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O.C. better off in dealing with drought, expert says

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Orange County is in better shape than most areas when it comes to dealing with California’s increasingly dire water woes, a longtime water policy expert said at a Newport Beach Chamber of Commerce event Wednesday morning.

But better than most is still cause for concern, said Richard Atwater, executive director of the Southern California Water Committee.

“Frankly, we don’t know what’s going to happen in the next few months,” he told about 200 audience members at the chamber’s 2015 Economic Forecast breakfast.

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The drought, Atwater explained, has had an impact on California’s water supply for six or seven years already — with the exception of a wet winter in 2010.

And global climate change isn’t helping, as vital snowpacks shrink, making the water they’d supply impossible to capture.

Still, he said, Orange County has taken steps to manage its local water supplies, which are more plentiful than in other areas in the state.

Regions that rely almost entirely on imported water from the Colorado River and other faraway sources, however, are facing big problems. Hoover Dam, outside of Las Vegas, is at its lowest-ever level — and that’s perilously low, Atwater said.

One potential solution, he noted, is the implementation of ocean-water desalination plants. A desalination plant project proposed for Carlsbad, for instance, made sense because the area is dry and lacks groundwater, he argued.

In central and northern Orange County, on the other hand, desalinated water will likely be expensive for some time, making it harder to immediately justify a plant in Huntington Beach, where one has been proposed.

At the event, Andrew Policano of the Paul Merage School of Business at UC Irvine, and former PIMCO executive David Young, who founded the firm Anfield Capital, also spoke.

They discussed the state of the country’s economic recovery and how it could impact personal finances.

While both agreed that, at the moment, growth levels are nothing to write home about, their takeaways were different.

Policano said that measures, such as unemployment rates, indicated a slow, but steady recovery nationally, and that California and Orange County were about average compared to other states and regions.

He said one region that’s seen major economic growth is North Dakota, where an oil boom has ratcheted up the number of jobs.

“If you don’t have a job, hop on a train and go to North Dakota,” he said, drawing chuckles.

Policano also offered a couple tips on keeping on top of the market as a businessperson.

“How many of you remember a Blockbuster on every corner?” he asked the audience.

It’s a distant memory, Policano said, because business leaders haven’t been adapting to digital innovations in their fields.

“If you look why companies fail today, it’s not day-to-day operations,” he said. “It’s because they failed to recognize the disrupters.”

Young said that his approach to some of the same economic measures yielded a less-positive outlook.

He said that Americans are beholden to the ebbs and flows of not one, but two, distinct economies.

While what he called the “financial” economy is growing fast, the other economy, the “real” economy — meaning the one that involves material goods and services — hasn’t recovered as quickly as it should have, compared to other recessions in the nation’s history.

Instead, he said, the policymakers have tightened up the regulatory framework that would allow money to flow from the financial economy into the real economy.

He said the Federal Reserve should gradually raise interest rates to relieve pressure on what he called a “liquidity bubble,” rather than keep them low, and raise them too quickly down the road.

At the end of their talks, during a question-and-answer session, both Policano and Young agreed on one other point: Growing wealth disparities help no one.

Policano said that problem is rarely disputed.

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