Freeman

PERSPECTIVE

Polluting Production

Property-Rights Enforcement Is the Solution to Pollution

MARCH 01, 2001 by SHELDON RICHMAN

Politicians use language differently from the rest of us. Take the expression “Big Polluters.” Big Oil produces oil. Big Pharmaceuticals produce medicines. I guess Big Polluters produce air and water pollution.

What’s more, they somehow make big profits doing so. How this works I’m not sure. Who would pay for pollution?

Obviously, there are no businesses that make profits by producing nothing but pollution. But that perverse fantasy serves a purpose. It is much easier for capitalism’s antagonists to denounce Big Polluters if they can make people believe those firms are an unmitigated evil. Allow for a moment that they produce something that people value and the politicians’ case is considerably weakened.

To live, man must produce. Production is the transformation of a combination of things (inputs) into something new (output). In the production process, waste byproducts inevitably result. There is nothing sinful in generating waste. On the contrary, since production makes life—an increasingly better life—possible, the production process is virtuous. (It’s a myth, of course, that waste is unique to industrial societies.)

There’s more to the story. Waste is not a fixed concept. What is a useless byproduct one day is a useful product the next. Entrepreneurs make extraordinary profits by finding value in what everyone else thinks is of little or no value.

As Jane Shaw and Michael Sanera note in their excellent book on the environment, Facts, Not Fear, industrial air pollution is largely unburned fuel. Fuel being costly, you might think that anyone who “puts profits before people” would hate burning money.

There’s an intrinsic problem with the anti-capitalists’ model of the businessman. If he is profit?hungry, he would not behave as he is accused of behaving. He would, for example, have no interest in using any more inputs than necessary to satisfy consumers. His profit is derived from minimizing inputs and maximizing the value of his output. That sounds like conservation, doesn’t it?

Of course, the idea of putting profits before people is absurd. Business people earn profits by thinking up ways to make people’s lives better. In the free market, people generally have a harmony of interests. “People before profits” is a vestige of Marx’s discredited philosophy of class warfare.

The upshot is that no factory is a mere polluter. If it didn’t produce things people valued, it would close. This is not to deny that some factories pollute. At a given time, it may not be possible or economical to use the waste byproducts going up the smokestack. In that case, harmful pollution is a trespass onto the property (including the lungs) of other people.

Thus the right way to address a pollution problem is to identify and enforce property rights. The wrong way is to give bureaucrats carte blanche to regulate business. Since they see only pollution and no value in production, they will surely throw out the baby with the bathwater.

* * *

A college student who takes a summer job at the minimum wage would make his counterparts of 30 and 50 years ago positively green with envy. W. Michael Cox and Richard Alm enumerate the unappreciated riches of this low man on the economic totem pole.

The bureaucrats never tire of looking for ways to restrict our peaceful activities. But Ted Roberts reminds them that human beings have been cleverly evading such impositions for a very long time.

The spectacle of anti-capitalist protesters in designer clothes talking on cell phones and coordinating their demonstrations over the Internet is more than an irony. Alex Moseley explains.

The United States apparently ended welfare “as we know it” a few years ago. Was there genuine reform? Has it been successful? Norman Barry has an update.

People who run red lights endanger the people around them. Does that justify cameras at intersections? Frank Stephenson has his doubts.

It is widely accepted that the computer revolution has transformed business in untold ways. You haven’t heard the half of it, writes Larry Schweikart.

The threat of gun registration always looms no matter how many times it is repelled. Miguel Faria reminds us of the tragic history of gun registration and what it means for America.

Japan’s education system has for years been lauded by some Americans, who are convinced its alleged virtues should be embraced here. Not so fast, says Christopher Lingle.

Columbia University has the distinction of being the precedent-setter in establishing a campus “sexual misconduct” policy. Wendy McElroy predicts that the discarding of simple principles of justice and due process will have nightmare results.

Romanticizers of Soviet socialism continue to insist that its ideals were impeccable and only its methods were flawed. Jim Peron questions that claim and shows that democratic socialism is a chimerical alternative.

Here’s what our columnists have this month: Donald Boudreaux pens an appreciation and elaboration—of “I, Pencil.” Lawrence Reed defends the Electoral College. Doug Bandow wonders what’s gained by jailing Robert Downey Jr. Thomas Szasz continues his examination of the schools as drug pushers. Dwight Lee praises economic efficiency. Mark Skousen looks to the private sector for a solution to Social Security. Russell Roberts wonders why actress Sarah Jessica Parker’s family needs government help. And Jerry Taylor, reading a claim that Americans have to change their way of life to head off global warming, proclaims, “It Just Ain’t So!”

Our reviewers pass judgment on books about the role of economics in law, economic principles, schools of education, NATO, junk weather forecasting, and the history of distrust of government.

ASSOCIATED ISSUE

March 2001

ABOUT

SHELDON RICHMAN

Sheldon Richman is the former editor of The Freeman and TheFreemanOnline.org, and a contributor to The Concise Encyclopedia of Economics. He is the author of Separating School and State: How to Liberate America's Families.

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