From: johnc@yuma.acns.colostate.edu (John Cooley)
Newsgroups: talk.environment
Subject: Re: Libertarians & the environment
Summary: This stuff looks like fun!
Date: 23 Jul 92 16:46:51 GMT
Followup-To: talk.environment
Organization: Colorado State University, Fort Collins, CO  80523

In article <92205.101411MEK104@psuvm.psu.edu> MEK104@psuvm.psu.edu writes:
>in <1992Jul22.061453.916@cco.caltech.edu> carl@SOL1.GPS.CALTECH.EDU writes:

>>...Well, if you're in the lumber business, and you reached the point where
>>you couldn't expect to move on to a different forest after you'd clearcut
>>those you have now, ...

>I know this wasn't the purpose of your posting, but it appears that you have
>some misconception about how the timber industry opperates these days.  In
>the early 1800's your hypothetical would have been quite accurate:
>cut-out-and-get-out was the rule and timber barrons raced each other to get
>to the next stand of timber.  That kind of thing doesn't go on any more - to
>any noticeable degree at least.

Yeah, right, that's the ticket!

>>...  if you realize that as your competitors cut the last of their forests,
>>the lumber in yours will become more valuable. 

As we all know, this has done great things in the 80's to prevent timber
companies from clearcutting (liquidating) their own holdings.  Certain well-
publicized satellite photographs have illustrated a healthy, tree-covered
Pacific Northwest.  (Yeah, right!  Of course, everyone knows those photographs
show the result of poor government management (yeah!  It's all the government's
fault!) and, besides, they were probably faked up by left-wing environmentalist
loony tree-huggers!)

>> There are feedback loops in
>>privately owned productive resources that simply don't occur when you've
>>got a government deciding what will and won't be cut.  Especially when the
>>government can be lobbied into giving away the resources to the first
>>person who's ready to step in and liquidate them.

The government doesn't make such decisions for private holdings, as you've
pointed out.  This does not stop timber companies from liqidating their own
forests to maximize shot-term gain and/or service junk bond debt.  It just
gives them someone else to blame when they run out of their own trees and
end up laying off people because the government won't give them as many of
the public's trees as they want.  If they really cared about the long-term
viability of their property, their resource, and the jobs of their employees,
they would (and have in the past) manage their forests sustainably, if not
for ecological variety.  They would mill the lumber in the US.  But they
don't.  They cut as fast as they can.  They ship raw logs offshore, if they
can get away with it.  Then they tell the residents of depressed towns in the
Pacific Northwest and elsewhere that environmentalists are causing all the
problems.

They manage even their own forests like they would manage a machine.  Get the
most out of it you can, until it becomes scrap.  Then do something else.

This wasn't always the case.  However, Wall Street manipulators and absentee
owners do not appear to be subject to the feedback loops and motivations
that libertarians assert exist for most owners of real property.  They may be
in the lumber business this year, but they don't expect to *stay* in the lumber
business.  There will be new investments next year or five years from now.

>From my perspective you came close to hitting one of the problems.  I think
>congress often tends to muck things up when they place conditions and
>restrictions on forest management policy.  For example, if the USFS wants to
>maintain a certain tract of land in timber production rather than designate
>it as wilderness, congress will often place harvest quotas on that tract.
>The result is timber harvest for the sake of the quota and not necessarily
>what the market demands or what is ecologically sound forest management.

Of course, Congress and the USFS don't arrive at those quotas single-handedly.
As pointed out in your own posting, the timber companies lobby, and lobby hard,
for what they want.  Like absentee owners and financial deal-makers, Congress
members often have no connection with the actual private property, either,
and are prone to at least partially give in to the noisiest constituents with
the most money.  Those who are asserting that people with environmentalist
leanings are the beneficiaries of socialist behavior on the part of Congress
should consider the kind of government gift the USFS ends up giving the
timber companies.

The assertion that owners are motivated to care for their property is often
untrue.  Especially where maximum return on investment is concerned, many
counterexamples exist.  Many strip mine operations are on private land.  If
the mined land has insufficient residual value, it may simply be abandoned,
and many mines have been.  Should it be the responsibility of people who have
different views of "investment" to buy the land and repair the damage?  This,
as Dean Alaska (aka "dingo") points out, means that the mining company has
managed to transfer an incurred cost to someone else.  When a timber company
strips 40 or 160 or 1,000 acres, whether it's their own or public land, why
should someone else clean up the mess?  Why should it be up to someone else
to keep the hillside from sliding into the nearest river?  The timber company
apparently regards the land as scrap, even if it's their own land.  They
don't want to increase their cost of sales.  What about ranchers?  I mean,
they're RIGHT THERE, on the property.  They should do a better job, shouldn't
they?  Don't they have a tradition to hand down to their children?  Maybe so,
but the riparian zones of many private lands in the West are not usable by
cows or anything else.  Public lands are probably worse, since what motivation
to maintain the property that does exist shrinks even more.

These things happen.  They're documented in photographs, in popular journalism,
in mounds of scholarly technical reports.  The mechanisms that the private
property crowd insist upon do exist - for some owners.  Unfortunately, they
don't exist for nearly enough owners.  Shortsightedness, maximization of short-
term profits, and sometimes sheer resistance to change are all factors with
owners which short-circuit those mechanisms.  A know a private forester who
manages his land for a small sustained yield, the health of the forest, and
ecological diversity.  But it's a hobby forest.  He doesn't make very much
money off of it; he doesn't have to.  His harvest and management is labor-
intensive.  I know ranchers who do a good job with their land.  I know hunters
who tolerate (even encourage) predators and other non-game wildlife.  But
I don't know very many of them.

Dean Alaska pointed out some reasons why the mechanisms proposed by the
private property enthusiasts don't work.  I'll repeat parts of his post here:
>  The first is that an examination of
>maximum yield for an investment will often show that it will be more
>profitable to use up an environmental resource for its cash value now
>and then move your capital to some other resource and do the same there.

>Secondly, many of the costs for using environmental resources are externalized
>so that others pay for your profit.  It is a common tactic to
>maximize ones profit by minimizing ones expense, which can be done by
>maximizing someone elses expense.  The delayed nature of the expense
>of environmental degradation means that private property owners can
>pollute now, profit now, and the rest of us pay later.

>All of this shouldn't be taken to mean that I am a supporter of the
>government ban form of environmental protection.  It is shown to be
>ineffective.  At best it lessens some damage with a very low efficiency.

>I cannot point to some miracle solution to this problem, but the private
>ownership solution touted by Libertarians is simplistic.  I do support
>the Libertarian concept of litigation for environmental damage AS LONG
>AS it includes criminal prosecution and the use of governmental action
>to prevent obvious damage, as the police would prevent a mugging.

We have lots of that litigation going on now.  It usually happens after the
fact; it's a labor intensive, low efficiency process, involving lawyers (if
you'll excuse my foul language :-), and it rarely accomplishes what the
litigators set out to accomplish.  Further, the damage is often not "obvious,"
so penalties, if handed down at all, rarely increase the cost of doing
business very much.

If the economics of extractive industries were applied over a sufficiently
long time span, without externalizing costs such industries would like to
ignore, (The nuclear power industry wants the gummint to write off $11 billion
in debt so they can start over again.  Except they've got this little waste
problem from the first time around because they haven't figured out what to
do with it.  So they want to give that to the government, too.  So you and I
get to pay.  Sounds like socialism to me.  They don't think of it that way,
of course.) then maybe the libertarian mechanisms might work.  But as
long as certain costs can be ignored, whether through government interference
or lack of it, the economic engine that is business, and its drivers, will
ignore them, and short-term gain will mortgage long-term values.

Like the post above, I can offer no long-term solution as long as human nature
remains the way it appears to be.  Too many people seeking to turn a profit
from a piece of ground or a power generation facility or a group of employees
have demonstrated that some external mechanism is required to make them face
issues not shown in a profit-and-loss statement or a balance sheet.  Ideally,
we'd think things through and look far enough ahead and be willing to face
such issues.  But we don't, for the most part.  And we all buy the lumber from
the clearcuts, because going out and selectively harvesting, drying and 
milling it is too difficult.  So the rapists win.

Another overly long diatribe from:
     John Cooley
Newsgroups: talk.environment