Water rights

At work the other day, I was streaming NPR through iTunes while eating lunch and heard this story about water issues in Nevada and Arizona, an area that has been experiencing a 11-year drought but at the same time is developing at a rapid pace, with green golf courses and artificial lakes. The town of Mesquite in Nevada is purchasing water, quite cheaply, from the state of Arizona. They are able to do this because of laws saying that water is a commodity that cannot be restricted in trade. This is causing worries in Beaver Dam, Arizona, which is also tight for water, and as described by one of the citizens of Beaver Dam, is creating a situation of "your development versus my development."

As most people probably would be, I was appalled at not just the quantity of development going on, but the type of development in Mesquite as it was described in the story. I understand somewhat the reason why water, as something we all need, cannot be restricted in trade between states. But why isn't someone restricting the development that is going on in these arid areas? Why the lush golf courses and new lakes? It seems like, in an area that has been experiencing drought for over a decade, local municipalities should disallow, or at least make extremely expensive, developments that do the opposite of converse water. If you can't make water expensive, at least make the wasting of water expensive. Of course, maybe the local government in Nevada doesn't care about the wasting of water, as long as it's Arizona's water.