Freeman

ARTICLE

Prosperity Without Pollution

The Mainstream Environmentalist Creed Is Unnecessarily Pessimistic

MARCH 01, 1996 by JOHN SEMMENS

Mr. Semmens is an economist with Laissez-Faire Institute in Chandler, Arizona.

I recently had the opportunity to participate in a World Future Society “debate” on whether we could reduce pollution without also reducing our economic well-being. Mainstream thinking asserts that we must sacrifice at least some of our prosperity in order to protect the environment. One panelist in the World Future Society debate insisted that we must drastically reduce population, live in houses made of mud and straw (apparently oblivious to the fate of one of the “Three Little Pigs” who tried this), and ride bicycles to work.

Fortunately, this mainstream thinking is wrong. We can have both a growing economy and an improving environment. In fact, it seems likely that a growing economy may well provide the very means needed to improve the environment. “Sacrifice” may not only be unnecessary, it may even be counterproductive. On balance, there is good reason to be optimistic about the “fate of the planet.”

If we are to overcome the institutionalized pessimism of the mainstream environmentalist creed, we must first dispel its erroneous premises.

Erroneous premise #1: Natural is better than artificial.

Natural is the survival of the fittest. The natural condition is for the weak, the lame, the sick to be mercilessly exterminated by predators and climate. Dying of old age is not natural. In a state of nature, most deaths are violent, painful, or agonizing. The most common modes of demise are being killed and eaten or starving to death. The natural world is not the “playland” depicted by Disney cartoons. It is the constant struggle for survival perceived by Charles Darwin. Some 99 percent of extinctions that have occurred on this planet occurred before human beings existed. The environment does not preserve species or habitat. Left alone, the environment is ruled by an undiluted principle of “might-makes-right.”

Civilization is artificial. This creation of the human species has modified the “might-makes-right” rule of nature. The artificial institution of law helps to channel human predatory instincts to more humane purposes. One does not have to watch too many nature documentaries before it becomes clear that theft, assault, rape, and murder are common behaviors in the animal kingdom. Nature has no law respecting property. The strong dispossess the weak. Abandonment, exile, and death are the fate of those who cannot compete in the Darwinian struggle.

Technology is artificial. The inquiring minds of the human species have discovered or created the means to enable the survival of the weak, the lame, and the sick. Medicine has lowered the mortality rates from disease, accident, and violence. Improved production methods have made starvation a relatively rare cause of death in the Western world. Devices like eyeglasses and wheelchairs have helped to offset disabilities that would imperil survival in a state of nature. As a result, we have the opportunity to lead lives that are less violent, painful, and precarious than would be natural.

“Environmentalism” itself is an artifact of civilization. The abundance generated by our technologically advanced civilization allows people to contemplate more than just survival. Creatures living in a natural state of subsistence cannot afford the luxury of refraining from unbridled exploitation of the environment. For example, without abundance, wilderness is a barrier for humans to overcome or avoid. With abundance, wilderness can be perceived as worthy of being preserved.

Erroneous premise #2: Resources are finite.

The very concept of what constitutes a resource is a creation of the human mind. No “thing” is a resource by nature’s decree. All “resources” are “man-made.” That is, it is only the application of human valuation to objects that make them resources. If humans place no value on an object it is not going to be called a resource. Its supply in a state of nature will exceed the demand for it. An example of a “thing” that has undergone a transition from a non-resource to a highly valued resource is crude oil. At one time, in the not too distant past, oil was seen mainly as a blight on agriculture. The few places where oil bubbled to the surface posed hazards to livestock and crops. However, during the nineteenth century, human ingenuity discovered a means of converting this substance to useful purposes.

Even such a highly prized substance as crude oil is not valued for itself. Rather, it is valued for the service it can perform in meeting human wants. If some other substance can be found or made that offers better or cheaper service, it will supplant crude oil, just as crude oil supplanted whale oil in the nineteenth century. That some other substance will eventually be found or made seems highly probable. The high prices of scarce resources stimulate the search for better or cheaper alternatives for meeting the same human wants. So, in the final analysis, it is not the “finiteness” of any substance that is critical. The critical factor is the scope of the human imagination. This scope seems to be getting broader. The accelerating pace of technological advancement should give us confidence that, barring the implementation of oppressive government meddling, we are not likely to run short of intellectual resources in the foreseeable future.

Erroneous premise #3: Population growth is a problem.

One participant in the World Future Society debate showed a graph of world population growth that he described as “scary.” Frankly, I would find a graph showing a comparable plunge in world population far more scary. The growth in population that has characterized the modern era is due primarily to lower mortality rates. Fewer people are dying at young ages. More are living longer lives. For most, the prospect of living a longer life would not be considered a fearful event. Fear is more aptly associated with an untimely early demise.

The fear of population growth seems to be driven by the notion that eventually there will be too many people for the planet to support. Such a fear is grossly exaggerated. Most of those familiar with the “carrying capacity” concept agree that given the current level of technology the sustainable human population figure is in the 30 to 40 billion range. Inasmuch as the present population is under 6 billion and no credible forecast projects a figure even close to the 30 billion mark for the next few centuries, the planet seems far from overloaded. Besides, as the mortality rates have fallen in the industrialized portions of the globe, so too have the birth rates. Once parents are more assured that their children will survive to adulthood, the need to produce enough offspring to compensate for a high death rate is alleviated. Obviously, human reproduction is influenced by factors more complicated than pure sexual instinct.

It is not population, per se, that could pose a problem for humanity, but the political and social institutions that affect human behavior. In this regard, the paternalistic welfare state is a serious problem. Government programs that entitle people to consume without their having to produce turns them into drones and parasites. Energy conservation is an important survival trait. Individuals that can obtain more goods for less cost will tend to thrive. The welfare state seduces individuals into behavior patterns that exploit this survival trait, but at the cost of imposing extra burdens on the productive individuals. The more generous the welfare benefits, the larger the number of people that will be drawn into this parasitic mode of existence. At some point, the burden of the parasitic portion of the population may overwhelm the output capacity of the productive portion. Thus, it is the ratio of parasitic to productive individuals that is crucial, not the total size of the population.

Absent parasite-inducing paternalism, a larger population could offer significant advantages. More people means more minds. Having more minds working on human problems improves the chances of finding solutions. There is more opportunity for specialization and the depth of expertise that specialization brings. The dramatic acceleration in science and technology in our high population era is evidence for the potential advantages of a growing population.

Erroneous premise #4: The environment is getting worse.

On balance, the environment is getting better. Consider the case of transportation. The internal combustion engine is frequently singled out as a prime culprit in the pollution of the environment. Yet, the internal combustion engine vehicle is clearly less polluting than the animal-powered transportation it supplanted. A horse produces 45 pounds of manure per day. This emission, in an urban context, typically generated a horrible smell and mess. Further, it provided a breeding ground for insects, vermin, and the diseases associated with filth. In contrast, the emissions of internal combustion engine powered vehicles pose a much smaller threat to human health.

Neither should the efficiency aspect be ignored. A gasoline powered vehicle can travel farther in one hour than a horse can in a day. Therefore, on an emissions per mile of travel basis, automobiles are less polluting than horses.

Automotive technology has not stood still since supplanting animal-powered travel. Autos last longer, travel faster, and use less fuel per mile now than they did when first invented. In terms of pollution emitted during the operation of autos, noxious emissions per vehicle mile are down 70 percent to 95 percent since 1970. In most cities, the ambient air is cleaner now than it was 20 years ago.

Erroneous premise #5: More government control is the answer.

The awesome power wielded by government has persuaded many that it should be the instrument of choice for dealing with environmental problems. Plausible as the resort to government’s awesome powers may at first appear, experience would seem to indicate that this would be a poor choice.

The first source of difficulty for those wont to rely upon government solutions is that government is inherently irresponsible. Because government has the might to compel compliance with its dictates, it cuts itself off from essential feedback on the success or failure of its efforts. Government coercion rides roughshod over differing values. Its “one-size-fits-all” standard ignores the differing needs of diverse individuals. The balancing of values that typically occurs in the marketplace is suppressed. In its place, costly, and frequently ineffective measures are imposed.

The fact that government is funded through taxation increases the odds that government programs will fail to achieve their announced objectives. Taxes sever the link between costs and benefits. This creates a “problem of the commons.” The “problem of the commons” is that everyone has an incentive to demand more than can be provided by the resources available. At the same time, no one has an incentive to provide more resources. Those who receive the benefits do not have to pay the costs. Those who pay the costs do not receive the benefits. This is the formula for failure that contributed to the demise of socialistic societies like the Soviet Union, East Germany, and Poland.

One of the clearest demonstrations of the “problem of the commons” in the American economy is in our urban transportation systems. Almost all of the urban transportation systems in America are operated under conditions that could most accurately be characterized as socialistic. The roads and rails are owned and operated by government. Most of the funding comes from taxes. Decisions regarding investment, services, and prices are all made through a political rather than a market process.

Since they don’t have to pay in proportion to the cost to obtain access to roads, drivers demand more than can be provided. Highway agencies go through recurring financial crises in a futile effort to sate this demand. Meanwhile, a massive waste of precious time is underway during every “rush hour.” Some would have us address this waste by building heavily subsidized rail transit systems. However, even with two-thirds of the cost of transit trips being borne by taxpayers, this mode has continued to lose riders. Continuing to pour more money into these transit systems is the kind of irresponsible misallocation of resources that only government is prone to inflict on society. (See the chart of “Public Transit Operating Results” for an illustration of the inauspicious results of government subsidies to transit.)


Public Transit Operating Results
Before and After Federal Aid

Source: Transit Fact Book (American Public Transit Association)


A second source of difficulty for those who look to government for solutions is that government planning is inherently inept. Reality is too complex to fit into any plan that government can devise. Government lacks adequate information on the subjective values of individuals, on the world’s continuously changing circumstances, and on what the future might bring. Further, government lacks sufficient incentives to avoid mistakes. The burdens of its errors fall on others. Its failures serve as a rationale for further meddling.

If granting more power to government is not the best way to achieve prosperity and reduce pollution, what is? Well, since the attainment of both prosperity and a cleaner environment is likely to hinge upon the application of human creativity to perceived problems, an obvious option would appear to be to attempt to encourage more creativity. Creativity is likely to be encouraged if individuals are (1) free to use their minds and (2) have sufficient incentive to do so.

This argues for reducing the scope of government intervention and control over society and increasing the scope for voluntary human interactions. Government spending and taxing should be reduced. The lessening burden on private transactions that would result would permit more investment in innovations and technological advancement. The lure of greater “net-of-taxes” returns on investment would provide added incentive for innovations and technological advances.

The socialistic enterprises of government, like highways and transit systems, should be privatized. Selling such operations to private-sector owners would enable the powerful forces of market incentives to more efficiently direct resources to meet consumers’ most urgent needs. More rational pricing of services will reduce the deadweight losses epitomized by traffic jams. The fixed capacities of urban roads could be more effectively used and avert the need to pave over more of the environment.

Environmentalists urging a government-mandated return to a more natural mode of living are misperceiving the past and the true implications of “natural.” There is no “Garden of Eden” to which humanity can return. Human creativity is the key to a more livable future in both economic and environmental terms. To foster creativity we must have freedom to think and act.

ASSOCIATED ISSUE

March 1996

comments powered by Disqus

EMAIL UPDATES

* indicates required
Sign me up for...

CURRENT ISSUE

July/August 2014

The United States' corporate tax burden is the highest in the world, but innovators will always find a way to duck away from Uncle Sam's reach. Doug Bandow explains how those with the means are renouncing their citizenship in increasing numbers, while J. Dayne Girard describes the innovative use of freeports to shield wealth from the myriad taxes and duties imposed on it as it moves around the world. Of course the politicians brand all of these people unpatriotic, hoping you won't think too hard about the difference between the usual crony-capitalist suspects and the global creative elite that have done so much to improve our lives. In a special tech section, Joseph Diedrich, Thomas Bogle, and Matthew McCaffrey look at various ways these innovators add value to our lives--even in ways they probably never expected.
Download Free PDF

PAST ISSUES

SUBSCRIBE

RENEW YOUR SUBSCRIPTION