> If someone neglects to clear their home area of burn material, and their house catches fire then burns their neighbors house - there certainly is a liability.

This is actually incorrect. Liability only exists if you start the fire (and often times requires the element of negligence or intent).

> We live in a society where individual actions and rights have boundaries when they cause social effects

And that's why it's illegal to siphon your neighbors groundwater. We have hundreds of years of court cases on groundwater rights and they are generally clear - the owner of the land has rights to the groundwater before appropriation.

You can't build your home in a desert and then complain that it's a desert. That's a you problem. Go live somewhere with water.