Coyote Blog

Currently, Congress is considering scaling back on tax breaks for conservation easements.  As habitat protection and open space have become larger environmental issues, conservation easements have gone way up in use.  As with most government programs, the laws of unintended consequences have taken over, and many have found ways to get tax breaks some feel are undeserved.  Nature Noted has a long series of posts on the debate. 

I have mixed feelings on the change.  To understand this, lets take a step back and look at government environmental policy.  As I have written in the past, I think of government environmental legislation in 2 parts:

1. Regulation of pollution and emissions that affect other people's property.  These regulations are essential to the maintenance of a system of strong private property rights.  Without them, we would all be in court every day suing each other for damage to our property or water or air on our land from neighboring lands. Of course, we can all argue about whether set limits are reasonable, and we do.
2. Regulations of land use that effects only your own land.  This is a relatively new area of environmental law, ushered in by the Endangered Species act and various wetlands regulations.  These regulations say that even if your proposed land use doesn't create any emisions that affect anyone else, the government may still ban your land use for some other environmentally related goal (habitat, watershed, anti-sprawl, the list is endless). 

These land-use laws constitute by far the most distressing area to me in environmental law.  In the worst cases, these laws can result in what are effectively 100% takings of a person's land without any compensation. (Example:  you buy a lot on the ocean for $500,000 to build a beach house.  Before you can build it, new regulations are passed making it illegal for you to build a house on that land.  Yes, you still own the land, but it is now worthless to you since you cannot use or develop it).  Good article on this here (pdf) and a listing of Cato Institute articles on this topic here.

I have for a long time been a supporter of the Nature Conservancy and other land trusts (see Nature Noted site linked above for lots of links and info).  These trusts works to reach the goals in #2 above but with private money instead of government regulation and takings. 

Back to the issue of conservation easements.  It is becoming clear to me that while deals made by the Nature Conservancy rely on private money, they also rely on government subsidy through conservation easement tax breaks.  Their actions are not as private as I thought the were.  And therefore my mixed feelings.  I still think that their activities, even with the tax breaks, is more fair and probably much more efficient than the government takings approach.

Via the Club for Growth:

[San Francisco's] Commission on the Environment is expected to ask the mayor and board of supervisors Tuesday to consider a 17-cent per bag charge on paper and plastic grocery bags. While the goal is reducing plastic bag pollution, paper was added so as not to discriminate.

"The whole point is to encourage the elimination of waste, not to make people pay more for groceries," said Mark Murray, executive director of Californians Against Waste.

Environmentalists argue that plastic bags jam machinery, pollute waterways and often end up in trees. In addition to large supermarkets, other outfits that regularly use plastic bags, including smaller grocery stores, dry cleaners and takeout restaurants, could eventually be targeted.

Officials calculate that the city spends 5.2 cents per bag annually for street litter pickup and 1.4 cents per bag for extra recycling costs.

What might have started out as a desire to change behavior or pay for a specific problem has become, as is typical, a general revenue grab.  Note two things:

• They want to reduce plastic bag use, but put the tax on all bags.  Therefore, it will have no effect on behavior in the market when someone asks "paper or plastic" since they still will cost the same.  If they had put it only on plastic, then people might well have shifted en mass to asking for paper - I certainly would, as I am usually indifferent as to bag type.  But someone probably pointed out that if they only taxed plastic, everyone would shift to paper and they would get no extra revenue, despite the fact that the behavior shift was what started the proposal in the first place.
• If they really only wanted to pay for cleanup costs, which presumably were calculated based on plastic since paper biodegrades pretty fast, they would not have made the tax 2.5 times their calculated cost.  What is the extra amount over 6.6 cents for?  General revenue of course.

If you think I am reading too much into this, ask how much of the cigarette taxes imposed by the tobacco liability settlement really went towards education and the health care costs of smoking-related illnesses (the original intent).  The answer is well less than half, and in some states, none.  In fact, the tobacco settlement has become such a strong general revenue source for states that some states are now supporting legislation to protect the business of large tobacco companies in the settlement. 

By the way, in a story only related because it involves taxes in California, all I can say is go, Arnold, go.

I have written that many forms of environmental regulation, such as pollution limits, are not in conflict with property rights, but are in fact essential to their preservation.

However, one area where statist environmentalism and property rights do conflict is over "preservations".  Whether it be preserving species or habitat or forests or open space or wilderness or whatever, preservation is often used as an excuse for raping property owners.

Which is a shame, since there are very viable free market alternatives open to environmentalists as a substitute for state coercion.  I have supported the Nature Conservancy for years, because it (generally) works to bring together private funds to purchase lands for various preservation goals.  This organization and other sets up private land trusts, generally using private money but sometimes with a public contribution to buy out landowners.  The blog Nature Noted focused on the activities of these trusts, including this recent deal in Michigan.  This deal in particular is cool, because we run most of the public campgrounds in this area.  Thanks to the Commons for the link to this site.

Via the Commons, the story of how the Clear Skies initiative came off the rails, despite the fact it was initially seen as a win-win for both environmentalists and industry.  I don't know all the issues on the table, but I like the cap-and-trade concept for pollution control. 

Many folks, by the way, automatically assume that as a libertarian, I am automatically against pollution laws.  This is not the case.  In fact, this issue is a good example of how a thoughtful understanding of individual rights and property rights differs from just being blindly "pro-business".  In fact, pollution laws are nearly essential to strong property rights.  As I wrote then:

In fact, environmental laws are as critical to a nation with strong property rights as is contract law. Why? Imagine a world without any environmental legislation but with strong property rights. What happens when the first molecule of smoke from my iron furnace or from my farm tractor crosses over on to your land. I have violated your property rights, have I not, by sending unwanted substances onto your land, into your water, or into your airspace. To stop me, you might sue me. And so might the next guy downwind, etc. We would end up in an economic gridlock with everyone slapping injunctions on each other. Since economic activity is almost impossible without impacting surrounding property owners, at least in small ways, we need a framework for setting out maximums for this impact - e.g., environmental legislation.

Cap and trade strike me as the best, most free market way to limit pollution - this system shifts the burden of pollution control to the people and industries and technologies that can do it the cheapest.  Unfortunately, many environmentalists are command and control technocrats and/or socialists who greatly prefer having government micro-manage technology choices and industry by industry requirements.  Which is exactly what led to the problems referred to in the article around "new source review".

New source review is long and complicated, but basically says that existing power plants don't have to upgrade to new technologies, but new ones have to go through a very extensive environmental review and permitting process and have a suite of government mandated pollution control technologies installed.  OK, that has all been clear for 3+ decades.  The rub comes when a company considers upgrading or replacing a portion of a power plant.  For most of the life of the Clean Air Act, the government allowed utilities to upgrade and modernize plants without having to install the expensive suite of new controls.  The Clinton administration clamped down on this, making it harder to upgrade existing plants.  All the recent hullabaloo has occurred as GWB proposed to go back to the pre-Clinton rules.

This issue is a great test for environmentalists, because it separates them into those who really understand the issues and the science and legitimately want improvement, and those who care more about symbolism and politics.  Those who like symbolism have cast this move as a roll-back, and are fighting it tooth and nail.  Those who care about results know the following:

Experience under the Clinton rules has shown that most old plants will never be upgraded if they have to go through the planning process and install the new scrubbing and other technologies.  So, they will just keep running inefficiently, as-is, until they are finally shut down.  However, if allowed to be upgraded without review and new scrubbers, etc., they will become much more efficient.  No, they won't have the most modern scrubbing technology, but because they are more efficient, they burn less fuel (coal) to make the same amount of electricity and therefore will pollute less.  In some cases these rules even prevent switching to cleaner fuels like natural gas. 

In other words, most scientists, including scientific-oriented environmentalists, agree that GWB's proposal will result in less pollution, but environmentalists still oppose it because they don't like the symbolism of any pollution regulation appearing to be rolled back.  You can read a lot more about New Source Review and how it actually increases pollution in practice here.

Global warming advocates are already trying to make hay from the recent tsunami disaster (via Reuters, who else)

"Global Warming, Pollution Add to Coastal Threats"

Creeping rise in sea levels tied to global warming, pollution and damage to coral reefs may make coastlines even more vulnerable to disasters like tsunamis or storms in future, experts said on Monday.

Of course it says "may...in the future", but advocates want you to believe that the death toll is due in part to global warming.  Forget of course that the world has yet to see any rises in ocean level (presumably due to melting ice somewhere) or that the basic disaster mechanism of earthquake causing tidal wave has nothing, zero, nada to do with climate.

The argument that clearing mangrove swamps may make a tsunami worse may or may not be true to some extent, but this is only a secondary effect.  The primary, by far, human activity that affected the death toll is the desire by humans to live on the coast.  Unless you want to change this (and I would bet that a disproportionate number of the world's environmentalists make this same personal choice to live on the coast) it does not really matter if there are mangroves or not.

Ironically, the primary way to avoid such disasters is not by reversing human technology (as global warming activists want to do), but by increasing it, in the form of warning systems and evacuation routes.  Global warming advocates actually want to keep everyone poor - they blame wealth and progress for global warming, but note that wealthy countries like the US (the global warming great Satan) has had the technology and the wealth to afford to put systems in place that would have prevented such a huge death toll.  Wealth, prosperity and technology are what would have averted this disaster, and it is just these things that global warming advocates oppose for Southeast Asia.  So here is my alternate headline and first paragraph:

"Poverty, Lack of Technology add to Coastal Threats"

The creeping influence of global warming advocates and treaties that are limiting 3rd world growth and prosperity may make coastlines even more vulnerable to disasters like tsunamis or storms in future, experts said on Monday.