On Environmental Economics, the authors take note that Krugman appears to be reading their blog. They then state that the market will fail to protect the environment. Not that the government literally, by reserving powers to itself, FORCES the failure to protect the environment.
As soon as something that is useful becomes a scarcity, it needs market PROTECTION. Not market consumption, but market PROTECTION. What does that mean? Lets start with their erroneous complaint:
But what if a deal between consenting adults imposes costs on people who are not part of the exchange? What if you manufacture a widget and I buy it, to our mutual benefit, but the process of producing that widget involves dumping toxic sludge into other people’s drinking water? When there are “negative externalities” — costs that economic actors impose on others without paying a price for their actions — any presumption that the market economy, left to its own devices, will do the right thing goes out the window.
This is only because we allow the violation of property rights. If rivers, oceans and air were ‘owned’ then we could .
Ownership need not include infinite rights to use. We do not have infinite rights to use flammable things, nor even infinite rights to play music or engage in speech. So it is possible to regulate the use of rivers, oceans, forests and air, as well as endangered species, so that people have the incentive for responsible protection of resources.
It is the enforced-ignorance that the state places upon men by denying them the ownership of resources and with it the construct and protections of property.
Ownership is a necessary part of the division of knowledge and labor.
The state mandates knowledge-incompetence by reserving to itself administration of the ‘property’ we call commons, instead of defining the limits on the use of that property and putting it in private hands, so that individuals have the knowledge and incentive to protect it.
Privatize stewardship of air, water, nature. The market will correctly distribute costs of doing so. And the owners of these resources will vehemently protect their ‘interests’ while protecting ours.
Otherwise, there will continue to be the ongoing illusion that political forces who compete for government attention are the same as commercial forces who seek to avoid it, and our bureaucracy will continue to be a self-aggrandizing waste of the efforts of the citizens, while our resources continue to be ruined.
While the market has weaknesses: in particular, it cannot CREATE property without state intervention (as in determining the rules by which property is used), and it cannot PRESERVE objects without state intervention (as in determining the conditions by which the property is transferred, or the limits on it’s use), the market is far superior at protecting those interests and making use of scarce monetary resources to do so without the waste of government.
Since government employees can have special consideration because they are outside the market, they gain special rights that the market would not endow them with. In particular, protection against risks that we call unemployment (the drop in demand for our skills and labor). As such, this is the driving factor behind all political organizations. Whereas, the market would protect the long term resource over the short term desires of government employees.
In other words, failing to make ‘public goods’ or ‘commons’ into ‘property’ is simply the willful and mandated theft and redistribution of those goods and the redistribution of those goods to government employees. The commons is the theft of resources by the state so that individuals may profit by the use of ‘commons’ to fund their political advocates.
The tragedy of the commons is that ownership leads to over-consumption. But there is another tragedy of the commons, and that is the state-ownership tragedy of the commons, wherein the state uses it’s assets to reward or create advocates. Instead we should avoid the over-consumption tragedy of the commons as well as the bureaucratic tragedy of the commons, and eliminate the commons as a form of property and stewardship, and instead, make it a market matter of the regulated use of and transfer of property, thus enabling individuals and organizations to protect and use it without the participation of the state except as an enforcer.
Sell off the air, seas, rivers, lakes, forests, preserves. Directly redistribute money to these ‘owners’ in order to subsidize any ‘common use’. But leave protection of the resource to the owners, who will, universally, do better than the state at doing so. Regulate the use of those ‘goods’.
The division of labor, knowledge and incentive is humanity’s greatest accomplishment, because it is the method and means by which we break the universe up into knowable entities. The market is the means by which we allocate the use of those resources. And the state is the organization that creates the ENVIRONMENT that is the market, as well as the means of resolution of differences in property.
The state is CREATING THE WRONG ENVIRONMENT when it manages something, rather than when it defines the rules for something, and leaves it to the market to actually do the labor. And thinking otherwise, is to attribute to human beings, knowledge and incentive that they cannot have in a division of knowledge and labor of any degree of complexity.
And therefore a fools errand.