THE FREEMAN
VOL. 43  NO. 9  
SEPTEMBER 1993

The Freeman is the monthly publication of The Foundation for Economic
Education, Inc., Irvington-on-Hudson, NY 10533. FEE, established in 1946 by
Leonard E. Read, is a non-political, educational champion of private
property, the free market, and limited government.

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CONTENTS 
 
332 
 
Environmentalism: The Triumph of Politics  
Doug Bandow  
 
It is a mistake to think that the goal of the environmental movement is
protection of the environment.  
 
340 
 
Linking Liberty, Economy, and Ecology  
John A. Baden and Robert Ethier  
 
Liberty and private property are the best defense for the environment.  
 
343 
 
Science and the Environment  
Bruce N. Ames  
 
Correcting some of the errors of the environmentalists.  
 
345 
 
Overpopulation: The Perennial Myth  
David Osterfeld  
 
Food, natural resources, and living space are becoming
 more abundant.  
 
348 
 
Stewardship versus Bureaucracy  
Rick Perry  
 
The control of water is too important to be left to government.  
 
350 
 
The Market and Nature  
Fred L. Smith, Jr.  
 
Economic development guided by the market is sustainable.  
 
357 
 
Eco-Justice  
Jane M. Orient, M.D.  
 
How politics has perverted justice.  
 
358 
 
Pulling the Plug on the REA  
Albert R. Bellerue  
 
The Rural Electrification Administration serves no public interest.  
 
360 
 
In Praise of Billboards  
Lawrence Person
 
Information is an economic good, especially for travelers.  
 
362 
 
Oil Drilling in Alaska  
Sarah Anderson  
 
Protecting the environment on the North Slope.  
 
366 
 
Book Reviews  
 
Jim Russell reviews Earth in the Balance 
 by Al Gore; 

Environmental Politics: Public Costs, Private Rewards
 edited by Michael S. Greve and Fred L. Smith, Jr., reviewed by Brian
Doherty; 

The Heated Debate: Greenhouse Predictions vs. Climate Reality
 by Robert C. Balling, reviewed by John Semmens.  


 
Published by  The Foundation for Economic Education  Irvington-on-Hudson, NY
10533 
President: Hans F. Sennholz, Ph.D. 
Editor:John W. Robbins, Ph.D. 
Senior Editor:  Beth A. Hoffman 
Associate  Editors:  John Chamberlain, Bettina Bien Greaves, Edmund A. Opitz 
Paul L. Poirot, Ph.D. 
Contributing  Editors:  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 of The Foundation for Economic
Education, Inc., Irvington-on-Hudson, NY 10533. FEE, established in 1946 by
Leonard E. Read, is a non-political, educational champion of private
property, the free market, and limited government. FEE is classified as a 26
USC 501(c)(3) tax-exempt organization. Copyright \C 1993 by The Foundation
for Economic Education. Permission is granted to reprint any article in this
issue, provided appropriate credit is given and two copies of the reprinted
material are sent to The Foundation. The costs of Foundation projects and
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LETTERS


Private Property  
It 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, equally sacred from arbitrary interference: the right to
his life, the right to his liberty, the right to his property. . . . The
three rights are so bound together as to be essentially one right. To give
a man his life but deny him his liberty is to take from him all that makes
his life worth living. To give him liberty but to take from him the property
which is the fruit and badge of his liberty, is to still leave him a slave. 
--Justice George Sutherland  


Government Against Wildlife  
Perversely, the government sometimes penalizes landowners for improving
habitat. Dayton Hyde, who put 25 percent of his ranch into marshes for
wildlife, initiated research on the sandhill crane and built a lake with
three and a half miles of shoreline for wildlife. But he paid a price: ``My
lands have been zoned. I am being regulated for wetlands that weren't there
before I created them. Like most of my neighbors I can save myself from
financial disaster only by some creative land management, but the state
legislature has cut out most of my options.''  
 
As founder of Operation Stronghold, an international organization of private
landowners practicing conservation on their land, 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 government would refrain
from imposing costly zoning restrictions. Hyde has found that some ranchers
are reluctant to join. As one landowner put it: ``Look, you don't understand.
We would like to do our share for wildlife but we are afraid if we create
something worthwhile the public will want what we have. It's just plain
easier and a lot safer to sterilize the land.'' Because the willingness of
the private sector to improve habitat or create recreational opportunity
depends on the incentives landowners face, we cannot expect a positive
response from the private sector if landowners are penalized for improving
habitat.  
--Terry L. Anderson and Donald R. Leal Free Market Environmentalism 


Spotted Owl with Tarragon Pesto?  
I have one question about that April 2 environmental teach-in in Portland
with President Clinton: Why are those spotted owl couples entitled to 300
acres each? Candidate Clinton pledged to help ``the ones who do the work and
play by the rules,'' and I know a lot of humans like that and none of them
has even one acre.  
 
``The ones who do the work and play by the rules'' are getting an average of
$4,500 added to each new house in higher lumber prices. The price of 2x4s is
up 90 percent since November, in no small part because of the logging
restrictions imposed by environmentalists.  
 
John Hampton, president of Willamina Lumber Company, figures that the
proposed millions of acres in set-asides for owl habitat will 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 to lose anywhere from 10,000 to
50,000 logging jobs, plus the secondary unemployment that will ripple out. 
 
The bottom line, as I understand it, is that someone has to move, either the
loggers or the owls. Neither can live with the other; both have their family
roots deeply planted in the same ``old growth'' forests, and someone is going
to end up losing his home. Just looking at that aspect, from an economist's
focus on costs and benefits, it's clearly the owl couples who should hit the
road since their homes are next to worthless.  
 
And in terms of the actual costs of moving, loggers must hire expensive vans
and help, whereas all the owls have to do is wake up when they hear the saws
and fly over to some other trees. Isn't that why birds have wings, so they
can fly? Many birds fly thousands of miles each year--some even do a
roundtrip from Canada to Argentina every year without whining about it. But
environmentalists whine because owls might have to move to ``new growth''
trees. So there they sit, even though they are costing millions of dollars
in unnecessary housing costs, tens of thousands of lost jobs, and the closing
of entire human towns.  
 
It's time to tell the spotted owls to start playing survival of the fittest
and move on and take their chances adapting to a new environment, just like
most of the rest of us did. The Irish survived the potato famine by moving
to New York City and the Cubans survived Castro's power grab by moving to
Miami. Why should someone with wings be expected to do less?  
 --Ralph R. Reiland, Robert Morris College  


Acid Rain  
In 1980 the Environmental Protection Agency asserted that the average lake
in the northeastern United States had been acidified a hundredfold in the
last 40 years by acid rain. And the National Academy of Sciences claimed that
acid rain would double the damage again by 1990.  
 
But the 10-year National Acid Precipitation Assessment Program (NAPAP),
conducted under the auspices of the EPA, has completely discredited these
claims and shown them to be baseless. The $500 million study found that:  
 
 The average lake in the Adirondacks is no more acidic now than it was before
the Industrial Revolution.  
 
 There was no measurable change in the acidity of lakes over the preceding
10 years.  
 
 Only 35,000 of the 200 million acres of U.S. lakes are too acidic to support
sports fisheries--and most of this acidity is natural.  
 
--Executive Alert

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Environmentalism: The Triumph of Politics  
by Doug Bandow 
SEPTEMBER 1993 

Doug Bandow is a Contributing Editor of The Freeman and a Senior Fellow at
the Cato Institute.  
 
There's no doubt that the environment makes for good politics. Eight of ten
Americans call themselves environmentalists. Overwhelming majorities say that
gasoline should be less polluting, cars should be more efficient, trash
should be recycled, and lifestyles should be changed.  
 
This increasing sensitivity is reflected in business' growing emphasis on
environmental products. Such catalogues as Real Goods, Seventh Generation,
and Earth Care Paper offer recycled paper, vegetable-based dishwashing
liquid, battery chargers, and fluorescent light bulbs. Even many mainstream
firms are labeling their products CFC-free, biodegradable, and
environmentally friendly. While the environmental benefits of these
activities are unclear, they apparently help sell products.  
 
Increasing numbers of people are taking an interest in environmental issues
in part in response to their own concerns and in part in response to social
pressure--including from their children. The schools have launched what for
a less politically correct goal would be called indoctrination programs. And
the campaign seems to be working: The New York Times ran one story about
parents who were relieved when their children went off to camp so they could
again use styrofoam cups and toss out used plastic.  
 
The law is also playing a greater role in people's lives. An unaccountable
bureaucracy in southern California, for instance, proposed banning use of
lighter fluid for barbecues and prohibiting drive-in facilities. Federal
agencies have essentially seized control of millions of acres of land
arbitrarily designated as wetlands. And the Washington, D.C., suburb of
Takoma Park employs what it euphemistically calls ``recycling coordinators''
to comb through people's trash and hand out tickets--with fines ranging up
to $500--for not properly sorting garbage.  
 
In the abstract, greater attention to environmental matters would seem to be
a positive trend. After all, no one wants to breath polluted air. No one
wants to visit an Everglades that is dying or see Yellowstone's Old Faithful
replaced by condominiums. And who could not be concerned about the
possibility of a warming environment, threatening ozone holes, and the
specter of acid rain?  
 
The problem, however, is that the environment has become a hostage to
politics. Many environmental activists want more than a clean environment.
Their commitment to conservation and political action is religious, and their
goals are often far-reaching: to transform what they consider to be a sick,
greedy, and wasteful consumer society. As a result, many otherwise well- 
meaning people have proved quite willing to use state power to force
potentially draconian social changes irrespective of numerous important
alternative values, including freedom, health, and prosperity.  
 
The real political divide is not between right and left, conservative and
liberal, or Republican and Democrat. Rather, it is between market process and
central planning, the free market and command and control by the government.
Most politicians believe in government solutions. They may not be consistent
in the specific ways they want the state to intervene, but they like
government involvement. Although liberal enthusiasm for state action is best
known, conservatives, too, often want government to rearrange environmental
outcomes arbitrarily. There are no more fervent supporters of irrigation
projects that deliver below-cost water to farmers, subsidies to promote
logging on public lands, and cut-rate range fees on federal grazing land for
ranchers than Republican legislators. Conservative western senators have
fervently opposed selling federal lands.  

Where Do We Stand?  
Much of today's concern for new environmental restrictions comes from the
perception that the sky is falling. In the view of Lester Brown of
Worldwatch, for instance, we're in a ``battle to save the earth's
environmental support systems.'' He worries about global warming, growing
populations, disappearing species, expanding deserts, depleting topsoil, and
so on. We face ``the wholesale collapse of ecosystems,'' he claims.  
 
Yet somehow the world seems rather less bleak than he suggests. Between 1970
and 1986, 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 of industrial
wastes was reduced 94 percent. There were 80 percent fewer cities without
adequate sewage treatment plants. Rivers unfit for swimming dropped 44
percent. Hazardous waste sites such as Love Canal and Times Beach now appear
far less dangerous than once thought. Cars built in 1988 produced 96 percent
less carbon monoxide and hydrocarbons than those made in the early 1980s.
Population continues to grow sharply in some Third World states, but these
increases reflect lower infant mortality rates and longer life expectancies.
Total recoverable world oil reserves grew by 400 billion barrels between 1985
and 1990. Global warming trends may lengthen growing seasons. And extensive
product packaging, falsely derided as wasteful, makes Americans among the
most efficient eaters on earth.  
 
The point is not that there are no environmental problems. But claims of
imminent disaster are simply not supported by the facts. To the contrary,
they reflect the politicization of the environment, because only claims of
imminent disaster can galvanize popular support for the sort of exceedingly
harsh policy changes advocated by many 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 is to create real environmental problems. The second is to generate
unfounded hysteria.  

Poor Environmental Stewardship  
For all of the enthusiasm of environmentalists for government programs, the
government has proved to be a remarkably poor resource steward. Consider
Uncle Sam's 191 million acres of forestland. The Wilderness Society estimates
that losses on federal timberland amounted to $400 million annually during
the 1980s, while losses on Alaska's Tsongass rain forest have hit 99 cents
on the dollar. The problem is that the government both undertakes expensive
investments, such as road-building in mountainous wilderness terrain, and
underprices the timber that is produced. Washington's reason for doing so is
to ``create'' a few jobs. The cost, however, is both needless environmental
destruction and the squandering of taxpayers' money.  
 
Federal water projects and management of rangeland have consistently led to
similar results. The government has expended billions of dollars to subsidize
such influential groups as farmers and ranchers, all the while leaving
environmental despoliation in its wake. In fact, the greatest threat to
wetlands across the country is not private development, but federal efforts
like the $1.2 billion Garrison Diversion project, which destroyed some 70,000
acres of wetlands to benefit a few thousand farmers.  
 
Nearly 90 percent of all federal water in the west is sold at heavily
subsidized prices to heavily subsidized farmers. In California's San Joaquin
Valley, for instance, irrigation projects typically cost $300-$500 an acre
foot, yet the water is marketed to farmers for less than a tenth that much-- 
even as Los Angeles and other parts of the state until recently were
suffering from severe water shortages. Only the government would subsidize
the production of a water-intensive 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 what it costs the government to administer its land, and one-tenth
the rental price for comparable private lands. The BLM also spent millions
of dollars ``chaining'' land--ripping out trees to create more rangeland on
which it would lose more money. Not surprisingly, federal lands are generally
in poor condition--and continue to generate a flood of red ink.  
 
It is not just Uncle Sam who is to blame. Local governments have distorted
the trash market, leading to pressure for a federal garbage law. Many
localities have essentially socialized trash collection and disposal, barring
any private competition which increases efficiency and innovation. Moreover,
few cities charge citizens based upon how much garbage they generate,
providing no incentive for people either to recycle or to change their buying
habits. (Localities that have implemented fees for each can or bag have made
people more environmentally conscious without a trash Gestapo.) Political
restrictions on the placement of new landfills and construction of
incinerators, both of which are quite safe with new technologies, have
exacerbated the problem.  
 
But the U.S. government is the most culpable party. World Bank loans,
underwritten by American taxpayers, have financed the destruction of
Brazilian rain forests; federally subsidized flood insurance has encouraged
uneconomic construction on the environmentally sensitive Barrier Islands.
Years of energy price controls inflamed demand and discouraged conservation. 
 
This sort of special-interest driven environmental abuse is not new, and the
only solution is to eliminate political malfeasance. Unfortunately, as public
choice economists have so effectively pointed out, the political process
tends to be biased toward taxpayer exploitation and against sound policy.  

Unfounded Hysteria  
The second form of environmental politicization is more recent. That is the
manufacture of false crises and the exaggeration of more limited problems to
achieve other ideological ends, such as banning chemicals, closing
incineration plants, and eliminating chlorofluorocarbons (CFCs).
Unfortunately, examples of this sort of problem now abound.  
 
For instance, in 1989 the Natural Resources Defense Council (NRDC) used a
public relations agency to launch a campaign against the chemical Alar, a
pesticide used on some 15 percent of apples in the United States. The charges
received wide attention and demand for apples dropped dramatically--prices
fell almost in half, ruining some farmers. Yet the furor was based on one
1973 study, where mice were fed very high levels of Alar. Two recent reviews,
by Great Britain's Advisory Committee on Pesticides and the California
Department of Food and Agriculture, concluded that the risk of ingesting Alar
was minimal. As Dr. Joseph Rosen of Rutgers University explained, ``There was
never any legitimate scientific study to justify the Alar scare.''  
 
But skillful manipulation of the media to inflame people's fears--and the
enlistment of such knowledgeable environmental experts as Hollywood's Meryl
Streep--enabled one activist group to create a crisis. The NRDC's public
relations agent later circulated a memo to other organizations describing his
efforts.  
 
Indeed, pesticides have long been subject to counterfactual demagogic
attacks. Natural pesticides--nature's way of protecting plants--may cause
cancer, and they occur in far higher quantities in at least 57 food varieties
than do man-made pesticides. A National Center for Policy Analysis study
estimates that the risk of getting cancer from chloroform in tap water is
greater than that of getting it from pesticides in food. A person is more
than three times as likely to be killed by lightning than to contract cancer
from pesticides. The risk of cancer from all pesticides in the food consumed
by the average person in one day is one-twentieth of the risk from the
natural carcinogens in a single cup of coffee.  
 
Another apocalyptic vision emerged from the EPA, which in 1980 claimed that
acid rain, caused by sulfur dioxide emissions, had increased the average
acidity of northeast lakes one hundredfold over the last 40 years and was
killing fish and trees alike. A year later the National Research Council
predicted that the number of acidified lakes would double by 1990. So
Congress included stringent provisions to cut SO2 emissions (already down 50
percent from the 1970s) at a cost of billions of dollars annually when it
re-authorized the Clean Air Act three years ago.  
 
Yet in 1987 EPA research raised doubts about the destructiveness of acid
rain: A congressional firestorm forced the study's director to quit. Then
came the most complete study of acid rain ever conducted, the half billion
dollar National Acid Precipitation Assessment Project (NAPAP), which
concluded that the allegedly horrific effects of acid rain were largely a
myth. Among other things, the study found that lakes were on average no more
acidic than before the industrial era; just 240 of 7,000 northeast lakes,
most with little recreational value, were critically acidic, or ``dead'';
most of the acidic water was in Florida, where the rain is only one-third as
acidic; there was only very limited damage to trees, far less than that
evident elsewhere in the world where SO2 emissions are minimal; half of the
Adirondack lakes were acidified due to natural organic acids; and crops
remained undamaged at acidic levels ten times present levels. In the end,
NAPAP's scientists figured that applying lime to the few lakes that were
acidic would solve the problem at a mere fraction of the cost of the Clean
Air Act's acid rain provisions.  
 
Perhaps the most famous form of the ``sky is falling'' claim today is global
warming--the so-called ``Greenhouse Effect.'' The U.N.'s 1992 Rio summit
focused on this issue. The fear is that pollution, particularly such
``greenhouse gases'' as carbon dioxide, will stay within the atmosphere,
leading to a rise in the earth's temperature, which will create deserts, melt
the polar icecaps, and flood coastal nations.  
 
In fact, warnings of global warming are not new: The theory was first
advanced in the 1890s and re-emerged in the 1950s. But soon thereafter a new
theory gained sway--that we were entering a new Ice Age. In 1974 the U.S.
National Science Board stated that ``during the last 20 to 30 years, world
temperature has fallen, irregularly at first but more sharply over the last
decade.'' In the same year, Time magazine opined that ``the atmosphere has
been growing gradually cooler for the past three decades. The trend shows no
indication of reversing.'' Similarly, observed Dr. Murray Mitchell of the
National Oceanic and Atmospheric Administration in 1976, ``Since about 1940
there has been a distinct drop in average global temperature. It's fallen
about half a degree Fahrenheit.''  
 
Five years later Fred Hoyle's Ice: The Ultimate Human Catastrophe appeared,
warning that a new Ice Age was long overdue, and ``when the ice comes, most
of northern America, Britain, and northern Europe will disappear under the
glaciers. . . . The right conditions can arise within a single decade.'' He
advocated warming the oceans to forestall this ``ultimate human
catastrophe.'' Another two years passed and Rolling Stone magazine declared
that: ``For years now, climatologists have foreseen a trend toward colder
weather--long range, to be sure, but a trend as inevitable as death. . . .
According to [one] theory, all it would take is a single cold summer to
plunge the earth into a sudden apocalypse of ice.''  
 
A decade later we have passed into a new crisis. Climatologists like Stephen
Schneider, who two decades ago was warning of a cooling trend that looked
like ``one akin to the Little Ice Age,'' now berates the media for covering
scientists who are skeptical of claims that global warming is occurring. He
is, at least, refreshingly honest, admitting that ``to avert the risk we need
to get some broad-based support, to capture public imagination. . . . So we
have to offer up some scary scenarios, make some simplified dramatic
statements and little mention of any doubts one might have.''  
 
And he does this precisely because the doubts about global warming are
serious, so serious that both The Washington Post and Newsweek recently ran
stories debunking the apocalyptic predictions of everyone from Vice President
Gore to Greenpeace. Observed The Post: 
Scientists generally agree that it has been getting warmer over the last
hundred years, but the average rate of change is no greater than in centuries
past, and there is no consensus that human activity is the cause. And while
there is no doubt that continued emissions of ``greenhouse gases'' tend to
aid warming, it is not clear that cutting back on emissions could do much to
stop a natural trend, if that is what is happening.  
Indeed, a survey by Greenpeace, one of the most radical environmental
organizations, of scientists involved in the Intergovernmental Panel on
Climate Change found that only 13 percent of them believed there was probably
a point-of-no-return in the future leading to a runaway greenhouse effect.
Just 17 percent of climatologists in a broader Gallup poll believed that
human-induced warming had occurred at all, while 53 percent did not.  
 
The problems with the theory are many. First, there is no reason to assume
that any change in temperature is undesirable. In fact, peoples living in
colder climates would benefit from small increases; higher temperatures at
night also would likely have a positive impact.  
 
Second, the evidence does not support the contention that human activity is
raising temperatures. We have seen slight warming over the last century, but
90 percent of it occurred before 1940, when greenhouse gas emissions started
rising dramatically. The assumptions suggest that daytime temperatures should
rise in the northern hemisphere, but most of the limited warming so far
observed has occurred at night in the southern hemisphere. The ice caps have
been growing, not shrinking. And so on. Even those predicting a much hotter
future have had to lower their forecasts over the last decade. In the end,
it is obvious both that mankind, which produces just a couple percent of
total CO2, has only a limited impact on the earth's climate, and that the
globe has a dramatic ability to adjust. For instance, increased pollution may
help shield the earth from sunlight, counteracting any temperature increase.
Higher temperatures at the poles actually allow more precipitation. Since
serious warming could cause serious damage, there is cause to monitor changes
in climate, but not yet to implement the sort of draconian changes demanded
by the greenhouse crowd.  
 
The ozone issue has been similarly politicized. The fear is that
chlorofluorocarbons are thinning atmospheric ozone, allowing in more
ultraviolet (UV) rays. In January 1992 a Harvard University chemist, James
Anderson, held a press conference warning of a ``hole'' in the ozone in the
so-called polar vortex, the upper atmosphere over New England and Canada. His
claims were based on the initial findings from a scientific expedition
monitoring atmospheric conditions and received wide attention. Yet four
months later he was forced to admit that ``the dreaded ozone hole never
materialized.''  
 
A decade ago apocalyptic environmentalists were warning of a reduction of 18
percent in ozone levels. Today the predictions are down to two to four
percent. Even if these forecasts are borne out, the impact may not be
dramatic: It would be like moving roughly 60 miles south, from Palm Beach to
Miami in Florida. And, oddly, UV radiation levels have dropped over the last
decade, even as the ozone layer was supposedly thinning. Moreover, there is
some question as to whether CFC's--inexpensive, safe chemicals that have no
obvious replacement--are really villainous destroyers of ozone after other
factors are taken into account. Such things as ocean salt spray may help
counteract increasing CFC levels. Explains Dr. Melvyn Shapiro of the National
Oceanic and Atmospheric Administration, in making their claims even many
atmospheric chemists ``have little regard for the impact of atmospheric
variability on chemical processes.'' In fact, the higher levels of chlorine
monoxide detected in January did not create an ozone hole because
temperatures were higher than expected.  
 
Population growth has been cited as an impending disaster for nearly two
centuries. Recent apocalyptics include Paul Ehrlich of Stanford University,
who predicted mass famine and death in the 1970s, and former World Bank
President Robert McNamara, who went so far as to compare the threat of
population pressure to that of nuclear war.  
 
Their argument is simple: More people mean the use of more resources and more
waste. The end result is lower incomes and disaster.  
 
This apocalyptic scenario ignores the fact that some part of the population
``explosion'' is short term, since infant mortality rates have fallen more
swiftly than have fertility rates. Moreover, people normally produce more
than they consume--otherwise even one person would be too many. Further,
fears of population growth assume a static view of the world, that economics
is a zero-sum game. Yet the market naturally adjusts as the number of people
and demand for goods and services increase; technological innovation and
behavioral changes work together to allow better and more efficient resource
use.  
 
In practice we see no adverse relationship between population or population
density and economic growth. Population density is very high in such places
as Hong Kong, Singapore, and Taiwan, yet their economies have grown faster.
The population of the Netherlands is 50 percent denser than India, Great
Britain's is twice as dense as that of Thailand, and South Korea possesses
less territory but twice the population of North Korea. In all of these cases
the more populated states have achieved much higher levels of development. 

 
The issue of population growth, then, is a red herring. The central issue is
economic growth. The most important means of adaptation is the marketplace:
If governments prevent people from freely producing goods and services,
charging prices that reflect changing resource values, and responding to
diverse human needs, then worsening poverty will result. Third World
countries are impoverished not because they are populous, but because their
governments have enforced anti-capitalistic economic policies.  
 
Related to the supposed problem of too many people is that of too few
resources. Such reports as the Club of Rome's 1972 Limits to Growth and the
Carter Administration's 1980 Global 2000 predicted that we would soon run out
of key resources. Indeed, much of the Carter energy program was predicated
on the assumption that we would soon run out of fossil fuels. (Since oil was
first discovered in the United States 130 years ago people have been
predicting that reserves would soon be depleted.)  
 
The Club of Rome, which imagined the imminent exhaustion of such resources
as gold, lead, and zinc, has already been proved 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 the
Institute for Policy Innovation, ``of 38 natural resources examined in this
study, 34 declined in real price'' between 1980 and 1990. Prices for two
remained constant, while only the cost of manganese and zinc rose. Moore
found that American and international prices of food, energy, timber, and
minerals, for instance, all fell.  
 
Again, the doomsayers have ignored the powerful adjustment process that
occurs through the marketplace. As goods become scarcer, prices rise,
encouraging entrepreneurs to locate new supplies, manufacture synthetic
equivalents, find substitutes, use products more efficiently, and reduce
consumption. As long as prices can rise freely, the market will ensure that
shortages will not occur. The fact that real resource prices fell during the
1980s indicates that relative scarcity has not increased but decreased.  
 
Apocalyptic predictions regarding a number of other issues, such as toxic
wastes and desertification, have proved to be equally flawed. The point is
not that there are no environmental problems, but rather that environmental
issues tend to be quite complex and that one should not make long-run
predictions based on short-term trends. Unfortunately, many activists are
willing to distort the facts because they have either political or religious
reasons for proclaiming that disaster is imminent.  

The New Theology  
The 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
endangered animal species. Moreover, religious leaders who once busily
promoted social and economic ``justice'' are now turning to ecological
concerns. Global warming ``is a spiritual issue, not just a technical
problem,'' explained Bruce McLeod, president of the Canadian Council of
Churches, after his organization endorsed the U.N.'s World Climate Convention
last year.  
 
Indeed, a variety of religious environmental organizations have formed--the
North American Coalition on Religion and Ecology (NACRE), Religion and
Science for the Environment, and the Presbyterian Eco-Justice Task Force, for
instance. The 1990 NACRE Intercontinental Conference on Caring for Creation
presented a Liturgy for the Earth, in which ``Mother Earth'' spoke to her
``children.''  
 
Much church activism is based on false scientific theories, such as global
warming. More significant, however, is the theological contamination from
much of the new conservation ethic. Christianity and Judaism hold man to be
a steward of the earth, which King David declared to be ``the Lord's, and
everything in it'' (Psalm 24:1). Because man thereby ``subdues'' or exercises
dominion over the planet (Genesis 1:28), many environmentalists view these
faiths as largely responsible for the plight of the earth today. Historian
Lynn White, for one, has criticized Christianity for being ``the most
anthropocentric religion the world has ever seen.'' He further argued that
``since the roots of our [environmental] trouble are so largely religious,
the remedy must also be essentially religious.'' Many other environmentalists
have made similar charges.  
 
Strangely, some churchmen seem to agree. James Nash, Executive Director of
the Churches' Center for Theology and Public Policy, writes that ``without
doubt, Christian traditions bear some responsibility for propagating''
destructive environmental perspectives. Thus, ``for the Christian churches,''
he argues, ``the ecological crisis is more than a biophysical challenge. It
is also a theological-ethical challenge.'' The obvious solution, then, is to
make Christianity ``green.'' We now have a similarly minded ecologian in the
White House. ``Both conservative and liberal theologians have every reason,
scriptural as well as ideological, to define their spiritual mission in a way
that prominently includes the defense of God's creation,'' argues Vice
President 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 early environmentalists experimented with different forms of
Earth and nature worship. More recently, environmentalism has joined New Age
thinking to produce a vibrant Neo-Pagan movement, including such practices
as witchcraft, which has always had a heavy ecological emphasis, and goddess
(Earth) worship. Moreover, explains Lesly Phillips, ``the growing awareness
of the urgent need to honor and heal Mother Earth has drawn many Unitarian
Universalists to 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 Earth-bonding rituals.'' Some deep ecologists even support the use of
violence to protect their ``god.'' Dave Foreman, co-founder of Earth First!
and later convicted of attempting to blow up power pylons for an Arizona
nuclear plant, explains that so-called ecoterrorism is ``a form of worship
toward the earth.'' He has also advocated allowing the poor in third world
countries to starve, ``to just let nature seek its own balance.''  
 
The new eco-spiritualism does more than threaten traditional faiths, which
are being pressed to accept doctrines contrary their basic tenets. More
broadly, treating the earth as sacred distorts public policy. Our objective
should be to balance environmental preservation with economic growth and
personal freedom, and to rely on market forces to make any environmental
controls as efficient and as flexible as possible. Unfortunately, however,
treating the environment as a goddess has caused environmental activists to
advance the most frightening theories, irrespective of the evidence, and
demand the most draconian controls possible, irrespective of the cost.  

The Reds and the Greens  
Many other environmentalists have radical philosophical rather than
theological agendas. Most of the activists are implicitly anti-capitalist,
anti-profit, and, frankly, anti- 
freedom, since it is people acting freely that leads, in some
conservationists' views, to consumerism, greed, pollution, and waste. In
fact, it has been jokingly said that the only remaining socialists in the
world are in the environmental movement, since they are promoting a centrally
planned system based on government command-and-control regulation. The Reds
have been replaced by the Greens.  
 
The problem is not so much the motives of such activists, but the fact that
their ideological biases lead them to ignore evidence questioning the
genuineness of alleged environmental problems and to refuse to make
compromises in drafting solutions to real concerns. While a doctrinal
environmentalist might be happy with the policy result for religious or
philosophical reasons, it is foolish for the rest of us to waste resources
on non-problems and on unnecessarily inefficient clean-up strategies.  
 
Environmental protection is important, and good people can disagree on the
best policies to adopt. But today the public discussion over conservation is
being distorted by politics and pagan theology, making the American public
poorer and less free and the environment dirtier.  
 
We need to look for private strategies to protect the environment.
Privatizing federal timber and rangeland, for instance, would end subsidized
development, since no private individual or company would willingly turn a
dollar investment into a few cents in revenue. Establishing full private
property rights in water would help conserve this precious resource in the
western United States. We need to develop equally creative solutions for such
``common pool'' problems as air and water pollution. In short, we need to
depoliticize the environment, making the issue one of balancing competing
interests rather than imposing ideological or religious dogmas. If we succeed
in doing so, we will end up with not only a cleaner society, but also a
wealthier and freer one. 

---------------------------------------------------------------------

Linking Liberty, Economy, and Ecology  
by John A. Baden and Robert Ethier 
SEPTEMBER 1993 
 
John A. Baden is Chairman of the Foundation for Research on Economics and the
Environment. Robert Ethier, a F.R.E.E. research assistant, contributed to
this paper.  


Much environmental writing is marked by a profound disregard, even hostility,
toward property rights and individual liberty. Self-interest is an evil to
be combatted. And markets, at best, provide mechanisms for people to express
their self-interest 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
environmentally correct behavior. However, some are finding that
environmental causes fostered through self-interest and property rights are
more likely to succeed than appeals to environmental values and bureaucratic
micro-management. Even the environmental newspaper High Country News finds
``a growing free-market attitude toward environmental protection.'' Let's see
why.  

Prosperity and Ecology  
For years environmentalists ignored or discounted the strong correlation
between economic prosperity and environmental concern. But when prosperity
is at risk, people willingly trade environmental quality for economic gain.
This occurs even in wealthy nations. In our political campaigns environmental
themes are crowded out by economic issues. As Michael R. Deland, former
chairman of the President's Council on Environmental Quality, observed: ``in
a recession there is an increased sensitivity to the 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 1992 World Bank World Development Report shows that less than two
percent of sewage in Latin America is treated. Worldwide more than one
billion people have no safe water. In China, two-thirds of rivers near large
cities are too polluted for fish. These are problems that require capital,
not promises and Green pretenses.  
 
Given that wealth enhances environmental quality, environmental policy can
be based upon three fundamental principles: (1) private property and markets
create wealth; (2) government management responds to political pressures in
ways that decrease environmental quality; and (3) government's constructive
role is to provide environmental monitoring. These principles can direct the
environmental debate in a positive direction, avoiding wasteful efforts that
advance only interest groups seeking political power and wealth transfers.
These principles provide the basis for both an environmental vision and a
sound policy direction.  

International Trade Fosters Environmental Quality  
The best way to spread free markets and create wealth in less developed
nations is free trade. The U.S. has urged the removal of trade barriers in
the Uruguay round of the General Agreement on Tariffs and Trade (GATT) talks.
This has been opposed by some environmentalists who fear that trade, and its
resultant economic growth, will bring degradation. They are misinformed.
Environmental quality and prosperity are complementary. Evidence shows that
wealthier is usually healthier; longevity is correlated with per capita
income.  
 
Free trade would increase global income levels while speeding the
dissemination of pollution-control technologies. Research by Gene Grossman
and Alan Krueger of Princeton indicates that economic growth also promotes
a cleaner environment. For example, above a per capita income level of
$4,000-$5,000, air quality improves. This is because wealth and efficiency
go together--the U.S. emits almost 30 percent less CO2 per $1,000 of GNP than
the world average. Improved efficiency and pollution control technologies,
coupled with increased environmental awareness, allow production to rise
while emissions fall.  
 
Poor nations typically have low environmental standards and enforcement. Some
environmentalists argue that free trade encourages the migration of polluting
industries to these poor countries. However, a 1987 World Resources Institute
study finds that environmental factors have not played a major role in
determining international capital allocations. And as increased environmental
concern, regulation, and enforcement in Mexico show, the prosperity
accompanying trade speeds the adoption of shared higher standards among
nations.  
 
Senior economist Peter Emerson of the Environmental Defense Fund writes,
``poverty and economic autocracy are the handmaidens of environmental
degradation.'' Only by attacking poverty can we effectively address
environmental destruction and promote long-term stewardship abroad. We must
loosen the stranglehold of the command-and-control approach to regulation,
introducing markets and private management as the solution to environment
problems.  

Ending Command and Control at Home  
As the U.S. works to promote free markets in Eastern Europe, the costs of its
own environmental autocracy are ignored or heavily 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 they have incentives both to degrade the environment and to lose
money.  
 
Bureau of Land Management lands are among the most degraded and eroded in the
west. Yet the agency continues to encourage, even require, overgrazing.
Ranchers, who pay far below market rates for grazing rights, have little
incentive to invest in soil conservation or water storage. If they attempt
to rest an area through reduced use they are threatened with revocation of
permits for underuse.  
 
Many of the National Forests lose money while hurting the environment. They
build roads whose costs are not covered by the revenues from the timber sales
they facilitate, while the environmental costs are unaccounted for. Far more
is invested in replanting than would be in a private forest, where natural
revegetation is a realistic option. Budgets are maximized while the
environment and the taxpayer suffer.  
 
It is essential that environmental groups realize the negative effects of
command-and-control policies on the environment. While politics may seem to
be the cheapest route 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 Biodiversity  
Much of the current environmental debate centers on endangered species
preservation and biodiversity. This conflict is reduced to ``jobs versus the
environment,'' an unholy trade-off. Many environmentalists feel that
government must mandate species preservation. This approach has been both
unsuccessful and has infringed upon private property rights.  
 
Environmental and wildlife groups could buy conservation easements in the
areas where disturbances might harm species listed as endangered. The North
American Elk Foundation, Trout Unlimited, and Ducks Unlimited have each done
this on private lands and waters with private funds. Such organizations could
also pay ``bounties'' to land managers if an endangered species successfully
breeds on their land. The Montana chapter of Defenders of Wildlife has
recently announced such a program to facilitate wolf reintroduction.  
 
A rancher in Dubois, Wyoming, has offered to pay the Forest Service $300,000
not to log a pristine canyon. This move was supported by many local citizens
who value it as a recreation area. Some outfitters and guest ranches also
benefit from its natural state 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 de facto wilderness area,'' even though the
sum was almost certainly greater than any income the Forest Service would
have received from timber sales. Only in a world as perverse as that of the
Forest Service bureaucracy would a decision be made to lose money while at
the same time harm the environment.  
 
Because wildlife and their habitat are ``public goods,'' some believe there
is a theoretical case for government involvement. But a system encouraging
private initiative is likely to be far more efficient and effective than
federal mandates for species recovery. Costs would become explicit, not
unevenly imposed upon landowners by the Endangered Species Act. This also
allows comparisons and trade-offs to be made among competing species and
habitats in a way that is impossible under the current Act.  

Preserving Property Rights  
In terms of our future environment, it is important that property rights be
protected. The current Endangered Species Act has resulted in an attenuation
of property rights and begun to provoke a backlash fueling the ``wise-use''
movement. In contrast, land and ecological trusts are founded upon private
property rights. They preserve species by using, not sabotaging, property
rights.  
 
With proper incentives we can expect private land owners to support the
listing of new species. Under the Endangered Species Act, if a landowner
improves habitat on his own property to encourage an endangered species, he
could lose control of that property. For example, Dayton Hyde, a rancher in
Eastern Oregon, created a lake out of wilderness and attracted a variety of
species including the American bald eagle. He was then told by the Forest
Service that he could no longer access his property by truck because he might
disturb the eagles. This is a perversity of monumental proportions.  
 
A sound economy fosters environmental protection. We must eschew conventional
Green wisdom with its appeals to command- 
and-control mechanisms. Environmental quality will be enhanced via markets
and secure property rights, an approach that is consistent with America's
intellectual heritage. Government must be the moderator, not the manager. In
this way we can have both environmental quality and prosperity. 

----------------------------------------------------------------------------

Science and the Environment  
by Bruce N. Ames 
SEPTEMBER 1993  

Bruce Ames is Professor of Biochemistry and Molecular Biology at the
University of California, Berkeley, where he is also the Director of the
Environmental Health Sciences Center.  
 
It is popular these days to espouse an apocalyptic vision of the future of
our planet. Pollution is being blamed for global warming and ozone depletion,
pesticides for cancer. Yet these and many other purported environmental
causes are based on weak or bad science. The reality is that the future of
the planet has never been brighter. With the bankruptcy of Communism, a
hopeful world is on the path to democracy, free markets, and greater
prosperity. Science and technology develop in a free society, and free
markets bring wealth, which is associated with both better health and lower
birth rates. Scientific advances and free markets can also lead to
technologies that minimize pollution for the lowest cost. A market for
pollution rights is desirable--polluting shouldn't be free--and is much more
effective than a bureaucratic monopoly. In my scenario for the future, I
would like to see environmentalism based on scientific evidence and directed
at solving real problems rather than phantoms.  
 
An example of this problem is the public misconception that pollution is a
significant contributor to cancer and that cancer rates are soaring. As life
expectancy continues to increase in industrialized countries, cancer rates
(unadjusted for age) also increase; however, the age-adjusted cancer death
rate in 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 (which is due to smoking, as are 30 percent of all U.S.
cancer deaths), melanoma (possibly due to sunburn), and non-Hodgkin's
lymphoma. Cancer is fundamentally a degenerative disease of old age, although
external factors can increase cancer rates (cigarette smoking in humans) or
decrease them (eating more fruits and vegetables).  
 
A second misconception is that high-dose animal cancer tests tell us the
significant cancer risks for humans. Approximately half of all
chemicals--whether natural or synthetic--that have been tested in standard
animal cancer tests have turned out to be carcinogenic. These standard tests
of chemicals are conducted chronically, at near-toxic doses--the maximum
tolerated dose-- and evidence is accumulating that it may be the high dose
itself, rather than the chemical per se that is the risk factor for cancer.
(This is because high doses can cause chronic wounding of tissues or other
effects that lead to chronic cell division, which is a major risk factor for
cancer.) At the very low levels of chemicals to which humans are exposed
through water pollution or synthetic pesticide residues, such increased cell
division does not occur. Thus, they are likely to pose no or minimal cancer
risks.  
 
The third misconception is that human exposures to carcinogens and other
toxins are nearly all due to synthetic chemicals. On the contrary, the amount
of synthetic pesticide residues in plant foods are insignificant compared to
the amount of natural pesticides produced by plants themselves. Of all
dietary pesticides, 99.99 percent are natural: They are toxins produced by
plants to defend themselves against fungi and animal predators. Because each
plant produces a different array of toxins, we estimate that on average
Americans ingest roughly 5,000 to 10,000 different natural pesticides and
their breakdown products. Americans eat an estimated 1,500 milligrams of
natural pesticides per person per day, which is about 10,000 times more than
they consume of synthetic pesticide residues. By contrast, the FDA found the
residues of 200 synthetic chemicals, including the synthetic pesticides
thought to be of greatest importance, average only about 0.09 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 is carcinogenic when tested in both rats and mice is the same
as for synthetic chemicals--roughly half. All chemicals are toxic at some
dose, and 99.99 percent of the chemicals we ingest are natural.  
 
The fifth misconception is that the toxicology of man-made chemicals is
different from that of natural chemicals. Humans have many general natural
defenses that make us well buffered against normal exposures to toxins, both
natural and synthetic. DDT is often viewed as the typically dangerous
synthetic pesticide. However, it saved millions of lives in the tropics and
made obsolete the pesticide lead arsenate, which is even more persistent and
toxic, although all natural. While DDT was unusual with respect to
bioconcentration, natural pesticides also bioconcentrate if they are fat
soluble. Potatoes, for example, naturally contain fat soluble neurotoxins
detectable in the bloodstream of all potato eaters. High levels of these
neurotoxins have been shown to cause birth defects in rodents.  
 
The sixth misconception is that correlation implies causation. The number of
storks in Germany has been decreasing for decades. At the same time, the
German birth rate also has been decreasing. Aha! Solid evidence that storks
bring babies! Cancer clusters in small areas are expected to occur by chance
alone, and there is no persuasive evidence from either epidemiology or
toxicology that pollution is a significant cause of cancer for the general
population.  
 
There are tradeoffs involved in eliminating pesticides. Plants need chemical
defenses--either natural or synthetic--in order to survive pest attack. One
consequence of disproportionate concern about synthetic pesticide residues
is that some plant breeders are currently developing plants to be more
insect-resistant and inadvertently are selecting plants higher in natural
toxins. A major grower recently introduced a new variety of highly
insect-resistant celery into commerce. The pest-resistant celery contains
6,200 parts per billion (ppb) of carcinogenic (and mutagenic) psoralens
instead of the 800 ppb normally present in celery. The celery is still on the
market.  
 
Synthetic pesticides have markedly lowered the cost of plant foods, thus
making them more available to consumers. Eating more fruits and vegetables
is thought to be the best way to lower risks from cancer and heart disease,
other than giving up smoking; our vitamins, anti-oxidants, and fiber come
from plants and are important anti-carcinogens. Thus, eliminating essential
pesticides is likely to increase cancer rates. Huge expenditure of money and
effort on tiny hypothetical risks does not improve public health. Rather, it
diverts our resources from real human health hazards, and it hurts the
economy. 

----------------------------------------------------------------------------

Overpopulation: The Perennial Myth  
by David Osterfeld 
SEPTEMBER 1993  

Dr. Osterfeld is Professor of Political Science at Saint Joseph's College in
Rensselaer, Indiana.  

 
``What most frequently meets our view (and occasions complaint) is our
teeming population. Our numbers are burdensome to the world, which can hardly
support us. . . . In very deed, pestilence, and famine, and wars, and
earthquakes have to be regarded as a remedy for nations, as the means of
pruning the luxuriance of the human race.''  
This was not written by professional doomsayer Paul Ehrlich (The Population
Bomb, 1968). It is not found in the catastrophist works of Donella and Dennis
Meadows (The Limits to Growth, 1972; Beyond the Limits, 1992). Nor did it
come from the Council on Environmental Quality and the Department of State's
pessimistic assessment of the world situation, The Global 2000 Report to the
President (1980).  
 
It did not even come from Thomas Malthus, whose Essay on Population (1798)
in the late eighteenth century is the seminal work to which much of the
modern concern about overpopulation can be traced. And it did not come from
Botero, a sixteenth-century Italian whose work anticipated many of the
arguments advanced by Malthus two centuries later.  
 
The opening quotation was penned by Tertullian, a resident of the city of
Carthage in the second century, when the population of the world was about
190 million, or only three to four percent of what it is today. And the fear
of overpopulation did not begin with Tertullian. One finds similar concerns
expressed in the writings of Plato and Aristotle in the fourth century B.C.,
as well as in the teachings of Confucius as early as the sixth century B.C. 
 
From the period before Christ, men have been worried about overpopulation.
Those concerns have become ever more frenzied. On an almost daily basis we
are fed a barrage of stories in the newspapers and on television--complete
with such appropriately lurid headlines as ``Earth Near the Breaking Point''
and ``Population Explosion Continues Unabated''--predicting the imminent
starvation of millions because population is outstripping the food supply.
We regularly hear that because of population growth we are rapidly depleting
our resource base with catastrophic consequences looming in our immediate
future. We are constantly told that we are running out of living space and
that unless something is done, and done immediately, to curb population
growth, the world will be covered by a mass of humanity, with people jammed
elbow to elbow and condemned to fight for each inch of space.  
 
The catastrophists have been predicting doom and gloom for centuries. Perhaps
the single most amazing thing about this perennial exercise is that the
catastrophists seem never to have stopped quite long enough to notice that
their predictions have never materialized. This probably says more about the
catastrophists themselves than anything else. Catastrophism is characterized
by intellectual arrogance. It's been said of Thomas Malthus, for example,
that he underestimated everyone's intelligence but his own. Whenever
catastrophists confront a problem for which they cannot imagine a solution,
the catastrophists conclude that no one else in the world will be able to
think of one either. For example, in Beyond the Limits the Meadows tell us
that crop yields, at least in the Western world, have reached their peak.
Since the history of agriculture is largely a history of increasing yields
per acre, one would be interested in knowing how they arrived at such a
significant and counter-historical conclusion. Unfortunately, such
information is not forthcoming.  

Overpopulation  
But isn't the world overpopulated? Aren't we headed toward catastrophe? Don't
more people mean less food, fewer resources, a lower standard of living, and
less living space 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 eighteenth century. Population rose
sixfold in the next 200 years. But this explosion was accompanied, and in
large part made possible, by a 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 in world population was dwarfed by
the eightyfold increase in world output. As real incomes rose, people were
able to live healthier lives. Infant mortality rates plummeted and life
expectancies soared. According to anthropologists, average life expectancy
could never have been less than 20 years or the human race would not have
survived. In 1900 the average world life expectancy was about 30 years. In
1993 it is just over 65 years. Nearly 80 percent of the increase in world
life expectancy has taken place in just the last 90 years! That is arguably
one of the single most astonishing accomplishments in the history of
humanity. It is also one of the least noted.  
 
But doesn't this amazing accomplishment create precisely the overpopulation
problem about which the catastrophists have been warning us? The data clearly
show that this is not the case. ``Overpopulation'' cannot stand 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 all
three variables are, and have been, increasing more rapidly than population. 
 
Food. Food production has outpaced population growth by, on average, one
percent per year ever since global food data began being collected in the
late 1940s. There is currently enough food to feed everyone in the world. And
there is a consensus among experts that global food production could be
increased dramatically if needed. The major problem for the developed
countries of the world is food surpluses. In the United States, for example,
millions of acres of good cropland lie unused each year. Many experts believe
that even with no advances in science or technology we currently have the
capacity to feed adequately, on a sustainable basis, 40 to 50 billion people,
or about eight to ten times the current world population. And we are
currently at the dawn of a new agricultural revolution, biotechnology, which
has the potential to increase agricultural productivity dramatically.  
 
Where people are hungry, it is because of war (Somalia, Ethiopia) or
government policies that, in the name of modernization and industrialization,
penalize farmers by taxing them at prohibitive rates (e.g., Nigeria, Ghana,
Kenya), not because population is exceeding the natural limits of what the
world can support.  
 
Significantly, during the decade of the 1980s, agricultural prices in the
United States, in real terms, declined by 38 percent. World prices followed
similar trends and today a larger proportion of the world's people are better
fed than at any time in recorded history. In short, food is becoming more
abundant.  
 
Resources. Like food, resources have become more abundant over time.
Practically all resources, including energy, are cheaper now than ever
before. Relative to wages, natural resource prices in the United States in
1990 were only one-half what they were in 1950, and just one-fifth their
price in 1900. Prices outside the United States show similar trends.  
 
But how can resources be getting more abundant? Resources are not things that
we find in nature. It is ideas that make things resources. If we don't know
how to use something, it is not a resource. Oil is a perfect example. Prior
to the 1840s oil was a liability rather than a resource. There was little use
for it and it would often seep to the surface and get into the water supply.
It was only with the dawn of the machine age that a use was discovered for
this ``slimy ooze.''  
 
Our knowledge is even more important than the physical substance itself, and
this has significant ramifications: More people mean more ideas. There is no
reason, therefore, that a growing population must mean declining resource
availability. Historically, the opposite has been true. Rapidly growing
populations have been accompanied by rapidly declining resource prices as
people have discovered 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,
the political and economic institutions must be right. A shortage of a good
or service, including a resource, will encourage a search both for additional
supplies and for substitutes. But this is so only if those who are successful
are able to profit from their effort. This is precisely what classical
liberalism, with its emphasis on private property and the free market,
accomplishes. A shortage of a particular resource will cause its price to
rise, and the lure of profit will attract entrepreneurs anxious to capitalize
on the shortage by finding solutions, either additional supplies of the
existing material or the development of an entirely new method of supplying
the service. Communicating through the use of fiber optics rather than copper
cable is a case in point.  
 
Entrepreneurs typically have drawn scientists and others with relevant
expertise into the field by paying them to work on the problem. Thus, the
market automatically ensures that those most likely to find solutions to a
particular problem, such as a shortage of an important resource, are drawn
into positions where they can concentrate their efforts on finding solutions
to the problem. To cite just a single example, a shortage of ivory for
billiard balls in nineteenth-century England led to the invention of
celluloid, followed by the entire panoply of plastics.  
 
In the absence of an efficient and reliable way to match up expertise with
need, our efforts are random. And in the absence of suitable rewards for
satisfying the needs of society, little effort will be forthcoming. It was
certainly no accident that the takeoff, both in population growth and
economic growth, dates from the decline of mercantilism and extensive
government economic regulations in the eighteenth century, and the emergence
in the Western world of a relatively free market, characterized by private
property, low taxes, and little government interference.  
 
In every category--per capita income, life expectancy, infant mortality,
cars, telephones, televisions, radios per person--the performance of the more
free market countries far surpasses the more interventionist countries. The
differences are far too large as well as systematic to be attributed to mere
chance.  
 
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 the more people in it, the less space there is for everyone.
In a statistical sense this is true, of course. But it is also irrelevant.
For example, if the entire population of the world were placed in the state
of Alaska, every individual would receive nearly 3,500 square feet of space,
or about one-half the size of the average American family homestead with
front and back yards. Alaska is a big state, but it is a mere one percent of
the earth's land mass. Less than one-half of one percent of the world's
ice-free land area is used for human settlements.  
 
But perhaps ``living space'' can be measured more meaningfully by looking at
such things as the number of houses, the amount of floor space, or the number
of rooms per person. There are more houses, more floor space, and more rooms
per person than ever before. In short, like both food and resources, living
space is, by any meaningful measure, becoming more abundant.  
 
Finally, it should be noted that the population explosion has begun to
fizzle. Population growth peaked at 2.1 percent per year in the late 1960s
and has declined to its present rate of 1.7 percent. There is no doubt that
this trend will continue since, according to the latest information supplied
by the World Health Organization, total fertility rates (the number of births
per woman) have declined from 4.5 in 1970 to just 3.3 in 1990. That is
exactly fifty percent of the way toward a fertility rate of 2.1 which would
eventually bring population growth to a halt.  
 
Everything is not fine. There are many problems in the world. Children are
malnourished. But the point that cannot be ignored is that all of the major
economic trends are in the right direction. Things are getting better.  
 
Contrary to the constant barrage of doomsday newspaper and television
stories, the data clearly show that the prospect of the Malthusian nightmare
is growing steadily more remote. The natural limits of what the earth can
support are steadily receding, not advancing. Population growth is slowing
while the supplies of food, resources, and even living space are increasing.
Moreover, World Bank data show that real wages are increasing, which means
that people are actually becoming more scarce.  
 
In short, although there are now more people in the world than ever before,
by any meaningful measure the world is actually becoming relatively less
populated. 

---------------------------------------------------------------------------- 
 
Stewardship Versus Bureaucracy  
by Rick Perry 
SEPTEMBER 1993  

Rick Perry is Commissioner of the Texas Department of Agriculture.  

Insuring a safe, plentiful water supply is an issue crucial to the well-being
of every American--one that will certainly intensify as we move into the
twenty-first century. Thus, we must answer this question: How can we
guarantee a sufficient supply of water to satisfy the necessary but competing
demands of agriculture, industry, and a population that is expected to
increase rapidly in the next 50 years?  
 
First of all we must challenge the assumption that government ownership
offers the best solution for protecting our precious natural resources. The
premise that puts bureaucratic regulation above the rights of private
property owners is not only false, it actually 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 rights has contributed to the depletion of salmon populations.  
 
The salmon's seasonal need for high water levels to journey to its summer
spawning grounds coincides with peak consumer demand for electricity in the
West. So, it would make good sense to produce and sell more hydroelectricity
during these peak months and to conserve it when demand is low. Consumers
would benefit and so would the salmon.  
 
Unfortunately, a maze of bureaucratic regulations--combined with the West's
``use it or lose it'' rule that often prevents resale of water rights--makes
such a sensible solution nearly impossible, and the salmon species has
suffered, not benefited.  
 
Our natural resources are better left in the hands of private citizens who
are more likely than government agencies to care for them. It's a question
of stewardship versus bureaucracy. Private ownership gives people a vested
interest in their property, instills pride in what they own.  
 
Ownership also spurs agricultural producers to manage their resources
wisely--their water as well as their land. In Texas, groundwater management
has historically been based on the ``right of capture,'' the decades-old,
time-honored premise that bestows ownership of water on the owner of the land
above. Under this system, farmers and ranchers have led the way in developing
efficient methods of water use.  
 
There is room for improvement, however. Though ownership of groundwater is
vested in property owners in the Texas Water Code, this property right is
loosely defined, which affects the incentive to conserve. A market-based
system for groundwater with well defined, enforceable, and transferable
property rights based on the surface ownership would more accurately reflect
water's economic and ecological value to society. By strictly defining the
ownership of underground water, it can be given a value--just as land
has--and become subject to the efficiencies of the marketplace. Water rights
would be more marketable, and owners would be able to sell water to buyers
at a price reflecting market demand.  
 
Such a market-based system would replace government control of water--and the
specter of rationing, expensive financing programs, and confiscation of water
rights by a centralized bureaucracy. Government involvement would remain in
the hands of local water districts that would define owners' rights and
devise enforcement methods appropriate to each locality.  
 
A market-based system--achieved by placing a value on water
inventories--would motivate agricultural producers to increase even further
their conservation efforts and enhance supplies for future generations. 

--------------------------------------------------------------------------
 
Making Every Drop Count 
 
Water markets offer something for nearly everyone: They can eliminate water
shortages, reduce environmental degradation, and reduce government spending,
too. 
 
--Don Leal, The Freeman, June 1988 

----------------------------------------------------------------------------

The Market and Nature  
by Fred L. Smith, Jr.  
SEPTEMBER 1993 

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

Many environmentalists are dissatisfied with the environmental record of free
economies. Capitalism, it is claimed, is a wasteful system, guilty of
exploiting the finite resources of the Earth in a vain attempt to maintain
a non-sustainable standard of living. Such charges, now raised under the
banner of ``sustainable development,'' are not new. Since Malthus made his
dire predictions about the prospects for world hunger, the West has been
continually warned that it is using resources too rapidly and will soon run
out of something, if not everything. Nineteenth-century experts such as W.
S. Jevons believed that world coal supplies would soon be exhausted and would
have been amazed that over 200 years of reserves now exist. U.S. timber
``experts'' were convinced that North American forests would soon be a
memory. They would similarly be shocked by the reforestation of eastern North
America--reforestation that has resulted from market forces and 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 computer simulations, and their
static view of resource supply and demand, have no relation to reality.
Nevertheless, these models are back, most notably in the book Beyond the
Limits, and enjoying their newly found attention. This theme of imminent
resource exhaustion has become a chronic element in the annual Worldwatch
publication, State of the World. (This book is, to my knowledge, the only
gloom-and-doom book in history which advertises next year's edition.) Today,
sustainable development theorists, from the World Bank's Herman Daly and the
United Nations' Maurice Strong to Vice President Albert Gore and Canadian
David Suzuki, seem certain that, at last, Malthus will be proven right. It
was this environmental view that was on display at the United Nations'
``Earth Summit'' in Rio de Janeiro in 1992. This conference, vast in scope
and mandate, was but the first step in the campaign to make the environment
the central organizing principle of global institutions.  
 
If such views are taken seriously, then the future will indeed be a very
gloomy place, for if such disasters are in the immediate future, then drastic
government action is necessary. Consider the not atypical views of David
Suzuki: ``[T]here has to be a radical restructuring of the priorities of
society. That means we must no longer be dominated by global economics, that
the notion that we must continue to grow indefinitely is simply off, that we
must work towards, not zero growth, but negative growth.'' For the first time
in world history, the leaders of the developed nations are being asked to
turn their backs on the future. The resulting policies could be disastrous
for all mankind.  

The Environmental Challenge  
The world does indeed face a challenge in protecting ecological values.
Despite tremendous success in many areas, many environmental concerns remain.
The plight of the African elephant, the air over Los Angeles, the hillsides
of Nepal, the three million infant deaths from water-borne diseases
throughout the world, and the ravaging of Brazilian rain forests all
dramatize areas where problems persist, and innovative solutions are
necessary.  
 
Sustainable development theorists claim these problems result from ``market
failure'': the inability of capitalism to address environmental concerns
adequately. Free market proponents suggest that such problems are not the
result of market forces, but rather of their absence. The market already
plays a critical role in protecting those resources privately owned and for
which political interference is minimal. In these instances there are truly
sustainable practices. Therefore, those concerned with protecting the
environment and ensuring human prosperity should seek to expand capitalism,
through the extension of property rights, to the broadest possible range of
environmental resources. Our objective should be to reduce political
interference in both the human and the natural environments, not to expand
it.  
 
Private stewardship of environmental resources is a powerful means of
ensuring sustainability. Only people can protect the environment. Politics
per se does nothing. If political arrangements fail to encourage individuals
to play a positive role, the arrangements can actually do more harm than
good. There are tens of millions of species of plants and animals that merit
survival. Can we imagine that the 150 or so governments on this planet--many
of which do poorly with their human charges--will succeed in so massive a
stewardship task? Yet there are in the world today over five billion people.
Freed to engage in private stewardship, the challenge before them becomes
surmountable.  

Sustainable Development and Its 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 a concept, it is extremely vague, often little more than a
platitude. Who, after all, favors non-sustainable development? The basic
definition promoted by Gro Harlem Brundtland, former Prime Minister of Norway
and a prominent player at the Earth Summit, is fairly vague as well:
``[S]ustainable development is a notion of discipline. It means humanity must
ensure that meeting present needs does not compromise the ability of future
generations to meet their own needs.''  
 
In this sense, sustainability requires that as resources are consumed one of
three things must occur: New resources must be discovered or developed;
demands must be shifted to more plentiful resources; or, new knowledge must
permit us to meet such needs from the smaller resource base. That is, as
resources are depleted, they must be renewed. Many assume that the market is
incapable of achieving this result. A tremendous historical record suggests
exactly the opposite.  
 
Indeed, to many environmental ``experts,'' today's environmental problems
reflect the failure of the market to consider ecological values. This market
failure explanation is accepted by a panoply of political pundits of all
ideological stripes, from Margaret Thatcher to Earth First! The case seems
clear. Markets, after all, are shortsighted and concerned only with quick
profits. Markets undervalue biodiversity and other ecological concerns not
readily captured in the marketplace. Markets ignore effects 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 should be careful, thoughtful, even
scientific, but the logic is clear: Those areas of the economy having
environmental impacts must be politically controlled. Since, however, every
economic decision has some environmental effect, the result is an effort to
regulate the whole of human activity.  
 
Thus, without any conscious decision being made, the world is moving
decisively toward central planning for ecological rather than economic
purposes. The Montreal Protocol on chlorofluorocarbons, the international
convention on climate change, the proposed convention on biodiversity, and
the full range of concerns addressed at the U.N. Earth Summit--all are
indicative of this rush to politicize the world's economies. That is
unfortunate, for ecological central planning is unlikely to provide for a
greener world.  

Rethinking the Market Failure Paradigm  
The primary problem with the market failure explanation is that it demands
too much. In a world of pervasive externalities --that is, a world where all
economic decisions have environmental effects--this analysis demands that all
economic decisions be politically managed. The world is only now beginning
to recognize the massive mistake entailed in economic central planning; yet,
the ``market failure'' paradigm argues that we embark on an even more
ambitious effort of ecological central planning. The disastrous road to
serfdom can just as easily be paved with green bricks as with red ones.  
 
Environmental policy today is pursued exactly as planned economies seek to
produce wheat. A political agency is assigned the task. It develops detailed
plans, issues directives, and the citizens comply. That process will produce
some wheat just as environmental regulations produce some gains. However,
neither system enlists the enthusiasm and the creative genius of the
citizenry, and neither leads to prosperity. In fact, political management has
been able to turn the cornucopia that was the Horn of Africa into a barren,
war-torn desert.  
 
That markets ``fail'' does not mean that governments will ``succeed.''
Governments, after all, are susceptible to special interest pleadings. A
complex political process often provides fertile ground for economic and
ideological groups to advance their agendas at the public expense. The U.S.
tolerance of high sulfur coal and the massive subsidies for heavily polluting
``alternative fuels'' are evidence of this problem. Moreover, governments
lack any means of acquiring the detailed information dispersed throughout the
economy essential to efficiency and technological change.  
 
More significantly, if market forces were the dominant cause of environmental
problems, then the highly industrialized, capitalist countries should suffer
from greater environmental problems than their centrally managed
counterparts. This was once the conventional wisdom. The Soviet Union, it was
argued, would have no pollution because the absence of private property, the
profit motive, and individual self-interest would eliminate the motives for
harming the environment. The opening of the Iron Curtain exploded this myth,
as the most terrifying ecological horrors ever conceived were shown to be the
Communist reality. The lack of property rights and profit motivations
discouraged efficiency, placing a greater stress on natural resources. The
result was an environmental disaster.  

Do Markets Fail--Or Do We Fail to Allow Markets?  
John Kenneth Galbraith, an avowed proponent of statist economic policies,
inadvertently suggested a new approach to environmental protection. In an
oft-quoted speech he noted that the U.S. was a nation in which the yards and
homes were beautiful and in which the streets and parks were filthy.
Galbraith then went on to suggest that we effectively nationalize the yards
and homes. For those of us who believe in property rights and economic
liberty, the obvious lesson is quite the opposite.  
 
Free market environmentalists seek ways of placing these properties in the
care of individuals or groups concerned about their well-being. This approach
does not, of course, mean that trees must have legal standing, but rather a
call for ensuring that behind every tree, stream, lake, air shed, and whale
stands one or more owners who are able and willing to protect and nurture
that resource.  
 
Consider the plight of the African elephant. On most of the continent, the
elephant is managed like the American buffalo once was. It remains a
political resource. Elephants are widely viewed as the common heritage of all
the peoples of these nations, and are thus protected politically. The
``common property'' management strategy being used in Kenya and elsewhere in
East and Central Africa has been compared and contrasted with the experiences
of those nations such as Zimbabwe which have moved decisively in recent years
to transfer elephant ownership rights to regional tribal councils. The
differences are dramatic. In Kenya, and indeed all of eastern Africa,
elephant populations have fallen by over 50 percent in the last decade. In
contrast, Zimbabwe's elephant population has been increasing rapidly. As with
the beaver in Canada, a program of conservation through use that relies upon
uniting the interests of man and the environment succeeds where political
management has failed.  

The Market and Sustainability  
The prophets of sustainability have consistently predicted an end to the
world's abundant resources, while the defenders of the free market point to
the power of innovation--innovation which is encouraged in the marketplace.
Consider the agricultural experience. Since 1950, improved plant and animal
breeds, expanded availability and types of agri-chemicals, innovative
agricultural techniques, expanded irrigation, and better pharmaceutical
products have all combined to spur a massive expansion of world food
supplies. That was not expected by those now championing ``sustainable
development.'' Lester Brown, in his 1974 Malthusian publication By Bread
Alone, suggested that crop yield increases would soon cease. Since that date,
Asian rice yields have risen nearly 40 percent, an approximate increase of
2.4 percent per year. This rate is similar to that of wheat and other grains.
In the developed world it is food surpluses, not food shortages, that present
the greater problem, while political institutions continue to obstruct the
distribution of food in much of the Third World.  
 
Man's greater understanding and ability to work with nature have made it
possible to achieve a vast improvement in world food supplies, to improve
greatly the nutritional levels of a majority of people throughout the world,
in spite of rapid population growth. Moreover, this has been achieved while
reducing the stress to the environment. To feed the current world population
at current nutritional levels using 1950 yields would require plowing under
an additional 10 to 11 million square miles, almost tripling the world's
agricultural land demands (now at 5.8 million square miles). This would
surely come at the expense of land being used for wildlife habitat and other
applications.  
 
Moreover, this improvement in agriculture has been matched by improvements
in food distribution and storage, again encouraged by natural market
processes and the ``profit incentive'' that so many environmentalists
deplore. Packaging has made it possible to reduce food spoilage, reduce
transit damage, extend shelf life, and expand distribution regions. Plastic
and other post-use wraps along with the ubiquitous Tupperware have further
reduced food waste. As would be expected, the United States uses more
packaging than Mexico, but the additional packaging results in tremendous
reductions in waste. On average, a Mexican family discards 40 percent more
waste each day. Packaging often eliminates more waste than it creates.  
 
Despite the fact that capitalism has produced more environment-friendly
innovations than any other economic system, the advocates of sustainable
development insist that this process must be guided by benevolent government
officials. That such efforts, such as the United States' synthetic fuels
project of the late 1970s, have resulted in miserable failures is rarely
considered. It is remarkable how many of the participants at the U.N. Earth
Summit seemed completely oblivious to this historical reality.  
 
In the free market, entrepreneurs compete in developing low-cost, efficient
means to solve contemporary problems. The promise of a potential profit, and
the freedom to seek after it, always provides the incentive to build a better
mousetrap, if you will. Under planned economies, this incentive for
innovation can never be as strong, and the capacity to reallocate resources
toward more efficient means of production is always constrained.  
 
This confusion is also reflected in the latest environmental fad: waste
reduction. With typical ideological fervor, a call for increased efficiency
in resource use becomes a call to use less of everything, regardless of the
cost. Less, we are told, is more in terms of environmental benefit. But
neither recycling nor material or energy use reductions per se are a good
thing, even when judged solely on environmental grounds. Recycling paper
often results in increased water pollution, increased energy use, and in the
United States, actually discourages the planting of new trees. Mandating
increased fuel efficiency for automobiles reduces their size and weight,
which in turn reduces their crashworthiness and increases highway fatalities.
Environmental policies must be judged on their results, not just their
motivations.  

Overcoming Scarcity  
Environmentalists tend to focus on ends rather than process. This is
surprising given their adherence to ecological teaching. Their obsession with
the technologies and material usage patterns of today reflects a failure in
understanding how the world works. The resources that people need are not
chemicals, wood fiber, copper, or the other natural resources of concern to
the sustainable development school. We demand housing, transportation, and
communication services. How that demand is met is a derivative result based
on competitive forces--forces which respond by suggesting new ways of meeting
old needs as well as improving the ability to meet such needs in the older
ways.  
 
Consider, for example, the fears expressed in the early post-war era that
copper would soon be in short supply. Copper was the lifeblood of the world's
communication system, essential to link together humanity throughout the
world. Extrapolations suggested problems and copper prices escalated
accordingly. The result? New sources of copper in Africa, South America, and
even the U.S. and Canada were found. That concern, however, also prompted
others to review new technologies, 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 Lynn Scarlett of the Reason Foundation noted that a system
requiring, say, 1,000 tons of copper can be replaced by as little as 25
kilograms of silicon, the basic component of sand. Moreover, the fiber optics
system has the ability to carry over 1,000 times the information of the older
copper wire. Such rapid increases in communication technology are also
providing for the displacement of oil as electronic communication reduces the
need to travel and commute. The rising fad of telecommuting was not dreamed
up by some utopian environmental planner, but was rather a natural outgrowth
of market processes.  
 
It is essential to understand that physical resources are, in and of
themselves, largely irrelevant. It is the interaction of man and science that
creates resources: Sand and knowledge become fiber optics. Humanity and its
institutions determine whether we eat or die. The increase of political
control of physical resources and new technologies only increases the
likelihood of famine.  

Intergenerational Equity  
Capitalism is ultimately attacked on grounds of unsustainability for its
purported failure to safeguard the needs of future generations. Without
political intervention, it is argued, capitalists would leave a barren globe
for their children. Thus, it is concluded, intergenerational equity demands
that politics intervene. But are these criticisms valid?  
 
Capitalists care about the future because they care about today's bottom
line. Market economies have created major institutions--bond and stock
markets, for example--which respond to changes in operating policies that
will affect future values. A firm that misuses its capital or lowers its
quality standards, a pet store that mistreats its stock, a mine that reduces
maintenance, a farmer that permits erosion--all will find the value of their
capital assets falling. Highly specialized researchers expend vast efforts
in ferreting out changes in management practices that might affect future
values; investment houses pay future analysts very well indeed to examine
such questions.  
 
Markets, of course, are not able to foresee all eventualities, nor do they
consider consequences hundreds of years into the future. Yet, consider the
time horizon of politicians. In the U.S., at least, they are concerned with
only one thing: getting re-elected, a process that provides them at best a
two-to-six-year time horizon. Politically managed infrastructure is routinely
undermaintained; funds for new roads are more attractive than the smaller
sums used to repair potholes; national forests are more poorly maintained
than private forests; erosion is more serious on politically controlled lands
than on those maintained by private corporations. If the free market is
shortsighted in its view of the future, then the political process is even
more so. It is therefore the free market which best ensures that there will
be enough for the future.
  
Warring Paradigms  
The alternative perspectives on environmental policy--free markets and
central planning--differ dramatically. One relies upon individual ingenuity
and economic liberty to harness the progressive nature of market forces. The
other rests upon political manipulation and government coercion. In point of
fact, these approaches are antithetical. There is little hope of developing
a ``third way.'' Yet, there has been little debate on which approach offers
the greatest promise in enhancing and protecting environmental concerns. The
political approach has been adopted on a wide scale throughout the world,
with more failure than success, while efforts to utilize the free market
approach have been few and far between.  
 
Nevertheless, there are numerous cases where private property rights have
been used to complement and supplement political environmental strategies.
One excellent example is a case in England in the 1950s where a fishing club,
the Pride of Derby, was able to sue upstream polluters for trespassing
against private property. Even the pollution issuing from an upstream
municipality was addressed. This ability to go against politically preferred
polluters rarely exists where environmental resources are politically
managed.  
 
At the heart of the division between statist and free market
environmentalists is a difference in moral vision. Free market
environmentalists envision a world in which man and the environment live in
harmony, each benefiting from interaction with the other. The other view,
which dominates the environmental establishment, believes in a form of
ecological apartheid whereby man and nature must be separated, thus
protecting the environment from human influence. From this view rises the
impetus to establish wilderness lands where no humans may tread and a
quasi-religious zeal to end all human impact on nature.  
 
Thus, the establishment environmentalists view pollution--human waste--as an
evil that must be eliminated. That waste is an inevitable by-product of human
existence is of secondary concern. To the environmentalist that endorses this
ideology, nothing short of civilization's demise will suffice to protect the
earth.  
 
The view that free market environmentalists endorse is somewhat different.
Not all waste is pollution, but only that waste which is transferred
involuntarily. Thus it is polluting to dispose of garbage on a neighbor's
lawn, but not to store it on one's own property. The voluntary transfer of
waste, perhaps from an industrialist to the operator of a landfill or
recycling facility, is merely another market transaction.  

Conclusion  
The United Nations Earth Summit considered an extremely important issue: What
steps should be taken to ensure that economic and ecological values are
harmonized? Unfortunately, the Earth Summit failed to develop such a program,
opting instead to further the flawed arguments for ecological central
planning.  
 
The world faces a fateful choice as to how to proceed: by expanding the scope
of individual action via a system of expanded private property rights and the
legal defenses associated with such rights or by expanding the power of the
state to protect such values directly. In making that choice, we should learn
from history. Much of the world is only now emerging from decades of efforts
to advance economic welfare via centralized political means, to improve the
welfare of mankind by restricting economic freedom, by expanding the power
of the state, to test out the theory that market forces are inadequate to
protect the welfare of society. That experiment has been a clear failure on
economic, civil liberties, and even ecological grounds. Economic central
planning was a utopian dream; it became a real world nightmare.  
 
Today, the international environmental establishment seems eager to repeat
this experiment in the ecological sphere, increasing the power of the state,
restricting individual freedom, certain that market forces cannot adequately
protect the ecology. Yet, as I've quickly sketched out here, this argument
is faulty. Wherever resources have been privately protected, they have done
better than their politically managed counterparts--whether we are speaking
of elephants in Zimbabwe, salmon streams in England, or beaver in Canada.
Where such rights have been absent or suppressed, the results have been less
fortunate. Extending property rights to the full array of resources now left
undefended, now left as orphans in a world of protected properties, is a
daunting challenge. Creative legal arrangements and new technologies will be
necessary to protect the oceans and air sheds of the world, but those tasks
can be resolved if we apply ourselves. The obstacles to ecological central
planning are insurmountable. The need for centralized information and a
comprehensive system of controls in order to coerce the population of the
world to act in highly restricted ways as well as that for omniscient
decision-makers to choose among technologies can never be met.  
 
Ecological central planning cannot protect the environment, but it can
destroy our civil and economic liberties. There is too much at stake to allow
the world to embark upon this course. The environment can be protected, and
the world's peoples can continue to reach new heights of prosperity, but it
is essential to realize that political management is not the proper approach.
Rather, the leaders of the world should follow the path of the emerging
nations of Eastern Europe and embrace political and economic freedom. In the
final analysis, the free market is the only system of truly sustainable
development. 

----------------------------------------------------------------------------

Eco-Justice 
by Jane M. Orient, M.D. 
SEPTEMBER 1993 

Dr. Orient is a physician in private practice in Tucson, Arizona.   
 
In a little noticed speech last year, William Reilly, head of the
Environmental Protection Agency (EPA), boasted of past success and set the
agenda for the future: ``George Bush said the polluters would pay if they
broke the law and during the past three years the Bush Administration has
collected more penalties and sent more violators to jail for longer sentences
than in the rest of the EPA's 18-year history combined.''  
 
Rioters may be free in Los Angeles, but the Feds are jailing ``polluters.'' 

 
Three men have already served time in federal penitentiary for inadvertent
``criminal'' violations of wetlands regulations (Ocie Mills, Carrie Mills,
and John Pozsgai). The ``pollutant'' involved was common dirt--the kind found
on construction sites and in backyards everywhere.  
 
The fourth person found guilty of crimes against the Earth, Bill Ellen,
reported to prison earlier this year. The Department of Justice announced
that Ellen's sentence ``should send a clear message that environmental
criminals will, in fact, go to jail. Those who commit criminal environmental
insults will come to learn and appreciate the inside of a federal
correctional facility.''  
 
But prison cannot serve as a deterrent unless the public learns what behavior
is supposed to be deterred. Those who don't want to have to explain to their
toddlers why they are going to jail (Bill Ellen has two young sons) had
better pay attention to Ellen's crime.  
 
This is what the notorious outlaw did:  
 
1. He accepted a job as a marine and environmental consultant to oversee the
construction of a hunting and conservation preserve. He did so because of his
interest in wildlife. For six years, he rehabilitated and 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's definition of ``wetland.'' He did so because of his contractual
obligations, to avoid penalties from the contractors. Ellen argued that the
state's head soil scientist, an employee of the Soil Conservation Service,
had classified the area in question as an ``upland,'' not a wetland.  
 
3. During the time that the dispute with the bureaucrat was being
adjudicated, Ellen allowed his crew to dump two truckloads of dirt on the
site before shutting down the work completely.  
 
The Supreme Court declined to review the legal aspect of Ellen's case, and
he served six months in federal penitentiary for this crime. His wife, Bonnie
Ellen, had to do the best she could to shield the children and to keep some
aspects of her husband's business going in his absence.  
 
``I have no idea how I can pay all the bills,'' she said, when her husband
was sentenced.  
 
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't know what a ``wetland'' is, and the
average citizen has no hope of being able to tell because often a ``wetland''
looks completely dry.  
 
The most important lesson jailing ``eco- 
criminals'' 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 wildlife refuge. One mistake, and the bureaucracy has the power to
tear the most civic-minded breadwinner away from his family, leaving him to
the mercy of the murderers and molesters inside the prison, while his wife
and children face a lonely struggle outside. 

--------------------------------------------------------------------------
 
Pulling the Plug on the REA  
by Albert R. Bellerue 
SEPTEMBER 1993 

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


Franklin D. Roosevelt created the Rural Electrification 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 was a general program of unemployment relief.  
 
This relief program authorized the immediate spending of $100 million to help
correct the unemployment problems of the '30s. The Order required that 25
percent of these funds should be spent for labor and 90 percent of the labor
should be taken from the relief rolls. This requirement nearly stopped the
REA in its tracks, because skilled labor was needed to build electric power
systems, and sufficient skilled labor could not be found on the relief rolls. 

Morris L. Cooke, former director of Public Works for Philadelphia, was
appointed the REA administrator May 20, 1935. As it became evident that REA
would not qualify as a relief program under the Executive Order, Cooke, in
true political style, launched a lobbying program maintaining that the REA
would have to be a loan agency instead of a temporary emergency unemployment
relief program.  
 
On August 8, 1935, President Roosevelt issued Regulation No. 4 establishing
the REA as a lending agency, which freed it from earlier regulations and gave
it authority to make its own exceptions to any other regulations that might
restrict it.  
 
Regulation No. 4 transformed a temporary emergency unemployment relief
program into a not-for-profit, taxpayer- 
supported national lending agency--all by Presidential Executive Order.  
 
According to REA publications, the interest rates charged the electric power
cooperatives from 1936 to 1952 ranged from two percent to three percent,
approximately equal to the cost of Treasury issues. From 1951 to 1971, a
period of 20 years, only two percent interest was charged for these REA
loans, whereas the Treasury issues rate increased 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 of money to the Treasury
Department averaged 12.3 percent. From 1983 through 1991, the REA interest
charge was slightly less than five percent while the Treasury rate dropped
slowly from 10.8 percent to eight percent. Taxpayers have been forced to fund
these subsidies for 58 years.  
 
Following is a chart showing comparisons with the going cost of money
(Treasury issues rates) and the taxpayer-supported REA loans rates. Treasury
borrowing rates did not exceed REA loan rates until 1952.  

Interest Rate on REA Loans vs. 
Cost of Money to the Government Fiscal Year REA Loans 
 Rate*  
Treasury Issues  Rate**   
Percent   Percent  
 
1936 3.00 2.530  
1940 2.69 2.492  
1945 2.00 1.718  
1950 2.00 1.958  
1955 2.00 2.079  
1960 2.00 3.449  
1965 2.00 3.800  
1970 2.00 5.986  
1975 4.42 6.533  
1980 4.37 9.608  
1985 4.99 10.383  
1990 4.97 8.843  
 
*Weighted average for loans approved during the year. **Source: Monthly
Statement of the Public Debt of the United States, Department of the
Treasury.   

That REA loan rates equaled the interest rates paid by the U.S. Treasury
until 1952 does not mean that the electrification program was unsubsidized
during the early years. The taxpayers were forced to underwrite the
additional REA costs for federal management of these loans.  
 
Although there is no need to continue this welfare program for roughly one
thousand REA cooperatives, taxpayer support continues. Today, according to
the REA, 99 percent of the 2.3 million farms in the U.S.A. have electricity.
Since 1949, REA has also been making loans for telephones. Today more than
96 percent have phones.  
 
So, what's keeping Congress from getting the taxpayers out from under this
unnecessary burden?  

Welfare for the Wealthy  
On July 5, 1992, CBS News presented its 60 Minutes feature ``Welfare for the
Wealthy'' wherein Steve Kroft exposed the most recent Rural Electrification
Administration boondoggles, clearly not in the best interests of U.S.
taxpayers.  
 
Kroft interviewed Harold Hunter, former REA Administrator, who agreed that
the REA was a ``boondoggle.''  
 
Kroft pointed out that the REA made huge loans to several holding companies
such as GTE, Century Telephone, ALLTELL, and TDS. In addition, REA made
low-interest, taxpayer-subsidized loans to ski resorts in Aspen and Vail,
Colorado, and to recharge golf carts in Hilton Head, South Carolina. This is
nothing new. It has been going on for 30 years or more, and Congress has
known all about it and done nothing to correct it. Kroft also informed his
viewers that taxpayers are forced to support REA loans on the island of
Saipan in Micronesia. REA, in cooperation with the Agency for International
Development (A.I.D.), has organized dozens of cooperatives abroad as part of
a foreign aid program.  
 
But what can be done? Jim Miller, former Budget Director; Harold Hunter,
former REA Administrator; and Roland Vautour, former Undersecretary of
Agriculture, all proposed to Congress that the REA be phased out. Congress
has taken no action.  
 
Steve Kroft brought out the fact that one of the reasons no Congressman can
be found to clean up this mess and save the taxpayers a billion dollars a
year is that the REA co-ops have a powerful political lobby for perpetuation
of their welfare program.  
 
The lobbyist is the taxpayer-supported National Rural Electric Cooperative
Alliance (NRECA), the powerful national union of REA co-ops. There is no
Congressman brave enough to support the taxpayer against this union that can
bring some 1,000 co-op members to Washington.  
 
John Becker, former manager of the Wisconsin Development Authority, recalled
a conversation he had in the '40s with Robert B. Craig, an REA Administrator
and acknowledged father of the NRECA.  
 
Craig told him that in the NRECA, ``We will have one million members which
means four million votes. Further we will have manufacturers doing millions
of dollars worth of business with us, and during the campaign we can raise
lots of money for our friends from these sources. . . . [W]ith four million
votes and several hundred thousand in campaign funds, we will maintain in
public offices enough friends that even the devil himself can't hurt us.'' 

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

--------------------------------------------------------------------------
 
In Praise of Billboards  
by Lawrence Person 
SEPTEMBER 1993 

Mr. Person is former editor of Citizens Agenda. His work has appeared in
National Review, Reason, and other magazines.  
 
I recently took a car trip from central Texas to northern Virginia. Though
my journey was of an entirely practical nature (two straight days of driving,
with no time for sightseeing), it gave me a new appreciation for something
I had not really given much thought to: billboards. Despite the scathing
criticism heaped upon them for aesthetic reasons, billboards are actually
possessed of a number of unsung virtues.  
 
First of all, billboards are a valuable source of information, especially
when you're making a long trip through an unfamiliar area. If it's getting
near lunchtime, and I see a sign that says ``McArches--30 miles,'' then I
have more information on how and when to plan my stops. Likewise, if I am
starting to run low on gas, a sign for Texxon might tell me not only how far
ahead the station is, but whether it has a mechanic on duty, the best way to
get there, and so forth. Finally, if I'm starting to get sleepy, a billboard
can tell me how far to the next motel, and what it might be charging for a
room. As a consumer, every piece of information I have helps me make better
choices.  
 
Some states have a government substitute for billboards: signs with little
metal plates bearing the establishment's logo, distance-to-information, and
which exit to take. Like most state-owned substitutes, their usefulness falls
far short of the real thing. For one thing, these little signs don't tell you
the prices of a room for the night, a gallon of unleaded, or a large order
of fries. For another, they don't give you all the other information a
business might provide on their billboard: Homebaked Cookies! Air
Conditioning! A Toledo Mudhens Collector's Glass with Every Purchase!  
 
Despite these many virtues, you almost never hear a kindly word for
billboards. Critics charge they're ``sight pollution,'' as though they emit
cancer-causing agents that infect the body via the optic nerve. These same
critics go on to charge that billboards clutter up the natural landscape,
and, above all, are inferior to trees.  
 
The poet Ogden Nash wrote:  
I think that I shall never see A billboard lovely as a tree. Indeed, unless
the billboards fall I'll never see a tree at all.  

Fair enough. Such critics are, after all, entitled to their opinion. There
are a lot of things I might personally label ``sight pollution,'' including
those hideous modern art sculptures that seem to spring up like giant metal
weeds in front of every government building. Indeed, between the two I much
prefer billboards, especially since they weren't constructed using my tax
dollars. However, there is a big difference between saying something is ugly
and saying that it should be regulated or outlawed.  
 
As far as cluttering up the natural landscape goes, there are a lot of things
that do that, including houses, cars, highways, and people, but you don't see
special-interest groups trying to legislate them out of existence. (OK, a few
environmentalists are trying to outlaw all of the above, including people.
However, since people make up the vast majority of the voting population,
they haven't made much progress on this front.) I must admit that I, too,
think that the average tree is more attractive than the average billboard.
Then again, a tree never told me that I could get three Supertacos for 99
cents either. Also, if my trip is any indication, trees are in no danger of
disappearing anytime soon. On the way up they outnumbered billboards at least
10,000 to 1.  
 
Aesthetic differences aside, it shouldn't matter whether a billboard is
beautiful or ugly: Both are protected by the right of private property. The
idea that someone's property rights should be taken away because a handful
(or even a majority) of people deem a particular structure ``ugly'' is
absurd.  
 
There is a particularly insidious line of reasoning being marshaled by
anti-billboard forces these days. ``Because billboards are profitable only
because they are placed along major public thoroughfares,'' goes this
argument, ``the right of private property does not apply, and thus it is well
within a government's right to regulate them out of existence.'' The
implications of such reasoning are truly frightening. This same logic applies
to every single business that operates along any public road, and since the
overwhelming majority of roads in the United 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 the government enforce aesthetic
dictates, it is only a small step from regulating the billboards along a road
to regulating the cars on it. In the future, we can expect to see the Good
Taste Police handing out tickets to those wretched miscreants whose cars need
body work or a new paint job. The scourge of automotive sight pollution must
be driven off our streets, which means no more purple Cadillacs, custom
low-riders, jacked-up pickup trucks, or any other vehicle that fails to
conform with the new Government Aesthetics Standards.  
 
In addition to property rights, billboards are also protected by another of
our basic freedoms: the right to free speech. In Austin, Texas, there used
to be a mural billboard that proclaimed: FREE NELSON MANDELA! While this is
an overtly political message, commercial messages on billboards are also
expressions of that same right to free speech. The First Amendment makes no
distinction between commercial and non-commercial speech, and the message
``Two McBurgers--$1.99'' should be no less constitutionally protected than
``Free Nelson Mandela.''  
 
Finally, billboards can be a source of humor. While driving in Tennessee, I
saw a billboard for one particular establishment proudly proclaim: FOOD / GAS
/ ELVIS COLLECTIBLES. Now there's one thing no government sign is ever going
to tell me! 

-----------------------------------------------------------------------------

Oil Drilling in Alaska  
by Sarah Anderson 
SEPTEMBER 1993 

Sarah Anderson is a 14-year-old residing in Bozeman, Montana.  
 
large percentage of the two million barrels of oil produced every day in
Alaska comes from an area known as the North Slope. The North Slope is on the
eastern end of the north coast of Alaska and consists of mostly coastal
plains. There are five oil fields currently in production on the North Slope;
the biggest of these is Prudhoe Bay, which is also the largest oil field in
North America. Another oil field of particular interest is Endicott, located
about ten miles northeast of Prudhoe Bay. Endicott is the first continuous,
offshore oil-producing field in the Arctic. The field is in fact two man-made
islands that require a ten-mile access road and a five-mile causeway
connecting the two islands. The other three fields are Kuparek, Lisburne, and
Milne Point.  
 
The Prudhoe Bay field encompasses 5,000 acres, and Endicott, the sixth
largest oil field in North America, encompasses only 55 acres. It is possible
for oil fields to be small because the oil wells themselves are only ten feet
square. They are placed immediately next to one another.  
 
The oil is not pumped from the wells but, when the reserve is tapped, the oil
flows out under natural pressure. This means that the wells are not only
small, but quiet. Modern technology has made it possible to build the oil
fields on gravel pads that make a solid foundation for the equipment and
insulate the underlying permafrost. Previously, oil drilling pads had to be
big enough to accommodate many reserve pits to hold the waste water and mud
from drilling. Now, however, a new technique of pumping the wastes back into
the ground eliminates the waste of space, maintains a sub-surface pressure
high enough to keep oil flowing, and reduces the possibility of spills on the
tundra. If oil is not found directly beneath the well location, the well can
be drilled horizontally, again reducing the area of land affected by the oil
development.  
 
When the 800-mile trans-Alaskan pipeline was built, temporary access roads
were required for construction and maintenance. A breakthrough in road
technology has eliminated the need for these gravel roads that leave an
impact on the environment. Ocean water is pumped onto the tundra where it
freezes to form an ice road from which maintenance can be done during the
winter. In the summer these roads melt and leave no trace. Vehicles with huge
rubber tires use the roads. Ice roads are also used for oil exploration.  
 
There has long been a controversy between environmentalists and oil companies
over whether to allow oil drilling in the Arctic National Wildlife Refuge,
commonly referred to as ANWR. To put the size of the ANWR in perspective,
keep in mind that Alaska contains 591,000 square miles, or about 378,000,000
acres. The ANWR is five percent of Alaska or 19 million acres. Of these
acres, eight percent have been proposed for development, and only one percent
would be affected by oil production. This means that about 15,000 acres, or
.004 percent of Alaska, would be affected. Actual production facilities
including roads, drilling pads, living quarters, and pipelines would cover
a thousand acres.  
 
At Prudhoe Bay the vast majority of oil spills are small and never leave the
gravel pads. All spills are promptly reported to government agencies and
thoroughly cleaned up. There are about 250 spills each year, which sounds
terrible, but a ``spill'' includes a single drop of oil. By this standard the
average parking lot has more oil spills than that each year. Of those 250
spills, nearly half are zero-to five-gallon spills that never leave the
gravel pad. The contaminated gravel is all scooped up and taken to an
incinerator where the oil is burned off.  
 
Environmentalists claim that oil drilling affects the wildlife; however, if
the drill sites are any indication, most animal populations are not affected
or their numbers have risen. Caribou numbers, for example, grew from 3,000
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 20,000
animals. A group of about 100 caribou usually winters in the Prudhoe area.
The oil producing companies have taken great care to elevate the pipeline or
build ramps over it for caribou migration. The only snow goose colony in the
United States has also steadily increased from 50 to 180 nests.  
 
Sometimes the oil companies are forced to use expensive means for
environmental protection with questionable results. British Petroleum, the
company drilling from the Endicott oil field, has been forced to install two
breaches in the causeway because environmentalists felt that the Arctic
cisco, a fish that spawns in nearby rivers, would not be able to reach them.
It seems that many of the fish go around the causeway anyway, but British
Petroleum has been very cooperative in trying to reduce the impact on the
environment. Even the buildings on Endicott were assembled in Louisiana and
then transported whole on a barge all the way to Alaska.  
 
Oil drilling companies take great care to clean up and revegetate the areas
they use. Parts of gravel pads that are not needed anymore are manually
shoveled or raked up to reduce damage to the underlying vegetation. Studies
have been done on what types of grasses to use to revegetate an area and the
oil companies take pride in bringing the tundra back to its original state. 

In spite of the fact that environmental effects have been minimal and the
amount of land affected is small, environmental groups such as the Audubon
Society still strongly oppose drilling in the ANWR. To understand why,
consider the following story. In the mid-1970s, oil companies came to the
Audubon Society for permission to drill on the Society's Rainey Preserve.
They got an emphatic ``No!'' The oil companies persisted, offering
approximately $2,000,000 a year in royalties. Unsure of the environmental
consequences of the drilling, the Audubon Society demanded slant drilling
with pads placed outside sensitive areas. The oil companies agreed. The
Society demanded expensive, quiet mufflers. The oil companies agreed. The
Society required that the oil companies move out during certain times of the
year. The oil companies again agreed. As the Audubon magazine put it, ``There
was this timeclock, and when the cranes punched in, the hardhats would have
to punch out.''  
 
Why the cooperation in the Rainey Preserve but not in the ANWR? Clearly the
Audubon Society has a lot to gain from the drilling in the Rainey Preserve,
but nothing in the ANWR. The Audubon Society can control what the oil
companies do on their own preserves. On the other hand, they have no control
over the oil companies when they drill on public land.  
 
On privately owned property, both economic development and protection for the
environment can be achieved through negotiation. But in property owned by the
government, such negotiation is extremely difficult. Most of the land area
in Alaska is locked up by government ownership. To assure that it is both
developed and protected, we should consider transferring it to private
owners. 

----------------------------------------------------------------------------
BOOK REVIEWS 

SEPTEMBER 1993 
 
 
Earth in the Balance  
by Al Gore  
Boston: Houghton Mifflin, 1992  407 pages  $22.95  

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

I confess that my mind was too closed to political rhetoric, and my wallet
too thinned by involuntary taxation to fork over nearly twenty-three dollars
to a then-member of the wealthiest club in America--the U.S. Senate--for a
book. My daughter, however, a recently crowned lawyer, purchased Al Gore's
Earth in the Balance with the reckless abandon of the nouveau riche, and gave
it to me for my birthday, along with a comment that the author was a man of
brilliant intellect, and a pointed remark that ``Not all things are subject
to economic analysis.''  
 
I rightly deduced from that remark what was in store for me, but I read the
book anyway because I dearly love my daughter. (She is, regardless of weird
ideas on political economy acquired at expensive schools that don't teach
classical economics, the best daughter ever entrusted to the blundering care
of an unworthy father.) I only read Gore's book because my darling Jenny gave
it to me, but I'm glad now that I did.  
 
If I could have but two books to read the rest of my life, one would be the
Bible and the other would be Austrian economist Ludwig von Mises' magnus
opus, Human Action. I'd choose the Bible to enlighten me on spiritual
matters; Human Action on matters economic. Together, these two books can save
me from brilliant intellects.  
 
Gore professes to be a Christian. ``I am a Baptist,'' he says. But thanks to
Matthew, Mark, and Mises, I am not deceived by Al Gore. I deduce from his
book and his voting record in the United States Senate that Vice President
Gore is a devout practitioner of statolatry. ``The state,'' wrote Mises, who
coined statolatry, ``[that] new deity of the dawning age of statolatry,
[that] eternal and superhuman institution beyond the reach of human
frailties.'' Jesus said, ``Be on your guard against false prophets. . . . You
will know them by their deeds'' (Matthew 7:15- 
16).  
 
Gore's votes in the Senate, his deeds, so to speak, by which Jesus said we
could know him, reveal much. This is a man who never met a government
spending initiative he couldn't approve. The National Taxpayers Union has
ranked Senator Gore as the Senate's leading tax-and-spender for the last two
years.  
 
Although the author laboriously denies it, Earth in the Balance is a cunning
warrant for the establishment of the equivalent of world government through
``a framework of global agreements that obligate all nations to act in
concert.'' Gore proposes a ``Global Marshall Plan'' incorporating broad
governmental powers to save the environment, forcibly taxing and regulating
people's lives and restraining individual liberty in the process. A clever
polemicist, Gore never refers to the unique attribute of government that
imparts to it the illusion of being beyond human frailties: its monopoly on
the use of force.  
 
Mises, on the other hand, bluntly depicts the state as ``the social apparatus
of coercion and compulsion'' whose role is ``to beat people into submission''
to its dictates. Jesus of Nazareth preached the futility of relying on force
in the conduct of human affairs, and he taught us how to do without it.  
 
Gore disarmingly argues that resolving the ``global ecological crisis''
caused by ``humankind's assault on the earth'' is essentially a spiritual
challenge. Whether his moralizing on man's spiritual inadequacies is sincere
or sanctimonious, the recommendations embodied in his Global Marshall Plan
are entirely material and amenable to economic analysis.  
 
Gore establishes the reality of a crisis primarily by the rhetorical devices
of incessant incantation and vivid metaphor. He repetitiously refers to a
``grave crisis,'' ``environmental crisis,'' ``ungodly crisis,'' ``deep
crisis,'' ``population explosion,'' ``catastrophe at hand,'' ``catastrophe
in the making,'' ``crumbling ecological system,'' ``ravenous civilization,''
``destruction of the earth's surface,'' ``garbage imperialism,''
``destructive cycle,'' ``rapidly emerging dilemma,'' and ``ecological
holocaust.''  
 
Gore's Earth in the Balance indicts classical economics and laissez-faire
capitalism for the problem of environmental degradation. Why? Because if
classical economics can be discredited, environmentalists can safely ignore
the economists who warn that their utopian plans won't work.  
 
Gore pledges to reform his insatiable spending habit. But his sincerity is
suspect, for he renounces only one ecologically disastrous government program
among the multitude he has long supported. ``I myself,'' he confesses, ``have
supported sugar price supports and--until now--have always voted for them
without appreciating the full consequence [in damage to the environment] of
my vote. . . . I have followed the general rule that I will vote for the
established farm programs of others in farm states . . . in return for their
votes on behalf of the ones important to my state. . . . But change is
possible: I, for one, have decided as I write this book that I can no longer
vote in favor of sugarcane subsidies.'' Hallelujah! A vote-trading,
tax-and-spend junkie is willing to skip one little agricultural fix in order
to overdose on a kilo of environmentally correct spending.  
 
Although Gore pays lip service to the contributions of economics and praises
laissez-faire capitalism faintly, their demise is his ultimate objective. He
endorses ``modified free markets.'' Of course a slave is a person whose
freedom has been modified merely by the addition of shackles. As classical
economist Frederic Bastiat pointed out, one cannot be both free and not free
at the same time.  
 
Throughout Earth in the Balance, Gore confuses economics (a science) with
capitalism (a social system), statistics, and accounting. His problems with
semantics are not inconsequential and should not necessarily be attributed
to ignorance. Mises warned us in Human Action that faulty nomenclature
becomes understandable if we realize that pseudo-economists and the
politicians who apply it want to prevent people from knowing what the market
economy really is. They want to make people believe that all the repulsive
manifestations of restrictive government policies are produced by
``capitalism.'' Blaming economics for environmental degradation, is akin to
blaming mathematics for the size of the federal deficit.  
 
In Human Action Mises identified two primary causes of environmental
degradation; namely, the failure of legislators to fully implement
private-property rights; and the propensity of government to limit the
liability and indemnification that would otherwise be imposed by the common
law on the owners of property. If there is a ``global ecological crisis,''
and if it is the product of ``humankind's assault on the earth,'' the science
of human action is the only branch of human knowledge capable of
understanding the problem, which is a prerequisite to avoiding an
``ecological holocaust.''  
 
Years before Rachel Carson launched the modern environmental movement with
the publication of Silent Spring in 1962, Ludwig von Mises had considered the
problem of mankind's abuse of his environment, identified the etiology of
environmental degradation, and prescribed the only practical defense against
``humankind's assault on the earth.'' If Al Gore sincerely cared about the
environment he would repudiate his plan to spend vast sums of other people's
money and embrace classical economics and laissez-faire capitalism as the
keys to environmental salvation.  
 
Preservation of Earth cannot be entrusted to any government--not the U.S.,
not the U.N., nor to any supranational coalition. To put the matter in
perspective: Would you trust the people who gave you the post office, the
House Bank scandal, the savings and loan debacle, and the national debt with
the survival of the human race?  
 
If Earth is in the balance, let us not entrust it to the wisdom of
governments.  
 
---------------------------------------------------------------------------
 
Environmental Politics: Public Costs, Private Rewards  
Edited by Michael S. Greve and Fred L. Smith, Jr.  
Praeger Publishers, 1992  212 pages  $19.95  

Reviewed by Brian Doherty 
Brian Doherty is assistant editor of Regulation magazine.   

The old rationales for central control of the economy have suffered a
crippling blow at the hands of history and economic logic. Socialism has
proven neither more rational, more efficient, nor more humane than the free
market. But could it be more environmentally sound?  
 
This book is edited by Michael S. Greve, the founder and executive director
of the Center for Individual Rights, a public interest law firm, and Fred L.
Smith, Jr., the founder and president of the Competitive Enterprise Institute
(CEI), a free market think tank. It attempts to lay the groundwork for a
scholarly and accessible literature that makes the case that environmental
command-and-control policies, even when planned with the best of intentions,
are still just a road to serfdom, only paved with green bricks, to use
Smith's apposite phrase. The book's contributors include Jonathan H. Adler
and Christopher L. Culp of CEI, Marc K. Landy and Mary Hague of Boston
College, Daniel F. McInnis of Georgetown University, R. Shep Melnick of
Brandeis University, and David Vogel of the University of California at
Berkeley. The writers are not all sympathetic to a totally free market
approach, but all of them are keen analysts of the problems associated with
centralized environmental planning.  
 
There are legal hurdles in the way of sane environmental policy as well as
political ones, even though all of its authors don't seem to grasp the most
sensible and fair solution. The chapter by political scientists Marc Landy
and Mary Hague examines the workings of Superfund, a program designed to
clean up abandoned waste dumps. The cost was supposed to be borne by the
polluter, which seems sensible and just.  
 
Unfortunately, the Superfund ``polluter pays'' principle, in which liability
is ``strict, joint and several, and retroactive'' has led to runaway tort
problems where anyone with deep pockets who has any sort of connection,
however tenuous, to a site (including ``prior owners, users, bankers,
insurers, waste generators, and transporters'') can be held liable for the
entire cleanup cost, even if the site adhered to all legal and known
scientific standards at the time. So Superfund cleanup attempts are generally
kept tied up in court for years as any party held liable tries to drag as
many other associated parties as possible into the liability process. This
leads Landy and Hague to the mistaken conclusion that ``clearly, it would be
fairer and more efficient to simply pay for cleanup from public funds.''  
 
But political and legal interference with free markets is not the only
problem with the current state of environmental policy. When attempting to
regulate ``the environment,'' there are often no markets to corrupt. You can
have a market only when there is property to be bought and sold, and air and
water pollution involve invasive actions on individuals being performed
through an ``unowned'' medium, a ``public good.''  
 
The book's final chapter by Fred Smith shines an exploratory light toward an
intellectual and political revolution in environmental law that would extend
markets and private, voluntary arrangements to even the trickiest of
pollution problems.  
 
Smith admits the existence of problems with ``tort law which . . . has been
almost completely socialized,'' where ``courts often award compensation to
parties who have suffered no demonstrable damages while imposing liability
on parties who have caused no harm.'' But the solution lies in the
innovations that property rights and markets give incentive to create, not
central governmental management. Smith points out that such innovations as
fences, locks, fingerprinting, and burglar alarms only developed because of
private property rights, and he hypothesizes the development of technologies
that would make applying the property paradigm to currently ``unowned''
resources like endangered species, air, and water possible. Particularly
intriguing is his notion of ``chemical fingerprinting, which could identify
the culprits responsible for oil spills and toxic dumping.''  
 
Neither Smith nor the reader is able to imagine beforehand all the various
mechanisms and benefits that would develop spontaneously if we were to try
to extend property rights over the current ``public'' goods of the
environment. But Environmental Politics: Public Costs, Private Rewards makes
clear that ceding all attempts at ending environmental degradation and
managing environmental concerns to the government leads to private gain at
public expense, and, too often, at the expense of environmental quality.  
 
--------------------------------------------------------------------------
 
 
The Heated Debate: Greenhouse Predictions vs. Climate Reality  
by Robert C. Balling  
Pacific Research Institute, 177 Post St., San Francisco, CA 94108  1992  250
pages  $21.95 cloth, $14.95 paper  

Reviewed by John Semmens 
John Semmens has been a frequent contributor to The Freeman. 

Industrialization has allegedly led to increased levels of carbon dioxide
(CO2) from combustion of fossil fuels. Higher amounts of CO2 have purportedly
raised global temperatures. Warmer weather could generate significant changes
in our climate. The perception that those changes would be a disaster for the
planet has inspired demands for drastic remedies. An example is Vice
President Albert Gore's call for a phaseout of the internal combustion engine
over the next few decades. Even more desperate are demands that the
Industrial Revolution be reversed and mankind returned to a pre-industrial
agricultural mode of life.  
 
The author of this book suggests that the call for drastic action is at best
premature. Without challenging the premise that CO2 will double during the
next century, he attempts to investigate dispassionately the likely effects.
These effects appear to be of a smaller magnitude than many headline- 
grabbing visions of apocalypse have implied. Further, it is not at all clear
that the impacts would, on balance, be negative.  
 
For starters, the global warming experienced since the beginnings of
industrialization is less than would have been predicted by the same models
that are now being used to predict future disaster. This suggests that the
link between CO2 and climate is more complex than many doomsayers
acknowledge. Taking this historical record into account, the most probable
increase in global temperature over the next century is less than two degrees
Fahrenheit. This will not be sufficient to melt polar ice caps and inundate
coastal cities as many have feared.  
 
Most of the temperature rise will occur at night, during the winter, and at
higher latitudes. In many ways, this pattern of warming would actually be
beneficial. The increase in nighttime temperatures will reduce the spread
between daily high and low temperatures. This decreases thermal stress on
vegetation. Plants would be more likely to survive and thrive under such
conditions. This would mean a longer frost-free growing season in many
locations. A correspondingly larger agricultural output could be expected.
This would lower the cost of food and fiber, mitigating poverty for large
segments of the world's population.  
 
It seems more likely that further economic progress would hold forth more
hope for averting environmental disaster. It is progress that has improved
energy efficiency. It is progress that is enabling improved communication of
information.  
 
If the economic growth that naturally flows from economic freedom can
continue to fuel technology, the next couple of generations of human beings
will probably have many more attractive options for dealing with the world
they inherit.