Why does everything have to be so economically driven? Clean drinking water should be totally free for everyone, we kinda need it to live

Clean drinking water for drinking, yes. Clean drinking water for industrial (or even irrigation) purposes, no – because putting a fair price on it would appropriately punish those who use it wastefully.

And to build on that, only about 5% of California's water goes to indoor household use. It, or perhaps the first 50/100 gallons per person per day, could easily be free based on a tiny fee to the other 95%.

Many municipalities are switching to grey water irrigation in an effort to conserve.

I wish it were so simple to remove economics from things. Unfortunately, the problem isn't the need (the demand), its the supply. We don't just have unlimited clean drinking water, and as soon as there is a constrained supply, we have to consider how we can divvy it up to meet demand.

Usually that means increasing price, but the what the commenter above was saying is that often we're making it artificially cheaper. Often by either subsidizing things w/ our taxes (hiding the cost), or by not adequately funding the collection, which will eventually cause failure or exhaustion of the supply.

The problem is that fresh water is a scarce resource. Give it away for free and it will be used inefficiently and you will run out. This is an area where markets are an efficient solution, so long as the scarcity problem does not become so pronounced that the poor are unable to afford water. If this happens it is a policy failure and an external force (the government) would have to step in to insure that everybody has enough water to at least survive, probably by shutting down some big industrial users to reduce demand and lower the price.

The government can also intervene by actually paying the price. Like food stamps for water.

In California, I believe the state actually does subsidize the price of water for farmers. However, as a result of water being significantly under market price, farmers are not incentivized to undertake water conservation efforts -- even though in times of drought, that aggravates the water supply.