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http://www.mises.org/fullstory.asp?control=1060
Preservation and Private
Property
by James E. McClure and T. Norman Van Cott
[Posted October 4, 2002]
Haiti and the Dominican Republic share a Caribbean island. Haiti
occupies the western portion, the Dominican Republic the eastern.
An aerial photograph of the border between the two countries
reveals a stark contrast (our favorite appeared in the November
1987 National Geographic).To wit, the Dominican Republic is
heavily forested; Haiti, once heavily forested, is now virtually
barren.
Does Haitian-like resource depletion await tomorrow's
Americans?Yes, if you listen to many of our professional
counterparts (and their students) at colleges and universities across
the country.For these capped-and-gowned doomsters, the problem
is that American capitalism's bottom-line focus shortchanges
tomorrow's Americans.Capitalist decision-makers, say these critics,
ride roughshod over natural resources in the same way that Buffalo
Bill slaughtered buffalo and Paul Bunyan decimated forests.
"Sustainability" is the doomsters' rallying cry.The slogan is clever. It
sparks apocalyptic urgency, since today's consumption of many
natural resources (like petroleum) necessarily reduces future
availability. The slogan also appropriates an aura of self-sacrificing
piety for its proponents, while simultaneously hampering opponents
by making it appear they favor "unsustainability."
Clever slogans and vivid imagery are no substitute for clear
thinking.For example, the border between Haiti and the Dominican
Republic convincingly demonstrates the essential role private
property, which is the defining characteristic of capitalism, has in the
preservation of natural resources.Haitian land ownership rights
have always been tenuous, to say the least.Not so for the
Dominican Republic.The stark contrast along the border of the two
countries mirrors a stark contrast in land ownership rights.The
pervasiveness of intergenerational myopia in Haiti traces to
attenuated property rights.
The same applies to use of Buffalo Bill/Paul Bunyan-like examples
to support an apocalyptic vision for natural resources under
American capitalism.The fact is that Bill killed buffalo that were not
owned by anyone. Ditto for the land where Paul Bunyan cut
trees.Nobody owned the trees.Nobody owned the land.No wonder
Paul didn't replant.A lack of private property biases attentions away
from future generations.To blame capitalist institutions for
something that happens when the defining characteristic of
capitalism is lacking is disingenuous at best, ignorant at worst.
Our colleagues frequently respond with high-sounding nonsense to
the effect that ". . . all humanity, by virtue of being inhabitants of
spaceship earth, has an ownership stake in the earth's
resources."Rhetoric aside, the fact is that no one effectively owns
resources that "everyone owns."This explains why whales, for
example, face extinction, while KFC serves up millions of chickens
each week without people fretting over tomorrow's Americans facing
life without fried chicken.
Private property in natural resources gives yet-to-be-born Americans
a powerful voice in current resource use.These Americans
"communicate" their resource desires via the prices that are
expected to rule when the future arrives.The higherfuture prices
are, the more profitable it will be for owners to delay current
consumption of resources.Attempting to enhance the present value
of long-lived resources in no way shortchanges tomorrow's
Americans.
Of course, no one knows future prices with certainty (and that
includes "sustainability" gurus).However, private owners of natural
resources have an important reason to be among the most well-
informed.Their personal wealth is at stake!
For hundreds of years,economists have shown that, despite the
pervasiveness of self-interested behavior in the world, nations can
achieve economic success as a by-product of their citizens' self-
interested actions.The secret, they have said, is ingetting
incentives right.The evidence of world economic events over the
years has demonstrated the veracity ofthisinsight over and over
again.
"Sustainability" gurus simply ignore this evidence.Instead, by
attenuating private property rights, they muffle the voice that
capitalism grants tomorrow's Americans.This distorts
intergenerational economic incentives.That many of these gurus
are well-intentioned is irrelevant.The road to hell is paved with good
intentions.In economic affairs, it's important to get incentives
right.If you still don't believe it, look again at a picture of Haiti's
border with the Dominican Republic.
The authors are economics professors at Ball State University,
Muncie, IN.Send themMAIL.
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