Picking Up Where I Left Off, Vol. 2

I just watched Tarantino's "Kill Bill" movies, so I decided to include a little homage to that in the title this week.

Here's another one of my email correspondences with Kollin. He asked me what I thought about eminent domain and capitalists exhausting resources. I replied with a few articles and my thoughts on the subject. Please take the time to read the Mises Daily on endangered species I hyperlinked in my reply. Its a really great read, especially if you're a self-described environmentalists or into conservation, ecology, or biology.

One of the most common arguments against libertarianism and capitalism is: "The greedy capitalists are going to pollute our drinking water and chop down all our forests if the government doesn't put into place some kind of regulations!!!" I'm here to tell you, that argument couldn't be more false.

Kollin:

Had a random thought...

Does the government have a right to interfere in the free market if people are exhausting resources? Such as parks and wildlife preservation. You could say that the free market would take care of it and private preservationist groups would do the work the government has done/does, but surely they wouldn't do it as effectively as a government mandate that says "do not kill this animal" or "do not chop down trees here."
Or is the government justified in their actions in these specific examples through the eminent domain concept?

Brad:

A couple thoughts come to mind here. First, private property rights almost always create responsibility for resources. If a land owner chops down all his trees for lumber sales without replanting or harvests all his deer in one season without allowing them to mate, then he loses all future profits from the scarce resources. For the landowner's land to remain profitable, he must refrain from exhausting all his natural resources. Most misuse of land and resources stem from a lack of private ownership of land, rivers, lakes, etc. (Rothbard on pollution)

Secondly, the government mandate stating "do not kill this animal" often incentivizes poaching by increasing the price paid for the animal on the black market (Endangered Species, Private Property, and the American Bison). Indirectly, the government mandate actually increases demand and "subsidizes" poachers.

Also, Murray Rothbard has a great chapter on this whole issue in "For A New Liberty." In chapter 13 - Conservation, Ecology, and Growth - he spells out much more succinctly than I ever could the benefit the free market and private property rights have on conservation. I think it'll probably answer all your questions and more.

Kollin:

Those are some good points I hadn't thought of. And I think you're probably right that private businesses would have their own best interest at hand to conserve resources. It seems sometimes, however, that industries simply want to keep up with demand until demand is exhausted (and so are the resources). I think of fur trappers or buffalo hunters in the 18th and 19th centuries. They trapped and trapped and trapped until the beavers (or buffalo) were near extinct. I could see oil companies doing the same thing if they were allowed to drill unregulated in parts of the continental U.S.


And unlike manufacturing (such as toys, clothes, etc.), you don't get "do-overs" once a natural resource is completely exhausted. Although on the same line of thinking, if a natural resource were exhausted, there would be a demand for innovation which would inevitably be met by someone on the free market, I suppose.

Postscript reply by me:

(I never replied to Kollin's last email, but I'll try here)
The fur trapper and buffalo question is answered very well in the aforementioned Mises Daily. Oil, however, is not a renewable resource, thus cannot be considered alongside beavers and buffalo. Drilling oil until the supply is exhausted would lower the price for the consumers. Then, new energy resources and drilling procedures (sugar-based ethanol, biofuels, and fracture drilling) would emerge on the market via free-market innovations. The government regulation limiting oil production benefits large oil companies by NOT flooding the market with an excess of oil. This only harms consumers and is exactly what stifles innovation in new fuels.


I hope everyone is enjoying my attempts at blogging. I've still yet to receive one comment on any of my blogs. I'd really like to hear y'all's take on anything I write, so please don't hesitate to comment. If any questions come to mind that aren't answered above then please ask them. I'd love to research the questions and try to find a good answer.