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Progressive Environmentalism: A Pro-Human, Pro-Science, Pro-Free Enterprise Agenda For Change
National Center for Policy Analysis
Endangered Species
Endangered Species
The approach of reactionary environmentalists is to ban markets. Thus the reactionaries support bans on the importation of ivory, sea turtles, parrots and products obtained from other endangered species. Reactionaries propose bans on wood and virtually every other product produced in tropical rain forests. They also oppose private ownership.
Progressive environmentalists recognize that banning markets and private ownership is the worst possible way to achieve environmental goals. Nothing communicates as rapidly as market prices to people in remote villages all over the world. A high price means that things are rare and valuable. Private ownership gives people the right to protect and defend what the market says is valuable.
Save an Elephant; Buy Ivory.88 In Kenya, the sale of ivory has been banned for decades. In Zimbabwe, by contrast, ivory is openly bought and sold, with part of the profits returned to the country's national parks. Which country has a growing elephant population?
- In Kenya, where ivory sales are banned, the elephant population has
dropped from 65,000 to 19,000 over the past decade and faces extinction
in the next five years.
- In Zimbabwe, where ivory sales are encouraged, the elephant population has grown from 30,000 to 43,000 over the past decade.
Throughout Africa, similar patterns prevail. Contrary to conventional wisdom, when American consumers buy ivory, on balance they help save elephants. Buying ivory helps increase the economic value of elephants and gives African villagers more economic incentives to protect them.
Eliminating Poaching. As consumers, our biggest problem is that when we buy ivory we don't know whether it comes from a place where endangered elephants are being preserved (in which case our purchase encourages more conservation) or from poachers (in which case our purchase encourages illegal killing.) A similar problem existed in cattle ranching in the last century, and there is a similar solution.
The problem of cattle rustling was greatly diminished by branding individual cows. If trace elements (or some other way of "fingerprinting") could be used to establish the origin of products from endangered species, consumers and government authorities could distinguish between legal and illegal products.89 Such labeling would not be costless. But it would help protect endangered species by protecting the ownership rights of people who have custody of the species, thus making these ownership rights more valuable.
Rivers and Streams
Rivers and Streams
Rivers and streams represent a classic example of the problem of the commons. Historically, they have been misused as a source (e.g., overfishing) and as a sink (e.g., pollution.) Fortunately, there are progressive alternatives.
Private Ownership in Britain. In England and Scotland, there are private property rights to fish in certain rivers and streams. As a result, many voluntary associations have been formed to fiercely protect these rights against the threats of overfishing and pollution. One fishing club, the Pride of Derby, won a landmark lawsuit against an upstream municipal polluter.90 The case set a precedent which to this day puts potential polluters on notice that endangering fish is not acceptable.
- Since the 1950s, the Anglers' Cooperative Association in England "has
handled more than fifteen hundred cases of pollution [and] recovered hundreds
of pounds in damages to enable club and riparian owners to restore their
fisheries; [and] it has also defeated the attempt by various governments
to alter the common law in relation to pollution."91
- In Scotland, "virtually every inch of every major river and most minor ones is privately owned or leased, and while trespassing isn't quite as serious a crime as first degree murder or high treason, it isn't taken lightly."92
One exception exists in the Yellowstone River Valley, south of Livingston, Montana - where spring creeks offer some of the world's best trout fishing. Because the creeks begin and end on private property, restrictions on private ownership do not apply. The owners charge fees to sportsmen who come from all over the world for fly-fishing. To protect the value of their assets, property owners limit livestock grazing on stream banks and protect the area's wildlife, land and fish. By contrast, state-owned Spring Creek in Lewistown, Montana, has similar potential, but "free access" for everyone has produced crowding and reduced the fish population. 94
With respect to pollution control, it is interesting to compare the record of private enforcers in England and Scotland with that of government bureaucracies in the United States. Under the administration of the Clean Water Act, politically favored polluters (such as municipalities) are treated preferentially - with less stringent cleanup goals and more lenient cleanup schedules. To politicians, the source of the pollution is as significant as the pollution itself. Yet to the river and the fish, pollution is pollution.
Lakes and Bays
Lakes and Bays
By protecting privately owned fishing spots from pollution, British fishing clubs not only protect their own portion of the river, they protect downstream areas as well. Can a similar principle be applied to larger bodies of water? Many think that it can.
Property Rights in Scotland, Canada, Iceland and Greenland. Consider the case of British salmon sport fishermen. They not only must be diligent in preventing upstream pollution, they also must be concerned about what happens downstream - since the salmon swim to the commonly owned coastal waters and then return to the privately owned streams to spawn.
Because commercial fishermen were depleting salmon stocks in the coastal waters, the Atlantic Salmon Conservation Trust of Scotland has been buying up ocean netting rights from private owners and the government and retiring them. The idea of buying out ocean fishing rights began in Canada, where the government bought and retired commercial netting rights in New Brunswick, Nova Scotia and Quebec. Private interests in Iceland are considering the possibility of buying the Greenland and Faeroese fisheries and shutting them down completely. But for this approach to work, there must be rights that can be purchased.95
Public Ownership In the United States. With few exceptions there are no property rights - either to pollute or to fish in U.S. coastal waters.
Because there are no well-defined property rights, virtually every major species of commercially valuable marine life is being over-fished and stocks are being depleted. Yet at privately owned (or leased) oyster beds and private salmon fisheries, studies show that the stocks are carefully maintained.96
Among the sources of pollution, more than 1,300 major industrial facilities and 500 municipal plants dispose of wastes in estuaries, which flow to coastal waters. An additional 70 municipal plants and about 15 major industrial facilities dump pollutants directly into coastal waters. One consequence is that, during the 1980s, about one-third of U.S. shellfish-producing areas were closed to commercial harvests because of actually or potentially contaminated marine water. In 1988, more than 50 miles of New York City and Long Island beaches were closed to sunbathing and swimming because of medical waste contamination.97 Among the filthiest water bodies in the United States are Commencement Bay in Puget Sound and Boston Harbor.98
Government restrictions on discharges have led to some improvement. But one reason why it's difficult for government to solve the problem is that a significant amount of pollution is caused by governmental entities (e.g., municipal treatment plants) or by private parties operating under government contract. In addition, under the current system, interested parties can bring about improvements only by doing battle in the political arena.
Tradeable Pollution Permits. A welcome move toward a better approach is the system of tradeable pollution permits that exists on the Lower Fox River, which flows from Lake Winnebago to Green Bay, Wisconsin. The river is lined by ten pulp and paper mills and four municipalities - all of which discharge pollutants. But since well-defined rights to pollute can be bought and sold, discharging pollutants has a clear cost and each polluting entity has an economic incentive to reduce its discharges.99 If this system were in general use, private parties (including conservation groups, commercial and recreational fishing interests, etc.) could buy many of these rights and retire them. The more valuable clean water is to others, the more expensive it would become to discharge pollutants (by using rather than selling rights to pollute) and the more attractive nonpolluting methods of production would become.100
The Ocean
The Ocean
Like the open range of the Old West, the ocean today is one of the world's largest commons. Outside of the territorial limits of sovereign countries, only weak treaties limit the use of the ocean for fishing, mineral and energy development, shipping and garbage disposal. Can there be an ocean equivalent of "homesteading," "fencing," "branding" and the prosecution of "rustlers" on the high seas? That idea is less far-fetched than it might appear.
Aquaculture. "Aquaculture" is the term for ranching and farming in the sea. Although still in its infancy, aquaculture holds great promise. It requires technological innovation in order to create a system of property rights under which people will find it in their self-interest to preserve the value of ocean resources. The problem is that government policies distort incentives. As a result of these policies, the vast majority of innovations have enhanced people's ability to deplete rather than to conserve ocean resources.101
Take commercial fishing, for example. Like the Cattle Management Associations of the Old West, commercial fishing interests have made many attempts to prevent overfishing through unions, trade associations and informal contracting. But unlike the private pastureland solutions, the courts struck down these agreements as violating U.S. antitrust laws. In ocean waters, government solutions have replaced private ones.
Through a succession of policies, government has attempted to prevent the depletion of fish stock by restricting the days and times of fishing, the number of boats and the methods of fishing. These restrictions have spurred entrepreneurs to develop bigger boats, more efficient nets, sonar equipment and other innovations which allow commercial interests to catch more fish and further deplete the fish population. There are, however, a few welcome exceptions.
Property Rights in Fisheries in Japan, Australia and New Zealand. Japan has privatized aquaculture by creating private property rights in fisheries. Under the Japanese system, each fisherman has an incentive to make investments and discover new technology that enhances the value of his rights. Another approach is used by Australia (for bluefin tuna) and New Zealand (for abalone). In both cases, the government establishes a total allowable catch, and individual tradeable quotas (ITQs) permit fishermen to catch a specified percentage of the total. Since ITQs can be bought and sold, a system of property rights has been created under which holders of ITQs have a self-interest in preserving and maintaining the value of their property.102
This brief discussion by no means covers all of the problems or the progressive solutions to maintaining the value of ocean resources. It does show that progressive solutions not only are possible, but in many instances are being employed.
Ground Water
Ground Water
Because more than half of our drinking water comes from ground water, ground water is one of our most important environmental resources. Among the problems are overuse of water and too much pollution. Because there are no property rights to ground water, each user has a tendency to take too much since there is no guarantee that water left in the ground will not be taken by other users. (In other words, people have no right to the water they conserve.) The lack of property rights also means that there are no owners and defenders to deter people who trespass by polluting the water.103
Interestingly, a similar problem existed in the oil industry. Like an aquifer, an oil pool is an underground liquid resource which is subject to the problems of too rapid depletion and quality deterioration. But unlike the governmental approach to ground water, the oil industry solved the problem with market-based institutions. The oil industry developed a property rights approach called "unitization," which assigns ownership rights to an entity called the "unit." The unit manager operates the oil field in an integrated fashion and each owner receives a share of the income from the field. As in the case of cattle grazing, solving the "commons" problems of oil recovery was extremely difficult. But because solutions were perceived as valuable, people had a self-interest in discovering them.104
Forests
Forests
The reactionary approach to saving forests and trees is to turn ownership rights over to government. Often this involves replacing private owners and defenders with property owned in common.
Yet when government acquires power over resources, special-interest pressures invariably assert themselves. As a result, decisions tend to be made on the basis of political rather than economic or environmental costs and benefits. To the horror of environmentalists, governments in the United States, Canada, Sweden, Finland and Brazil frequently destroy forests in order to create jobs for loggers and pressure private owners to do the same. For example:105
- The government of Ontario, Canada, is deforesting government lands,
while private woodlot owners refuse to harvest their timber as fast as the
government would like.
- Sweden, where most of the forest land is privately owned, has more
standing forest today than at any time in the past, yet private owners are
required to harvest at least half of their trees within a decade after maturity.
- In Finland, which also has more forest than ever before, the government
is using tax incentives to encourage tree owners to harvest.
- In Brazil's Amazon basin, the government has subsidized the stripping
and burning of a forested area larger than France. The land was seized from
local inhabitants.
- Subsidized logging on more than half of the U.S. Forest Service's lands costs taxpayers more than $800 million a year.106
Auto Air Pollution
Auto Air Pollution
For as long as there have been cities, the air shed over them has been a commons, used as a dumping ground for various forms of waste. In the past, wood burning and coal burning to heat homes were the major sources of urban air pollution. Today, it's the automobile.
The Bureaucratic Approach. The current approach to curtailing tail pipe pollution is collectivist and ignores the behavior of individuals. Instead of imposing costs on people who pollute and rewarding those who don't, regulators are attempting to tell the entire automobile industry how to produce cars. One consequence is that cars are never cleaner than when they leave the assembly line. Individual car owners have weak incentives to reduce tail pipe pollution by, for example, getting regular tune-ups. The current approach is also inequitable. Higher auto prices penalize drivers in rural areas where pollution problems are nonexistent (and incomes are generally lower) in order to meet more cheaply the concerns of urban residents who actually have a pollution problem (and higher incomes).
To make matters worse, the current approach may be leading to more emissions and pollution. Studies show that 50 percent of the tail pipe pollution is caused by 10 percent of the cars (mainly old ones). But because federal regulations increase the prices of new cars, people have incentives to continue driving their older, more polluting cars.
An Individualistic Approach. Can auto pollution be reduced more intelligently? Indeed it can. The technology now exists to detect emissions from each car as it passes a monitor on the roadway. (See the case study below.) Car owners could be subject to fines and fees based on the pollution they create - the higher the emission level, the higher the fee. Under such a system, each car owner would have a financial interest in keeping emissions low. For people driving solely in cities, emission performance would become an attractive automobile feature. For people driving outside the cities, this feature would be less important.107
Industrial Air Pollution
As in the case of auto air pollution, the traditional approach to industrial air and water pollution in the United States is for government to literally tell producers how to produce things. For example, under the Clean Air Act, the federal government tells coal burning factories (mainly utility companies) that they must install scrubbers in order to reduce their emissions of sulphur dioxide (SO2), which causes acid rain.
One problem with this approach is that it leaves factories with no further incentive to reduce pollution. As long as they are in legal compliance, factory owners experience no economic gain if they further reduce sulphur emissions, and no economic cost if their emissions increase. A second problem is that such regulations create perverse incentives that may make the pollution problem worse. By raising the cost of new factories relative to old ones, the regulations inadvertently encourage the retention of older (more polluting) factories and discourage investments in newer (cleaner) ones. A third problem is that factory owners have no incentive to invest in discovering newer and better pollution abatement technology.108
A fourth problem is politics itself. For many utilities, burning low-sulphur Western coal is a cheaper way to control pollution than installing scrubbers, which are needed primarily for high-sulphur Appalachian and Midwestern coal. The federal government's requirement that all factories install scrubbers - regardless of the quality of coal used - is an example of special-interest pressure to prevent utilities from switching to Western coal. The program is actually an expensive jobs program for coal miners in Appalachia and the Midwest, which leaves the air dirtier than it would be with far cheaper control methods.109 For every $1 of additional costs (added to people's utility bills), coal miners receive only 5 cents of added benefits, and there is virtually no gain in air quality.110
Tradeable Pollution Permits. A better approach is to establish a permissible level of pollution and allow companies to buy and sell rights to pollute. Under this approach, government does not tell industry how to produce. It establishes pollution levels and lets producers find the least-cost method of reaching those levels. Under this approach, producers always have a financial self-interest in reducing pollution. If they pollute more, they have to buy more pollution rights. If they pollute less, they can sell their rights to others. A market for pollution rights tends to minimize the cost of achieving any given level of clean air and the hardship for workers and employers, while giving entrepreneurs incentives to devise better, cheaper pollution control methods.111
The idea of a tradeable market in pollution rights looks good in theory and is embodied in the amendments to the Clean Air Act, passed in the fall of 1990. Yet in practice, things are different. In the past, regulators have arbitrarily limited the rights and even revoked them whenever it seemed politically popular to do so. Thus politics has taken away many of the potential advantages of this approach.112
A Property Rights Approach. A different approach has been suggested by Fred Smith, a former EPA analyst, who is now president of the Competitive Enterprise Institute in Washington, DC. Smith sees polluters as trespassers. If there were a way to identify which pollutants come from which polluters, we could fine or tax each for the harm done to individuals who use the air shed. How can we "fence" air sheds and make individual trespassers pay? Technology may provide an answer:
Tracers (odorants, coloring agents, isotopes) might be added to pollutants to [detect the identity of the polluter]. Detection and monitoring schemes would evolve as environmental values mounted and it became appropriate to expend more on fencing. ... Lasimetrics, a technology which can already map atmospheric chemical concentrations from orbit, might in time provide a sophisticated means of tracking transnational pollution flows. If that system were combined with a system under which each nation adopted ... fingerprinting ... to identify its major greenhouse gases (a type of chemical zip code system), it would become possible to trace [worldwide] pollution to its source and thus make it possible to make the polluters pay.113
To some degree, these imaginative solutions are already being used. For example, in Canyonlands National Park in southern Utah, tracers were used to determine whether nearby power plants were contributing to haze-causing pollutants in the park.114
The United States Coast Guard has demonstrated that new sensing technology can be used to identify which oil tanker is the source of an oil spill with a probability of 99.9 percent.115 As a definer and enforcer of property rights, government has an important role to play in this solution. Just as states registered cattle brands and prosecuted rustlers, the government could move us in the right direction if it would register pollutants, monitor the flow of atmospheric pollutants and enforce liability for damages.
Global Warming
Global Warming
The theory behind global warming is that a buildup of greenhouse gases (especially carbon dioxide) will cause the earth to warm, with potentially harmful effects. We will review the predictions and evidence for the theory below.
Currently, scientists disagree on whether global warming has already occurred, whether significant global warming will occur in the future, whether warming would be harmful or somewhat beneficial to humans and whether, if harmful, it is better to adjust to the warming or try to prevent it. At least two of the world's leading climate scientists - Arizona State physicist Sherwood Idso116 and Soviet climatologist Mikhail Budyko117 - argue that we should welcome a CO2 buildup with open arms. In general, those scientists who welcome global warming, or at least do not worry about it, take the longer view - considering the historical variations in the earth's temperature and cycles in carbon dioxide (CO2) concentration.
Natural Temperature Changes. Most historical evidence suggests that warmth is life-enhancing and life-sustaining, whereas cold is life-threatening:
- In the past two to three million years, the earth's temperature has
gone through at least 17 climate cycles, with ice ages typically lasting
about 100,000 years interrupted by warm periods lasting about 10,000 years.118
[See Figure V.]
- Since by some calculations the current warm period is about 13,000 years old, the next ice age is overdue.119
Natural Changes in Carbon Dioxide Levels. Those who worry that the human use of carbon-based fuels is sending too much CO2 into the atmosphere may be surprised to learn that atmospheric CO2 levels have varied radically as life on earth has evolved. Moreover, just as warmth has always been unambiguously good for life, so has CO2:120
- When dinosaurs walked the earth (about 70 to 130 million years ago),
there was from five to ten times as much CO2 in the atmosphere as there
is today, and the average temperature was 5°C to 10°C warmer.
- Those conditions must have been extremely life-enhancing, since they
permitted the huge creatures to find plenty of food and survive - a task
that is difficult for today's largest land animal, the elephant.
- The ancestors of the earth's plants evolved at a time when plant-life-enhancing
CO2 was so abundant that some scientists fear today's plants are suffering
from CO2 deprivation.
- This may explain why plants thrive when exposed to more CO2, a phenomenon greenhouse operators have observed for years.
Unworkable Solutions. Although scientists now disagree about global warming, suppose it becomes clear that global warming is a real threat, and we all agree that worldwide reduction in atmospheric CO2 is desirable. What's the best way to achieve this goal? The collectivist approach focuses entirely on governments. An international treaty would be negotiated and each country would agree to reduce its CO2 emissions by regulating the behavior of its citizens. How likely is this to work? Consider a similar approach used by a fairly homogeneous group of countries (OPEC) to reduce the annual output of oil. OPEC agreements continue to fail miserably because each nation has a financial interest in cheating on the agreement, while hoping that all others will keep their word.
If OPEC agreements routinely fail to restrict oil production, how much more likely would failure be for an agreement to restrict CO2 emissions among 150 heterogeneous governments? The agreement would require each country to sacrifice for the common good. Yet each country, and each individual within each country, would have a self-interest in not sacrificing.122
Progressive Solutions. A progressive approach to global warming recognizes that people are far more likely to act in their self-interest than to sacrifice for abstract (and hard-to-understand) common goals. Accordingly, this approach would seek to empower individuals and make it in their self-interest to enhance carbon sinks (which absorb CO2), create alternative energy sources and develop new technology to deal with the problem. (See the case study below.)
Next Section Techniques for Empowering Individuals Back to Policy Issues Environment