interview

Grilling Terry L. Anderson, Free-Market Environmentalist

By Christian Probasco, 6-18-08

Terry L. Anderson is one of the most original and controversial thinkers in the West.  Executive director of the Property and Environmental Research Center (PERC) in Bozeman and cochairman of the Hoover Institute’s Property Rights, Freedom and Prosperity Task Force, Anderson is also one of the pioneers of “free-market environmentalism.” He coauthored a book by that name with Donald Leal in 1992 (Palgrave Macmillan), and has also authored or coauthored over thirty other papers and books, including The Not So Wild, Wild West: Property Rights on the Frontier (Stanford University Press), and the CATO Institute study, “How and Why to Private Federal Lands.”

Anderson, who received his Ph.D. in economics from the University of Washington, is a professor emeritus at Montana State University.

My take on The Not So Wild, Wild West is that Anderson finally gives anarcho-capitalism the enormous credit it deserves for peacefully forging the laws and institutions of the frontier West.  However, free-market environmentalism scares the bejesus out of me because I believe the approach could work—that it is working very well, in fact, in the form of the Nature Conservancy.  What I fear is that, in an attempt to restore environmental health to our wildlands, the public will be excluded, and my access, and my child’s access to what are now BLM and national park, monument and forest lands will be further restricted.  I, and a lot of other people who can’t afford to pay to see the land we supposedly own—need that access to stay sane. 

You may believe that free-markets and capitalism are incompatible with environmentalism.  If so, you will be happy to know that I think it is a writer’s responsibility to ask difficult questions of the people he’s interviewing.  I sure didn’t hold back with Anderson.  Here’s what he had to say:

New West: In “How and Why to Privatize Federal Lands,” you write, “The mission of the National Park Service is unambiguous: to protect the environmental health of sensitive ecosystems,” but in the very next sentence, you note, “The Park Service’s charge is: ‘to promote and regulate the use of the…national parks…which purpose is to conserve the scenery and the national and historic objects and the wild life therein and to provide for the enjoyment of the same in such manner and by such means as will leave them unimpaired for the enjoyment of future generations.’” But isn’t that quite different than protecting the “environmental health of sensitive ecosystems”?  Aren’t you trying to reduce the Park Service’s and other federal agencies’ roles to a single environmental dimension for the purposes of your argument?

Terry L. Anderson: I do know what the legal mission is, but what was written in the 1870s is not necessarily what is done today. For example, when I discussed wolf reintroduction with an assistant superintendent prior to reintroduction, she said that the reintroduction was necessary to fill the last missing link necessary for ecosystem health. Protecting ecosystem health may be a good thing and it may or may not provide for the enjoyment for present and future generations. 

NW: How do you measure the cash quality of the land in terms of a refuge from urban life and/or the land’s aesthetic or spiritual appeal? 

TLA: There is only one way to measure the “cash quality” and that is through markets where people put their money where their mouths are. That is not to say that aesthetic and spiritual values are not important or that markets necessarily fully measure those values.

NW: Under your “divestment plan,” wouldn’t it be possible for parents to divest their children and grandchildren of their birthright access to federal lands by selling their shares? 

TLA: Parents, or for that matter anyone alive today, can divest future generations of valuable assets. I can sell my shares in a company, live it up on the proceeds, and divest my children of their possible inheritance. Of course, I might also invest in other assets and leave them those assets, which is what has been happening for generations in this country; i.e. we have been passing on more wealth to each succeeding generation. The wealth might not be in the form of access to land, but it is wealth.

The question is, do future generations have a right to an inheritance? In the case of federal lands, you assert they have a “birthright.” I’m not exactly sure what that means, but if I take it to mean they have a right to trump what current generations do, I must ask who will be the agent for those future generations. The typical answer is politicians, but I’m skeptical that politicians who are elected for 2, 4, or 6 year terms and therefore are shortsighted are very good agents for future generations.

NW: Were American Indians anarchists?

TLA: No. Generally they were people who understood the importance of developing institutions and rules that got the incentives right. They had property rights systems which encouraged productivity and investment.

NW: Were early mining, ranching, farming and trading communities in the West anarcho-capitalist societies?  Could some of the principles, which “governed” them, be applied to modern Western societies?

TLA: Defining anarcho-capitalist to mean minimal government with property rights developed from the bottom up, the western frontier was anarcho-capitalistic. People on the frontier invented institutions that fit the resource constraints they faced. That is why the West has a very different water rights system (prior appropriation) than the East (riparian).  Using water rights as an example, the prior appropriation system is very compatible with modern societies because it allows markets to allocate water among increasingly competing uses.

NW: In chapter ten of The Not So Wild, Wild West you discuss the prior appropriation doctrine adopted in the Great Plains and much of the West.  When the federal government appropriates individual water rights, what are the economic and political consequences for local communities and the general public that the government is supposed to serve?

TLA: I don’t know what you mean by the “federal government appropriates individual water rights.” If you mean, “takes individual water rights,” the consequence is fighting over water in a zero-sum game as exemplified by the Klamath River.

NW: On page 66 of Free Market Environmentalism, you discuss landowners “capturing a return from (hunting) recreationists” which can then be used to “produce” more wildlife on their land.  But wouldn’t ceding them the rights to the wildlife on their land influence them to “produce” game animals at the possible expense of endangered species? How could landowners be influenced to protect endangered species?

TLA: First, landowners don’t have to own the wildlife; they only need own the habitat, which they now do. If people are willing to pay for habitat, whether for animals to be hunted or animals to be saved from endangerment, the market can handle this. There may be free riders among those who want to save endangered species in which case it is a challenge for environmentalist to overcome. Possibly the government can force people to pay and not be free riders and then act as their representative in paying landowners for habitat. The bottom line is that someone has to pay for habitat. Forcing the landowner to pay by regulating him does not get the incentives right. Instead it makes endangered species the enemy.

Finally, I would add that even when landowners focus on hunting, it often the case that habitat for huntable animals complements habitat for non-huntable species.

NW: On page 71 of FME, you mention “realistic user fees.” Why should people be charged realistic user fees to view land they already own?  And doesn’t that amount to a form of double taxation?

TLA: To say people “own” the federal lands misses the important point of who actually controls access to and use of lands. If access and use are not controlled, we will have the tragedy of the commons with overuse. Hence the question is, who gets to use the land and how is that decision made? Politics is one way; prices are another. And prices are utilized for some uses such as grazing and logging. Not surprisingly those uses have gotten more attention from bureaucrats than uses that don’t pay. If payment suggests “double taxation,” then it follows that grazers and loggers should have free access too.

The fact that we pay taxes to support a wide variety of governmental activities doesn’t mean that our taxes cover the cost of those activities or that pay a direct price won’t get us more of what we want. Recreation on federal lands generates the biggest deficits of all activities. Obviously those of use who recreate aren’t paying enough taxes for what we want.

NW: On page 76 of FME, you write, “Zero or token fees result in crowding, abuse of resources and reduced incentives for the private sector to provide similar activities.” How could the private sector provide activities similar to gazing into the Grand Canyon? 

TLA: It would do this in much the same way that the government does. Private owners would build access points, platforms, roads, hotels, etc, and charge a price to reduce the crowding and cover the costs. If you don’t pay, you don’t gaze.

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