Foreword – Anthony Scott

Go Back to the Table of Contents for Property Rights in the Defence of Nature

This book does not simply reiterate the present orthodoxy about protecting nature. Its approach goes much further.

Today most environmentalists have abandoned the early approach of targeting bad-guy polluters. Instead they work on politicians to enact ever more regulations, controls, and standards. Profoundly dissatisfied with laggard government, they strain ever harder to whip it on, their urgency leaving them little time to wonder whether there may not be a better way. Uncritical of the fundamental basis of existing laws, they find it simplest to maintain the dislike of property rights inherited from earlier movements that fought against feudal proprietors, serfdom, slavery, enclosures, clearances, absentee ownership, share cropping, speculative reserves, and exploitative rents.

More recently, interest in an ecosystem approach has drawn some to the deep ecology principle that humans have no right to interfere with the richness and the diversity of life forms, which have inherent value. Because landed property rights (to manage, to profit from, and to sell or exchange) do confer rights to interfere with nature, deep ecology gives activists another reason to oppose property rights.

But most activists and anti-pollution workers are more pragmatic. True, they may one week attack a firm whose human greed and foreign capital combine with its “entrenched property” to motivate it to dangerous pollution. But the next week, the worker sees property in a new guise. No longer villains, property holders are now “local citizens” protecting their homes and families against outside polluters. The worker’s casual pragmatism admits that in disputes about pollution, property is often the victim’s ally.

Here this book is refreshing and precise. Property can be a weapon that victims use in their own defence. Those who care more about nature than about the glorification or vilification of government will find property protects it better than government does.

Protection by property tends to avoid courtrooms as well as legislatures. Although legal professors too often forget it, property law does its job best when land is held and exchanged in an orderly way without litigation. A good standard property right works regularly and informally to keep disputes out of the courts; indeed knowledge of it prevents disputes from even arising. Millions and millions of registered holders of land, woods, water rights and minerals, many of them overlapping, knowing and accepting their rights and responsibilities, never see a court. A good foundation of property rights allows neighbours to routinely tailor their boundary fences, views, noise, trees, crops, gates or roaming livestock to suit their particular circumstances.

Of course Elizabeth Brubaker, in clearly displaying property’s defensive powers, is not quite alone. She has on her side small camps of environmental lawyers and environmental economists who invoke property. We need her book because, surprisingly, they are not whole-hearted allies.

Consider environmental lawyers. Sometimes they even seem hostile to Brubaker’s approach. They seem too concerned with laws, not Law: with government statutes, standards controls, and enforcement. They deal with politicians and regulators, in strategies and policies. This is easy to understand. Because the lawyers for polluters and developers spend their time trying to get environmental rules defeated, weakened, ignored, or set aside, environmental lawyers spend their time defending the rules, rarely considering whether, instead of trying to supply governments with backbone, they could be developing the common-law concepts illustrated here.

If we look into the various camps of economists, we again find few who actively support a property approach. Property, if thought about at all, is considered the shield of parties who create environmental problems. Consequently environmental economists join teams that, with environmental lawyers, attack that shield, doing duty somewhere in the enforcement procedure – making either demand projections, input-output estimates, benefit-cost analyses, environmental impact statements, contingent valuations, or searches for alternative technologies. Sadly, this long list of procedural studies offers a career to many economic researchers. Indeed, the demand for their research is greatest for problems where property rights are weakest, biasing them against property.

In another camp, where both lawyers and economists dwell, property has adherents. A few of them, often academics, have long favoured pricing: taxes, charges, graded penalties, and fines set at rates that make pollution a costly alternative, in order to harness the cost-conscious attitudes of polluters and developers. Such proposals win automatic support from other academics and textbooks, but never from real decision makers. In still another camp, members have long and consistently backed a property-and-market approach to environmentalism. Political and economic conservatives by inclination, they tend to see an increase in private property primarily as a means of narrowing the domain of government.

These latter two groups are sometimes confused with a more truly environmentally oriented school whose members like property rights because they can produce better environmental results, both alone and in property markets, than any tax or charge gimmick. This school’s increasing influence can be seen in the modern design of emission or pollution rights. Emission rights can work within the structure of old common-law rights described in this book, having the right abstract characteristics to make them exclusive, secure before the courts, and tradable in the market. The book’s chapter on the new individual fishing quotas, now being adopted all over the world, from New Zealand to Iceland, also illustrates the modern creation of property in the defence of nature. However, this book does not focus on such new creations. Instead it concentrates on the power in the common law and old kinds of property interest that many busy environmentalists, lawyers, and economists have come to neglect. I’m all for it.

The recognition of property in defence of nature is well rooted. The conservation movement, under way in Canada and the U.S. around 1900, thought very hard about property. An impressively active group in Ontario worried about dangers to the forest from fire and disease, but also from over-cutting and waste, and about dangers to soil, fisheries and mine lands. What united its members was the conservation goal, something like today’s sustain-able-development goal: to preserve natural resources for future generations.

To this end they favoured long-term ownership, either private or public. Permanent government ownership was more or less acceptable, if only government would show any sign of resolute forest policy. Short-term timber licences, which gave lumbermen no incentive to ensure a second crop, were criticized. Such weakness of government forest management provoked these early conservationists into a decade of discussion and complaint, from which many of them emerged favouring long-term private rights of various kinds, for loggers, settlers, summer people and miners. Early conservationists concentrated on preserving natural re-sources from over-harvesting. Today, the principles they embraced can also be used to fight air and water pollution.

The author’s loyalty to the property-rights approach is courageously consistent. When her outline brings her face to face with the 1980s litmus-paper test, whether to entrench property in the Constitution along with other items in the Charter, she does not blink. Many of the pragmatic lawyers, economists and nature protectors failed that test. They argued that property would confer the right to pollute. Not so, Brubaker answers. Property, such as riparian water rights, give potential victims power to fight polluters, independently of the government’s programs.

Two characteristics of property rights – their exclusivity and security – have made them powerful environmental protection tools. But property rights have a third characteristic: transferability. The fuller a holder’s powers of ownership, the wider the rights to dispose of them in whatever way, and to whomever, the holder wishes. Ordinarily they get transferred to heirs or traded to the highest bidder. By being the highest bidder, a polluting firm can pay off its victims. In particular it can buy the riparian rights of landowners along a river. River-law history shows that it need not actually buy their lands: it need merely contract informally with them not to object to its pollution. Should such pollution-permitting transfers be allowed? Do they not convey rights to the wrong people? If so, should not a revived property regime prohibit sales of rights to certain parties? (This is sometimes recommended for fishing quota rights. Even now not everyone can buy his way into becoming a holder.)

While transferability does not directly or invariably protect nature, Brubaker argues that the transferability in a property right works indirectly to do so, through the setting of a price which not only tempts its owner but also deters the polluter. When the defence of nature is left to a property owner, he will abandon the defence only when paid enough to do so: he will transfer to a polluter the right to use nature only if the price fully compensates for his loss. Conversely, a firm can pollute only if it can induce the victim to trade or transfer to it his property right or his right to enforce an injunction. Collectively, property owners can be regarded as sellers in a market. Their willingness or reluctance to sell reflects their own valuation of nature.

Just as important, the market brings each of them knowledge of what property like theirs is worth to the keenest enthusiast for nature, whether conservation groups in the business of acquiring environmentally valuable properties, wilderness outfitters whose business depends on pristine attractions, or individuals seeking a private refuge. Potential offers from these parties free owners, even owners with personal reasons for a quick sale, from selling for a song to the first comer. With a market price, mortgage financing becomes available, raising the price and also enabling some owners to hold on, or to lease instead of selling. These influences establish a money cost to the polluter of disposing of its wastes in the natural environment. The extent of this cost depends on how many owners it must buy or rent rights from, the cost of finding and bargaining with each of them, the penalty for cancellation if its wastes change, the future costs of renegotiation when rights expire, and other legal, inspection, and enforcement costs. Will the polluter pay this price? Brubaker argues that the cost of buying owners’ rights will often be prohibitively higher than the cost of the next-best alternative or opportunity. Instead of acquiring rights to pollute, a firm can change its location, its product, its process, or its recycling policy. It will choose these alternatives or make an informed choice combining pollution abatement costs with the costs of damaging nature.

The argument is convincing, at least insofar as it applies to resources sought by a limited number of users. But it raises questions about a forest or body of water used for multiple purposes, be they recreational, aesthetic, scientific, commercial, or industrial. Each purpose depends upon a site’s particular group of attributes and their value to a specific group of users. Where property rights have been assigned, owners may typically use or enjoy a particular attribute, often in conjunction with other users of other attributes. But there are gaps in the spectrum of property: rights to attributes that are useful for some purposes – say fishing rights downstream of a potential dam-site – may not have been granted to any group of users. Where missing rights produce conflict government arbitrarily decides, rationing some uses, protecting some attributes, promoting some purposes. Although environmentalists have been urging governments for years to plan river basins as “multiple-use resources,” they have not done so, and show no sign of doing so in the future. Even if governments did, the chance that they would get it right would be vanishingly small.

Could a market, and property rights, prevent governments from enforcing their uninformed priorities? When overlap turns into conflict, promoters of one use can buy out one or more of the others. Their ownership of physical attributes expands in the process, requiring them to deal with owners or holders of still other rights, easements, licences, permits, and privileges. The market prices of the various kinds of rights would guide a dominant user to devise a compromise mixture of uses, to bring about a multiple-purpose regime. Users of an attribute for which there is no specialized right generally get a free ride on the compromise plans to protect or provide other attributes; canoeists, for example, may benefit from water flows protected or enhanced for fisheries.

This book, in suggesting that owners of transferable property rights can do better than governments, questions whether the current property system is up to the job. Does a sufficient variety of rights and entitlements exist? Will the government allow them to be traded? Can representative holders be found for attributes that are widely valued by scattered users? Today government agencies often deliberately prevent their resource and environmental licences and permits from becoming rights in the hands of their holders. Because rights to use resources lack useful property characteristics, their security is reduced (they are not satisfactorily recorded or registered), their exclusivity is unknown (not even the agencies know or tell how many are to be issued), their transferability is denied, their duration is bafflingly short, and they cannot be divided or modified by negotiation. Change is needed for property rights holders to protect the environment: we will have to assign exclusive and transferable rights to resources, and we will have to ensure their security against threats from other resource users and governments alike.

Exclusive, transferable property rights are also needed at the global level, where they can play a central role in resolving resource-use conflicts and in reducing international pollution. Today the diplomats who negotiate environmental treaties are far removed from those whom the treaties will affect. Limited knowledge foils their attempts to speak for all. Their negotiations, excluding resource owners and users, often ignore the agreements’ net costs to them. The resulting agreements may be inefficient, ineffective, difficult to enforce, and subject to lobbying for change.

The expansion of the domain of property rights is changing all this. In some international fisheries the individual fishermen have their own quotas. Now their governments are not free to offer more fish to other nations at the expense of their own propertied fishermen. Indeed, fishermen may soon, as a matter of private international law, agree together without government intervention. Property rights may also curb international air pollution. Under U.S. acid rain law, polluters hold property rights to limited emissions. Not so in Canada or the U.K. If in the future it were to be decided that the balance of greenhouse gas emissions between countries should be revised, governments would have to act. But if in various countries the emitters held rights like the present U.S. acid rain rights, government participation would hardly be needed. Parties in the countries that wanted more rights could buy them from parties in the others. The governments could confine themselves to buying rights on the market, screwing down the total emissions allowed to parties in the two countries combined. Directly or indirectly the market and the market price would determine which country undertook most of the joint physical effort to clean up to protect nature on a global scale.

Wherever large commons can be found – be they oceans or the atmosphere, Crown lands or public waterways – we will also find our worst pollution problems. Wherever would-be waste dumpers find that rights are held by private owners, pollution and degradation are rare events. Brubaker would assign property rights to these commons, eliminating them as cheap dumping grounds. Her clear and vigorous argument is convincing: everywhere, property rights have had and will continue to have unmatched power for the defence of nature.

Anthony Scott
Department of Economics
The University of British Columbia

Go Back to the Table of Contents for Property Rights in the Defence of Nature

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