I agree with the article that the most efficient mechanism to deal with scare resources is via price. I also like the idea of ensuring the poor still have access to a reasonable amount of water: a fixed price baseline low-cost allocation then a per-unit fee for anything above that.
I am not a farmer but the notion of higher water prices shifting growers away from water intensive crops to less water intensive makes sense. Living in the state capitol, I can’t help but think agriculture lobbyists are hard at work keeping the cost of water down so farmers don’t have to make any adjustments (and maximize their profit). Can lobbyists reeducate and retool themselves to become crop and water use optimization consultants? Or, will thy just focus energy on maintaining the inefficient status quo?