California has plenty of water…just not enough to satisfy every possible use of water that people can imagine when the price is close to zero. As David Zetland points out in an excellent interview with Russ Roberts, people in San Diego county use around 150 gallons of water a day. Meanwhile in Sydney Australia, with a roughly comparable climate and standard of living, people use about half that amount. Trust me, no one in Sydney is going thirsty.
I often complain about textbook economics, but certainly this is an example where it offers important insights. When you see a “shortage,” look for the artificially low price.
The price system fosters order. Repression of the price system leads to disorder.
If you know anything of climatology, you will know west coasts of continents are similar to other west coasts, and east coasts to other east coasts, so no, they are not similar. Average annual precipitation San Diego 10 in, Sydney 48 in.
If Sydney gets more rain, isn’t even more surprising that they use less water?
Textbook micro is pretty reliable. Textbook macro, not so much.