Thursday, May 14, 2015

Good For The Nestle Waters CEO!

By Chris Rossini

The Soviet-style central planners in California has decreed that its subjects must use less water. Naturally, publications that get a rise out of government rationing, went to work on attacking companies that bottle water in California. Starbucks buckled (big surprise), tucked its tail, and took its bottling operations elsewhere.

But Tim Brown, the CEO of Nestle Waters, is not buckling to the apparatchiks!

BusinessInsider reports:
Brown said during an interview this week that he would not only continue selling water from the Golden State, but insisted he wants to bottle even more.

“Absolutely not,” Brown told radio station KPCC. “In fact, if I could increase it, I would.”
"If I stop bottling water tomorrow," Brown continued, "people would buy another brand of bottled water. As the second largest bottler in the state, we’re filling a role many others aren’t filling.

“It’s driven by consumer demand, it’s driven by an on-the-go society that needs to hydrate,” he added. “Frankly, we’re very happy [consumers] are doing it in a healthier way.”
Isn't that a breath of fresh air?

Good for Tim Brown!

I wonder if he's been reading Robert Wenzel....


  1. State assumes monopoly control of scarce resource, water

    State provides service poorly

    Private sector fills consumer need, i.e., clean, drinkable water in a convenient form

    State and its supporters pitches fit

    Good on Nestle. Privatize everything.

  2. Bottled water is a great product serving a real consumer need. However, Brown's statement : "Its driven by consumer demand..." is only half the story. Nestle is operating in an industry dominated by the government monopoly. A monopoly that sets the rates for water sourced in California and a monopoly that prohibits competition in the harvesting, storage and distribution of this water through its capital structure. Once the water leaves this structure a limited market economy enables companies like Nestle to see there is demand for bottled water at a voluntary market price. But because their supply is regulated they don't know if the supply side is adequate or efficient enough to economically meet this demand.

    The radio interview from which this story was sourced came from a PBS station in Orange County and a more interesting comment from Brown was that there have been 17 droughts in the past 100 years in California. He suggested that we need to "adapt" to this situation in careful and efficient ways. A local professor made similar comments about changing "human behavior" regarding our use of water. Neither pointed out it was impossible to do this given a government monopoly and its rate regulation.

    Currently the only thing governing water usage is favoritism for special interest groups that support politicians. Until the consumers are allowed to put their money where their mouth is regarding water usage, neither the demand for or the supply of water will be adequately understood. Periodic water shortages and widespread waste will continue until the monopoly is eliminated. This is best accomplished by a complete separation of government from the water industry. Not just privatization, but complete separation. The government should simply and quickly abandon all water utility assets to whoever wants to operate them.