Environmentalism Needs Fewer Socialists
Tim Haab at Environmental Economics asked for help understanding an article entitled “Privatization is the Real Tragedy of the Commons”, by “Robert Ovetz, PhD”. As a smart guy who is inimately familiar with nonsense of this sort, I’d like to offer my assistance. Robert Ovetz, PhD begins with a explanation of the theory behind the tragedy of the commons as follows:
“When a resource is shared in common [Hardin] posited, ‘the rational being … seeks to maximize his gain’ and is bound to exploit the common property to ones own advantage thus exhausting the resource for all of us.”
He then, before managing to properly explain the idea, conjures a devastating argument that simply cannot be overcome:
“…why do we still have ancient rainforests, ancient species that swam with the dinosaurs, fresh water or clean air? Their mere existence must be proof enough that Hardin’s theory of the tragedy of the commons is flawed.”
Take that, Garrett Hardin!
Well, maybe not. See, the Tragedy of the Commons only applies to scarce resources held in common. If the resource isn’t in such demand that individuals expect it to be depleted in the forseeable future, the theory doesn’t apply. Well, people behave differently based on whether or not they expect a resource to be depleted soon. Let me provide an example:
In my fraternity house in college, we used reusable plastic cups held in the kitchen (in common). There was a long-standing problem with these cups, because there were roughly enough cups for all the guys in the house, plus the new guys who would be expected to join soon, plus only a handful of extras. Because it was a house populated by a lot of guys who had a lot of serious studying to do, there were often quite a few cups sitting around that hadn’t been washed yet, and sometimes a small shortage of cups as a result of brothers absentmindedly leaving a cup or two in their rooms upstairs. When a large number of the brothers who lived outside the house showed up, this result in a severe shortage of cups. If someone didn’t have a cup hoarded in his room, he was out of luck. As a result, brothers who lived in the house did what any rational being would do– keep cups in their rooms. Of course, this meant that there were only a handful of cups left in the kitchen, which were then also hoarded by people who, understandably, wanted a vessel from which to drink.
This shortage of partially-enclosed cylinders to ferry milk to my parched lips persisted until a new house manager, an economics major who looked like he was 40, put his aged-looking head to the task of solving it. His solution was brilliant in its simplicity: buy more cups. Not just a few more cups, a lot more cups. Enough cups that it was obvious that no cup shortage would ever befall our house. I can only guess that people had previously assumed that since the quantity of cups that the house had was constantly disappearing, any increased amount would disappear as well. They hadn’t considered the fact that cups were disappearing so quickly because cups were scarce, and that simply purchasing a large quantity of cups would cure the scarcity and thereby alter people’s behavior. His plastic cup gambit worked; the brothers stopped hoarding cups.
It’s a silly example, but examples should be silly whenever possible, and it’s a good illustration of the fact that individuals behave differently in the presence of a scarce resource versus one perceived as being limited. So the mere existence of resources isn’t the disproof of the Tragedy of the Commons that Robert Ovetz, PhD claims it is. Robert Ovetz, PhD himself makes a reference to what he refers to as the “infamous” “Lifeboat Ethics: The Case Against Helping the Poor”– surely he’s read it? It’s only a relevant question because it opens with a discussion of the dominant paradigms shaping our views of the world and its resources: the Frontier, “Spaceship Earth”, and his proposed “lifeboat”. The fact that only within the past sixty years has the dominant paradigm shifted away from the idea of the unlimited frontier should serve as an indicator that resource scarcity hasn’t been a major factor in human affairs (at least outside Europe) until quite recently– so human behavior wouldn’t have shifted into cup-hoarding mode, so to speak.
Robert Ovetz, PhD then drops another bomb: privatization of the commons is the real enemy.
“The real tragedy of the commons began with the enclosure of lands farmed in common by English peasants beginning in the 18th century in order to clear the way for industry and sever the populace from their own means of self-sufficiency in order to free up a new workforce. These same enclosures denuded the forests of Scotland-yes, Scotland once had forests-to provide wood as fuel for these factories and materials for urban slums to house the newly created workers.”
His questionable interpretation of the motives behind enclosure aside, he doesn’t bother to answer the obvious question of whether the wood would have been consumed had it continued to be held in common. Given the enormous demand for wood at the time, it’s likely that Scotland’s forests would have met the same fate as the rainforest held in common in South America meets on a daily basis– it would have been destroyed by the peasants in their quest to survive as best they could.
He then argues that
“Over the past few decades we have come to learn the fatal flaw in Hardin’s hypothesis that ‘under a system of private property, the men who own property recognize their responsibility to care for it.’ As we know from our global economic system, ownership no longer assumes geographic limitations. Once a privatized commons is exhausted and the costs passed onto the local and increasingly global communities, new commons to exploit are sought elsewhere ad infinitum. The crisis only ensued once the privateers began to run out of commons to be exhausted.”
This argument shows not a fatal flaw in Hardin’s hypothesis, but rather in Robert Ovetz, PhD’s understanding. Hardin’s argument isn’t based on geographic limitations. It’s based on the fact that if one owns, say, a fishery, one derives maximum value not by depleting it in a year or ever, but by managing it so that it provides a continuous, long-run stream of income. There’s no incompatibility between this concept and capitalism– stocks, for example, are valued by the present discounted value of all cash flows into the future. Technical explanation aside, this means that a company that took only 100 tons of fish a year, year after year, would be valued more highly than one that took 500 tons of fish in a year and destroyed the fishery.
Robert Ovetz, PhD doesn’t address this fact, though. Instead, he cites examples with no discussion, citing environmental problems and blaming them on “privatization,” “our modern global consumer culture”, and “powerful multinational corporations”. Of course, he can’t discuss the issues, because he clearly doesn’t understand them– if he discussed them honestly, it would be obvious that he’s simply wrong. He demonizes “the selling of quotas to polluters,” even though these quota systems have been proven to be the most cost-effective way of reducing emissions– allowing emissions reductions to occur that would not have been possible under a command-and-control system. But what does he advocate as a solution? “[R]eforming, rebuilding and strengthening global institutions to protect and restore the commons,” or, in other words, a command-and-control system.
I’ll spare my readers the exercise of determining what Robert Ovetz, PhD’s degree is in. A google search of his name turns up an good number of pieces written by him, all of which carry his name as “Robert Ovetz, PhD” or “Dr. Robert Ovetz, PhD” without any indication as to his specialty. Normally I wouldn’t consider this offensive, but I tend to believe that there are two approaches to argument. The first, and best, is to let your argument stand on its merits alone– develop it as fully as is necessary to explain why you’re correct and provide sufficient supporting evidence where needed. This isn’t always practical, however, as readers often have better things to do with their time, so to some extent, people rely on experts. So, if an author hasn’t taken the time to sufficiently develop his argument, we might allow it to stand somewhat on his expertise alone. Use of titles such as “Dr. xxx, PhD” is an implicit claim to expertise, one that might cause us to consider an argument more seriously. Naturally, when the argument is in the realm of economic and environmental or natural resource issues, we’d hope that the doctor’s Ph.D. would be in something like economics, natural resource management, environmental engineering, or something along those lines. We’d certainly hope that the doctor wouldn’t have a PhD in sociology, with a dissertation on “Entrepreneurialism, Rationalization, and the Crisis of the Universities”.
It shouldn’t be a surprise that the villains in his dissertation are those of capitalism, particularly multinational corporations, or that a derivative work was published in “Capital & Class”, the journal of the Conference of Socialist Economists (an oxymoron, if I may say so). Socialists such as the good doctor have a long-standing and rather annoying habit of attaching themselves and their command-and-control ideology to environmental problems. It’s frustrating for those of us who actually care about finding the best possible solutions to environmental issues, because they obstruct market-based solutions, which can at times be highly effective (and, yes, are also sometimes inappropriate) based on ideology alone– and beyond this, they’re ready-made strawmen for those who oppose any sort of environmental protections. Just as Robert attaches the PhD to everything he says in an attempt to claim legitimacy, socialists attach themselves to worthwhile environmental (and other) causes in an attempt to do the same.
So, to answer Tim’s original question, to understand Robert Ovetz, PhD’s piece, one has to understand that the doctor doesn’t really get the issues he’s talking about. He just knows that the answer is socialism.
It’s sometimes difficult to ask people like Robert Ovetz, PhD to go away because they’re doing more harm than good, but I’d like to make this easier for people by offering a letter, useful for many different movements dealing with hangers-on of various ideologies:
Dear Leeches:
Please detach yourself before removing the last bit of lifeblood from our movement. We actually care about what we’re doing, and you’re not helping, thanks. Take your ideology somewhere else.
Thanks,
People Who Care about Doing What’s Best more than They Care about Your Ideology.