The Freeman 1993 · use styrofoam cups and toss outused plastic. The law is also playing a greater role in people's lives. An unaccountable bureau cracy in southern California, for

THEFREEIDEAS ON LIBERTY

332 Environmentalism: The Triumph of PoliticsDoug Bandow

It is a mistake to think that the goal of the environmental movement isprotection of the environment.

340 Linking Liberty, Economy, and EcologyJohn A. Baden and Robert Ethier

Liberty and private property are the best defense for the environment.

343 Science and the EnvironmentBruce N. Ames

Correcting some of the errors of the environmentalists.

345 Overpopulation: The Perennial MythDavid Osterfeld

Food, natural resources, and living space are becomingmore abundant.

348 Stewardship versus BureaucracyRick Perry

The control of water is too important to be left to government.

350 The Market and NatureFred L. Smith, Jr.

Economic development guided by the market is sustainable.

357 Eco-JusticeJane M. Orient, M.D.

How politics has perverted justice.

358 Pulling the Plug on the REAAlbert R. Bellerue

The Rural Electrification Administration serves no public interest.

360 In Praise of BillboardsLawrence Person

Information is an economic good, especially for travelers.

362 I Oil Drilling in AlaskaSarah Anderson

Protecting the environment on the North Slope.

366 Book ReviewsJim Russell reviews Earth in the Balance by Al Gore;Environmental Politics: Public Costs, Private Rewards edited byMichael S. Greve and Fred L. Smith, Jr., reviewed by Brian Doherty;The Heated Debate: Greenhouse Predictions vs. Climate Realityby Robert C. Balling, reviewed by John Semmens.

CONTENTSSEPTEMBER

1993VOL. 43

NO.9

THEFREEMANIDEAS ON LIBERTY

Published byThe Foundation for Economic EducationIrvington-on-Hudson, NY 10533

President: Hans F. Sennholz, Ph.D.

Editor: John W. Robbins, Ph.D.Senior Editor: Beth A. Hoffman

AssociateEditors: John Chamberlain

Bettina Bien GreavesEdmund A. OpitzPaul L. Poirot, Ph.D.

ContributingEditors: Doug Bandow

Clarence B. Carson, Ph.D.Thomas J. DiLorenzo, Ph.D.Roger W. Garrison, Ph.D.Robert Higgs, Ph.D.John Hospers, Ph.D.Ronald Nash, Ph.D.William H. Peterson, Ph.D.Richard H. Timberlake, Ph.D.Lawrence H. White, Ph.D.

The Freeman is the monthly publication ofThe Foundation for Economic Education,Inc., Irvington-on-Hudson, NY 10533. FEE,established in 1946 by Leonard E. Read, is anon-political, educational champion of private property, the free market, and limitedgovernment. FEE is classified as a 26 USC50l(c)(3) tax-exempt organization.

Copyright © 1993 by The Foundation forEconomic Education. Permission is grantedto reprint any article in this issue, providedappropriate credit is given and two copies ofthe reprinted material are sent to The Foundation.

The costs of Foundation projects and services are met through donations, which areinvited in any amount. Donors of $25.00 ormore receive a subscription to The Freeman. Additional copies of single issues ofThe Freeman are $2.00. For foreign delivery, a donation of $40.00 a year is suggestedto cover mailing costs.

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Phone (914) 591-7230FAX (914) 591-8910

PERSPECTIVE

Private PropertyIt is not the right of property which is

protected, but the right to property. Property, per se, has no rights; but the individual, the man, has three great rights, equallysacred from arbitrary interference: the rightto his life, the right to his liberty, the right tohis property. . . . The three rights are sobound together as to be essentially one right.To give a man his life but deny him hisliberty is to take from him all that makes hislife worth living. To give him liberty but totake from him the property which is the fruitand badge of his liberty, is to still leave hima slave.

-JUSTICE GEORGE SUTHERLAND

Government Against WildlifePerversely, the government sometimes

penalizes landowners for improving habitat.Dayton Hyde, who put 25 percent of hisranch into marshes for wildlife, initiatedresearch on the sandhill crane and built alake with three and a half miles of shorelinefor wildlife. But he paid a price: "My landshave been zoned. I am being regulated forwetlands that weren't there before I createdthem. Like most of my neighbors I can savemyself from financial disaster only by somecreative land management, but the statelegislature has cut out most of my options. "

As founder of Operation Stronghold, aninternational organization of private landowners practicing conservation on theirland, Hyde is serious about wildlife conservation. But his efforts rest on the cooperation of thousands of private landowners,who could go a lot further if governmentwould refrain from imposing costly zoningrestrictions. Hyde has found that someranchers are reluctant to join. As one landowner put it: "Look, you don't understand.We would like to do our share for wildlifebut we are afraid if we create somethingworthwhile the public will want what wehave. It's just plain easier and a lot safer tosterilize the land." Because the willingnessof the private sector to improve habitat or

330

create recreational opportunity depends onthe incentives landowners face, we cannotexpect a positive response from the privatesector if landowners are penalized for improving habitat.

-TERRY L. ANDERSONand DONALD R. LEAL

Free Market Environmentalism

Spotted Owl withTarragon Pesto?

I have one question about that April 2environmental teach-in in Portland withPresident Clinton: Why are those spottedowl couples entitled to 300 acres each?Candidate Clinton pledged to help' 'the oneswho do the work and play by the rules," andI know a lot of humans like that and none ofthem has even one acre.

"The ones who do the work and play bythe rules" are getting an average of $4,500added to each new house in higher lumberprices. The price of 2x 4s is up 90 percentsince November, in no small part because ofthe logging restrictions imposed by environmentalists.

John Hampton, president of WillaminaLumber Company, figures that the proposedmillions of acres in set-asides for owl habitatwill have each pair of spotted Owls sitting on$95 million in timber.

On the top of these rising lumber prices,there's unemployment. The people in Oregon, Washington, and California stand tolose anywhere from 10,000 to 50,000 loggingjobs, plus the secondary unemployment thatwill ripple out.

The bottom line, as I understand it, is thatsomeone has to move, either the loggers orthe owls. Neither can live with the other;both have their family ros;>ts deeply plantedin the same "old growth" forests, and someone is going to end up losing his home. Justlooking at that aspect, from an economist'sfocus on costs and benefits, it's clearly theowl couples who should hit the road sincetheir homes are next to worthless.

And in terms of the actual costs of mov-

PERSPECTIVE

ing, loggers must hire expensive vans andhelp, whereas all the owls have to do is wakeup when they hear the saws and fly overto some other trees. Isn't that why birdshave wings, so they can fly? Many birds flythousands of miles each year-some evendo a roundtrip from Canada to Argentinaevery year without whining about it. Butenvironmentalists whine because owlsmight have to move to "new growth" trees.So there they sit, even though they arecosting millions of dollars in unnecessaryhousing costs, tens of thousands oflost jobs,and the closing of entire human towns.

It's time to tell the spotted owls to startplaying survival of the fittest and move onand take their chances adapting to a newenvironment, just like most of the rest of usdid. The Irish survived the potato famine bymoving to New York City and the Cubanssurvived Castro's power grab by moving toMiami. Why should someone with wings beexpected to do less?

-RALPH R. REILANDRobert Morris College

Acid RainIn 1980 the Environmental Protection

Agency asserted that the average lake in thenortheastern United States had been acidified a hundredfold in the last 40 years by acidrain. And the National Academy ofSciencesclaimed that acid rain would double thedamage again by 1990.

But the 10-year National Acid Precipitation Assessment Program (NAPAP), conducted under the auspices of the EPA, hascompletely discredited these claims andshown them to be baseless. The $500 millionstudy found that:

• The average lake in the Adirondacks isno more acidic now than it was before theIndustrial Revolution.

• There was no measurable change in theacidity of lakes over the preceding 10 years.

• Only 35,000 of the 200 million acres ofu.S. lakes are too acidic to support sportsfisheries-and most of this acidity is natural.

-Executive Alert

331


ENVIRONMENTALISM:THE TRIUMPH OFPOLITICS

by Doug Bandow

T here's no doubt that the environmentmakes for good politics. Eight of ten

Americans call themselves environmentalists. Overwhelming majorities say that gasoline should be less polluting, cars should bemore efficient, trash should be recycled, andlifestyles should be changed.

This increasing sensitivity is reflected inbusiness' growing emphasis on environmental products. Such catalogues as RealGoods, Seventh Generation, and EarthCare Paper offer recycled paper, vegetablebased dishwashing liquid, battery chargers,and fluorescent light bulbs. Even manymainstream firms are labeling their productsCFC-free, biodegradable, and environmentally friendly. While the environmental benefits of these activities are unclear, theyapparently help sell products.

Increasing numbers of people are takingan interest in environmental issues in part inresponse to their own concerns and in partin response to social pressure-includingfrom their children. The schools havelaunched what for a less politically correctgoal would be called indoctrination programs. And the campaign seems to be working: The New York Times ran one storyabout parents who were relieved when their

Doug Bandow is a Contributing Editor of TheFreeman and a Senior Fellow at the Cato Institute.

children went off to camp so they could againuse styrofoam cups and toss out used plastic.

The law is also playing a greater role inpeople's lives. An unaccountable bureaucracy in southern California, for instance,proposed banning use of lighter fluid forbarbecues and prohibiting drive-in facilities.Federal agencies have essentially seizedcontrol ofmillions ofacres ofland arbitrarilydesignated as wetlands. And the Washington, D.C., suburb of Takoma Park employswhat it euphemistically calls "recycling coordinators" to comb through people's trashand hand out tickets-with fines ranging upto $500-for not properly sorting garbage.

In the abstract, greater attention to environmental matters would seem to be apositive trend. Mter all, no one wants tobreath polluted air. Noone wants to visit anEverglades that is dying or see Yellowstone's Old Faithful replaced by condominiums. And who could not be concernedabout the possibility of a warming environment, threatening ozone holes, and thespecter of acid rain?

The problem, however, is that the environment has become a hostage to politics.Many environmental activists want morethan a clean environment. Their commitment to conservation and political action isreligious, and their goals are often farreaching: to transform what they consider to

332

be a sick, greedy, and wasteful consumersociety. As a result, many otherwise wellmeaning people have proved quite willing touse state power to force potentially draconian social changes irrespective of numerous important alternative values, includingfreedom, health, and prosperity.

The real political divide is not betweenright and left, conservative and liberal, orRepublican and Democrat. Rather, it isbetween market process and central planning, the free market and command andcontrol by the government. Most politiciansbelieve in government solutions. They maynot be consistent in the specific ways theywant the state to intervene, but they likegovernment involvement. Although liberalenthusiasm for state action is best known,conservatives, too, often want governmentto rearrange environmental outcomes arbitrarily. There are no more fervent supporters of irrigation projects that deliver belowcost water to farmers, subsidies to promotelogging on public lands, and cut-rate rangefees on federal grazing land for ranchersthan Republican legislators. Conservativewestern senators have fervently opposedselling federal lands.

Where Do We Stand?Much of today's concern for new envi

ronmental restrictions comes from the perception that the sky is falling. In the view ofLester Brown of Worldwatch, for instance,we're in a "battle to save the earth's environmental support systems." He worriesabout global warming, growing populations,disappearing species, expanding deserts,depleting topsoil, and so on. We face "thewholesale collapse of ecosystems," heclaims.

Yet somehow the world seems rather lessbleak than he suggests. Between 1970 and1986, for instance, the amount of particulates spewed into the air fell by 64 percent,carbon monoxide emissions dropped 38 percent, and releases of volatile organic compounds fell by 29 percent. Ocean dumping ofindustrial wastes was reduced 94 percent.There were 80 percent fewer cities without

333

adequate sewage treatment plants. Riversunfit for swimming dropped 44 percent.Hazardous waste sites such as Love Canaland Times Beach now appear far less dangerous than once thought. Cars built in 1988produced 96 percent less carbon monoxideand hydrocarbons than those made in theearly 1980s. Population continues to growsharply in some Third World states, butthese increases reflect lower infant mortalityrates and longer life expectancies. Totalrecoverable world oil reserves grew by 400billion barrels between 1985 and 1990.Global warming trends may lengthen growing seasons. And extensive product packaging, falsely derided as wasteful, makesAmericans among the most efficient eaters onearth.

The point is not that there are no environmental problems. But claims of imminent disaster are simply not supported bythe facts. To the contrary, they reflect thepoliticization of the environment, becauseonly claims of imminent disaster can galvanize popular support for the sort of exceedingly harsh policy changes advocated bymany people for ideological-or even religious-reasons. Some environmental apocalyptics have admitted as much.

Politics has infected environmental policymaking in two different ways. The first isto create real environmental problems. Thesecond is to generate unfounded hysteria.

Poor EnvironmentalStewardship

For all of the enthusiasm of environmentalists for government programs, the government has proved to be a remarkably poorresource steward. Consider Uncle Sam's191 million acres of forestland. The Wilderness Society estimates that losses on federaltimberland amounted to $400 million annually during the 1980s, while losses on Alaska's Tsongass rain forest have hit 99 centson the dollar. The problem is that thegovernment both undertakes expensive investments, such as road-building in mountainous wilderness terrain, and underpricesthe timber that is produced. Washington's

334 THE FREEMAN • SEPTEMBER 1993

reason for doing so is to "create" a fewjobs.The cost, however, is both needless environmental destruction and the squanderingof taxpayers' money.

Federal water projects and managementof rangeland have consistently led to similarresults. The government has expended billions of dollars to subsidize such influentialgroups as farmers and ranchers, all the whileleaving environmental despoliation in itswake. In fact, the greatest threat to wetlandsacross the country is not private development, but federal efforts like the $1.2 billionGarrison Diversion project, which destroyed some 70,000 acres of wetlands tobenefit a few thousand farmers.

Nearly 90 percent of all federal water inthe west is sold at heavily subsidized pricesto heavily subsidized farmers. In California's San Joaquin Valley, for instance, irrigation projects typically cost $300-$500 anacre foot, yet the water is marketed tofarmers for less than a tenth that mucheven as Los Angeles and other parts of thestate until recently were suffering from severe water shortages. Only the governmentwould subsidize the production of a waterintensive crop like rice in a desert.

The federal government similarly mismanages its 307 million acres of rangeland.The Bureau of Land Management (BLM)has typically charged ranchers half of whatit costs the government to administer itsland, and one-tenth the rental price forcomparable private lands. The BLM alsospent millions of dollars "chaining" landripping out trees to create more rangelandon which it would lose more money. Notsurprisingly, federal lands are generally inpoor condition-and continue to generate aflood of red ink.

It is not just Uncle Sam who is to blame.Local governments have distorted the trashmarket, leading to pressure for a federalgarbage law. Many localities have essentially socialized trash collection and disposal, barring any private competitionwhich increases efficiency and innovation.Moreover, few cities charge citizens basedupon how much garbage they generate,providing no incentive for people either to

recycle or to change their buying habits.(Localities that have implemented fees foreach can or bag have made people moreenvironmentally conscious without a trashGestapo.) Political restrictions on the placement of new landfills and construction ofincinerators, both of which are quite safewith new technologies, have exacerbatedthe problem.

But the U.S. government is the mostculpable party. World Bank loans, underwritten by American taxpayers, have financed the destruction of Brazilian rainforests; federally subsidized flood insurancehas encouraged uneconomic construction onthe environmentally sensitive Barrier Islands.Years of energy price controls inflameddemand and discouraged conservation.

This sort of special-interest driven environmental abuse is not new, and the onlysolution is to eliminate political malfeasance. Unfortunately, as public choiceeconomists have so effectively pointed out,the political process tends to be biasedtoward taxpayer exploitation and againstsound policy.

Unfounded HysteriaThe second form of environmental polit

icization is more recent. That is the manufacture of false crises and the exaggerationof more limited problems to achieve otherideological ends, such as banning chemicals, closing incineration plants, and eliminating chlorofluorocarbons (CFCs). Unfortunately, examples of this sort of problemnow abound.

For instance, in 1989 the Natural Resources Defense Council (NRDC) used apublic relations agency to launch a campaign against the chemical Alar, a pesticideused on some 15 percent of apples in theUnited States. The charges received wideattention and demand for apples droppeddramatically-prices fell almost in half, ruining some farmers. Yet the furor was basedon one 1973 study, where mice were fedvery high levels of Alar. Two recent reviews, by Great Britain's Advisory Committee on Pesticides and the California De-

ENVIRONMENTALISM: THE TRIUMPH OF POLITICS 335

partment of Food and Agriculture,concluded that the risk of ingesting Alar wasminimal. As Dr. Joseph Rosen of RutgersUniversity explained, "There was neverany legitimate scientific study to justify theAlar scare."

But skillful manipulation of the media toinflame people's fears-and the enlistmentof such knowledgeable environmental experts as Hollywood's Meryl Streep-enabled one activist group to create a crisis.The NRDC's public relations agent latercirculated a memo to other organizationsdescribing his efforts.

Indeed, pesticides have long been subjectto countetfactual demagogic attacks. Natural pesticides-nature's way of protectingplants-may cause cancer, and they occurin far higher quantities in at least 57 foodvarieties than do man-made pesticides. ANational Center for Policy Analysis studyestimates that the risk of getting cancer fromchloroform in tap water is greater than that ofgetting it from pesticides in food. A person ismore than three times as likely to be killed bylightning than to contract cancer from pesticides. The risk of cancer from all pesticidesin the food consumed by the average personin one day is one-twentieth of the risk fromthe natural carcinogens in a single cup ofcoffee.

Another apocalyptic vision emerged fromthe EPA, which in 1980 claimed that acid rain,caused by sulfur dioxide emissions, had increased the average acidity of northeast lakesone hundredfold over the last 40 years andwas killing fish and trees alike. A year later theNational Research Council predicted that thenumber of acidified lakes would double by1990. So Congress included stringent provisions to cut S02 emissions (already down 50percent from the 1970s) at a cost of billions ofdollars annually when it re-authorized theClean Air Act three years ago.

Yet in 1987 EPA research raised doubtsabout the destructiveness of acid rain: Acongressional firestorm forced the study'sdirector to quit. Then came the most complete study of acid rain ever conducted, thehalf billion dollar National Acid Precipitation Assessment Project (NAPAP), which

concluded that the allegedly horrific effectsof acid rain were largely a myth. Amongother things, the study found that lakes wereon average no more acidic than before theindustrial era; just 240 of 7,000 northeastlakes, most with little recreational value,were critically acidic, or "dead"; most ofthe acidic water was in Florida, where therain is only one-third as acidic; there wasonly very limited damage to trees, far lessthan that evident elsewhere in the worldwhere S02 emissions are minimal; half ofthe Adirondack lakes were acidified due tonatural organic acids; and crops remainedundamaged at acidic levels ten times presentlevels. In the end, NAPAP's scientists figured that applying lime to the few lakes thatwere acidic would solve the problem at amere fraction of the cost of the Clean AirAct's acid rain provisions.

Perhaps the most famous form ofthe" skyis falling" claim today is global warmingthe so-called "Greenhouse Effect." TheU.N.'s 1992 Rio summit focused on thisissue. The fear is that pollution, particularlysuch "greenhouse gases" as carbon dioxide, will stay within the atmosphere, leadingto a rise in the earth's temperature, whichwill create deserts, melt the polar icecaps,and flood coastal nations.

In fact, warnings of global warming arenot new: The theory was first advanced inthe 1890s and re-emerged in the 1950s. Butsoon thereafter a new theory gained swaythat we were entering a new Ice Age. In 1974the U.S. National Science Board stated that"during the last 20 to 30 years, worldtemperature has fallen, irregularly at firstbut more sharply over the last decade." Inthe same year, Time magazine opined that"the atmosphere has been growing gradually cooler for the past three decades. Thetrend shows no indication of reversing."Similarly, observed Dr. Murray Mitchell ofthe National Oceanic and Atmospheric Administration in 1976, "Since about 1940there has been a distinct drop in averageglobal temperature. It's fallen about half adegree Fahrenheit."

Five years later Fred Hoyle's Ice: TheUltimate Human Catastrophe appeared,


warning that a new Ice Age was long overdue, and "when the ice comes, most ofnorthern America, Britain, and northernEurope will disappear under the glaciers. . . . The right conditions can arisewithin a single decade." He advocatedwarming the oceans to forestall this "ultimate human catastrophe." Another twoyears passed and Rolling Stone magazinedeclared that: "For years now, climatologists have foreseen a trend toward colderweather-long range, to be sure, but a trendas inevitable as death.... According to[one] theory, all it would take is a single coldsummer to plunge the earth into a suddenapocalypse of ice."

A decade later we have passed into a newcrisis. Climatologists like Stephen Schneider, who two decades ago was warning of acooling trend that looked like "one akin tothe Little Ice Age," now berates the mediafor covering scientists who are skeptical ofclaims that global warming is occurring. Heis, at least, refreshingly honest, admittingthat "to avert the risk we need to get somebroad-based support, to capture publicimagination. . . . So we have to offer upsome scary scenarios, make some simplifieddramatic statements and little mention ofany doubts one might have."

And he does this precisely because thedoubts about global warming are serious, soserious that both The Washington Post andNewsweek recently ran stories debunkingthe apocalyptic predictions of everyonefrom Vice President Gore to Greenpeace.Observed The Post:

Scientists generally agree that it has beengetting warmer over the last hundredyears, but the averagerate of change is nogreater than in centuries past, and there isno consensus that human activity is thecause. And while there is no doubt thatcontinued emissions of "greenhouse gases" tend to aid warming, it is not clear thatcutting back on emissions could do muchto stop a natural trend, if that is what ishappening.

Indeed, a survey by Greenpeace, one ofthe most radical environmental organiza-

tions, of scientists involved in the Intergovernmental Panel on Climate Change foundthat only 13 percent of them believed therewas probably a point-of-no-retum in thefuture leading to a runaway greenhouseeffect. Just 17 percent of climatologists in abroader Gallup poll believed that humaninduced warming had occurred at all, while53 percent did not.

The problems with the theory are many.First, there is no reason to assume that anychange in temperature is undesirable. Infact, peoples living in colder climates wouldbenefit from small increases; higher temperatures at night also would likely have apositive impact.

Second, the evidence does not supportthe contention that human activity is raisingtemperatures. We have seen slight warmingover the last century, but 90 percent of itoccurred before 1940, when greenhouse gasemissions started rising dramatically. Theassumptions suggest that daytime temperatures should rise in the northern hemisphere, but most of the limited warming sofar observed has occurred at night in thesouthern hemisphere. The ice caps havebeen growing, not shrinking. And so on.Even those predicting a much hotter futurehave had to lower their forecasts over thelast decade. In the end, it is obvious boththat mankind, which produces just a couplepercent of total CO2 , has only a limitedimpact on the earth's climate, and that theglobe has a dramatic ability to adjust. Forinstance, increased pollution may helpshield the earth from sunlight, counteractingany temperature increase. Higher temperatures at the poles actually allow more pr~

cipitation. Since serious warming couldcause serious damage, there is cause tomonitor changes in climate, but not yet toimplement the sort of draconian changesdemanded by the greenhouse crowd.

The ozone issue has been similarly politicized. The fear is that chlorofluorocarbonsare thinning atmospheric ozone, allowing inmore ultraviolet (UV) rays. In January 1992a Harvard University chemist, JamesAnderson, held a press conference warningof a "hole" in the ozone in the so-called


polar vortex, the upper atmosphere over NewEngland and Canada. His claims were basedon the initial findings from a scientific expedition monitoring atmospheric conditionsand received wide attention. Yet four monthslater he was forced to admit that "thedreaded ozone hole never materialized." I

A decade ago apocalyptic environmentalists were warning ofa reduction of 18 percentin ozone levels. Today the predictions aredown to two to four percent. Even if theseforecasts are borne out, the impact may not bedramatic: It would be like moving roughly 60miles south, from Palm Beach to Miami inFlorida. And, oddly, UV radiation levelshave dropped over the last decade, even asthe ozone layer was supposedly thinning.Moreover, there is some question as towhether CFC's-inexpensive, safe chemicals that have no obvious replacement-arereally villainous destroyers of ozone afterother factors are taken into account. Suchthings as ocean salt spray may help counteract increasing CFC levels. Explains Dr.Melvyn Shapiro ofthe National Oceanic andAtmospheric Administration, in making theirclaims even many atmospheric chemists"have little regard for the impact of atmospheric variability on chemical processes. " Infact, the higher levels of chlorine monoxidedetected in January did not create an ozonehole because temperatures were higher thanexpected.

Population growth has been cited as animpending disaster for nearly two centuries.Recent apocalyptics include Paul Ehrlich ofStanford University, who predicted massfamine and death in the 1970s, and formerWorld Bank President Robert McNamara,who went so far as to compare the threat ofpopulation pressure to that of nuclear war.

Their argument is simple: More peoplemean the use of more resources and morewaste. The end result is lower incomes anddisaster.

This apocalyptic scenario ignores the factthat some part of the population "explosion" is short term, since infant mortalityrates have fallen more swiftly than havefertility rates. Moreover, people normallyproduce more than they consume-other-

wise even one person would be too many.Further, fears of population growth assumea static view of the world, that economics isa zero-sum game. Yet the market naturallyadjusts as the number of people and demandfor goods and services increase; technological innovation and behavioral changeswork together to allow better and moreefficient resource use.

In practice we see no adverse relationshipbetween population or population densityand economic growth. Population density isvery high in such places as Hong Kong,Singapore, and Taiwan, yet their economieshave grown faster. The population of theNetherlands is 50 percent denser than India,Great Britain's is twice as dense as that ofThailand, and South Korea possesses lessterritory but twice the population of NorthKorea. In all of these cases the more populated states have achieved much higherlevels of development.

The issue of population growth, then, is ared herring. The central issue is economicgrowth. The most important means of adaptation is the marketplace: If governmentsprevent people from freely producing goodsand services, charging prices that reflectchanging resource values, and responding todiverse human needs, then worsening poverty will result. Third World countries areimpoverished not because they are populous, but because their governments haveenforced anti-capitalistic economic policies.

Related to the supposed problem of toomany people is that of too few resources.Such reports as the Club of Rome's 1972Limits to Growth and the Carter Administration's 1980 Global 2000 predicted that wewould soon run out of key resources. Indeed, much of the Carter energy programwas predicated on the assumption that wewould soon run out of fossil fuels. (Since oilwas first discovered in the United States 130years ago people have been predicting thatreserves would soon be depleted.)

The Club of Rome, which imagined theimminent exhaustion of such resources asgold, lead, and zinc, has already beenproved wrong. Even more significant, however, is the fact that real resource prices fell


consistently throughout the 1980s. According to Stephen Moore, in a study for theInstitute for Policy Innovation, "of 38 natural resources examined in this study, 34declined in real price" between 1980 and1990. Prices for two remained constant,while only the cost of manganese and zincrose. Moore found that American and international prices of food, energy, timber, andminerals, for instance, all fell.

Again, the doomsayers have ignored thepowerful adjustment process that occursthrough the marketplace. As goods becomescarcer, prices rise, encouraging entrepreneurs to locate new supplies, manufacturesynthetic equivalents, find substitutes, useproducts more efficiently, and reduce consumption. As long as prices can rise freely,the market will ensure that shortages willnot occur. The fact that real resource pricesfell during the 1980s indicates that relativescarcity has not increased but decreased.

Apocalyptic predictions regarding a number of other issues, such as toxic wastes anddesertification, have proved to be equallyflawed. The point is not that there are noenvironmental problems, but rather thatenvironmental issues tend to be quite complex and that one should not make long-runpredictions based on short-term trends. Unfortunately, many activists are willing todistort the facts because they have eitherpolitical or religious reasons for proclaimingthat disaster is imminent.

The New TheologyThe environment has become as much a

spiritual as a political issue for some people.Many churches now recycle products, install solar power, and pray for endangeredanimal species. Moreover, religious leaderswho once busily promoted social and economic "justice" are now turning to ecological concerns. Global warming "is a spiritualissue, not just a technical problem," explained Bruce McLeod, president of theCanadian Council of Churches, after hisorganization endorsed the U.N.'s WorldClimate Convention last year.

Indeed, a variety ofreligious environmen-

tal organizations have formed-the NorthAmerican Coalition on Religion and Ecology (NACRE), Religion and Science for theEnvironment, and the Presbyterian EcoJustice Task Force, for instance. The 1990NACRE Intercontinental Conference onCaring for Creation presented a Liturgy forthe Earth, in which "Mother Earth" spoketo her "children."

Much church activism is based on falsescientific theories, such as global warming.More significant, however, is the theologicalcontamination from much of the new conservation ethic. Christianity and Judaismhold man to be a steward of the earth, whichKing David declared to be "the Lord's, andeverything in it" (Psalm 24: 1). Because manthereby "subdues" or exercises dominionover the planet (Genesis 1:28), many environmentalists view these faiths as largelyresponsible for the plight of the earth today.Historian Lynn White, for one, has criticized Christianity for being "the most anthropocentric religion the world has everseen." He further argued that "since theroots of our [environmental] trouble are solargely religious, the remedy must also beessentially religious." Many other environmentalists have made similar charges.

Strangely, some churchmen seem toagree. James Nash, Executive Director ofthe Churches' Center for Theology andPublic Policy, writes that "without doubt,Christian traditions bear some responsibility for propagating" destructive environmental perspectives. Thus, "for the Christian churches," he argues, "the ecologicalcrisis is more than a biophysical challenge.It is also a theological-ethical challenge."The obvious solution, then, is to makeChristianity "green." We now have a similarly minded ecologian in the White House."Both conservative and liberal theologianshave every reason, scriptural as well asideological, to define their spiritual missionin a way that prominently includes thedefense of God's creation," argues VicePresident Gore in his apocalyptic book,Earth in the Balance.

But some environmentalists go further,turning ecology into a separate religion by


mixing ancient and modern forms of pantheism. John Muir and a host of other earlyenvironmentalists experimented with different forms of Earth and nature worship.More recently, environmentalism hasjoinedNew Age thinking to produce a vibrantNeo-Pagan movement, including such practices as witchcraft, which has always had aheavy ecological emphasis, and goddess(Earth) worship. Moreover, explains LeslyPhillips, "the growing awareness of theurgent need to honor and heal Mother Earthhas drawn many Unitarian Universaliststo a contemporary pagan approach to religion."

Another religious strand is deep ecology,which treats the planet as sacred. Philosophy professors Bill Devall and George Sessions advocate "the revival of Earthbonding rituals.' , Some deep ecologistseven support the use of violence to protecttheir "god." Dave Foreman, co-founder ofEarth First! and later convicted of attempting to blow up power pylons for an Arizonanuclear plant, explains that so-called ecoterrorism is "a form of worship toward theearth. " He has also advocated allowing thepoor in third world countries to starve, "tojust let nature seek its own balance."

The new eco-spiritualism does more thanthreaten traditional faiths, which are beingpressed to accept doctrines contrary theirbasic tenets. More broadly, treating theearth as sacred distorts public policy. Ourobjective should be to balance environmental preservation with economic growth andpersonal freedom, and to rely on marketforces to make any environmental controlsas efficient and as flexible as possible. Unfortunately, however, treating the environment as a goddess has caused environmentalactivists to advance the most frighteningtheories, irrespective of the evidence, anddemand the most draconian controls possible, irrespective of the cost.

The Reds and the GreensMany other environmentalists have radi

cal philosophical rather than theological

agendas. Most of the activists are implicitlyanti-capitalist, anti-profit, and, frankly, antifreedom, since it is people acting freely thatleads, in some conservationists' views, toconsumerism, greed, pollution, and waste.In fact, it has beenjokingly said that the onlyremaining socialists in the world are in theenvironmental movement, since they arepromoting a centrally planned system basedon government command-and-control regulation. The Reds have been replaced by theGreens.

The problem is not so much the motivesof such activists, but the fact that theirideological biases lead them to ignore evidence questioning the genuineness of alleged environmental problems and to refuseto make compromises in drafting solutionsto real concerns. While a doctrinal environmentalist might be happy with the policyresult for religious or philosophical reasons,it is foolish for the rest of us to wasteresources on non-problems and on unnecessarily inefficient clean-up strategies.

Environmental protection is important,and good people can disagree on the bestpolicies to adopt. But today the publicdiscussion over conservation is being distorted by politics and pagan theology, making the American public poorer and less freeand the environment dirtier.

We need to look for private strategies toprotect the environment. Privatizing federaltimber and rangeland, for instance, wouldend subsidized development, since no private individual or company would willinglyturn a dollar investment into a few cents inrevenue. Establishing full private propertyrights in water would help conserve thisprecious resource in the western UnitedStates. We need to develop equally creativesolutions for such "common pool" problems as air and water pollution. In short, weneed to depoliticize the environment, making the issue one of balancing competinginterests rather than imposing ideological orreligious dogmas. If we succeed in doing so,we will end up with not only a cleanersociety, but also a wealthier and freero~. D


LINKING LIBERTY,ECONOMY,ANDECOLOGYby John A. Baden and Robert Ethier

Much environmental writing is markedby a profound disregard, even hostil

ity, toward property rights and individualliberty. Self-interest is an evil to be combatted. And markets, at best, provide mechanisms for people to express their selfinterest in ways injurious to the earth.

To some Greens, economic progress implies planetary suicide. Instead, environmental groups offer eco-empathy, altruism,and socialism as guides for environmentallycorrect behavior. However, some are finding that environmental causes fosteredthrough self-interest and property rights aremore likely to succeed than appeals toenvironmental values and bureaucraticmicro-management. Even the environmental newspaper High Country News finds "agrowing free-market attitude toward environmental protection." Let's see why.

Prosperity and EcologyFor years environmentalists ignored or

discounted the strong correlation betweeneconomic prosperity and environmentalconcern. But when prosperity is at risk,

John A. Baden is Chairman of the Foundationfor Research on Economics and the Environment. Robert Ethier, a F.R.E.E. research assistant, contributed to this paper.

people willingly trade environmental qualityfor economic gain. This occurs even inwealthy nations. In our political campaignsenvironmental themes are crowded out byeconomic issues. As Michael R. Deland,former chairman of the President's Councilon Environmental Quality, observed: "in arecession there is an increased sensitivity tothe job side of the equation."

This is because wealth fosters both environmental concern and the capacity to exercise that concern in a concrete way, e.g.,with sewage treatment plants. The 1992World Bank World Development Reportshows that less than two percent of sewagein Latin America is treated. Worldwidemore than. one billion people have no safewater. In China, two-thirds of rivers nearlarge cities are too polluted for fish. Theseare problems that require capital, not promises and Green pretenses.

Given that wealth enhances environmental quality, environmental policy can bebased upon three fundamental principles:(1) private property and markets createwealth; (2) government management responds to political pressures in ways thatdecrease environmental quality; and (3)government's constructive role is to provideenvironmental monitoring. These principlescan direct the environmental debate in apositive direction, avoiding wasteful efforts

340

that advance only interest groups seekingpolitical power and wealth transfers. Theseprinciples provide the basis for both anenvironmental vision and a sound policydirection.

International Trade FostersEnvironmental Quality

The best way to spread free markets andcreate wealth in less developed nations isfree trade. The U. S. has urged the removalof trade barriers in the Uruguay round of theGeneral Agreement on Tariffs and Trade(GATT) talks. This has been opposed bysome environmentalists who fear that trade,and its resultant economic growth, will bringdegradation. They are misinformed. Environmental quality and prosperity are complementary. Evidence shows that wealthieris usually healthier; longevity is correlatedwith per capita income.

Free trade would increase global incomelevels while speeding the dissemination ofpollution-control technologies. Research byGene Grossman and Alan Krueger ofPrinceton indicates that economic growth alsopromotes a cleaner environment. For exampie, above a per capita income level of$4,000-$5,000, air quality improves. This isbecause wealth and efficiency go togetherthe U.S. emits almost 30 percent less CO2

per $1,000 of GNP than the world average.Improved efficiency and pollution controltechnologies, coupled with increased environmental awareness, allow production torise while emissions fall.

Poor nations typically have low environmental standards and enforcement. Someenvironmentalists argue that free trade encourages the migration of polluting industries to these poor countries. However, a1987 World Resources Institute study findsthat environmental factors have not playeda major role in determining internationalcapital allocations. And as increased environmental concern, regulation, and enforcement in Mexico show, the prosperity accompanying trade speeds the adoption ofshared higher standards among nations.

Senior economist Peter Emerson of the

341

Environmental Defense Fund writes, "poverty and economic autocracy are the handmaidens of environmental degradation."Only by attacking poverty can we effectively address environmental destructionand promote long-term stewardship abroad.We must loosen the stranglehold of thecommand-and-control approach to regulation, introducing markets and private management as the solution to environmentproblems.

Ending Command andControl at Home

As the U.S. works to promote free markets in Eastern Europe, the costs of its ownenvironmental autocracy are ignored orheavily discounted. Many of the government's resource agencies, such as the Forest Service, the Bureau of Land Management, and the Bureau of Reclamation,operate. in a perverse world in which theyhave incentives both to degrade the environment and to lose money.

Bureau of Land Management lands areamong the most degraded and eroded in thewest. Yet the agency continues to encourage, even require, overgrazing. Ranchers,who pay far below market rates for grazingrights, have little incentive to invest in soilconservation or water storage. If they attempt to rest an area through reduced usethey are threatened with revocation of permits for underuse.

Many of the National Forests lose moneywhile hurting the environment. They buildroads whose costs are not covered by therevenues from the timber sales they facilitate, while the environmental costs are unaccounted for. Far more is invested inreplanting than would be in a private forest,where natural revegetation is a realisticoption. Budgets are maximized while theenvironment and the taxpayer suffer.

It is essential that environmental groupsrealize the negative effects of commandand-control policies on the environment.While politics may seem to be the cheapestroute to environmental control, recent conflicts over preserving old growth timber for


spotted owl habitat show that environmentalists cannot count on the political process.By replacing political-bureaucratic management with market forces, property rights,and private management, we promote conservation and economic progress.

Innovation for BiodiversityMuch of the current environmental de

bate centers on endangered species preservation and biodiversity. This conflict isreduced to "jobs versus the environment,"an unholy trade-off. Many environmentalists feel that government must mandatespecies preservation. This approach hasbeen both unsuccessful and has infringedupon private property rights.

Environmental and wildlife groups couldbuy conservation easements in the areaswhere disturbances might harm specieslisted as endangered. The North AmericanElk Foundation, Trout Unlimited, andDucks Unlimited have each done this onprivate lands and waters with private funds.Such organizations could also pay "bounties" to land managers if an endangeredspecies successfully breeds on their land.The Montana chapter of Defenders of Wildlife has recently announced such a programto facilitate wolf reintroduction.

A rancher in Dubois, Wyoming, has offered to pay the Forest Service $300,000 notto log a pristine canyon. This move wassupported by many local citizens who valueit as a recreation area. Some outfitters andguest ranches also benefit from its naturalstate because they use it for paying customers. But the Forest Service returned the$100,000 down payment to the rancher because it was not allowed to create "a defacto wilderness area," even though thesum was almost certainly greater than anyincome the Forest Service would have received from timber sales. Only in a world asperverse as that of the Forest Service bureaucracy would a decision be made to losemoney while at the same time harm theenvironment.

Because wildlife and their habitat are"public goods," some believe there is atheoretical case for government involvement. But a system encouraging privateinitiative is likely to be far more efficient andeffective than federal mandates for speciesrecovery. Costs would become explicit, notunevenly imposed upon landowners by theEndangered Species Act. This also allowscomparisons and trade-offs to be made amongcompeting species and habitats in a way thatis impossible under the current Act.

Preserving Propert~ RightsIn terms of our future environment, it is

important that property rights be protected.The current Endangered Species Act hasresulted in an attenuation of property rightsand begun to provoke a backlash fueling the"wise-use" movement. In contrast, landand ecological trusts are founded upon private property rights. They preserve speciesby using, not sabotaging, property rights.

With proper incentives we can expectprivate land owners to support the listing ofnew species. Under the Endangered SpeciesAct, if a landowner improves habitat on hisown property to encourage an endangeredspecies, he could lose control of that property. For example, Dayton Hyde, a rancherin Eastern Oregon, created a lake out ofwilderness and attracted a variety of speciesincluding the American bald eagle. He wasthen told by the Forest Service that he couldno longer access his property by truckbecause he might disturb the eagles. This isa perversity of monumental proportions.

A sound economy fosters environmentalprotection. We must eschew conventionalGreen wisdom with its appeals to commandand-control mechanisms. Environmentalquality will be enhanced via markets andsecure property rights, an approach thatis consistent with America's intellectualheritage. Government must be the moderator, not the manager. In this way we canhave both environmental quality andprosperity. D


SCIENCE AND THEENVIRONMENTby Bruce N. Ames

I t is popular these days to espouse anapocalyptic vision of the future of our

planet. Pollution is being blamed for globalwarming and ozone depletion, pesticides forcancer. Yet these and many other purportedenvironmental causes are based on weak orbad science. The reality is that the future ofthe planet has never been brighter. With thebankruptcy ofCommunism, a hopeful worldis on the path to democracy, free markets,and greater prosperity. Science and technology develop in a free society, and freemarkets bring wealth, which is associatedwith both better health and lower birth rates.Scientific advances and free markets canalso lead to technologies that minimize pollution for the lowest cost. A market forpollution rights is desirable-pollutingshouldn't be free-and is much more effective than a bureaucratic monopoly. In myscenario for the future, I would like to seeenvironmentalism based on scientific evidence and directed at solving real problemsrather than phantoms.

An example of this problem is the publicmisconception that pollution is a significantcontributor to cancer and that cancer ratesare soaring. As life expectancy continues toincrease in industrialized countries, cancerrates (unadjusted for age) also increase;

Bruce Ames is Professor of Biochemistry andMolecular Biology at the University of California, Berkeley, where he is also the Director oftheEnvironmental Health Sciences Center.

however, the age-adjusted cancer death ratein the United States for all cancers combined (excluding lung cancer from smoking)has been steady or decreasing since 1950.Decreasing since 1950 are primarily stomach, cervical, uterine, and rectal cancers.Increasing are primarily lung cancer (whichis due to smoking, as are 30 percent of allU.S. cancer deaths), melanoma (possiblydue to sunburn), and non-Hodgkin's lymphoma. Cancer is fundamentally a degenerative disease of old age, although externalfactors can increase cancer rates (cigarettesmoking in humans) or decrease them (eating more fruits and vegetables).

A second misconception is that high-doseanimal cancer tests tell us the significantcancer risks for humans. Approximatelyhalf of all chemicals-whether natural orsynthetic-that have been tested in standardanimal cancer tests have turned out to becarcinogenic. These standard tests of chemicals are conducted chronically, at neartoxic doses-the maximum tolerated doseand evidence is accumulating that it may bethe high dose itself, rather than the chemicalper se that is the risk factor for cancer. (Thisis because high doses can cause chronicwounding oftissues or other effects that leadto chronic cell division, which is a major riskfactor for cancer.) At the very low levels ofchemicals to which humans are exposedthrough water pollution or synthetic pesticide residues, such increased cell division

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344 THE FREEMAN. SEPTEMBER 1993

does not occur. Thus, they are likely to poseno or minimal cancer risks.

The third misconception is that humanexposures to carcinogens and other toxinsare nearly all due to synthetic chemicals. Onthe contrary, the amount of synthetic pesticide residues in plant foods are insignificant compared to the amount of naturalpesticides produced by plants themselves.Of all dietary pesticides, 99.99 p~rcent arenatural: They are toxins produced by plantsto defend themselves against fungi and animal predators. Because each plant produces a different array of toxins, we estimate that on average Americans ingestroughly 5,000 to 10,000 different naturalpesticides and their breakdown products.Americans eat an estimated 1,500 milligrams of natural pesticides per person perday, which is about 10,000 times more thanthey consume of synthetic pesticide residues. By contrast, the FDA found the residues of 200 synthetic chemicals, includingthe synthetic pesticides thought to be ofgreatest importance, average only about0.09 milligram per person per day.

The fourth misconception is that synthetic toxins pose greater carcinogenic hazards than natural toxins. On the contrary,the proportion of natural chemicals that iscarcinogenic when tested in both rats andmice is the same as for synthetic chemicals-roughly half. All chemicals are toxicat some dose, and 99.99 percent of thechemicals we ingest are natural.

The fifth misconception is that the toxicology of man-made chemicals is differentfrom that of natural chemicals. Humanshave many general natural defenses thatmake us well buffered against normal exposures to toxins, both natural and synthetic.DDT is often viewed as the typically dangerous synthetic pesticide. However, itsaved millions of lives in the tropics andmade obsolete the pesticide lead arsenate,which is even more persistent and toxic,although all natural. While DDT was unusual with respect to bioconcentration, nat-

ural pesticides also bioconcentrate if theyare fat soluble. Potatoes, for example, naturally contain fat soluble neurotoxins detectable in the bloodstream of all potatoeaters. High levels of these neurotoxins havebeen shown to cause birth defects in rodents.

The sixth misconception is that correlation implies causation. The number of storksin Germany has been decreasing for decades. At the same time, the German birthrate also has been decreasing. Aha! Solidevidence that storks bring babies! Cancerclusters in small areas are expected to occurby chance alone, and there is no persuasiveevidence from either epidemiology or toxicology that pollution is a significant cause ofcancer for the general population.

There are tradeoffs involved in eliminating pesticides. Plants need chemical defenses-either natural or synthetic-in order tosurvive pest attack. One consequence ofdisproportionate concern about syntheticpesticide residues is that some plant breeders are currently developing plants to bemore insect-resistant and inadvertently areselecting plants higher in natural toxins. Amajor grower recently introduced a newvariety of highly insect-resistant celery intocommerce. The pest-resistant celery contains 6,200 parts per billion (ppb) of carcinogenic (and mutagenic) psoralens instead ofthe 800 ppb normally present in celery. Thecelery is still on the market.

Synthetic pesticides have markedly lowered the cost of plant foods, thus makingthem more available to consumers. Eatingmore fruits and vegetables is thought to bethe best way to lower risks from cancer andheart disease, other than giving up smoking;our vitamins, anti-oxidants, and fiber comefrom plants and are important anti-carcinogens. Thus, eliminating essential pesticidesis likely to increase cancer rates. Hugeexpenditure of money and effort on tinyhypothetical risks does not improve publichealth. Rather, it diverts our resources fromreal human health hazards, and it hurts theeconomy. D

THEFREEMANIDEAS ON UBERTY

OVERPOPULATION:THE PERENNIAL MYTH

by David Osterfeld

"What mostfrequently meets our view (andoccasions complaint) is our teeming population. Our numbers are burdensome to theworld, which can hardly support us . ... Invery deed, pestilence, and famine, andwars, and earthquakes have to be regardedas a remedy for nations, as the means ofpruning the luxuriance ofthe human race."

This was not written by professionaldoomsayer Paul Ehrlich (The Popula

tion Bomb, 1968). It is not found in thecatastrophist works of Donella and DennisMeadows (The Limits to Growth, 1972;Beyond the Limits, 1992). Nor did it comefrom the Council on Environmental Qualityand the Department of State's pessimisticassessment of the world situation, TheGlobal 2000 Report to the President (1980).

It did not even come from ThomasMalthus, whose Essay on Population (1798)in the late eighteenth century is the seminalwork to which much of the modern concernabout overpopulation can be traced. And itdid not come from Botero, a sixteenthcentury Italian whose work anticipatedmany of the arguments advanced byMalthus two centuries later.

The opening quotation was penned byTertullian, a resident of the city of Carthagein the second century, when the population

Dr. Osterfeld is Professor ofPolitical Science atSaint JQseph's College in Rensselaer, Indiana.

of the world was about 190 million, or onlythree to four percent ofwhat it is today. Andthe fear ofoverpopulation did not begin withTertullian. One finds similar concerns expressed in the writings ofPlato and Aristotlein the fourth century B.C., as well as in theteachings of Confucius as early as the sixthcentury B.C.

From the period before Christ, men havebeen worried about overpopulation. Thoseconcerns have become ever more frenzied.On an almost daily basis we are fed a barrageof stories in the newspapers and on television-complete with such appropriately lurid headlines as "Earth Near the BreakingPoint" and "Population Explosion Continues Unabated" -predicting the imminentstarvation of millions because population isoutstripping the food supply. We regularlyhear that because of population growth weare rapidly depleting our resource basewith catastrophic consequences looming inour immediate future. We are constantlytold that we are running out of living spaceand that unless something is done, anddone immediately, to curb populationgrowth, the world will be covered by a massof humanity, with people jammed elbow toelbow and condemned to fight for each inchof space.

The catastrophists have been predictingdoom and gloom for centuries. Perhaps thesingle most amazing thing about this perennial exercise is that the catastrophists seem

345


never to have stopped quite long enough tonotice that their predictions have nevermaterialized. This probably says moreabout the catastrophists themselves thananything else. Catastrophism is characterized by intellectual arrogance. It's been saidof Thomas Malthus, for example, that heunderestimated everyone's intelligence buthis own. Whenever catastrophists confronta problem for which they cannot imagine asolution, the catastrophists conclude that noone else in the world will be able to think ofone either. For example, in Beyond theLimits the Meadows tell us that crop yields,at least in the Western world, have reachedtheir peak. Since the history ofagriculture islargely a history of increasing yields peracre, one would be interested in knowinghow they arrived at such a significant andcounter-historical conclusion. Unfortunately, such information is not forthcoming.

OverpopulationBut isn't the world overpopulated? Aren't

we headed toward catastrophe? Don't morepeople mean less food, fewer resources, alower standard of living, and less livingspace for everyone? Let's look at the data.

As any population graph clearly shows,the world has and is experiencing a population explosion that began in the eighteenthcentury. Population rose sixfold in the next200 years. But this explosion was accompanied, and in large part made possible, bya productivity explosion, a resource explosion, a food explosion, an information explosion, a communications explosion, a science explosion, and a medical explosion.

The result was that the sixfold increase inworld population was dwarfed by the eightyfold increase in world output. As real incomes rose, people were able to live healthier lives. Infant mortality rates plummetedand life expectancies soared. According toanthropologists, average life expectancycould never have been less than 20 years orthe human race would not have survived. In1900 the average world life expectancy wasabout 30 years. In 1993 it is just over 65years. Nearly 80 percent of the increase in

world life expectancy has taken place injustthe last 90 years! That is arguably one of thesingle most astonishing accomplishments inthe history of humanity. It is also one of theleast noted.

But doesn't this amazing accomplishmentcreate precisely the overpopulation problemabout which the catastrophists have beenwarning us? The data clearly show that thisis not the case. "Overpopulation" cannotstand on its own. It is a relative term.Overpopulation must be overpopulation relative to something, usually food, resources,and living space. The data show that allthree variables are, and have been, increasing more rapidly than population.

Food. Food production has outpacedpopulation growth by, on average, one percent per. year ever since global food databegan being collected in the late 1940s.There is currently enough food to feedeveryone in the world. And there is aconsensus among experts that global foodproduction could be increased dramaticallyif needed. The major problem for the developed countries of the world is food surpluses. In the United States, for example,millions ofacres ofgood cropland lie unusedeach year. Many experts believe that evenwith no advances in science or technologywe currently have the capacity to feedadequately, on a sustainable basis, 40 to 50billion people, or about eight to ten times thecurrent world population. And we are currently at the dawn of a new agriculturalrevolution, biotechnology, which has the potential to increase agricultural productivitydramatically.

Where people are hungry, it is because ofwar (Somalia, Ethiopia) or government policies that, in the name of modernization andindustrialization, penalize farmers by taxingthem at prohibitive rates (e.g., Nigeria,Ghana, Kenya), not because population isexceeding the natural limits of what theworld can support.

Significantly, during the decade of the1980s, agricultural prices in the UnitedStates, in real terms, declined by 38 percent.World prices followed similar trends andtoday a larger proportion of the world's

OVERPOPULATION: THE PERENNIAL MYTH 347

people are better fed than at any time inrecorded history. In short, food is becomingmore abundant.

Resources. Like food, resources havebecome more abundant over time. Practically all resources, including energy, arecheaper now than ever before. Relative towages, natural resource prices in the UnitedStates in 1990 were only one-half what theywere in 1950, andjust one-fifth their price in1900. Prices outside the United States showsimilar trends.

But how can resources be getting moreabundant? Resources are not things that wefind in nature. It is ideas that make thingsresources. If we don't know how to usesomething, it is not a resource. Oil is aperfect example. Prior to the 1840s oil wasa liability rather than a resource. There waslittle use for it and it would often seep to thesurface and get into the water supply. It wasonly with the dawn of the machine age thata use was discovered for this "slimy ooze."

Our knowledge is even more importantthan the physical substance itself, and thishas significant ramifications: More peoplemean more ideas. There is no reason, therefore, that a growing population must meandeclining resource availability. Historically,the opposite has been true. Rapidly growingpopulations have been accompanied by rapidly declining resource prices as people havediscovered new ways to use existing resources as well as uses for previously unused materials.

But an important caveat must be introduced here. For the foregoing to occur, thepolitical and economic institutions must beright. A shortage of a good or service,including a resource, will encourage asearch both for additional supplies and forsubstitutes. But this is so only if those whoare successful are able to profit from theireffort. This is precisely what classicalliberalism, with its emphasis on private propertyand the free market, accomplishes. A shortage of a particular resource will cause itsprice to rise, and the lure ofprofit will attractentrepreneurs anxious to capitalize on theshortage by finding solutions, either additional supplies of the existing material or the

development of an entirely new method ofsupplying the service. Communicatingthrough the use of fiber optics rather thancopper cable is a case in point.

Entrepreneurs typically have drawn scientists and others with relevant expertiseinto the field by paying them to work on theproblem. Thus, the market automaticallyensures that those most likely to find solutions to a particular problem, such as ashortage of an important resource, aredrawn into positions where they can concentrate their efforts on finding solutions tothe problem. To cite just a single example,a shortage of ivory for billiard balls innineteenth-century England led to the invention of celluloid, followed by the entirepanoply of plastics.

In the absence of an efficient and reliableway to match up expertise with need, ourefforts are random. And in the absence ofsuitable rewards for satisfying the needs ofsociety, little effort will be forthcoming. Itwas certainly no accident that the takeoff,both in population growth and economicgrowth, dates from the decline of mercantilism and extensive government economicregulations in the eighteenth century, andthe emergence in the Western world of arelatively free market, characterized by private property, low taxes, and little government interference.

In every category-per capita income, lifeexpectancy, infant mortality, cars, telephones, televisions, radios per person-theperformance of the more free market countries far surpasses the more interventionistcountries. The differences are far too largeas well as systematic to be attributed to merechance.

Living Space. But even if food and resources are becoming more abundant, certainly this can't be true for living space.After -all, the world is a finite place and themore people in it, the less space there is foreveryone. In a S'tatistical sense this is true,of course. But it is also irrelevant. Forexample, if the entire population of theworld were placed in the state of Alaska,every individual would receive nearly 3,500square feet of space, or about one-half the


size of the average American family homestead with front and back yards. Alaska is abig state, but it is a mere one percent of theearth's land mass. Less than one-halfofonepercent of the world's ice-free land area isused for human settlements.

But perhaps "living space" can be measured more meaningfully by looking at suchthings as the number of houses, the amountof floor space, or the number of rooms per'person. There are more houses, more floorspace, and more rooms per person than everbefore. In short, like both food and resources, living space is, by any meaningfulmeasure, becoming more abundant.

Finally, it should be noted that the population explosion has begun to fizzle. Population growth peaked at 2.1 percent peryear in the late 1960s and has declined to itspresent rate of 1.7 percent. There is nodoubt that this trend will continue since,according to the latest information suppliedby the World Health Organization, totalfertility rates (the number of births perwoman) have declined from 4.5 in 1970 to

THEFREEMANIDEAS ON L1BERlY

just 3.3 in 1990. That is exactly fifty percentofthe way toward a fertility rate of2.1 whichwould eventually bring population growth toa halt.

Everything is not fine. There are manyproblems in the world. Children are malnourished. But the point that cannot be ignored isthat all of the major economic trends are inthe right direction. Things are getting better.

Contrary to the constant barrage ofdoomsday newspaper and television stories,the data clearly show that the prospect oftheMalthusian nightmare is growing steadilymore remote. The natural limits of what theearth- can support are steadily receding, notadvancing. Population growth is slowingwhile the supplies of food, resources, andeven living space are increasing. Moreover,World Bank data show that real wages areincreasing, which means that people areactually becoming more scarce.

In short, although there are now morepeople in the world than ever before, by anymeaningful measure the world is actuallybecoming relatively less populated. 0

STEWARDSHIP VERSUSBUREAUCRACY

by Rick Perry

Ensuring a safe, plentiful water supply isan issue crucial to the well-being of

every American-one that will certainlyintensify as we move into the twenty-first

Rick Perry is Commissioner ofthe Texas Department of Agriculture.

century. Thus, we must answer this question: How can we guarantee a sufficientsupply of water to satisfy the necessary butcompeting demands of agriculture, industry, and a population that is expected toincrease rapidly in the next 50 years?

First of all we must challenge the assump-

STEWARDSHIP VERSUS BUREAUCRACY 349

tion that government ownership offers thebest solution for protecting our preciousnatural resources. The premise that putsbureaucratic regulation above the rights ofprivate property owners is not only false, itactually promotes problems for our environment.

Look, for example, at the Pacific Northwest, where a combination of federally operated dams and reservoirs and state policies that prevent the resale of water rightshas contributed to the depletion of salmonpopulations.

The salmon's seasonal need for high water levels to journey to its summer spawninggrounds coincides with peak consumer demand for electricity in the West. So, it wouldmake good sense to produce and sell morehydroelectricity during these peak monthsand to conserve it when demand is low.Consumers would benefit and so would thesalmon.

Unfortunately, a maze of bureaucraticregulations-combined with the West's"use it or lose it" rule that often preventsresale ofwater rights-makes such a sensiblesolution nearly impossible, and the salmonspecies has suffered, not benefited.

Our natural resources are better left in thehands ofprivate citizens who are more likelythan government agencies to care for them.It's a question of stewardship versus bureaucracy. Private ownership gives people avested interest in their property, instillspride in what they own.

Ownership also spurs agricultural producers to manage their resources wisely-theirwater as well as their land. In Texas,

groundwater management has historicallybeen based on the "right of capture," thedecades-old, time-honored premise that bestows ownership of water on the owner ofthe land above. Under this system, farmersand ranchers have led the way in developingefficient methods of water use.

There is room for improvement, however.Though ownership of groundwater is vestedin property owners in the Texas WaterCode, this property right is loosely defined,which affects the incentive to conserve. Amarket-based system for groundwater withwell defined, enforceable, and transferableproperty rights based on the surface ownership would more accurately reflect water's economic and ecological value to society. By strictly defining the ownership ofunderground water, it can be given a value-just as land has-and become subject tothe efficiencies of the marketplace. Waterrights would be more marketable, and owners would be able to sell water to buyers ata price reflecting market demand.

Such a market-based system would replace government control ofwater-and thespecter of rationing, expensive financingprograms, and confiscation of water rightsby a centralized bureaucracy. Governmentinvolvement would remain in the hands oflocal water districts that would define owners' rights and devise enforcement methodsappropriate to each locality.

A market-based system-achieved byplacing a value on water inventories-wouldmotivate agricultural producers to increaseeven further their conservation efforts andenhance supplies for future generations. D

Making Every Drop Count

W ater markets offer something for nearly everyone: They caneliminate water shortages, reduce environmental degradation,

and reduce government spending, too.-DON LEAL, The Freeman, June 1988

IDEASON

LIBERTY

$

THEFREEMANIDEAS ON L1BERlY

THE MARKET ANDNATURE

by Fred L. Smith, Jr.

M any environmentalists are dissatisfiedwith the environmental record of free

economies. Capitalism, it is claimed, is awasteful system, guilty of exploiting thefinite resources of the Earth in a vain attempt to maintain a non-sustainable standard of living. Such charges, now raisedunder the banner of "sustainable development," are not new. Since Malthus made hisdire predictions about the prospects forworld hunger, the West has been continuallywarned that it is using resources too rapidlyand will soon run out of something, if noteverything. Nineteenth-century expertssuch as W. S. Jevons believed that worldcoal supplies would soon be exhausted andwould have been amazed that over 200 yearsof reserves now exist. U.S. timber "experts" were convinced that North Americanforests would soon be a memory. Theywould similarly be shocked by the reforestation of eastern North America-reforestation that has resulted from market forcesand not mandated government austerity.

In recent decades, the computer-generated predictions of the Club of Rome enjoyed a brief popularity, arguing that everything would soon disappear. Fortunately,most now recognize that such computersimulations, and their static view of resource supply and demand, have no relationto reality. Nevertheless, these models are

Fred L. Smith, Jr., is the President of theCompetitive Enterprise Institute.

back, most notably in the book Beyond theLimits, and enjoying their newly found attention. This theme of imminent resourceexhaustion has become a chronic element inthe annual Worldwatch publication, State ofthe World. (This book is, to my knowledge,the only gloom-and-doom book in historywhich advertises next year's edition.) Today, sustainable development theorists,from the World Bank's Herman Daly andthe United Nations' Maurice Strong to VicePresident Albert Gore and Canadian DavidSuzuki, seem certain that, at last, Malthuswill be proven right. It was this environmental view that was on display at theUnited Nations' "Earth Summit" in Rio deJaneiro in 1992. This conference, vast inscope and mandate, was but the first step inthe campaign to make the environment thecentral organizing principle of global institutions.

If such views are taken seriously, then thefuture will indeed be a very gloomy place,for if such disasters are in the immediatefuture, then drastic government action isnecessary. Consider the not atypical viewsofDavid Suzuki: "[T]here has to be a radicalrestructuring of the priorities of society.That means we must no longer be dominatedby global economics, that the notion that wemust continue to grow indefinitely is simplyoff, that we must work towards, not zerogrowth, but negative growth." For the firsttime in world history, the leaders of thedeveloped nations are being asked to turn

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their backs on the future. The resultingpolicies could be disastrous for all mankind.

The Environmental ChallengeThe world does indeed face a challenge in

protecting ecological values. Despite tremendous success in many areas, many environmental concerns remain. The plight ofthe African elephant, the air over Los Angeles, the hillsides of Nepal, the three million infant deaths from water-borne diseasesthroughout the world, and the ravaging ofBrazilian rain forests all dramatize areaswhere problems persist, and innovative solutions are necessary.

Sustainable development theorists claimthese problems result from "market failure": the inability of capitalism to addressenvironmental concerns adequately. Freemarket proponents suggest that such problems are not the result of market forces, butrather of their absence. The market alreadyplays a critical role in protecting thoseresources privately owned and for whichpolitical interference is minimal. In theseinstances there are truly sustainable practices. Therefore, those concerned with protecting the environment and ensuring human prosperity should seek to expandcapitalism, through the extension of property rights, to the broadest possible range ofenvironmental resources. Our objectiveshould be to reduce political interference inboth the human and the natural environments, not to expand it.

Private stewardship of environmental resources is a powerful means of ensuringsustainability. Only people can protect theenvironment. Politics per se does nothing. Ifpolitical arrangements fail to encourage individuals to playa positive role, the arrangements can actually do more harm than good.There are tens of millions of species ofplants and animals that merit survival. Canwe imagine that the 150 or so governmentson this planet-many of which do poorlywith their human charges-will succeed inso massive a stewardship task? Yet there arein the world today over five billion people.Freed to engage in private stewardship, the

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challenge before them becomes surmountable.

Sustainable Development andIts Implications

The phrase sustainable development suggests a system of natural resource management that is capable of providing an equivalent, or expanding, output over time. As aconcept, it is extremely vague, often littlemore than a platitude. Who, after all, favorsnon-sustainable development? The basicdefinition promoted by Gro Harlem Brundtland, former Prime Minister of Norway anda prominent player at the Earth Summit, isfairly vague as well: "[S]ustainable development is a notion of discipline. It meanshumanity must ensure that meeting presentneeds does not compromise the ability offuture generations to meet their own needs. "

In this sense, sustainability requires thatas resources are consumed one of threethings must occur: New resources must bediscovered or developed; demands must beshifted to more plentiful resources; or, newknowledge must permit us to meet suchneeds from the smaller resource base. Thatis, as resources are depleted, they must berenewed. Many assume that the market isincapable of achieving this result. A tremendous historical record suggests exactly theopposite.

Indeed, to many environmental "experts," today's environmental problems reflect the failure of the market to considerecological values. This market failure explanation is accepted by a panoply of political pundits of all ideological stripes, fromMargaret Thatcher to Earth First! The caseseems clear. Markets, after all, are shortsighted and concerned only with quick profits. Markets undervalue biodiversity andother ecological concerns not readily captured in the marketplace. Markets ignoreeffects generated outside of the market,so-called externalities, such as pollution.Since markets fail in these critical environmental areas, it is argued, political intervention is necessary. That intervention shouldbe careful, thoughtful, even scientific, but


the logic is clear: Those areas of the economy having environmental impacts must bepolitically controlled. Since, however, every economic decision has some environmental effect, the result is an effort toregulate the whole of human activity.

Thus, without any conscious decisionbeing made, the world is moving decisivelytoward central planning for ecological ratherthan economic purposes. The Montreal Protocol on chlorofluorocarbons, the international convention on climate change, theproposed convention on biodiversity, andthe full range of concerns addressed at theV.N. Earth Summit-all are indicative ofthis rush to politicize the world's economies. That is unfortunate, for ecologicalcentral planning is unlikely to provide for agreener world.

Rethinking the MarketFailure Paradigm

The primary problem with the marketfailure explanation is that it demands toomuch. In a world of pervasive externalities-that is, a world where all economic decisions have environmental effects-this analysis demands that all economic decisions bepolitically managed. The world is only nowbeginning to recognize the massive mistakeentailed in economic central planning; yet,the "market failure" paradigm argues thatwe embark on an even more ambitious effortof ecological central planning. The disastrous road to serfdom can just as easily bepaved with green bricks as with red ones.

Environmental policy today is pursuedexactly as planned economies seek to produce wheat. A political agency is assignedthe task. It develops detailed plans, issuesdirectives, and the citizens comply. Thatprocess will produce some wheat just asenvironmental regulations produce somegains. However, neither system enlists theenthusiasm and the creative genius of thecitizenry, and neither leads to prosperity. Infact, political management has been able toturn the cornucopia that was the Horn ofAfrica into a barren, war-torn desert.

That markets "fail" does not mean that

governments will "succeed." Governments, after all, are susceptible to specialinterest pleadings. A complex political process often provides fertile ground for economic and ideological groups to advancetheir agendas at the public expense. TheV.S. tolerance of high sulfur coal and themassive subsidies for heavily polluting' 'alternative fuels" are evidence of this problem. Moreover, governments lack anymeans of acquiring the detailed informationdispersed throughout the economy essentialto efficiency and technological change.

More significantly, if market forces werethe dominant cause of environmental problems, then the highly industrialized, capitalist countries should suffer from greater environmental problems than their centrallymanaged counterparts. This was once theconventional wisdom. The Soviet V nion, itwas argued, would have no pollution because the absence of private property, theprofit motive, and individual self-interestwould eliminate the motives for harming theenvironment. The opening of the Iron Curtain exploded this myth, as the most terrifying ecological horrors ever conceivedwere shown to be the Communist reality.The lack of property rights and profit motivations discouraged efficiency, placing agreater stress on natural resources. Theresult was an environmental disaster.

Do Markets Fail-Or Do WeFail to Allow Markets?

John Kenneth Galbraith, an avowed proponent of statist economic policies, inadvertently suggested a new approach to environmental protection. In an oft-quotedspeech he noted that the u.S. was a nationin which the yards and homes were beautifuland in which the streets and parks werefilthy. Galbraith then went on to suggest thatwe effectively nationalize the yards andhomes. For those of us who believe inproperty rights and economic liberty, theobvious lesson is quite the opposite.

Free market e.nvironmentalists seek waysof placing these properties in the care ofindividuals or groups concerned about their

well-being. This approach does not, ofcourse, mean that trees must have legalstanding, but rather a call for ensuring thatbehind every tree, stream, lake, air shed,and whale stands one or more owners whoare able and willing to protect and nurturethat resource.

Consider the plight of the African elephant. On most of the continent, the elephant is managed like the American buffaloonce was. It remains a political resource.Elephants are widely viewed as the commonheritage of all the peoples of these nations,and are thus protected politically. The"common property" management strategybeing used in Kenya and elsewhere in Eastand Central Africa has been compared andcontrasted with the experiences of thosenations such as Zimbabwe which havemoved decisively in recent years to transferelephant ownership rights to regional tribalcouncils. The differences are dramatic. InKenya, and indeed all of eastern Africa,elephant populations have fallen by over 50percent in the last decade. In contrast,Zimbabwe's elephant population has beenincreasing rapidly. As with the beaver inCanada, a program of conservation throughuse that relies upon uniting the interests ofman and the environment succeeds wherepolitical management has failed.

The Market and SustainabilityThe prophets of sustainability have con

sistently predicted an end to the world'sabundant resources, while the defenders ofthe free market point to the power of innovation-innovation which is encouraged inthe marketplace. Consider the agriculturalexperience. Since 1950, improved plant andanimal breeds, expanded availability andtypes of agri-chemicals, innovative agricultural techniques, expanded irrigation, andbetter pharmaceutical products .have allcombined to spur a massive expansion ofworld food supplies. That was not expectedby those now championing ,'sustainabledevelopment." Lester Brown, in his 1974Malthusian publication By Bread Alone,suggested that crop yield increases would

THE MARKET AND NATURE 353

soon cease. Since that date, Asian riceyields have risen nearly 40 percent, anapproximate increase of 2.4 percent peryear. This rate is similar to that ofwheat andother grains. In the developed world it isfood surpluses, not food shortages, thatpresent the greater problem, while politicalinstitutions continue to obstruct the distribution of food in much of the Third World.

Man's greater understanding and abilityto work with nature have made it possible toachieve a vast improvement in world foodsupplies, to improve greatly the nutritionallevels ofa majority ofpeople throughout theworld, in spite of rapid population growth.Moreover, this has been achieved whilereducing the stress to the environment. Tofeed the current world population at currentnutritional levels using 1950 yields wouldrequire plowing under an additional 10 to 11million square miles, almost tripling theworld's agricultural land demands (now at5.8 million square miles). This would surelycome at the expense of land being used forwildlife habitat and other applications.

Moreover, this improvement in agriculture has been matched by improvements infood distribution and storage, again encouraged by natural market processes and the"profit incentive" that so many environmentalists deplore. Packaging has made itpossible to reduce food spoilage, reducetransit damage, extend shelf life, and expand distribution regions. Plastic and otherpost-use wraps along with the ubiquitousTupperware have further reduced foodwaste. As would be expected, the UnitedStates uses more packaging than Mexico,but the additional packaging results in tremendous reductions in waste. On average, aMexican family discards 40 percent morewaste each day. Packaging often eliminatesmore waste than it creates.

Despite the fact that capitalism has produced more environment-friendly innovations than any other economic system, theadvocates of sustainable development insistthat this process must be guided by benevolent government officials. That such efforts, such as the United States' syntheticfuels project of the late 1970s, have resulted


in miserable failures is rarely considered. Itis remarkable how many of the participantsat the U.N. Earth Summit seemed completely oblivious to this historical reality.

In the free market, entrepreneurs compete in developing low-cost, efficient meansto solve contemporary problems. The promise of a potential profit, and the freedom toseek after it, always provides the incentiveto build a better mousetrap, ifyou will. Underplanned economies, this incentive for innovation can never be as strong, and the capacityto reallocate resources toward more efficientmeans of production is always constrained.

This confusion is also reflected in thelatest environmental fad: waste reduction.With typical ideological fervor, a call forincreased efficiency in resource use becomes a call to use less of everything,regardless of the cost. Less, we are told, ismore in terms of environmental benefit. Butneither recycling nor material or energy usereductions per se are a good thing, evenwhen judged solely on environmentalgrounds. Recycling paper often results inincreased water pollution, increased energyuse, and in the United States, actuallydiscourages the planting of new trees. Mandating increased fuel efficiency for automobiles reduces their size and weight, which inturn reduces their crashworthiness and increases highway fatalities. Environmentalpolicies must be judged on their results, notjust their motivations.

Overcoming ScarcityEnvironmentalists tend to focus on ends

rather than process. This is surprising giventheir adherence to ecological teaching.Their obsession with the technologies andmaterial usage patterns of today reflects afailure in understanding how the worldworks. The resources that people need arenot chemicals, wood fiber, copper, or theother natural resources of concern to thesustainable development school. We demand housing, transportation, and communication services. How that demand is metis a derivative result based on competitiveforces-forces which respond by suggesting

new ways of meeting old needs as well asimproving the ability to meet such needs inthe older ways.

Consider, for example, the fears expressed in the early post-war era that copperwould soon be in short supply. Copper wasthe lifeblood of the world's communicationsystem, essential to link together humanitythroughout the world. Extrapolations suggested problems and copper prices escalatedaccordingly. The result? New sources ofcopper in Mrica, South America, and even theU.S. and Canada were found. That concern,however, also prompted others to review newtechnologies, an effort that produced today's rapidly expanding fiber optics links.

Such changes would be viewed as miraculous if not now commonplace in the industrialized, and predominantly capitalistic, nations of the world. Data assembled by LynnScarlett of the Reason Foundation notedthat a system requiring, say, 1,000 tons ofcopper can be replaced by as little as 25kilograms of silicon, the basic component ofsand. Moreover, the fiber optics system hasthe ability to carryover 1,000 times theinformation of the older copper wire. Suchrapid increases in communication technology are also providing for the displacementof oil as electronic communication reducesthe need to travel and commute. The risingfad of telecommuting was not dreamed upby some utopian environmental planner, butwas rather a natural outgrowth of marketprocesses.

It is essential to understand that physicalresources are, in and of themselves, largelyirrelevant. It is the interaction of man andscience that creates resources: Sand andknowledge become fiber optics. Humanityand its institutions determine whether weeat or die. The increase of political controlof physical resources and new technologiesonly increases the likelihood of famine.

Intergenerational EquityCapitalism is ultimately attacked on

grounds of unsustainability for its purportedfailure to safeguard the needs of futuregenerations. Without political intervention,

it is argued, capitalists would leave a barrenglobe for their children. Thus, it is concluded, intergenerational equity demandsthat politics intervene. But are these criticisms valid?

Capitalists care about the future becausethey care about today's bottom line. Marketeconomies have created major institutions-bond and stock markets, for example-which respond to changes in operatingpolicies that will affect future values. A firmthat misuses its capital or lowers its qualitystandards, a pet store that mistreats itsstock, a mine that reduces maintenance, afarmer that permits erosion-all will find thevalue of their capital assets falling. Highlyspecialized researchers expend vast effortsin ferreting out changes in managementpractices that might affect future values;investment houses pay future analysts verywell indeed to examine such questions.

Markets, of course, are not able to foresee all eventualities, nor do they considerconsequences hundreds of years into thefuture. Yet, consider the time horizon ofpoliticians. In the U.S., at least, they areconcerned with only one thing: getting reelected, a process that provides them at besta two-to-six-year time horizon. Politicallymanaged infrastructure is routinely undermaintained; funds for new roads are moreattractive than the smaller sums used torepair potholes; national forests are morepoorly maintained than private forests; erosion is more serious on politically controlledlands than on those maintained by privatecorporations. If the free market is shortsighted in its view of the future, then thepolitical process is even more so. It istherefore the free market which best ensuresthat there will be enough for the future.

Warring ParadigmsThe alternative perspectives on environ

mental policy-free markets and centralplanning-differ dramatically. One reliesupon individual ingenuity and economicliberty to harness the progressive nature ofmarket forces. The other rests upon politicalmanipulation and government coercion. In

THE MARKET AND NATURE 355

point of fact, these approaches are antithetical. There is little hope of developing a"third way." Yet, there has been littledebate on which approach offers the greatest promise in enhancing and protectingenvironmental concerns. The political approach has been adopted on a wide scalethroughout the world, with more failure thansuccess, while efforts to utilize the freemarket approach have been few and farbetween.

Nevertheless, there are numerous caseswhere private property rights have beenused to complement and supplement political environmental strategies. One excellentexample is a case in England in the 1950swhere a fishing club, the Pride ofDerby, wasable to sue upstream polluters for trespassing against private property. Even the pollution issuing from an upstream municipality was addressed. This ability to go againstpolitically preferred polluters rarely existswhere environmental resources are politically managed.

At the heart of the division between statistand free market environmentalists is a difference in moral vision. Free market environmentalists envision a world in which manand. the environment live in harmony, eachbenefiting from interaction with the other.The other view, which dominates the environmental establishment, believes in a formof ecological apartheid whereby man andnature must be separated, thus protectingthe environment from human influence.From this view rises the impetus to establishwilderness lands where no humans maytread and a quasi-religious zeal to end allhuman impact on nature.

Thus, the establishment environmentalists view pollution-human waste-as anevil that must be eliminated. That waste isan inevitable by-product ofhuman existenceis of secondary concern. To the environmentalist that endorses this ideology, nothing short of civilization's demise will sufficeto protect the earth.

The view that free market environmentalists endorse is somewhat different. Not allwaste is pollution, but only that waste whichis transferred involuntarily. Thus it is pol-


luting to dispose of garbage on a neighbor'slawn, but not to store it on one's ownproperty. The voluntary transfer of waste,perhaps from an industrialist to the operatorof a landfill or recycling facility, is merelyanother market transaction.

ConclusionThe United Nations Earth Summit con

sidered an extremely important issue: Whatsteps should be taken to ensure that economic and ecological values are harmonized? Unfortunately, the Earth Summitfailed to develop such a program, optinginstead to further the flawed arguments forecological central planning.

The world faces a fateful choice as to howto proceed: by expanding the scope ofindividual action via a system of expandedprivate property rights and the legal defenses associated with such rights or byexpanding the power of the state to protectsuch values directly. In making that choice,we should learn from history. Much of theworld is only now emerging from decades ofefforts to advance economic welfare viacentralized political means, to improve thewelfare of mankind by restricting economicfreedom, by expanding the power of thestate, to test out the theory that marketforces are inadequate to protect the welfareof society. That experiment has been a clearfailure on economic, civil liberties, and evenecological grounds. Economic central planning was a utopian dream; it became a realworld nightmare.

Today, the international environmentalestablishment seems eager to repeat thisexperiment in the ecological sphere, increasing the power of the state, restricting

individual freedom, certain that marketforces cannot adequately protect the ecology. Yet, as I've quickly sketched out here,this argument is faulty. Wherever resourceshave been privately protected, they havedone better than their politically managedcounterparts-whether we are speaking ofelephants in Zimbabwe, salmon streams inEngland, or beaver in Canada. Where suchrights have been absent or suppressed, theresults have been less fortunate. Extendingproperty rights to the full array of resourcesnow left undefended, now left as orphans ina world of protected properties, is a daunting challenge. Creative legal arrangementsand new technologies will be necessary toprotect the oceans and air sheds of theworld, but those tasks can be resolved if weapply ourselves. The obstacles to ecologicalcentral planning are insurmountable. Theneed for centralized information and a comprehensive system of controls in order tocoerce the population of the world to act inhighly restricted ways as well as that foromniscient decision-makers to chooseamong technologies can never be met.

Ecological central planning cannot protect the environment, but it can destroy ourcivil and economic liberties. There is toomuch at stake to allow the world to embarkupon this course. The environment can beprotected, and the world's peoples can continue to reach new heights ofprosperity, butit is essential to realize that political management is not the proper approach. Rather,the leaders of the world should follow thepath of the emerging nations of EasternEurope and embrace political and economicfreedom. In the final analysis, the free market is the only system of truly sustainabledevelopment. D


ECO-JUSTICEby Jane M. Orient, M.D.

I n a little noticed speech last year, WilliamReilly, head of the Environmental Pro

tection Agency (EPA), boasted of past success and set the agenda for the future:"George Bush said the polluters would payif they broke the law and during the pastthree years the Bush Administration hascollected more penalties and sent more violators to jail for longer sentences than in therest of the EPA's IS-year history combined."

Rioters may be free in Los Angeles, butthe Feds are jailing "polluters."

Three men have already served time infederal penitentiary for inadvertent "criminal" violations of wetlands regulations(Ocie Mills, Carrie Mills, and John Pozsgai).The "pollutant" involved was commondirt-the kind found on construction sitesand in backyards everywhere.

The fourth person found guilty of crimesagainst the Earth, Bill Ellen, reported toprison earlier this year. The Department ofJustice announced that Ellen's sentence"should send a clear message that environmental criminals will, in fact, go to jail.Those who commit criminal environmentalinsults will come to learn and appreciate theinside of a federal correctional facility. "

But prison cannot serve as a deterrentunless the public learns what behavior issupposed to be deterred. Those who don'twant to have to explain to their toddlers whythey are going to jail (Bill Ellen has twoyoung sons) had better pay attention toEllen's crime.

This is what the notorious outlaw did:1. He accepted a job as a marine and

Dr. Orient is a physician in private practice inTucson, Arizona.

environmental consultant to oversee theconstruction of a hunting and conservationpreserve. He did so because of his interestin wildlife. For six years, he rehabilitatedand returned to the wild nearly 2,000 ducks,geese, loons, egrets, herons, squirrels,songbirds, deer, and other creatures.

2. During the course of the construction,Ellen dared to challenge a bureaucrat'sdefinition of "wetland. " He did so becauseof his contractual obligations, to avoid penalties from the contractors. Ellen arguedthat the state's head soil scientist, an employee ofthe Soil Conservation Service, hadclassified the area in question as an "upland," not a wetland.

3. During the time that the dispute withthe bureaucrat was being adjudicated, Ellenallowed his crew to dump two truckloads ofdirt on the site before shutting down thework completely.

The Supreme Court declined to review thelegal aspect of Ellen's case, and he servedsix months in federal penitentiary for thiscrime. His wife, Bonnie Ellen, had to do thebest she could to shield the children andto keep some aspects of her husband'sbusiness going in his absence.

"I have no idea how 1 can pay all thebills," she said, when her husband wassentenced.

Although he pardoned a number of offenders on Christmas Eve, (including convicted bank robbers and drug dealers), President Bush did not pardon Bill Ellen.

The federal government itself doesn'tknow what a "wetland" is, and the averagecitizen has no hope of being able to tellbecause often a "wetland" looks completely dry.

The most important lesson jailing "ecocriminals" teaches is the necessity for bowing and scraping to the federal bureaucracy,and for the most extreme caution in undertaking any development, even of a wildliferefuge. One mistake, and the bureaucracy hasthe power to tear the most civic-mindedbreadwinner away from his family, leavinghim to the mercy of the murderers and molesters inside the prison, while his wife andchildren face a lonely struggle outside. D

357


PULLING THE PLUG ONTHEREA

by Albert R. Bellerue

F ranklin D. Roosevelt created the RuralElectrification Administration (REA) as

a temporary government agency on May 11,1935, by issuing Executive Order No. 7037.The Order was authorized by the Emergency Relief Appropriation Act, which wasa general program of unemployment relief.

This relief program authorized the immediate spending of$100 million to help correctthe unemployment problems of the '30s.The Order required that 25 percent of thesefunds should be spent for labor and 90percent ofthe labor should be taken from therelief rolls. This requirement nearly stoppedthe REA in its tracks, because skilled laborwas needed to build electric power systems,and sufficient skilled labor could not befound on the relief rolls.

Morris L. Cooke, former director of Public Works for Philadelphia, was appointedthe REA administrator May 20, 1935. As itbecame evident that REA would not qualifyas a relief program under the ExecutiveOrder, Cooke, in true political style,launched a lobbying program maintainingthat the REA would have to be a loan agencyinstead of a temporary emergency unemployment relief program.

On August 8, 1935, President Rooseveltissued Regulation No. 4 establishing theREA as a lending agency, which freed itfrom earlier regulations and gave it authority

Albert R. Bellerue is a real property analyst andconsultant from Gold Canyon, Arizona.

to make its own exceptions to any otherregulations that might restrict it.

Regulation No. 4 transformed a temporary emergency unemployment relief program into a not-for-profit, taxpayersupported national lending agency-all byPresidential Executive Order.

According to REA publications, the interest rates charged the electric power cooperatives from 1936 to 1952 ranged fromtwo percent to three percent, approximatelyequal to the cost of Treasury issues. From1951 to 1971, a period of 20 years, only twopercent interest was charged for these REAloans, whereas the Treasury issues rateincreased annually to six percent in 1973,when the REA rate was raised to 3.7 percent. In 1981 and 1982 the REA rate averaged about 4.4 percent while the cost ofmoney to the Treasury Department averaged 12.3 percent. From 1983 through 1991,the REA interest charge was slightly lessthan five percent while the Treasury ratedropped slowly from 10.8 percent to eightpercent. Taxpayers have been forced tofund these subsidies for 58 years.

Following is a chart showing comparisonswith the going cost of money (Treasuryissues rates) and the taxpayer-supportedREA loans rates. Treasury borrowing ratesdid not exceed REA loan rates until 1952.

That REA loan rates equaled the interestrates paid by the U.S. Treasury until 1952does not mean that the electrification program was unsubsidized during the early

358

Interest Rate on REA Loans vs.Cost of Money to the Government

REA TreasuryLoans Issues

Fiscal Rate* Rate**Year Percent Percent

Welfare for the WealthyOn July 5, 1992, CBS News presented its

60 Minutes feature "Welfare for theWealthy" wherein Steve Kroft exposed themost recent Rural Electrification Administration boondoggles, clearly not in the bestinterests of U.S. taxpayers.

Kroft interviewed Harold Hunter, formerREA Administrator, who agreed that theREA was a "boondoggle."

Kroft pointed out that the REA madehuge loans to several holding companiessuch as GTE, Century Telephone, ALLTELL, and TDS. In addition, REA made

*Weighted average for loans approved during the year.**Source: Monthly Statement of the Public Debt of theUnited States, Department of the Treasury.

years. The taxpayers were forced to underwrite the additional REA costs for federalmanagement of these loans.

Although there is no need to continue thiswelfare program for roughly one thousandREA cooperatives, taxpayer support continues. Today, according to the REA, 99percent of the 2.3 million farms in theU.S.A. have electricity. Since 1949, REAhas also been making loans for telephones.Today more than 96 percent have phones.

So, what's keeping Congress from gettingthe taxpayers out from under this unnecessary burden?

193619401945195019551960196519701975198019851990

3.002.692.002.002.002.002.002.004.424.374.994.97

2.5302.4921.7181.9582.0793.4493.8005.9866.5339.608

10.3838.843

359

low-interest, taxpayer-subsidized loans toski resorts in Aspen and Vail, Colorado, andto recharge golf carts in Hilton Head, SouthCarolina. This is nothing new. It has beengoing on for 30 years or more, and Congresshas known all about it and done nothing tocorrect it. Kroft also informed his viewersthat taxpayers are forced to support REAloans on the island of Saipan in Micronesia.REA, in cooperation with the Agency forInternational Development (A.J.D.), has organized dozens of cooperatives abroad aspart of a foreign aid program.

But what can be done? Jim Miller, formerBudget Director; Harold Hunter, formerREA Administrator; and Roland Vautour,former Undersecretary of Agriculture, allproposed to Congress that the REA bephased out. Congress' has taken no action.

Steve Kroft brought out the fact that oneof the reasons no Congressman can be foundto clean up this mess and save the taxpayersa billion dollars a year is that the REAco-ops have a powerful political lobby forperpetuation of their welfare program.

The lobbyist is the taxpayer-supportedNational Rural Electric Cooperative Alliance (NRECA), the powerful national unionof REA co-ops. There is no Congressmanbrave enough to support the taxpayeragainst this union that can bring some 1,000co-op members to Washington.

John Becker, former manager of the Wisconsin Development Authority, recalled aconversation he had in the'40s with RobertB. Craig, an REA Administrator and acknowledged father of the NRECA.

Craig told him that in the NRECA, "Wewill have one million members which meansfour million votes. Further we will havemanufacturers doing millions of dollarsworth of business with us, and during thecampaign we can raise lots of money for ourfriends from these sources. . . . [W]ith fourmillion votes and several hundred thousandin campaign funds, we will maintain inpublic offices enough friends that even thedevil himself can't hurt us."

The REA has cost the American taxpayers billions of dollars. Perhaps it's time topull the plug. D


IN PRAISE OFBILLBOARDS

by Lawrence Person

I recently took a car trip from centralTexas to northern Virginia. Though my

journey was of an entirely practical nature(two straight days of driving, with no timefor sightseeing), it gave me a new appreciation for something I had not really givenmuch thought to: billboards. Despite thescathing criticism heaped upon them foraesthetic reasons, billboards are actuallypossessed of a number of unsung virtues.

First of all, billboards are a valuablesource of information, especially whenyou're making a long trip through an unfamiliar area. If it's getting near lunchtime,and I see a sign that says "McArches-30miles," then I have more information onhow and when to plan my stops. Likewise,if I am starting to run low on gas, a signfor Texxon might tell me not only how farahead the station is, but whether it has amechanic on duty, the best way to get there,and so forth. Finally, if I'm starting to getsleepy, a billboard can tell me how far tothe next motel, and what it might be charging for a room. As a consumer, every pieceof information I have helps me make betterchoices.

Some states have a government substitutefor billboards: signs with little metal platesbearing the establishment's logo, dis-

Mr. Person is former editor ofCitizens Agenda.His work has appeared in National Review,Reason, and other magazines.

tance-to information, and which exit to take.Like most state-owned substitutes, theirusefulness falls far short of the real thing.For one thing, these little signs don't tell youthe prices of a room for the night, a gallon ofunleaded, or a large order of fries. Foranother, they don't give you all the otherinformation a business might provide ontheir billboard: Homebaked Cookies! AirConditioning! A Toledo Mudhens Collector's Glass with Every Purchase!

Despite these many virtues, you almostnever hear a kindly word for billboards.Critics charge they're "sight pollution," asthough they emit cancer-causing agents thatinfect the body via the optic nerve. Thesesame critics go on to charge that billboardsclutter up the natural landscape, and, aboveall, are inferior to trees.

The poet Ogden Nash wrote:

I think that I shall never seeA billboard lovely as a tree.

Indeed, unless the billboards fallI'll never see a tree at all.

Fair enough. Such critics are, after all,entitled to their opinion. There are a lot ofthings I might personally label "sight pollution," including those hideous modernart sculptures that seem to spring up likegiant metal weeds in front of every government building. Indeed, between the two Imuch prefer billboards, especially sincethey weren't constructed using my tax dol-

360

lars. However, there is a big differencebetween saying something is ugly and sayingthat it should be regulated or outlawed.

As far as cluttering up the natural landscape goes, there are a lot of things that dothat, including houses, cars, highways, andpeople, but you don't see special-interestgroups trying to legislate them out of existence. (OK, a few environmentalists aretrying to outlaw all of the above, includingpeople. However, since people make up thevast majority of the voting population, theyhaven't made much progress on this front.)I must admit that I, too, think that theaverage tree is more attractive than theaverage billboard. Then again, a tree nevertold me that I could get three Supertacos for99 cents either. Also, if my trip is anyindication, trees are in no danger of disappearing anytime soon. On the way up theyoutnumbered billboards at least 10,000 to 1.

Aesthetic differences aside, it shouldn'tmatter whether a billboard is beautiful orugly: Both are protected by the right ofprivate property. The idea that someone' sproperty rights should be taken away because a handful (or even a majority) ofpeople deem a particular structure' 'ugly" isabsurd.

There is a particularly insidious line ofreasoning being marshaled by anti-billboardforces these days. "Because billboards areprofitable only because they are placedalong major public thoroughfares," goesthis argument, "the right ofprivate propertydoes not apply, and thus it is well within agovernment's right to regulate them out ofexistence. " The implications of such reasoning are truly frightening. This same logicapplies to every single business that oper-

361

ates along any public road, and since theoverwhelming majority of roads in theUnited States are government controlled,the scale of government intervention permissible under such a doctrine is staggering.

Indeed, as long as we're going to have thegovernment enforce aesthetic dictates, it isonly a small step from regulating the billboards along a road to regulating the cars onit. In the future, we can expect to see theGood Taste Police handing out tickets tothose wretched miscreants whose cars needbody work or a new paint job. The scourgeof automotive sight pollution must be drivenoff our streets, which means no more purpleCadillacs, custom low-riders, jacked-uppickup trucks, or any other vehicle that failsto conform with the new Government Aesthetics Standards.

In addition to property rights, billboardsare also protected by another of our basicfreedoms: the right to free speech. In Austin, Texas, there used to be a mural billboardthat proclaimed: FREE NELSON MANDELA! While this is an overtly politicalmessage, commercial messages on billboards are also expressions of that sameright to free speech. The First Amendmentmakes no distinction between commercial

, and non-commercial speech, and the message "Two McBurgers-$1.99" should beno less constitutionally protected than"Free Nelson Mandela."

Finally, billboards can be a source ofhumor. While driving in Tennessee, I saw abillboard for one particular establishmentproudly proclaim: FOOD * GAS * ELVISCOLLECTIBLES. Now there's one thingno government sign is ever going to tellme! 0


OIL DRILLING IN ALASKA

by Sarah Anderson

A large percentage of the two millionbarrels of oil produced every day in

Alaska· comes from an area known as theNorth Slope. The North Slope is on theeastern end of the north coast of Alaska andconsists of mostly coastal plains. There arefive oil fields currently in production on theNorth Slope; the biggest of these is PrudhoeBay, which is also the largest oilfield inNorth America. Another oil field of particular interest is Endicott, located about tenmiles northeast of Prudhoe Bay. Endicott isthe first continuous, offshore oil-producingfield in the Arctic. The field is in fact twoman-made islands that require a ten-mileaccess road and a five-mile causeway connecting the two islands. The other threefields are Kuparek, Lisburne, and MilnePoint.

The Prudhoe Bay field encompasses 5,000acres, and Endicott, the sixth largest oil fieldin North America, encompasses only 55acres. It is possible for oil fields to be smallbecause the oil wells themselves are only tenfeet square. They are placed immediatelynext to one another.

The oil is not pumped from the wells but,when the reserve i~ tapped, the oil flows outunder natural pressure. This means that thewells are not only small, but quiet. Moderntechnology has made it possible to build theoil fields on gravel pads that make a solidfoundation for the equipment and insulatethe underlying permafrost. Previously, oil

Sarah Anderson is a 14-year-old residing inBozeman, Montana.

drilling pads had tq/be big enough to accommodate many reserve pits to hold the wastewater and mud from drilling. Now, however, a new technique of pumping thewastes back into the ground eliminates thewaste of space, maintains a sub-surfacepressure high enough to keep oil flowing,and reduces the possibility of spills on thetundra. If oil is not found directly beneaththe well location, the well can be drilledhorizontally, again reducing the area of landaffected by the oil development.

When the 800-mile trans-Alaskan pipelinewas built, temporary access roads wererequired for construction and maintenance.A breakthrough in road technology haseliminated the need for these gravel roadsthat leave an impact on the environment.Ocean water is pumped onto the tundrawhere it freezes to form an ice road fromwhich maintenance can be done during thewinter. In the summer these roads melt andleave no trace. Vehicles with huge rubbertires use the roads. Ice roads are also usedfor oil exploration.

There has long been a controversy between environmentalists and oil companiesover whether to allow oil drilling in theArctic National Wildlife Refuge, commonlyreferred to as ANWR. To put the size of theANWR in perspective, keep in mind thatAlaska contains 591,000 square miles, orabout 378,000,000 acres. The ANWR is fivepercent of Alaska or 19 million acres. Ofthese acres, eight percent have been proposed for development, and only one percent would be affected by oil production.

362

This means that about 15,000 acres, or .004percent ofAlaska, would be affected. Actualproduction facilities including roads, drillingpads, living quarters, and pipelines wouldcover a thousand acres.

At Prudhoe Bay the vast majority of oilspills are small and never leave the gravelpads. All spills are promptly reported togovernment agencies and thoroughlycleaned up. There are about 250 spills eachyear, which sounds terrible, but a "spill"includes a single drop ofoil. By this standardthe average parking lot has more oil spillsthan that each year. Of those 250 spills,nearly half are zero-to five-gallon spills thatnever leave the gravel pad. The contaminated gravel is all scooped up and taken toan incinerator where the oil is burned off.

Environmentalists claim that oil drillingaffects the wildlife; however, if the drill sitesare any indication, most animal populationsare not affected or their numbers have risen.Caribou numbers, for example, grew from3,000 at the beginning of Prudhoe development to 5,500 at the end of development.From there the population steadily increased to its present number of 20,000animals. A group of about 100 caribouusually winters in the Prudhoe area. The oilproducing companies have taken great careto elevate the pipeline or build ramps over itfor caribou migration. The only snow goosecolony in the United States has also steadilyincreased from 50 to 180 nests.

Sometimes the oil companies are forcedto use expensive means for environmentalprotection with questionable results. BritishPetroleum, the company drilling from theEndicott oil field, has been forced to installtwo breaches in the causeway because environmentalists felt that the Arctic cisco, afish that spawns in nearby rivers, would notbe able to reach them. It seems that many ofthe fish go around the causeway anyway,but British Petroleum has been very cooperative in trying to reduce the impact on theenvironment. Even the buildings on Endicott were assembled in Louisiana and thentransported whole on a barge all the way toAlaska.

Oil drilling companies take great care to

363

clean up and revegetate the areas they use.Parts of gravel pads that are not neededanymore are manually shoveled or raked upto reduce damage to the underlying vegetation. Studies have been done on what typesof grasses to use to revegetate an area andthe oil companies take pride in bringing thetundra back to its original state.

In spite of the fact that environmentaleffects have been minimal and the amount ofland affected is small, environmental groupssuch as the Audubon Society still stronglyoppose drilling in the ANWR. To understand why, consider the following story. Inthe mid-1970s, oil companies came to theAudubon Society for permission to drill onthe Society's Rainey Preserve. They got anemphatic "No!" The oil companies persisted, offering approximately $2,000,000 ayear in royalties. Unsure of the environmental consequences of the drilling, the Audubon Society demanded slant drilling withpads placed outside sensitive areas. The oilcompanies agreed. The Society demandedexpensive, quiet muffiers. The oil companies agreed. The Society required that theoil companies move out during certain timesof the year. The oil companies again agreed.As the Audubon magazine put it, "Therewas this timeclock, and when the cranespunched in, the hardhats would have topunch out."

Why the cooperation in the Rainey Preserve but not in the ANWR? Clearly theAudubon Society has a lot to gain from thedrilling in the Rainey Preserve, but nothingin the ANWR. The Audubon Society cancontrol what the oil companies do on theirown preserves. On the other hand, theyhave no control over the oil companies whenthey drill on public land.

On privately owned property, both economic development and protection for theenvironment can be achieved through negotiation. But in property owned by thegovernment, such negotiation is extremelydifficult. Most of the land area in Alaska islocked up by government ownership. Toassure that it is both developed and protected, we should consider transferring it toprivate owners. D

364

BOOKSEarth in the Balance

by Al GoreBoston: Houghton Mifflin, 1992 • 407 pages.$22.95

Reviewed by Jim Russell

I confess that my mind was too closed topolitical rhetoric, and my wallet too

thinned by involuntary taxation to fork overnearly twenty-three dollars to a thenmember of the wealthiest club in Americathe U.S. Senate-for a book. My daughter,however, a recently crowned lawyer, purchased Al Gore's Earth in the Balance withthe reckless abandon of the nouveau riche,and gave it to me for my birthday, along witha comment that the author was a man ofbrilliant intellect, and a pointed remark that"Not all things are subject to economicanalysis. "

I rightly deduced from that remark whatwas in store for me, but I read the bookanyway because I dearly love my daughter.(She is, regardless ofweird ideas on politicaleconomy acquired at expensive schools thatdon't teach classical economics, the bestdaughter ever entrusted to the blunderingcare of an unworthy father.) I only readGore's book because my darling Jenny gaveit to me, but I'm glad now that I did.

If I could have but two books to read therest of my life,' one would be the Bible andthe other would be Austrian economist Ludwig von Mises' magnus opus, Human Action. I'd choose the Bible to enlighten me onspiritual matters ; Human Action on matterseconomic. Together, these two books cansave me from brilliant intellects.

Gore professes to be a Christian. "I am aBaptist," he says. But thanks to Matthew,Mark, and Mises, I am not deceived by AlGore. I deduce from his book and his votingrecord in the United States Senate that VicePresident Gore is a devout practitioner ofstatolatry. "The state," wrote Mises, who

coined statolatry, "[that] new deity of thedawning age of statolatry, [that] eternal andsuperhuman institution beyond the reach ofhuman frailties." Jesus said, "Be on yourguard against false prophets. . . . You willknow them by their deeds" (Matthew 7: 1516).

Gore's votes in the Senate, his deeds, soto speak, by which Jesus said we couldknow him, reveal much. This is a man whonever met a government spending initiativehe couldn't approve. The National Taxpayers Union has ranked Senator Gore as theSenate's leading tax-and-spender for the lasttwo years.

Although the author laboriously denies it,Earth in the Balance is a cunning warrant forthe establishment of the equivalent of worldgovernment through" a framework ofglobalagreements that obligate all nations to act inconcert." Gore proposes a "Global Marshall Plan" incorporating broad governmental powers to save the environment, forciblytaxing and regulating people's lives andrestraining individual liberty in the process.A clever polemicist, Gore never refers to theunique attribute of government that impartsto it the illusion of being beyond humanfrailties: its monopoly on the use of force.

Mises, on the other hand, bluntly depictsthe state as "the social apparatus of coercion and compulsion" whose role is "to beatpeople into submission" to its dictates. Jesusof Nazareth preached the futility of relyingon force in the conduct ofhuman affairs, andhe taught us how to do without it.

Gore disarmingly argues that resolvingthe "global ecological crisis" caused by"humankind's assault on the earth" is essentially a spiritual challenge. Whetherhis moralizing on man's spiritual inadequacies is sincere or sanctimonious, the recom~

mendations embodied in his Global Marshall Plan are entirely material andamenable to economic analysis.

Gore establishes the reality of a crisisprimarily by the rhetorical devices of incessant incantation and vivid metaphor. Herepetitiously refers to a "grave crisis,""environmental crisis," "ungodly crisis,""deep crisis," "population explosion,"

"catastrophe at hand," "catastrophe in themaking," "crumbling ecological system,""ravenous civilization," "destruction ofthe earth's surface," "garbage imperialism," "destructive cycle," "rapidlyemerging dilemma," and "ecological holocaust. "

Gore's Earth in the Balance indicts classical economics and laissez-faire capitalismfor the problem of environmental degradation. Why? Because if classical economicscan be discredited, environmentalists cansafely ignore the economists who warn thattheir utopian plans won't work.

Gore pledges to reform his insatiablespending habit. But his sincerity is suspect,for he renounces only one ecologically disastrous government program among themultitude he has long supported. "I myself," he confesses, "have supported sugarprice supports and-until now-have always voted for them without appreciatingthe full consequence [in damage to theenvironment] of my vote. . . . I have followed the general rule that I will vote for theestablished farm programs of others in farmstates . . . in return for their votes on behalfof the ones important to my state. . . . Butchange is possible: I, for one, have decidedas I write this book that I can no longer votein favor of sugarcane subsidies." Hallelujah! A vote-trading, tax-and-spendjunkie iswilling to skip one little agricultural fix inorder to overdose on a kilo of environmentally correct spending.

Although Gore pays lip service to thecontributions of economics and praises laissez-faire capitalism faintly, their demise ishis ultimate objective. He endorses' 'modified free--markets." Of course a slave is aperson whose freedom has been modifiedmerely by the addition of shackles. Asclassical economist Frederic Bastiat pointedout, one cannot be both free and not free atthe same time.

Throughout Earth in the Balance, Goreconfuses economics (a science) with capitalism (a social system), statistics, and accounting. His problems with semantics arenot inconsequential and should not necessarily be attributed to ignorance. Miseswarned us in Human Action that faulty

365

nomenclature becomes understandable ifwe realize that pseudo-economists and thepoliticians who apply it want to preventpeople from knowing what the market economy really is. They want to make peoplebelieve that all the repulsive manifestationsof restrictive government policies are produced by "capitalism." Blaming economicsfor environmental degradation, is akin toblaming mathematics for the size of thefederal deficit.

In Human Action Mises identified twoprimary causes of environmental degradation; namely, the failure of legislators tofully implement private-property rights; andthe propensity of government to limit theliability and indemnification that would otherwise be imposed by the common law onthe owners of property. If there is a "globalecological crisis," and if it is the product of"humankind's assault on the earth," thescience of human action is the only branchofhuman knowledge capable ofunderstanding the problem, which is a prerequisite toavoiding an "ecological holocaust."

Years before Rachel Carson launched themodern environmental movement with thepublication of Silent Spring in 1962, Ludwigvon Mises had considered the problem ofmankind's abuse of his environment, identified the etiology of environmental degradation, and prescribed the only practicaldefense against "humankind's assault onthe earth." If Al Gore sincerely cared aboutthe environment he would repudiate his planto spend vast sums of other people's moneyand embrace classical economics and laissez-faire capitalism as the keys to environmental salvation.

Preservation of Earth cannot be entrustedto any government-not the U.S., not theU.N., nor to any supranational coalition. Toput the matter in perspective: Would youtrust the people who gave you the postoffice, the House Bank scandal, the savingsand loan debacle, and the national debt withthe survival of the human race?

IfEarth is in the balance, let us not entrustit to the wisdom of governments. D

Jim Russell is a free-lance writer living in Ohio.

366 THE FREEMAN. SEPTEMBER 1993

Environmental Politics: Public Costs,Private RewardsEdited by Michael S. Greve and FredL. Smith, Jr.Praeger Publishers, 1992 • 212 pages. $19.95

Reviewed by Brian Doherty

The old rationales for central control ofthe economy have suffered a crippling

blow at the hands of history and economiclogic. Socialism has proven neither morerational, more efficient, nor more humanethan the free market. But could it be moreenvironmentally sound?

This book is edited by Michael S. Greve,the founder and executive director of theCenter for Individual Rights, a public interest law firm, and Fred L. Smith, Jr., thefounder and president of the CompetitiveEnterprise Institute (CEI), a free marketthink tank. It attempts to lay the groundwork for a scholarly and accessible literature that makes the case that environmentalcommand-and-control policies, even whenplanned with the best of intentions, are stilljust a road to serfdom, only paved withgreen bricks, to use Smith's apposite phrase.The book's contributors include JonathanH. Adler and Christopher L. Culp of CEI,Marc K. Landy and Mary Hague of BostonCollege, Daniel F. McInnis of GeorgetownUniversity, R. Shep Melnick of BrandeisUniversity, and David Vogel of the University of California at Berkeley. The writersare not all sympathetic to a totally freemarket approach, but all of them are keenanalysts of the problems associated withcentralized environmental planning.

There are legal hurdles in the way of saneenvironmental policy as well as politicalones, even though all of its authors don'tseem to grasp the most sensible and fairsolution. The chapter by political scientistsMarc Landy and Mary Hague examines theworkings ofSuperfund, a program designedto clean up abandoned waste dumps. Thecost was supposed to be borne by thepolluter, which seems sensible and just.

Unfortunately, the Superfund "polluter

pays" principle, in which liability is "strict,joint and several, and retroactive" has led torunaway tort problems where anyone withdeep pockets who has any sort of connection, however tenuous, to a site (including"prior owners, users, bankers, insurers,waste generators, and transporters") can beheld liable for the entire cleanup cost, evenif the site adhered to all legal and knownscientific standards at the time. So Superfund cleanup attempts are generally kepttied up in court for years as any party heldliable tries to drag as many other associatedparties as possible into the liability process.This leads Landy and Hague to the mistakenconclusion that "clearly, it would be fairerand more efficient to simply pay for cleanupfrom public funds. "

But political and legal interference withfree markets is not the only problem with thecurrent state ofenvironmental policy. Whenattempting to regulate "the environment,"there are often no markets to corrupt. Youcan have a market only when there isproperty to be bought and sold, and air andwater pollution involve invasive actions onindividuals being performed through an"unowned" medium, a "public good."

The book's final chapter by Fred Smithshines an exploratory light toward an intellectual and political revolution in environmental law that would extend markets andprivate, voluntary arrangements to even thetrickiest of pollution problems.

Smith admits the existence of problemswith "tort law which ... has been almostcompletely socialized," where "courts often award compensation to parties who havesuffered no demonstrable damages whileimposing liability on parties who havecaused no harm. " But the solution lies in theinnovations that property rights and markets give incentive to create, not centralgovernmental management. Smith pointsout that such innovations as fences, locks,fingerprinting, and burglar alarms only developed because of private property rights,and he hypothesizes the development oftechnologies that would make applying theproperty paradigm to currently' 'unowned"resources like endangered species, air, and

water possible. Particularly intriguing is hisnotion of "chemical fingerprinting, whichcould identify the culprits responsible for oilspills and toxic dumping."

Neither Smith nor the reader is able toimagine beforehand all the various mechanisms and benefits that would develop spontaneously if we were to try to extend property rights over the current "public" goodsof the environment. But Environmental Politics: Public Costs, Private Rewards makesclear that ceding all attempts at endingenvironmental degradation and managingenvironmental concerns to the governmentleads to private gain at public expense, and,too often, at the expense of environmentalquality. 0Brian Doherty is assistant editor of Regulationmagazine.

The Heated Debate: GreenhousePredictions vs. Climate Reality

by Robert C. BallingPacific Research Institute, 177 Post S1., SanFrancisco, CA 94108 • 1992 • 250 pages •$21.95 cloth, $14.95 paper

Reviewed by John Semmens

I ndustrialization has allegedly led to increased levels of carbon dioxide (C02)

from combustion of fossil fuels. Higheramounts of CO2 have purportedly raisedglobal temperatures. Warmer weather couldgenerate significant changes in our climate.The perception that those changes would bea disaster for the planet has inspired demands for drastic remedies. An example isVice President Albert Gore's call for aphaseout of the internal combustion engineover the next few decades. Even moredesperate are demands that the IndustrialRevolution be reversed and mankind returned to a pre-industrial agricultural modeof life.

The author of this book suggests that thecall for drastic action is at best premature.Without challenging the premise that CO2

BOOKS 367

will double during the next century, heattempts to investigate dispassionately thelikely effects. These effects appear to be ofa smaller magnitude than many headlinegrabbing visions of apocalypse have implied. Further, it is not at all clear that theimpacts would, on balance, be negative.

For starters, the global warming experienced since the beginnings of industrialization is less than would have been predictedby the same models that are now beingused to predict future disaster. This suggeststhat the link between CO2 and climate ismore complex than many doomsayers acknowledge. Taking this historical recordinto account, the most probable increase inglobal temperature over the next centuryis less than two degrees Fahrenheit. Thiswill not be sufficient to melt polar ice capsand inundate coastal cities as many havefeared.

Most of the temperature rise will occur atnight, during the winter, and at higher latitudes. In many ways, this pattern of warming would actually be beneficial. The increase in nighttime temperatures will reducethe spread between daily high and lowtemperatures. This decreases thermal stresson vegetation. Plants would be more likelyto survive and thrive under such conditions.This would mean a longer frost-free growingseason in many locations. A correspondingly larger agricultural output could beexpected. This would lower the cost of foodand fiber, mitigating poverty for large segments of the world's population.

It seems more likely that further economic progress would hold forth more hopefor averting environmental disaster. It isprogress that has improved energy efficiency. It is progress that is enabling improved communication of information.

If the economic growth that naturallyflows from economic freedom can continueto fuel technology, the next couple of generations ofhuman beings will probably havemany more attractive options for dealingwith the world they inherit. D

John Semmens has been a frequent contributorto The Freeman.

If there's moral validityto free-market economics,why do so many clergy fro"fail to understand it? .,~~~

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THE ACTON INSTITUTEFor the study ofReligion & Liberty

Send or callfor more informationand a free copy ofour bi-monthlypublication: Religion & Liberty.

A.study of theological and seminary faculty conducted by the Roper Centerin 1982 revealed that 37% of the respondents felt "the United States wouldbe better off if it moved toward socialism." Nearly half of them favored theredistribution of wealth (as opposed to its creation) as a better way to meetthe needs of the poor.

These are the people who are teaching our future religious leaders. Is it anywonder so many of our mainstream ministries promote such a disturbinghostility toward the entrepreneur and free enterprise?

The Acton Institute, named after Lord Acton, is working to change theseattitudes by familiarizing the ecumenical religious community with themoral and ethical dimensions of capitalism in a social arrangement that isboth free and virtuous.

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The Freeman 1993 · use styrofoam cups and toss outused plastic. The law is also playing a greater role in people's lives. An unaccountable bureau cracy in southern California, for