Can a libertarian explain to me how we are supposed to prevent environmental disaster?

Great Debates
21

I call myself a Libertarian sometimes, but I have always had a problem with Libertarianism when it comes to externalities in general and the environment specifically.

Here is the problem:

I am a toxin manufacturer in Libertaria. Because I live in Libertaria, I can do anything with my property, on my property as long as I don’t cause damage to anything but my property. Well and good. I decide I am going to store all my toxins in milk cartons, because it is inexpensive and convenient. Well, they leak, polluting the air and the water table and causing lots of damage to everybody in the tri-county area. I am sued for everything I have, but of course this by no means will cover the damages or even the clean up. Now what?

I’ll tell you what happens next: I, being destitute, shack up with some relatives for a couple of months, move out of the tri-county area, and finally get a job with a milk carton manufacturer (I know a lot about milk cartons at this point and, being destitute, I am willing to work for much less than most experienced milk carton designers). I save enough money to buy some land in upstate Libertaria, a couple thousand milk cartons reinforced with duct tape, and the raw materials to resume manufacture of the toxin. My old customers are overjoyed; they were sad when I went out of business (none of them lived in the tri-county area) as I was the cheapest toxin manufacturer in the market. I make millions and spend it as quickly as I can.

Wouldn’t it be better for everyone involved if the government regulated the manufacture of toxins? Maybe passed some laws that made storing toxin in milk cartons illegal? Maybe detailing the type of storage and handling required to minimize the potential for damage if something goes wrong in the manufacture of said toxin? This goes against the entire spirit of Libertaria!

If we don’t regulate the toxin, then at the least we should mandate insurance. The government should require that I, as a toxin manufacturer, should carry a policy that will pay for the clean up and damages in the case that all my toxin spills from my milk cartons, vaporizes, and uniformly coats all the school children in the tri-county area. My behavior will then be regulated by the insurance company which will charge me an arm and a leg when they appraise their risk and find the milk cartons and note their proximity to the elementary schools. In this case though, we will need to regulate the insurance companies; make sure that they have the resources to pay for the skin replacement surgery for the slippery tykes and are not just going to declare bankruptcy and fold up shop when the PTA of tri-county region files a class-action suit.

22

Yes, and this happened in a non-libertarian context, right? So obviously government regulation of pollution is ineffective and utopian, right?

I guess I don’t understand the incentive difference between one scenario, where if you leak Chemical X you get sued and pay damages to your neighbors, and the other scenario, where if you leak Chemical X you get fined and pay damages to the government. Both require some sort of vigilance, one on the part of neighbors, and the other on the part of government regulators.

You say I’m naive for thinking that everyone would pay to have their waste handled safely, for fear of getting caught. But isn’t that the scenario we have now? I can dump chemicals into the sewer right now, and I probably won’t get caught. The only way I can get caught is if I do it all the time, like if I own a chemical factory that regularly dumps Chemical X into the river. If today, in the real-world United States, I go and buy a barrel of Chemical X, and dump in in some random place, it’s very likely that I won’t get caught.

As for why we won’t have limited liability corporations come the revolution, well, it’s right there in the “limited liability” part. Why would we privatize reward, but socialize risk?

And of course some people are going to screw up and find themselves in heaps and heaps of trouble. How that differs from present day America I don’t know.

I guess we have to define what would make a society “libertarian”. You’d have to have free market capitalism, right? Except how can you have a free market if others are free to steal from you? How can you have a free market if someone can agree to pay you Tuesday for a hamburger today, but when Tuesday rolls around they refuse to pay? How can you have a free market if the Nazi panzers can roll through your town and ship everyone off to slave labor camps?

And so a libertarian free market utopia requires police, it requires courts, it requires soldiers. A society without those features will devolve into Hobbesian anarchy, which will soon devolve into some sort of authoritarianism, as ruthless people with weapons start pointing those weapons at other people and start demanding goods and services in return for not killing and maiming them. And since we cannot exist without cops and judges and soldiers, we need to pay for them somehow. If “private” cops and judges and soldiers work well enough to maintain a free enough society, then we don’t need the government involved. Or if they don’t, then we need government to provide them.

And as a sometimes-libertarian, I’m supremely bored by fantasies of reconstructing society from the bottom to the top along libertarian principles, because such fantasies are just so much mental masturbation. We’re never going to redesign a society from scratch, even a brand new colonial society on a pristine planet can’t be designed from scratch, because the colonists are going to have existing ideas about how things should work. We’ll always have to deal with existing social organization. We’ll always have to deal with people who are assholes. Utopia doesn’t transform human nature. We can’t fix human nature, we can only ameliorate it.

And so what I’m interested in is moving our current existing government and society in a more libertarian direction. And fortunately for me, at least for things like pollution, we’re seeing some movement in directions I think are helpful. So if we determine that carbon dioxide is a pollutant and requires collective protection of the common atmosphere, a carbon tax is a libertarian solution. And we can make the carbon tax steep enough to bite, if we have the political will. If we don’t like funneling all that money to the government, we can cut other types of taxes (I suggest regressive payroll taxes). And so on.

So, how do we prevent economic disaster as libertarians? Do we declare that it is a sacred principle of the free market that everyone has a right to emit whatever substances they like into the collective common atmosphere and hydrosphere? Or do we recognize as a sacred principle of the free market that commons result in tragedies, and therefore the commons must be either regulated or enclosed? And that enclosure of the commons doesn’t mean unlimited emissions, since you can’t prevent your emissions from leaking out of your air into my air?

Of course since we are dealing with fallible humans, we’re going to have problems and squabbles and mistakes and disasters that cost lives and treasure. However, we have those things now. Government regulation didn’t prevent the BP oil spill, so clearly our current system isn’t perfect.

So since our current system isn’t perfect, that means we can improve it. And those improvements can be in a libertarian context. If the libertarian context means that investors are scared to drill in deep waters because they’re afraid of being sued into debtor’s prison, well, that sounds like a feature not a bug.

23

Thanks - and many of your argumets (not all) sound very libertarian and that is a compliment :slight_smile: For the record, I’m not a huge fan of labels - I guess I would describe myself as a free market, classical liberal mided pragmatist with an economic focus and a minarchist ideal, but that makes for crappy bumper stickers.

Agreed. You work with what you have, you realise that theories never work exactly as you would like, you use your basic pricnciples to shape the way you approach problems, but you should always focus on what actually works - what is practical. That’s rarely some perfect academic ideal.

24

Agreed. I’m sure I’ve said the same thing on a number of occasions here. As a sometimes-libertarian, the last thing I would want to do is to flip a switch and create Libertaria overnight. It’s a question of creating balance, because most people don’t put liberty above security in all cases all the time.

Let me suggest to the OP areas where Libertaria would differ substantially from any Western Democracy today:

  1. No government approval of drugs before they could be used by doctors or individuals. And no laws against recreational drugs, either.

  2. No sexual harassment laws. If your boss says he wants to fuck you in the ass or you’re fired, you’re fired if you don’t let him fuck you in the ass. On the flip side, no laws against prostitution. If you tell some they have to pay you $1,000 to fuck you in the ass, they pay you $1,000 or they don’t fuck you in the ass.

  3. No draft. Not in wartime or in peacetime. Not ever.

  4. No product labeling. No banning of trans-fats or banning of advertising legal products like tobacco.

  5. No anti-“wardrobe malfunction” agencies.

  6. No regulation of marriage. Gays, straights, polygamists. Doesn’t matter. It’s a purely civil contract, and the state doesn’t tell you whom you can marry (as long as they are and adult).

  7. No car pool lanes, but there probably would be lots of toll lanes.

  8. No welfare-- not for individuals or corporations.

That’s just off the top of my head. If you want to be sensational about Libertarianism, those are the kinds of things you’d focus on. Not environmental issues. Libertarians would be all over pollution, since pollution is always an infringement of property rights.

25

While I don’t agree with John on everything, I certainly agree with this. I don’t see how a libertarian could be OK with pollution - but I’m also keenly aware of how all over the board we/they are.

26

I never claimed that regulation would create an ideal society. Just one better than a libertarian version. My example was to demonstrate that paying post facto is not always adequate to make up losses. Do you think that the explosion was more likely to happen if regulations had been relaxed more or if they had been enforced better? In our current environment, with government under financial pressure and the right screaming about oppressive government regulations, they are unlikely to be adequate.

The goal is not to maximize payments, it is to minimize pollution. The government getting nothing out of the company because they are not polluting is a far better result than the neighbors getting a bundle. (Or their heirs getting it.)
Inspections are not about catching someone pouring chemicals down the sewer. It is about making sure that the proper equipment to contain the waste is there, and checking records to make sure that the waste is being removed by someone who knows what to do with it. If an inspector walks into a plant creating Chemical X, and sees no containment and no plausible disposal trail, he doesn’t have to catch someone from the plant pouring it into the river. Not to mention it might launch an investigation to see where the chemical went. I used to work at a research center which used noxious chemicals, and we had a full time environmental person dealing with exactly this stuff, and she had it ready for the inspectors.

I think they refer to personal liability, not corporate liability. To the extent that damage is done beyond what a corporation (or person) can pay, we always socialize risk.

Bernie Madoff would be just as in jail if the SEC paid attention and stopped his scam years before they finally did. Wouldn’t saving his customers billions be a good thing?

As for the rest, it appears that your solution to pollution is equivalent to the non-libertarian solution. Works for me.
The real plus of libertarianism is in areas where there are no or very few externalities. like social laws.

27

And yet it was the SEC that didn’t do anything, despite being warned by at least one private individual that he was running a pyramid scheme. Perhaps if the SEC didn’t exist as a government agency, people would be more careful about what they invested in, or rely on reputable, private agencies to rate investment options. We live in a society where we expect the government to take care of us, and so we are less likely perform due diligence.

28

This is faulty reasoning. You could just as easily argue that without government regulations we’d have millions of investment options that have not been screened at all by anyone, thereby increasing risk to everyone. No one has the time or resources to filter all that information. Even if we trusted some private agency to screen these options, a lack of regulation might mean that all such screening agencies are frauds too. You might be able to argue that the government is incompetent at screening, but at least they have no incentive to lie.

29

Yes, in Libertaria you would have that situation.

Libertarians would argue that no one is forced to invest in anything. Caveat emptor.

Sure they do. Is it your contention that government agencies never lie?

30

As a lawyer, I can tell you it ain’t. They’re way more scareder of the EPA, etc., than of all the private litigants in the wasteland.

And I can also tell you that you don’t get the loopholes out of laws by shortening or simplifying them. Quite the reverse, sometimes.

And that’s really nonsense. Under our present system, people who have no justiciable pollution-related claim of their own can lobby the government to take action. In Libertaria, almost certainly they can demand no government action that would not be unconstitutional.

31

Would you go quite that far? I once had a Libertarian friend who said the FDA should at least be retained as a labeling agency – if you’re careful, you’ll only buy drugs that bear the “FDA Approved” stamp.

But I must admit it would be nice to live in a country where you could, in those exact words, advertise in the newspaper for a “Secretary/Concubine.”

32

Well, there are many flavors of Libertarianism, so that might be a point of debate. I’d have to check the platform of the LP, but I wouldn’t be at all surprise if it included a statement about eliminating the FDA.

Just to make you feel better, there are probably brands of modern liberalism that would allow that as well. :wink:

33

I think that if labeling requirements were removed, most companies would still label - because people would want to know what they were buying, whether because of a food allergy, diet fads, drug interactions, or whatever else. There is a lot of optional labeling that goes on now, organic, khosher, glutten free, not tested on animals, etc. I can’t imagine many people buying drugs that weren’t tested - but those that would are probably the exact people who should be able to use untested drugs - those who are desperate and for whom even an unproven remedy is better than no hope of a remedy at all.

And as far as labeling agencies go - there would be different (private) agencies, like there are now for some of the optional stuff and people could pay a premium for the fancy pants agencies, or buy the economy rate “yeah, I doubt there’s much feces in this” if that’s what suited them. It would really be a marketing decision.

34

Ah, the old “we’ll show them how ineffective regulation is by doing a crappy job of it” argument. Time and time again the Bushies put into power either someone who is incompetent or who was philosophically opposed to the mission of the agency.
As for your thought that the lack of the SEC would make people more careful, please see Depression, Great.

35

The Great Depression was not caused by the stock market crash of 1929, contrary to popular opinion. But that crash sure made people very cautions about getting back into stocks for a long time. When everyone thinks the government will bail them out, they take more risk. See Recession, Great. See bank bailouts, recent.

36

N.B.: Neither was it caused by the Smoot-Hawley Tariff Act.

37

Which isn’t what I said. Part of the reason for the impact of the downturn in the market was excessively leveraging by investors - just as a cause of our recent problem was excessive leveraging by banks which magnified the impact of a fall in housing prices. Some of the pre-1929 bubble also came from there being inadequate and unreliable information.
In 1933 FDR started bailing out banks (or at least bank customers.) Not doing this had caused all sorts of problems. But the banks became tightly regulated in exchange for being protected from runs. The tight regulation, and strings attached to the bailout, are what is missing from the current situation. Remember - one investment house was not bailed out. That didn’t seem to inspire confidence in the market, did it?

38

There is a huge, trusted “labeling agency” right now - Underwriter Laboratories. They do a great job, so this is not something we’d have to invent.

39

Private investment-rating agencies have not exactly covered themselves in glory in the recent past.

40

Once you’re dead, your estate can sue.