Protecting the Environment with Private Property and Freedom

You don’t have to look far to find a political pundit critical of “unregulated capitalism being unsustainable and destructive to the environment”. While this claim appears rational, it presents a straw man argument by assuming unregulated capitalism has existed in the U.S. and that it causes environmental damage. Of course, this is usually followed up by hysterically demanding the government enact strict environmental “protection” laws. The government loves to throw that word “protection” around because it makes the masses feel warm and fuzzy. However, to the skeptic, it sounds like a flimsy excuse to make power grabs. In my opinion, the best way to protect the environment is through strong property rights and economic freedom. I want to clarify that the U.S. has never had free market capitalism, nor are individual property rights respected in the manner they should be.

The first misleading claim, mostly touted by far left socialists, is that technology creates more pollution and causes more environmental harm. They usually point to the rapid expansion of consumer vehicles. If their logic is true, then reducing technology would thus reduce pollution. Now consider how many cars are in any major U.S. city. If we removed this technology and replaced it with outdated versions (horse and buggy), the city of New York would be built on piles of horse shit (not that it isn’t already) and the air would be clouded with methane gas.

This claim also assumes that technology is incapable of reducing pollution. However, this is also proven to be false. For example, many textile factories and metallurgic manufacturers generate tons of waste in the form of excess material. In the past, this material would be destroyed in a not-so-environmentally (and expensive) fashion. As it goes with free markets, entrepreneurs created a solution to recycle the material so it can be used again in production. This practice reduces the consumption of resources and output of waste.

All too often, I hear that capitalism rapidly depletes natural resources in order to make a quick buck. We see this assumption often brought up in discussions about deforesting. First of all, there are more trees and protected land in the U.S. today than there was prior to 1900. This is a result of more efficient food production and technological developments in energy. We no longer need to grow food to feed animals so we can plough land, and wood burning heaters have gone the route of the phone booth.

However, there are parts of the U.S. that have been “deforested” by “greedy capitalists” as you will see in many memes. The forests usually referred to are actually government owned property. The U.S. government leases the logging rights out to the highest bidder, usually a friend, and allows them a set amount of time with no limit on production. The incentive becomes to extract as many trees as possible to yield the greatest return on investment. Since the logging company leased the land, it has no capital interest or ownership in the land. They do not care if the resource burns to the ground, so long as it does after their lease expires.

On the flip side, there are logging companies that actually own the land their trees grow on. They have a capital interest in the output of their resource. Chopping down their entire plot of land will make a quick buck, but their long term outlook will likely be a major loss. Therefore, to maintain a balanced production and profitable business, they develop highly efficient farming techniques that allow farmed area plenty of time to regrow while they farm the rest. It is not uncommon for tree farmers to plant more trees than before because their production capital has increased. In order to determine the balance of farm and grow, the farmer responds to market prices and forecasts. If the price of lumber is low, they will cut their output in the short term to hold out for future higher prices, and vice versa.

I can already hear the environmentalist saying “what about those evil corporations and how much they pollute”. As a libertarian, I believe in unabated property rights and their protection. I also believe that pollution is a form of violating your property rights. If I go to your house and burn it down, that is no different than if my factory dumped hazardous waste on your property or pumped deadly gas into the air that gave you lung diseases. Both are unwelcomed violations of your property, whether it be land or person.

Herein lies the biggest misconception about pollution. In many cases, pollution is government approved, protected, and taxed. Their policy is, essentially, “pollution is bad, but if you pay into our cap and trade system, then you can pollute as much as you can afford”. A cap and trade system, like the one created by Obama, creates an arbitrary market price on how much it costs to violate property rights. Furthermore, these systems of “regulating pollution” are often followed by protectionist legislation that makes it extremely difficult and, in some cases, illegal to pursue litigation against the aggressor of your property. If DuPont Chemical pollutes the community stream, the community would find it nearly impossible to bring a class-action suit against DuPont. This is not because DuPont is a greedy corporation with an expensive legal defense. It is the result of the government deeming itself a monopoly on environmental protection. Instead of going to court, your community will have to take it up with the EPA. Good luck with that.

As a result of government’s self-aggrandizing environmental crusades, technological innovations have stalled and more harm has been done. In a market where property rights are respected, the risk of class action suits and market blowback force companies to invest in more efficient production methods that reduce waste and safely dispose of pollutants. Subsidies in energy markets have misallocated resources leaving innovation stagnant. Protectionist legislation justifies arbitrary levels of pollution because the final output is for the “common economic good”. I think the person living next to the polluter would disagree with that and would like to sue them for it. In conclusion, we should be wary of government regulating pollution because government, with their wars and armies, is often the biggest polluter of them all!

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