The San Francisco Bay-Delta: A failure of decision-making capacity

The paper reviews the history of Bay-Delta decision-making in California in order to highlight the continuity between what happened with CALFED and what happened in the preceding decades since water project deliveries began in 1949. Throughout this period, there has been intense conflict about whether and how to transfer water from the Bay-Delta to users elsewhere-a conflict marked by a fundamental opposition of interests among stakeholders. We document how the State of California has failed to organize itself effectively to resolve this conflict and make a decision on how to manage the Delta. The strategy consistently adopted by the State was to encourage the main parties - agricultural and urban water diverters, and fisheries and other instream-protection interests - to work out a solution among themselves, rather than imposing one externally. However, economic theory suggests that a bargaining solution is unlikely to exist because of the extreme opposition of interest among the parties. The Bay-Delta history amply confirms this theoretical prediction. Thus, the State's strategy of relying on voluntary agreement to resolve the issue is fundamentally misconceived and is, at some level, an abdication of its responsibility.