Millions of Chinese Face Water Shortages

The Financial Times reports this morning that China is having major water problems:

The diversion of water to Beijing for the Olympics and for big hydropower projects threatens the lives of millions of peasant farmers in China’s north-western provinces, according to a senior Chinese government official.

In an interview with the Financial Times, An Qiyuan, a member and former chairman of the Chinese People’s Political Consultative Committee for Shaanxi province and former Communist party chief of Shaanxi, warned of an impending social and environmental disaster because of overuse of scarce water resources.

In a critical tone seldom heard from Chinese officials, Mr An called on Beijing to provide compensation to the provinces that have been told to pump their cleanest water to the capital in order to ensure potable supplies during the Olympics.

There are probably a great many lessons that can be learned from this story, but I'll limit myself to two:

* Totalitarian economies don't work. But China's been instituting all kinds of market reforms, you say. True. But this is classic proof that, at the end of the day, Beijing will still interfere with the market and risk the lives of its own citizens.

* China has a serious propaganda and influence system that reaches around the globe. This sounds like a conspiracy theory, but stop and think about it: How did Beijing convince the International Olympic Committee they should host the Games? By giving the impression that their capacity to do was was far greater than it in fact was. If they've hoodwinked us about that, where else might they be trying to deceive us?