While the current financial crisis has received much attention, another crisis has led to calls for government intervention. The Maryland blue crab population has dropped sharply in recent years. Some senators are urging that the crab crisis be declared a federal disaster, so that Chesapeake crabbers can receive $20 million in aid. FULL ARTICLE
Source link: http://blog.mises.org/8665/too-tasty-to-fail/
Too Tasty to Fail
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In (around) Iceland, the right to fish in given “territories” is privately owned (bought, sold, inherited). But the system is operated by the government. There are two factors “excusing” this involvement of a sovereign government:
(a) Iceland has such a small population (275,000) that the difference between government and pure association can be subtle; and (b) the areas in question are in what many people (and their governments) consider international waters – Iceland has had to extend its “territory” to operate this system as far as 200 miles from its coast (and still growing, in my opinion, not unlike Hitler’s territorial ambitions in Europe). Indeed, there has been armed confrontation between Iceland and the UK over fishing rights in many of these areas (all the shooting so far has been done by Iceland – a direct hit, at that).
Exactly why a CPR couldn’t be operated in international (ungoverned) waters isn’t clear to me, but I wouldn’t be surprised if Hoppe explores such subjects in his book that is advertised beside this article.
I hadn’t heard of Common Pool Resource associations (CPR’s). Thanks for the info!
Joseph,
Hoppe does not explore CPRs in his book. He mostly identifies the problems associated with the commons, but does not go into detail on any specific solutions. The book is mostly an attempt to provide a foundation for a rational ethics. As such it is a defense of private property and an indictment of government ownership and governmentally enforced commons. At least that is what I took out of it, maybe others can better describe it for you.
While property rights are central to my philosophy, things only work neatly when homesteading principles may be applied. I don’t believe that a CPR satisfies those principles. The problem that I see is that an individual or group of individuals may arbitrarily declare a CPR over a pool of resources and then extract rent payments.
In order for ownership to have any effect on conservation, the owner must be able to sell his property. It is this ability to sell that induces an owner to forgo current income for capital preservation. The ability for a buyer to bid on a poorly managed asset will tend to lead resources to be owned by people who can maximize income while conserving capital value.
Under the CPR construct as I see it, a person or group could declare common ownership and then turn around and sell it (as long as its ownership is unchallenged). This is a situation that has too frequently occurred generally with regards to property – even in instances in which clear homesteading principles could have been applied. In recent correspondence with opponents of property rights, I have had to concede that such appropriation is injust. I will not endorse them.
On the other hand, if a CPR does not permit sale of the resources, then it will lack the ability to induce behaviors aimed at conserving capital value.
Resources for which clear homesteading principles are not feasible pose a challenge to proponents of property rights. I am hopeful that market and technological innovations could help to more clearly establish property ownership. In the meantime, I think that we must admit that adequate solutions may be elusive. CPRs may help in managing un-owned resources. But I would be cautious in fully endorsing them as anything resembling private property rights.
Very interesting article. I think the Maine lobster industry was similarly affected years ago and came up with a CPR type of solution which certainly worked for a while. Have you looked into that one? It could offer a more relevant example to the Maryland crabbers.
I have very little knowledge of the crabbing industry but I would assume that capital stuffing may also be a problem?
This is the situation whereby because the entrants to the industry is limited their catch / quota becomes more certain and as a result allows owners / captains better access to credit whereby they can borrow to employ larger faster / more efficient vessels and equipment.
If this is indeed true then the actual free market / open access model may indeed be better than a regulated fishey – because fishers expected catch would be less and hence more risk of default on any loans thus making banks reluctant to make loans to them of the magnitude required to purchase the rather large vessels they often use.
Again though I tend to agree with D.W MacKenzie that the problem is one of property rights not being defined well enough.
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