Troubles of Public Resources
By Tibor Machan - July 30, 2012

Some insist that street vendors around the country should be banned. Why? Because the majority of those doing business adjacent to the street want them to be. The issue has come up in most major cities, including New York, NY, and Santa Ana, CA.

We are talking about public places, of course, where everyone is entitled to do his or her thing provided the local politicians or bureaucrats can be appeased and give their permission. (Why exactly do free men and women require the permission of such folks to do anything at all?)

In the 4th century BC Aristotle identified a very important principle of community life. He demonstrated the social value of the right to private property. This is how he summarized his case:

"That all persons call the same thing mine in the sense in which each does so may be a fine thing, but it is impracticable; or if the words are taken in the other sense, such a unity in no way conduces to harmony. And there is another objection to the proposal. For that which is common to the greatest number has the least care bestowed upon it. Everyone thinks chiefly of his own, hardly at all of the common interest; and only when he is himself concerned as an individual. For besides other considerations, everybody is more inclined to neglect the duty which he expects another to fulfill; as in families many attendants are often less useful than a few." (Politics, 1262a30-37)

This same idea was clarified by the late Professor Garrett Hardin, in his 1968 article, "The Tragedy of the Commons," published in the prestigious magazine Science. Hardin gave the example of a common grazing area used by several owners of cattle to feed their livestock. Because there are no borders identifying what area belongs to which cattle owner, the commons tend to be overused, not because of what is commonly assumed, the greed of the cattle owners, but because each cattle owners want to achieve the best possible results, namely, feed the cattle as well as possible. The principle at issue has been very fruitfully applied to environmental problems and the conclusion has been drawn by many scholars that without extensive privatization of what are now treated as public properties − lakes, rivers, beaches, forests and even the air mass − environmental problems will remain quite serious and the ecosystem will deteriorate.

Arguably, everyone knows that a problem exists with common ownership. Such ordinary phenomena as littering and the neglect of public parks and beaches, not to mention rentals properties, make the problem evident to us even if we do not often reflect on the matter. The problem is that nothing much can be done about it without changing what is publicly owned to private property. And it is nearly inconceivable in some cases that valued resources can be subjected to privatization, never mind the issue of whether such a policy could be squared with the more prominent conceptions of justice that would trump the practical solutions proposed. Accordingly, even among those who are fully persuaded of the need for privatization, the political will and savvy to achieve the solution is lagging far behind the analysis that identified the solution.

Still, in this area, at least, such an identification has occurred. What would be required to carry on along the lines suggested by the tragedy of the commons insight is a theory of justice that squares with it. Libertarianism is the only such theory afoot and that alone indicates what the prospects for such developments are.

Since I have made the attempt to place on record a libertarian theory of justice*, I shall not dwell on that topic here. Instead, I wish to provide another illustration of the tragedy of the commons with respect to public resources. In this case those resources will be less geographically and more economically telling. Still, recognizing the applicability of the analysis to this area, namely, public finance, we can perhaps consider the universality of some features of economic analysis. That might incline us to look upon the tragedy of the commons as more significant than has been thought for purposes of gleaning some insights about the nature of justice itself. Aristotle, for example, might be viewed in the passage above not as pointing to mere practical problems but also hinting at where the just solution might lie. If, furthermore, we consider the significance of "ought implies can" for a theory of justice, it could turn out that some currently popular theories, e.g., egalitarianism, will have to be seriously rethought.

The Treasury as the Commons

What has not been widely noticed is that a tragedy of the commons exists, as well, in our national treasury. We have here what by law amounts to a common pool of resources from which members of the political community will try to extract as much as will best serve their purposes. Be it for purposes of artistic, educational, scientific, agricultural, athletic, medical or general moral and social progress, the treasury stands to be dipped into by all citizens in a democratic society. And everyone has very sound reasons to try to dip into it − their goals are usually well enough thought out so they have confidence in their plans. They know that if they receive support from the treasury, they can further their goals. So they will do whatever they can to do just that, namely, extract from the commons as much for their purposes as is feasible.'

But, as both Aristotle and Professor Hardin knew, the commons are going to be exploited without regard to standards or limits: "That which is common to the greatest number has the least care bestowed upon it." Which explains, at least in part, why the treasuries of most Western democracies are being slowly depleted and deficits are growing without any sign of restraint. Greece, Spain, even Japan, Germany and Great Britain as well as the United States of America are all experiencing this, as are numerous other societies that make their treasuries available to the public to use for sheer private purposes. For how else can we construe education, scientific research, the building of athletic parks, the upkeep of beaches, forests and so forth than as the pursuit of special private goals by way of a common treasury?

Some might try to obscure this by claiming that all these goals involve a public dimension. Of course. So does nearly every private purpose, including the widely decried phenomenon of industrial activity that produces the negative public side-effect of pollution and contributes to the depletion of a quality environment. Private goals can have public benefits and costs. But their goal is to serve the specific objectives of some individuals.

When AIDS research is supported from the public treasury, the first beneficiaries of success would be those with AIDS, not those who haven't contracted the disease. When theater groups gain support from the National Endowment for the Arts, there may be beneficiaries beyond those obtaining funding but they are still the ones who benefit directly, immediately. When milk producers gain a federal subsidy by having the price of milk fixed or their withholding of production compensated, they are the first to gain from this, not some wider public. And so on with thousands of other "public" projects − they are, actually, supporting private or special goals, first and foremost. One need only observe who lobbies for them. But because the treasury is public property, there is no way to rationally allocate what's in there with rational budgetary constraints. Instead politicians embark on deficit spending − taking non-existing funds, ones not yet collected but only uncertainly anticipated, and funding the requests without restraint.

And there is no end in sight. Only when the country no longer has the credit-worthiness in the world community, so that its bonds will no longer be bought by hopeful lenders, will the Ponzi scheme be called to a screeching halt. We will have to declare bankruptcy and those of our citizens who had nothing at all to do with the enterprise will be left to hold the empty bag, namely, our grandchildren.

Road to Solutions

There is no quick and handy way to approach the problem of the tragedy of the commons. The suggestion of privatization and laissez-faire is too jarring to many people to take very seriously. Yet the problem itself seems quite intractable. Any effort to handle it by way of democratic or republican public policy seems to be a bandage, postponing a real solution for a while. Soon, however, the tragedy re-emerges because of the way that political organizations adjust − e.g., via lobbying and special interest pressure − to the obstacles placed before those who value such projects and will vigilantly pursue the way to fund them from the public treasury.

In the case of public finance, not unless the treasury stops allowing private projects to be funded from its coffers, confining itself to the support of constitutionally specified, bona fide public projects − the courts, the military and police − will there be an end that avoids the perhaps greatest tragedy of the commons. To reach such a position of financial responsibility, governments will have to sell off all the unwisely held common assets − lands, parks, beaches, buildings, forests, lakes and such − to private, profit seeking parties. They will thus liberate members of our future generations from the tragedy that has been so irresponsibly placed upon them by means of the proliferation of the commons.

This by itself does not solve all problems that face us in the wake of the tragedy of the commons. The air and water masses of the globe aren't easily privatizable, at least not for the time being. The way to discourage their abuse will have to be researched. It may be found in the law of personal injury and trespass. People who traverse the public realm will have to confine their conduct to what is peaceful, non-injurious, lest they find themselves charged with criminal assault and trespass. In any case, the acknowledgment of the tragedy of the commons will have to precede any serious research program that needs to be mounted in order to inch closer to a peaceful and just solution.

*See my book Libertarianism Defended (Ashgate, 2006), summarized in "Libertarian Justice," Hoover Digest (No. 4, Fall, 2006): 220-224.

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