On the Environment, Mr. Smith can’t have it both ways.

First Published: 2010-05-15

This is a written response by recent Nassau Institute guest, Laura Huggins, to Bahamian columnist Mr. Larry Smith who wrote a critcal article in the Tribune Newspaper after Mrs. Huggins’ presentation at The Bahamas National Trust on April 20, 2010.

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Thank you to Mr. Larry Smith for his review of my recent presentation for The Nassau Institute, at The Bahamas National Trust, Retreat. He provides an opportunity for me to share a bit more information with the Bahamian environmental audience.

At first Mr. Smith fully understands how market systems work to avoid “tragedy of the commons” scenarios (collapse of the sponge fishery in The Bahamas) and to improve environmental quality. As Smith explains in his excellent description of rights-based management systems, allocating exclusive “catch shares” to fishers to be bought and sold works well for fishers and fish populations. To elaborate, in the 5 years after catch share implementation in the U.S., per boat revenues increased an average of 80 percent. Today, catch shares have been implemented in more than 300 fisheries around the world from New Zealand to Namibia, in fisheries large and small. I have even heard that Cuba is exploring the option of catch share systems.

So why does Smith then do an about-face and seem to argue that this type of system would not be feasible in the Bahamas? Is your government so big that you can’t see beyond an old school regulatory approach? It is time to move fisheries management (and energy, forestry, waste, etc.) in the Bahamas into the 21st century.

There is a market for green products with environmental entrepreneurs ready to invest in them. But with government trying to clumsily perform these tasks at the taxpayers expense “enviropreneurs” get crowded out.

Elinor Ostrom won the 2009 Nobel Prize in economics for her work recognizing the role that local entrepreneurs play in eliminating the tragedy of the commons. Whether it is fisheries, forests, oil fields, or irrigation systems she provides plenty of examples.

Smith argues that “externalities” are a justification for government. To entrepreneurs there are not environmental problems caused by externalities, but environmental opportunities enhanced by strong property rights and markets. Indeed, entrepreneurs thrive in the space where there are impacts not accounted for in market transactions. The more they can replace externalities with entrepreneurship, the more we will see conflict replaced with cooperation and environmental rhetoric (yes that includes “claims about overpopulation threatening humanity) replaced with real environmental improvement.

Speaking of ideology, the first Earth Day (22 April 1970) was organized by Democrat congressman Gaylord Nelson. It was set upon the 100th birthday of Vladimir Lenin, who led the Communist Revolution in 1917. I bring this up as it serves as a yearly reminder that the world’s biggest environmental catastrophes took place in the USSR and many environmental problems can be seen in North Korea today. 

I too want workable solutions for real problems and that is why the Property and Environment Research Center (PERC) works with groups such as the Nature Conservancy, Environmental Defense Fund, and even the World Bank and that is also why we take no government money and why we don’t look to government to solve environmental problems.

With that said, I hope Mr. Smith authors more books such as "The Bahamas: Portrait of an Archipelago." It serves as a beautiful introduction to the treasure of natural resources found in the Bahamas.

Sincerely,

Laura E. Huggins
Research Fellow
Hoover Institution at Stanford University

&

Director of Outreach
Property and Environment Research Center
Bozeman, Montana
www.perc.org

(With thanks to Terry Anderson, Senior Fellow at the Hoover Institution for the line, "entrepreneurs thrive in the space where there are impacts not accounted for in market transactions.")

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