Mandate for a New Environmentalism

WE HAVE SELECTED FOUR AREAS in which the government could make visible changes that will reveal the environmental benefits of private property rights, markets, and decentralization. The Bush Administration should toss out the old and adopt the new environmentalists’ way of framing issues.

Above all, the Administration should reject the old environmental activists’ notion that economic progress and environmental protection are mutually exclusive. Decades of research plus the obvious evidence that developed countries such as the United States have cleaner air, water, and more protected land show that environmental quality goes hand-in-hand with economic progress. Free-market environmentalism seeks to improve environmental quality while recognizing that private property owners tend to be good stewards, that voluntary trading achieves cooperation, and that decentralized decision-making brings in valuable local information. Here are a few ways the current administration can turn these principles into policy:

1. Transferable Fishing Quotas. The federal government regulates coastal fisheries, but at least one third of the nation’s fisheries are excessively fished. A solution is individual fishing quotas (IFQs, also called individual transferable quotas or ITQs). Fishermen are allocated a percentage of the total allowable catch—say, one tenth of one percent of an 8 million ton seasonal catch. Assured that they will be able to catch this amount, fishermen stop the destructive “race to fish” that leads to over-fishing, waste, and even injury and death to fishermen. The Bush Administration supports IFQs but doesn’t designate them as property rights, which limits their effectiveness. The Bush Administration should recognize these quotas as property rights and start implementing them.

2. Water Quality. For years, controlling water pollution has meant setting very tight standards on contaminants that sewage treatment plants and industrial companies discharge into rivers and lakes. (These are called point sources of pollutants.) It is very expensive to clean up these sources further. But little has been done about the pollution that enters bodies of water from rain that washes off farmers’ fields or dirt from city streets (called non-point sources). Environmental laws are not very strict for these sources of pollution. Recently, the EPA encouraged point sources such as factories to pay non-point sources such as farmers to cut back on their pollution. It would cost the companies less, while achieving better results. The President should push for legislation that expands these markets.

3. Transferable Grazing Permits. Although grazing on public land is a “western” issue, national environmental groups have long lobbied to get livestock off the range. Conflict could turn to cooperation if the federal government allowed trading of existing grazing permits between willing sellers and willing buyers. If environmental groups want to buy the permits and retire them, they should be able to try. Voluntary trades require people to back romantic wishes with actual funds. The trades that result will lead to more justice and greater efficiency.

4. Water Marketing. Allocating water by buying and selling is mostly a western issue, too, but growing demands for municipal water around the country are moving it into the national consciousness. The Administration should identify areas, such as the Klamath River basin in southern Oregon, where clearer definition of rights to water could form the basis for trades. As water users weigh the value of the bids they receive, they will reconsider some of the more wasteful uses of water. More water will be available for those who really want it.

These are our nominations for immediate environmental action. With them, the President could toss out the old environmentalists and go with the new to get a return on his political capital. We could see greater environmental improvement along with greater freedom and prosperity.


Jane S. Shaw is senior fellow at the Property and Environment Research Center in Montana, and Bruce Yandle is interim dean of Clemson University’s College of Business and Behavioral Science.