and
which no one can explain.
4. Have developed a storyline that blames us, their customers, for
every imagined catastrophy from our desire to have a normal supply of
water to the dropping level of Lake Mead to the infamous “drought”
5. Asserts that our tiny allocation of 300,000 acre-do has enormous
impact on the Lake and the Colorado River, while refusing to confront
the two brazen wasters of water, Arizona and California.
6. Blames its customers for not conserving enough water, even as we
conserve nearly 30 percent (80,000 acre-feet).
7. “Loans” California the entire 80,000 acre-feet conserved even as
their managers deplore in very dramatic terms the “impending disaster
in Lake levels and water quality”.
8. Raised water rates dramatically in the 1990’s “BECAUSE WE WERE
CONSERVING TOO MUCH”.
9. Raised water rates 93% during the last decade including a $78
Million raise last year and a $49 Million raise this year because they
choose not to sell for $110 million the 80,000 acre-feet they sent to
10. Refuse to tell the truth about conservation: that Las Vegas has an
unlimited supply of water when it is used indoors.
11. Refuse to even distinguish between indoor and outdoor use.
12. Refuse to consider charging more for outdoor use to develop
revenue and to promote conservation if they are really interested in
conservation and Lake levels.
13. Have set higher rates, sometimes 8 times as much, for indoor users
as the maximum rates for outdoor one-time consumers/wasters.
14. Give high-income estate owners LOWER rates than apartment dwellers
— even though the former use up most of their water one time, while
the apartment dwellers give it back for return-flow credit from Lake
15. Refuse to consider rate changes that would increase conservation
and, thus, the level and quality of water in the Lake, while, at the
same time, treating all conserving customers equally with customers
who waste water.
16. Violate the laws requiring consideration of small business in the
setting of rates. The rates of small businesses with fire-lines
increased 200 percent in 2012, while rates to the hotel/casinos
increased less than 3 percent.
17. Permit employees to mount benefit on top of benefit during a
recession in which the customers are plagued with lost jobs and
income. The average employee at SNWA receives $120,000 in benefits
compared to the average employed customer who gets around $30,000 —
and that doesn’t account for all of the unemployed, some of whose jobs
were eliminated directly as a result of the increased water rates (and
consequent reduced private sector spending) and increased SNWA
18. Have established a hierarchy of benefits in which the customers
takes last place after employees, management, consultants and
contractors, and locals who have sufficient “juice”. There are
actually powerful interests in the community who are paid by SNWA for
doing nothing more than coming out in favor of SNWA’s frequent rate
19. Establish phony hand-picked “citizen” committees to ratify rate increases.
20. Have boards that operate more as rubber-stamps than as managing boards.
21. Carefully avoid any direct surveillance or authority by the
public. The public does not vote directly for the members of the SNWA
22. Insist on the necessity of snatching water from Central Nevada at
a cost of AT LEAST 3-6 times the maximum rate charged to outdoor
consumers/wasters of water—while being unwilling to charge this class
of customers enough so that the pipeline would not even be “needed”.
One of the next shoes to drop will be the announcement that ALL
customers will have to pay the higher rates created by the pipeline —
not just those responsible for the “need.”
23. Refuse to introduce free-market mechanisms into the pricing of
water, so that the rate increases would not be “necessary” and so that
people using water voluntarily and responsibly (i.e., returning it to
the Lake for return-flow credits) could buy more water and provide
voluntary revenues to SNWA.
24. Co-opted the Review Journal, Las Vegas Sun and KNPR into blindly
supporting the rate increases and parroting the lies and deceits of
the managers of SNWA.
Not only is this year’s rate increase unnecessary, but two logical
changes in the rate structure (charge every family equally and
distinguish between outdoor and indoor users, while charging the
latter LESS, not more, than the former) would make it possible for a
responsible operator of SNWA to increase revenues enough to abolish
this rate increase, last year’s increase and the sales tax (which has
no logical connection to a utility).
If we can’t bring the poster child of bad government under control, it
will be extremely difficult to reduce out-of-control government costs,
which are bankrupting the private sector and causing massive job
Las Vegas certainly won’t become the next Detroit — there are too many
other governments in the country, which are ready to implode. However,
it will eventually become another Detroit if government costs are not
brought into the realm of rationality. A perfect time and place to
start is NOW and at SNWA!