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Generally, the institution of private property is extremely effective at protecting many environmental resources. Consider resource conservation. Since resources are costly to obtain, and private property owners benefit from good stewardship of resources and suffer from poor stewardship (typically via the profit and loss mechanism), materials tend to be used effectively and new sources of materials are regularly found. Consider what a steel soda can was like in 1970 as compared to its 2011 counterpart for a simple illustration. Similarly, private property can handle a wide range of pollution problems so long as the sources and sinks of that pollution are not “too” numerous. Readers of this site and other similar ones can find myriad illustrations of this principle.

However, while I would certainly consider myself a “free-market environmentalist” I have increasingly become suspect that pure private property regimes can protect “the environment” in ways that I find desirable (note that I said “I” there). While it is certainly a useful thought experiment to characterize environmental problems as property rights problems (they are, by strict definition) there are at least three limitations to using property rights to achieve certain environmental goals. The first and most obvious, and one there is no need to elaborate on, is that even if the theory of private property protections for the environment is 100% sound, it is a total political non-starter. So while I enjoy thinking of those kinds of things while enjoying my craft beers on Friday nights, I am becoming less enthusiastic about exploring the impossible (I wax and wane on this one, remind me of this in a year when I decide to post a month of pieces on impossible reform ideas).

Second, I believe a serious problem for supporters of private property solutions to environmental problems is that it is really difficult to understand what ought to be consider part of the “private property sphere” to use a phrase of Hayek’s. It is clear in our heads what we mean by a sphere or private property, but in practice I am not so sure. The vitreous and aqueous humor of my own eyeballs are clearly my private property, and clearly no one out there can legitimately access these physical objects without my consent. But what else belongs in the private sphere? For example, suppose I laid legitimate claim to a 50 acre parcel of land on a lake. Under a system of private property, I am able to do whatever I want with my land so long as I do not violate the private spheres of others from actions that occur on my land. Thus, scratching my name in the dirt in the middle of my property, where no fauna or flora were damaged, no soil runs off, and no one can see it, is clearly within my rights. But what other activities would constitute actions that remain solely in the private sphere? Now, I do not believe we need to answer this question, as I believe strongly, as I am sure Hayek would have, that custom and tradition emerge to answer these questions large without us having to deliberate on them. But let’s explore it just a little bit anyway. Am I permitted to build a home on my land? If so, how large can it be? What if my neighbors can see it? What if I want to make it bright pink? What if I want to make it 10 stories tall? In a purely private system, the answers to these questions will be solved through Coasean transactions, whereupon the users that find the highest value of the disputed “public sphere” will bid to do something with it. So, while there is no inherent right for someone to not have to look at a pink house, while there is similarly no inherent right for me to have a pink house (is there?) the person who values the “view” more will bid for access to it. But are there not other uses of land that would preclude such transactions from happening? I can imagine some, and I offer up this query to readers as a thought problem. I don’t think it makes sense to uncritically accept the private property paradigm, it is intellectually lazy and it also makes it hard to address the concerns of other thoughtful folks who seem to be skeptical of pure private property systems.

Third (this is a related if not entirely identical point) is that coordination problems can be serious even among private property holders with similar interests and even with no confusion about what ought to be in the private sphere. Imagine that the world is comprised to two different types of people: those who prefer quiet and open and conserved space and those who prefer to use nature for thrill seeking and game playing. Neither preference is “right” as hard as it is for me to admit this. If the entire world wanted to pave nature into a massive parking lot, would my preference for forest land somehow trump the desires of all 7 billion other people? Now consider that we have two large spaces of land for people to settle on. It would be hard to imagine that all of the thrill seekers would end up on one plot of land while all of the serenity seekers end up on the other. What good, for example, would I be doing by spending $100,000 on a parcel of land, and keep it as an undeveloped quiet hiking parcel, while the guy next to me erects a concert pavilion and harbors jetskis on his dock? And would it be possible, especially after all of the fixed costs of building have been incurred, for thousands of people to come to an agreement about relocating to one or the other type of land? For previously unsettled land, with all kinds of people in a room, I suppose I can imagine a private property solution. But for already developed lands, or semi-developed lands, like this one, this is a much more difficult transaction cost problem. Cranberry Lake, where I like to visit in the summer, has its upper third consist mostly of private property, and the lake itself is open to motorboat and jetski use. The bottom two thirds is largely state-owned land, with the lower half of that land as dedicated “wilderness.” But the notion that the southern portions of that lake constitute real wilderness is laughable. I paddled there one day last week and took some time to walk around the “wilderness” area. While in there I had some good views of the houses on the Northwest portion of the lake (about a 4 mile view) and I had the pleasure of hearing some guys blowing cherry bombs off from somewhere on the Northeast side of the lake (again about 4 miles from where I was sitting). While contemplating the meaning of life I also had the pleasure of hearing a good many Air Force fighter jets and cargo plans roar by, obviously conducting exercises with the Airborne Ranger division at Fort Drum which is about 40 miles away, and after those things passed, I had the pleasure of hearing a bunch of guys screaming their lungs off while speeding through the lake on their jetskis. Now, I am not opposed to any of those things, but if we are going to call a piece of land “wilderness” then I’d argue that none of the disturbances I experiences should have been very apparent, if at all.

So, the state and many private landowners and agencies managed to secure lots of land on the southern end of Cranberry Lake to establish “wilderness” but it is certainly far from such a thing. And I am sure that there are thousands more people like me who would value a great deal having at least this one tiny place where one could go for some peace and quiet and to experience some natural space that does not have a heavy imprint on it. And I am sure that there are other lakes and pieces of land in the Adirondacks where the thrill seekers would be equally happy playing around. Would it be possible for all of us to figure out a way to make Cranberry a true wilderness? I do not believe so, and I am a strong supporter of organizations like the Nature Conservancy which spend considerable energy and money making things like that happen.

The elephant in the room here, is of course, that I am placing a high value on conservation of open and quiet space and it is not at all clear that this is valued by very many people. When we talk about private property as being able to accommodate myriad interests, it is typically in the context of locally contained physical goods – so that in a world of private property, I am able to enjoy ripe blueberries in mid-winter while my neighbor can sustain himself on root vegetables. But for certain goods I am less certain that this is the case.

I’ll have some more to say on this shortly, but am holding back for fear of being uninvited to yet a few more dinner parties.

6 Responses to “Private Property and the Environment, A Limitation”

  1. Trapper_John says:

    I view this as perhaps the critical flaw in libertarian philosophy (along with rocket launchers–where do you draw the line in terms of letting people buy whatever weapons they want?). Perhaps private property rights would allow for emergent conservation of wilderness, but I’m not convinced.

    So much of the appeal of libertarian thought is the high degree of logical consistency. It’s easy to argue many issues without detailed knowledge of statistics around the particular topic. Once I cede this intellectual moral high ground in favor of the politically expedient or practical (answer to the counter-point: “Yeah, but that will never happen.”), things become murky and I’m offering just another preference among myriad opinions and voices. I suspect this is the price for relevance.

    Excellent article.

  2. Stanton says:

    I feel like even if coordination problems and transaction costs were high, if collective preferences were high enough, there would be strong incentive for people to organize together and do something about the problem.
    As with the case here, where you used an example of dividing the world into two groups of people (those who prefer quiet in nature and those who prefer to use it for thrill seeking), perhaps common law (tort and nuisance) would be able to solve the problem? After all, wouldn’t the noise from the concert pavilion be considered “trespass” on the adjacent quiet land?

  3. Michael says:

    Coase tends to get a bit abused by many sides in a conversation; it is a limited theory. But there is the comparative institutional aspect which essentially is that although the market solution may not be the best, what makes us think a government solution must therefore be better? As far as preserving “green” space, I see the government inherently having conflicting goals. It seems that although they wish for us to use public transportation, bicycles, and preserve green space, the government does it’s best to open up new routes of transportation (and I mean beautiful paved roads, two lanes each way) and open up industrial parks, ect on the outskirts of town. Both goals have logic, but the combination is conflicting, and usually the unintended consequences abound.

  4. Harry says:

    I assume that Wintercow is not inviting us to write a treatise defending the merits of our having property, as opposed to the Tsar or the King or the commisar. I think his question is about whether there are reasonable limits on what we should be allowed, and what the state should be allowed to do on behalf of others. (I hope I am not committing the sin of the sophist who rephrases the question to suit his argument)

    Suppose somebody sells his place in the big city and buys a farm upstate, say three hundred acres, fee simple, with rights to the conic section to the Earth’s core, namely rights to water, coal, gas, gold and all diamonds. If there is a stream on his property, assume he has water rights to that, too.

    We should all agree he should be allowed to do almost anything he wants to do with his land, and we should also agree he should not be allowed to turn it into Jurassic Park.

    Then some other people move in from the big city, and instead of buying a few hundred acres themselves, each buys a half-acre lot across the road.

    Twenty years later the first guy decides to subdivide. Maybe he wants to move to Kansas so he does not want to look at the pink houses on those half-acre lots.

    Here is where the practical problem comes in.

    The people in the houses on the half-acre lots are upset that their view will be spoiled, and their first and only response is to ask elected officials to take away their neighbor’s property rights through regulation. In recent times, the strategy has been to get the NRDC, the Sierra Club, the local riverkeeper, Trout and Ducks Unlimited, and any other organization populated with liberal lawyers with time on their hands involved.

    I guess this means if I ever visit Wintercow in Rochester, I will not be on the dinner party A List.

  5. Harry says:

    Meant to say, “…have to look at the pink houses…”

  6. Rod says:

    The people in the pink houses also want more ballfields, so they pressure the township to demand that developers hand over land and money for the ballfields, as opposed to having the local little league raise money for the land and the ballfields. Prince John and the Sheriff of Nottingham did the same thing for Sherwood Forest, a 900-unit townhouse development in Yorkshire. Tot lots, jousting fields, a moat (no pools back then) and an archery range were put on the new “public lands,” all as donations in lieu of ridiculous public improvements demanded in the zoning code.

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