In a post yesterday, I said that the price of water should rise. In response, aqua-girl said "How can you say that! I think it is morally reprehensible to charge money for water. Water resources belong to everybody and consuming water is a basic human right." I think economists are immoral!
Let's respond to aqua-girl's comments:
1. Economists are often amoral -- they are interested in efficiency (maximizing surplus, wealth), not equity (the distribution of that wealth).
2. Water is certainly something that everyone needs to live and charging a price for something someone needs to live (and for which no substitutes exist) is immoral.
3. But, free things must have an unlimited supply. If not, demand exceeds supply, and shortages result.
4. Shortages result in rationing that favors the politically powerful and/or resource-rich. Shortages hurt the poor -- see examples such as this.
5. Also note that something owned by everyone is not protected from depredation and the tragedy of the commons often results.
6. Hence aqua-girl's idea will end up hurting the poor she is trying to help -- either because it will divert the resource to the powerful or destroy it.