Posts by Laura Huggins
What are the ethical foundations of free market environmentalism? This week we sat down with Kate Blanchard and Kevin O'Brein, two of this year's PERC Lone Mountain Fellows, to explore these questions and others. Blanchard is Associate Professor of Religious Studies at Alma College and O'Brien is Associate Professor of Christian Ethics at Pacific Lutheran University. They are currently working on a book about the connections and tensions of ethics, environmentalism, and economics.
Thanks to Blanchard and O'Brein for taking time to answer our questions. For more PERC Q&As, visit the series archive.
What does Christian ecological ethics have to say about the environment?
Christian ecological ethics includes a diverse group of scholars from many denominations and across the world, and while we cannot speak for all Christians, we do believe that traditional Christian teachings have significant environmental implications. Most generally, we argue that human beings have a responsibility to God and all of God’s creation, which includes not just other human beings but also the entirety of the nonhuman world. So, just as Christians are called to treat our human neighbors with respect and love, we must also learn to respect and love the animals, the plants, the ecosystem, and the earth God made.
Some Christians would call this stewardship, emphasizing that humans have a special responsibility to be the caretakers of other creatures. Others resist even that anthropocentric division, and would say that human beings should try not to manage other creatures, but instead work toward a more egalitarian community with them. The common theme is that Christian faith calls for loving care for all of creation.
Where, if at all, do free market environmentalism and Christian ecological ethics have common ground?
There is more common ground than it might first seem! There are disagreements, of course, the most important being that Christian ecological ethics tends to emphasize the intrinsic or God-given value of the nonhuman world, and to be suspicious of the corrupting influence that markets can have on things we would consider priceless. However, we share with FME a profound appreciation for human freedom, a celebration of diversity in human communities, a suspicion of the ways power can corrupt human relationships, and a preference for local solutions. And obviously we share a concern for the conservation and well-being of the earth.
How are markets useful for protecting earth’s long-term health? How does this relate to Christian ecological ethics?
We appreciate the ways markets provide clear and quick feedback mechanisms: property owners see the results of their management decisions and have the flexibility to adapt as they learn. They are also held accountable for their own imprudent behaviors, and if markets are structured fairly they can’t pass the costs of their mistakes on to someone else. Christian ethicists have thought long and hard about the importance of love and respect for the nonhuman world, but we are always looking for ways to actually put that love and respect into action. We suspect that markets may be more useful for smaller, local problems than for global questions or crises, but we see that markets can be one path to the goal of environmental integrity, and no environmental proposal is complete unless market mechanisms have been carefully considered.
Stories of my ancestors interacting with families of the Northwestern Shoshone tribe enthralled me as a girl. The idea that the native people were self-sufficient and often helped the early settlers survive by trading goods, such as animal skins, and by sharing their knowledge of water sources and hunting grounds was inspiring. Today, however, many “First Nations” are stuck in a welfare state. PERC's latest issue of PERC Reports looks at past and present trends in indigenous life, shining a light on how property rights and individual initiative can help create a higher standard of living and improve environmental quality on reservations and beyond.
PERC president TERRY ANDERSON points out that American Indians and First Nations people can reach back into their rich cultural heritage and find institutions that rewarded individual initiative. The key is for tribes to take this initiative again and for Congress to give tribal nations the rights that were once theirs.
Why is it that reservations are so poor asks JOHN KOPPISCH with Forbes. People are quick to point to alcoholism or underdeveloped land, but as Koppisch wisely writes, “those are just the symptoms. Prosperity is built on property rights, and reservations often have neither.”
Tribal governments can help solve the poverty problem. ROBERT MILLER draws on his experience as Chief Justice of the Grand Ronde Tribe and as a citizen of the Eastern Shawnee Tribe to explore how native governments can establish the laws and court systems necessary to attract investment.
In the past, native nations built their economies via extensive trade networks. Arctic tribal historian, JOHN BOCKSTOCE, reveals how the Eskimos and Chukchi in the greater Bering Strait region had been trading for thousands of years before the Russian and American trading vessels arrived.
Beyond North America, IAN BOISVERT, with BlueSky Mediation & Law and a former PERC graduate fellow, introduces the idea of “Tradable Occupation Rights” for the Maori in New Zealand. Creating these rights would offer both commercial and customary ocean users a market to resolve conflict and promote more efficient uses of resources.
This special issue of PERC Reports is made possible by the generous support of the M. J. Murdock Charitable Trust. PERC is continually grateful for their investment in tribal issues and free market solutions.
The mood at PERC is somber this morning due to the news of the loss of an extraordinary woman. Elinor Ostrom was the first woman to receive the Nobel Prize in Economics.
Ostrom received the 2009 Nobel Prize in Economic Sciences for her groundbreaking research demonstrating that ordinary people are capable of creating rules and institutions that allow for the sustainable and equitable management of shared resources. She shared the prize with Oliver Williamson, a University of California economist.Ostrom’s work on Governing The Commons certainly influenced PERC early on. Donald Leal, for example, wrote Community-Run Fisheries: Preventing the Tragedy of the Commons in 1996. Leal highlights her groundbreaking research focusing on the factors that induce a community of users to cooperate and defend their rights to steward a resource.The recipient of numerous international awards and honorary degrees, Ostrom was selected in April as one of the Time 100 for 2012, Time magazine’s annual list of the world’s 100 most influential people. In May, the IU Board of Trustees renamed the Workshop in Political Theory and Policy Analysis to honor Elinor Ostrom and her husband and colleague, Vincent Ostrom, who founded the center in 1973.
No doubt her contributions will continue to shed light on free market environmentalism. “Calling on Communities” is a chapter inspired by Ostrom’s research and will appear in the forthcoming edition of Free Market Environmentalism.
She is survived by her husband and by an international extended family of colleagues, collaborators, staff and friends who worked closely with her during an extraordinary 50-year career. Read more here.
A decade ago, Dan Benjamin wrote that tradable permits seem to offer the advantages suggested by their proponents: “The total costs of achieving the current SO2 cap are at a minimum—and surely lower than under command-and-control. Perhaps now some serious consideration will be given to environmental protection systems in which there is even less administrative control by the government.”
Indeed, this scheme was considered by most economists to be the poster child of cap and trade. As Terry Anderson and Gary Libecap write in the Daily Caller by 2007 annual SO2 emissions dropped to 8.95 million metric tons at a cost of $747 million, “one-third less than it would have cost had the EPA used standard command-and-control regulation. The system worked beautifully—for a while.”
Today, however, the sulfur dioxide scheme is dead. The cause of death, according to Anderson and Libecap, is regulatory manipulation.
The Clean Air Interstate Rule and subsequent rules from the Obama administration have significantly undermined the sulfur dioxide trading scheme by preventing the use of 12 to 14 million pre-2010 banked allowances for future trading and changing the ratio of allowances per ton of sulfur emissions from 1:1 to 2:1 for 2010–2014 and to 2.86:1 for 2015 and beyond.The original SO2 trading scheme, according to Benjamin, had some characteristics of property rights; for example, anyone was legally permitted to buy or sell allowances at market-determined prices: "Because the allowances are standardized (each represents the right to emit one ton of SO2) and the major potential traders (electric utilities) are likely to be well-informed, trade should be feasible at low transaction costs, just as we find in stock and bond markets.” But as Anderson and Libecap state, when allowances are not treated as property rights and are “given and taken at the whim of regulators,” the system fails.Not surprisingly, sulfur dioxide allowance prices began falling in 2005 from $1,600 per allowance and hit an all-time low in April of $0.56 on the spot market and $0.12 on the seven-year future market. For all intents and purposes, the EPA’s taking of banked allowances and manipulation of the trading ratio wiped out billions of dollars worth of assets held in the form of allowances.
The big brown trout I was fishing for yesterday on the Limay River in Patagonia was nowhere to be found but I did manage to come across an old hang out of Butch Cassidy.
Being from Montana, where the Hole-in-the-Wall Gang pulled off their last job—a holdup of a Union Pacific train—before fleeing to South America, I was happy with this historical catch.
Legend has it that Butch became friends with Jarred Jones who ventured down to Argentina from Texas in 1887 to make his fortune. Jones didn’t find gold but he did manage to open a general store at the mouth of the Limay. The old store, which is now a friendly restaurant, still holds the shops books, old photos, and a frontier atmosphere of a century ago.
Jones earned enough money at the store to purchase two big ranches, which he fenced off with barbed wire—the first to be seen around these parts. Today, barbed wire is strung across much of the 98 million hectares of the Patagonian Steppe to enclose vast quantities of sheep.
Unfortunately, a flock of sheep can gobble up great expanses of native grasses, and in southern Argentina, they’re clearing some serious vegetation. In addition to vegetation loss, overgrazing equates to lost habitat for other animals, and damages waterways with runoff and silt from erosion, which affects the fish, which affects tourism.
Paradoxically, sheep—the slayers of grasslands—could become the saviors of the same landscapes and in turn protect fish and other species. It turns out that because the plants of the grasslands co-evolved with herbivores, such as guanacos, a little munching is good (and necessary) for the flora. It is also true that companies that have environmental components to their business plans and seek to create goods from natural products, including merino wool, would like to see grasslands flourish for the long term. And tourists like me who want to fish and recreate in Patagonia would be willing to pay a price premium for this outcome.
Enter The Nature Conservancy, Patagonia, Inc. and Ovis XXI. Armed with scientific knowledge and market tools, this trilogy is working to conserve more than 15 million acres of land in Patagonia by 2016. Ovis XXI works directly with the woolgrowers. These consultants know the industry, and how to raise sheep without destroying grasslands. The Nature Conservancy brings its science-based knowledge and environmental credibility to help build the sustainable grazing standard through planning and subsequent monitoring of conservation outcomes. And Patagonia Inc. brings the market perspective—buying the wool, networking with others in the supply chain, creating the final products, and using its brand strength to help publicize Patagonian wool.
The majority of the land targeted by the Patagonian Grasslands Conservation Project is privately owned, and remains in large and undivided properties of intact native grasslands. Because most landowners face ongoing political and economic challenges that affect their ability to stay in business, an incentive is needed to gain commitment from landowners to manage resources sustainably. In this case, the carrot comes in the form of a payment to ranchers for grazing less sheep and or for using more modern and environmentally friendly grazing practices.
In November 2011, the first shipment of sustainable wool (29 tons) left Patagonia for Asia to be turned into socks for Patagonia, Inc. So far this scheme has worked to place two million acres under sustainable grazing agreements. Time will tell if the environmental protection purchased by conservationists from sheep ranchers will protect grasslands and associated waterways in the future, but signs look promising. Stay tuned...
Two years ago in PERC Reports Todd Gartner wrote about his efforts at "helping the American Forest Foundation develop a market-based habitat credit trading system in portions of Georgia and Alabama. The incentive-based framework will complement other efforts in the region to keep the eastern population of the gopher tortoise off the Endangered Species list."
Today, Gartner, in collaboration with Josh Donlan and James Mulligan of Advanced Conservation Strategies, are ready to launch their first pilot transactions.
Here is how the gopher tortoise candidate conservation marketplace is being designed and piloted:
- An interested and eligible private landowner (the “seller”) receives a negotiated payment to conserve, manage, or restore longleaf pine forests capable of supporting healthy populations of gopher tortoises on his or her property. In so doing, the landowner generates gopher tortoise habitat credits.
- The entity paying the landowner (the “buyer”) receives the habitat credits in return. The buyer may use the credits to offset the impact on gopher tortoise habitat elsewhere, in order to meet a voluntary net zero biodiversity impact commitment. Or, the buyer can save the credits for later use to meet offset requirements if the species is listed under the ESA. Other buyers may purchase credits simply to spur gopher tortoise conservation.
- A gopher tortoise habitat credit is the currency that can be bought and sold. The number of credits on a parcel of land is determined via a science-based and peer-reviewed method to ensure a net conservation benefit for the tortoise when used as offsets for future impacts. The credit price includes funds to manage and monitor the habitat, along with a negotiated profit margin for the seller.
- The USFWS approves the crediting methodology and maintains agreements with buyers and sellers. The agency may also provide federal-level assurances to both the buyer and seller. This regulatory certainty allows buyers to preemptively buy credits that can be used toward offsetting future impacts if the species were to be listed.
If you would like to learn more about market-based approaches for conservation, such as the approach Gartner began formulating as a PERC Enviropreneur Fellow, then apply to PERC's Enviropreneur Institute by March 5.


Founded 30 years ago in Bozeman, Montana, PERC—the Property and Environment Research Center—is the nation’s oldest and largest institute dedicated to improving environmental quality through property rights and markets.
PERC’s publications, each designed to resonate with specific groups, move ideas generated at PERC to broader audiences.
Research is at the heart of PERC's work, with a focus on the question: What is the link between economic growth and environmental quality?
The goal of PERC’s programs is to fully realize the vision of establishing “PERC University,” where scholars, students, policy makers, and others convene to expand the applications of free market environmentalism.
PERC's fellowships share a common goal of exposing new scholars, students, journalists, and policy makers to free market environmentalism, as well as enable scholars already familiar with FME to explore new applications.
PERC continues to publish and present a broad range of research and discussion through podcasts, videos, and other multimedia channels.