Are Great Lakes a Big Economic Advantage?

Denizens of the Great Lakes watershed long have looked at those five vast, deep, shimmering pools not only as an unmatched economic and cultural resource but also as the ultimate trump card.

Containing more than 20 percent of the entire world’s surface fresh water, Lakes Superior, Michigan, Huron, Erie and Ontario comprise the globe’s biggest reservoir of what is arguably its most important natural resource. And that could come in handy, the argument goes, as water becomes scarcer in future decades, giving the Midwest a sort of regional economic advantage that is unduplicated in America – and anywhere else.

But not so fast. We may not be able to rely on the simple fact of geographically surrounding the Great Lakes as any kind of edge, even as other states and other countries enviously eye our storehouses of fresh water. And if government and private entities husbanding the Great Lakes don’t do a better job of preserving the quality of the water that fills them, it may not matter how much of it there is.

That’s the argument made, anyway, by John Robinson, co-founder and managing partner of Mazarine Ventures, a Chicago-based venture-capital firm that invests solely in startups attempting to solve pressing water and wastewater challenges.

Robinson agrees the presence of the Great Lakes is a huge attribute for the region. “In economic development, everyone always talks about how we have water and you don’t,” Robinson told me. “It’s a strong fundamental of the region to have water security.”

One indicator of the significance of the Great Lakes to Flyover Country is that working together on issues affecting the watershed is one of the very few areas in which state governments in the Midwest actually demonstrate regional cooperation. There’s no other effective way, of course, but it’s a plus that the people running Michigan, Wisconsin, Indiana, Minnesota and the other states on the Great Lakes recognize the crucial importance of protecting and even enhancing this natural resource.

But Robinson knocks down the assumption that all the quadrillions of gallons of fresh water occupying the Great Lakes at any one time somehow can be leveraged to advance our region over others.

For one thing, Robinson said, its protectors need to do a much better job of ensuring that water reaching the Great Lakes from around the watershed is as pristine as possible and that it isn’t sullied once it gets to one of the lakes.

“What’s the point of an abundance of water if it’s of compromised quality?” he said. “Hello, Flint” – a reference to the lead poisoning of the municipal water supply in the mid-Michigan industrial city. “And with runoff from farms and nitrates in groundwater, all of our water can be totally useless.”

Second, Robinson said, there’s no significance alone in the fact that we have a lot of fresh water and other places don’t. “Water is really expensive to move, for one thing,” he said. “The conveyance of water to California, for example, would cost trillions of dollars a day.” It would be even more fantastical, he said, to imagine that Great Lakes water somehow could be provided to thirsty nations including Singapore.

At the same time, far-flung, reputationally waterless places like California aren’t as disadvantaged as you might assume, Robinson argued. “The California snow pack in the Sierra Nevada mountains could provide enough water for all of California,” he said.

But like most things in the Golden State, politics get in the way. The situation is similar to how mismanagement of forests is a huge contributor to a fire problem in California that is routinely blamed on climate change. The problem with water in California, Robinson said, is that state government hasn’t done a good job of disbursing aquatic resources to competing interests that range from the powerful growers of water-intensive tree nuts to water-parched Los Angeles.

And America’s ocean coasts have their own trump card if fresh-water resources really become stretched in the years ahead: desalination and water re-use. It remains prohibitively expensive for any state or even city to depend primarily on ocean water stripped of its salt because the process is so energy-intensive. But if there’s any scientific and technology base that can figure out eventually how to desalinate seawater affordably, it’s probably connected to Silicon Valley somehow.

Milwaukee is one spot that has been trying to leverage its historical intimacy with industrial water needs into an economic-development advantage. Legacy businesses including brewing, and manufacturing of water heaters and meters, and its position on the southwestern shore of Lake Michigan have given southeastern Wisconsin an argument as a promising incubator of new water technologies.

Also including Minneapolis, Chicago and Cleveland, the Midwest yields “a lot of technology innovation around water and wastewater,” Robinson allowed. “It’s stronger than in any other region of the country.” There’s also the formidable collective research engine of Big Ten land-grant universities that figure in our regional advantage around water, because these schools “have the best environmental engineers in the country.”

But all of this isn’t yet significantly indicated in the venture-deal flow that Mazarine and other VCs are seeing come out of supposed water capitals such as Milwaukee, Robinson said. Meanwhile, some of the most exciting new water technologies are emerging from some of the most parched places on earth, including Israel, precisely “because they don’t have enough water,” he said.

Yet, there’s no denying we’d rather be living on these five majestic bodies of water than not. And while we’re enjoying ice-fishing and snowmobiling on the Great Lakes this winter, and fish boils and water-skiing on them next summer, let’s not only be grateful for what Ontario, Erie, Huron, Michigan and Superior give us in the here-and-now. We need to preserve and treasure them for whatever might come in the future.