By capping prices, you're saying only those who live near water stockpiles deserve it (because that's what price caps lead to: first-come, first-served), which means more wasted water & fewer people surviving.

You can solve the waste issue by rationing. But more to the point, prioritizing rich people is every bit as arbitrary as prioritizing those who live near water stockpiles.

You're 100% correct. Rationing by wealth leads to equal misery as rationing by who happened by the grocery store sooner. However rationing by wealth is the surest way to increase supply quickly.

Do you like, not believe in monetary systems in general? This is how money works. With more of it, you can outbid people with less of it.

And in an emergency situation, that is a morally wrong system to have.

Like democracy, it's the worst system to have except for literally any other system we've tried.

Not true. You can set limits on how much people can purchase. And you're assuming that more would be wasted by the first to get there, and assuming that the rich wouldn't waste any.