Subsidies Anonymous #2

September 9, 1995

Table of Contents

  1. Update on Recreation User Fees
  2. How to Talk to Conservatives
  3. Book Review: Forfeiting Our Property Rights
  4. The Replicator Society

1 -- Update on Recreation User Fees

Representatives of the Forest Service, Park Service, and other land management agencies testified at August 3 hearings on recreation fees held by the Subcommittee on National Parks, National Forests, and Public Lands of the House Resources Committee. After more limited hearings held last May, the subcommittee chair, James Hansen, wrote two bills to authorize more recreation fees.

As reported in the last issue of Subsidies Anonymous, one bill would direct agencies to cover at least 75 percent of their recreation costs from fees. After a six year transition period, H.R. 2107, the "Visitor Services Improvement and Outdoor Legacy Act," would allow agencies to keep two-thirds of the funds they collected. Another bill, H.R. 2025, the "Park Renewal Fund," applies only to the Park Service, allowing that agency to collect more fees and to keep all of the fees it collects.

Most of the agency officials who testified were highly critical of H.S. 2107.

Forest Service Deputy Chief Gray Reynolds stated, without saying way, that recreationists "should not be expected to pay for all of the general management of the recreation resource." He also warned that the bill's focus on funding of fee collection could have unintended consequence of making managers pay more attention to fee collection than to other management problems. He also noted that the bill directed that each agency keep funds that it collects, but suggested that this be brought down to the level of the individual national forest, park, or other unit.

While strongly supporting H.R. 2505, National Park Service Director Roger Kennedy opposed H.R. 2107 because it "would indirectly mandate that the NPS become a revenue raising agency as opposed to a resource management agency."

Kennedy noted that the bill does not change current legal restrictions against charging park users under 16 or over 62 years old, who are more than a third of park users. Nor does it change restrictions against charging fees at a number of other parks, which have about 12 percent of park visitors.

So fee increases would fall on less than 60 percent of park users. To reach the 75 percent revenue target, Kennedy warned that a family visiting Yellowstone would have to pay $40 to $50.

The BLM and Fish and Wildlife Service were even more pessimistic about fees. The BLM claimed that, if the bill were passed, "your constituents be faced with the prospect of paying a day's salary to picnic on public lands." The FWS noted that its current fee collections of $2.5 million per year don't come close to its recreation costs of $20 million, so it would have to close most of its refuges to hunting and other recreation. The Bureau of Reclamation also opposed the bill.

Representatives of several travel industry groups also testified at the hearings. James Santini of Travel and Tourism Government Affairs Council stated several principles for fee collection, including: "Fees must accurately reflect the burden placed on public lands by visitor use"; and "Fees must be set to recover costs associated with the operation of commercial facilities."

Susan Pikrallidas of American Automobile Association warns that 75 percent "revenue target" may lead managers to "nickel and dime visitors to attain the goal." She suggested that visitors would rather pay a single entrance fee than separate fees for different activities.

Philip Voorhees of National Parks and Conservation Association warned against a "one size fits all" approach and worried that, as soon as NPS increased fees, appropriations committees would decrease appropriations.

Keith Griffall of the National Tour Association worried that tour bus riders might be forced to pay more than their fair share of fees. Daniel Anderson of the National Air Access Council wanted to maintain air tours over the Grand Canyon and other parks. He felt discriminated against because tour operators were charged fees but an American Airlines flight that also went over the Grand Canyon (at 18,000 feet) got in for free.

Many of the criticisms of the proposals are valid. The 75 percent revenue target creates the wrong incentives by encouraging wasteful spending on some areas and inadequate spending on others and by not guaranteeing that individual managers will be rewarded for increased fee collections. Moreover, the "recreation costs" that must be 75 percent covered by fees are poorly defined, allowing managers to simply create their own definitions. In addition, the transition period is not carefully planned.

At the same time, many of the criticisms raised are unimaginative or simply stupid. Numerous private operators can provide campground space for under $20 per night. Why can't the BLM provide a picnic space for less than a day's wages? Kennedy's fear that Yellowstone might cost $40 or $50 overlooks the fact that a week in Yellowstone is worth at least $40 or $50.

Nearly all officials assumed, as the Forest Service's Reynolds said, that recreationists should get a free ride, or at least significant discounts, and taxpayers' expense. That is an implication of Hansen's bill as well, which only requires agencies to cover 75 percent of their costs.

What is it about recreation that requires that we subsidize it? Is it so that poor people as well as the rich can use parks? If so, let's give recreation stamps to the poor, reimbursable by the agencies for dollars. Is it because recreation benefits everyone whether or not they actually visit the parks? If so, then we need bigger subsidies for America's favorite recreation: television.

In fact, there is no justification for subsidizing recreation. The idea that subsidies are needed because otherwise fees would be too high only suggests that federal agencies have budgets bloated by years of taxpayer support.

Santini's claims that "Fees must accurately reflect the burden placed on public lands by visitor use" and "Fees must be set to recover costs associated with the operation of commercial facilities" are also poorly considered. If fees reflect the burden on public land, then we charge higher fees to ORVs than to hikers. If we charge ORVs more and let managers keep the money, then managers will want to let more ORVs in and cater to fewer hikers.

Similarly, if fees are set for cost recovery, then managers will focus on high-cost recreation and ignore low-cost recreation. Under H.R. 2107, with no incentives to reduce costs, managers will emphasize recreation that can meet the 75 percent cost target and simply close down other types of recreation, even if an efficient manager could provide or even emphasize those other types.

The biggest problem with Hansen's proposals is that they don't change past Congressional policy of treating recreation as a special resource. Despite multiple-use goals, Congress has set very different rules for fee collection and retention for each resource: timber, grazing, recreation, wildlife, and minerals are all treated completely differently from one another.

For example, under current law, the Forest Service can keep all timber receipts, half of grazing receipts, 15 percent of recreation receipts, and no mineral receipts. This perpetuates all of the conflicts and inequities that environmentalists have protested for decades.

The solution is an omnibus law that reforms all resources, not just recreation. Timber, grazing, and mining should, like recreation, pay for themselves with user fees set at fair market value, not cost recovery.

2 -- How to Talk to Conservatives

The Thoreau Institute is planning to hold a series of workshops aimed at helping environmentalists and conservatives work together. Until funding is available for such workshops, the following is a first draft of a paper for environmentalists on "how to talk to conservatives."

Conservatives, regardless of party, dominate American politics today--and this seems likely to continue for several years. Rather than fight this trend, environmentalists would do well to join it, both for reasons of expediency and because there are many parallels between conservative and conservation thought.

To work with conservatives, environmentalists need to change their rhetoric. Oratory that goes over well at an Earth First! meeting is likely to bomb among Young Americans for Freedom. This guide is written to help environmentalists understand and work with conservative political leaders.

Understand Conservatives

In the liberal environment in which I was raised, I was taught that conservatives wanted to keep things they way they are. Indeed, I have heard this definition repeated by liberals in the past few months. But that is far from an adequate or accurate definition of a conservative today.

There are many definitions of conservative and many branches of the conservative movement, including neoconservatives, paleoconservatives, and libertarians. In general, however, most conservatives believe in the following:

If some of these ideas don't sound like the conservatives you read about in the paper, it may be because you have been getting a distorted view. When Jesse Helms opposes federal funding of art he considers obscene, for example, he is portrayed as a censor. In fact, he opposes federal funding of all art and just uses the obscene art as an extreme example.

Conservatives are far from unanimous on many issues, including abortion, gay rights, and school prayer, and no one has to pass a litmus test on any of these issues to work with conservatives. But conservatives clearly have many things in common with environmentalists.

At heart, most environmentalists are individualists who believe in decentralization and the Bill of Rights. If they are uncertain about free markets, they know that they don't like most of the big government agencies they deal with. Those similarities are enough to open a good dialog with conservatives.

Think About Means, Not Ends

Environmentalists are ends oriented, aiming to preserve natural areas and clean up pollution. In contrast, conservatives are means oriented, preferring decentralization and free markets over central planning and big government. if conservatives have an end in sight, it tends to be individual freedom.

Conservatives have a faith in free markets that few environmentalists can accept. Conservatives believe that, if the market is working, whatever happens is right because it is a result of what people want as they express through the marketplace.

This doesn't mean that conservatives believe that all pollution, wilderness destruction, and species extinction is right. Conservatives know that such things usually happen because the market isn't working. But conservatives believe that the solution is to fix the market, not to create a government bureaucracy, subsidy, or regulatory scheme, any of which are likely to distort the market even further.

If environmentalists can't have complete faith in free markets, they can at least see that the government bureaucracies created to save the environment often do more harm than good. On some issues, environmentalists and conservatives may have to part ways, but on many issues, such as recreation fees and ending tax support of natural resource agencies, the two should be able to agree.

Don't Assume Conservatives Are Your Enemy

Until around 1980, the environment was truly a nonpartisan issue, considered neither liberal nor conservative. Numerous conservationists and preservationists (as environmentalists were known before 1970) were very conservative.

Two that come to mind are Stephen Mather, the founder of the Park Service, and Newton Drury, the California preservationist who saved millions of acres of redwoods and later became the Park Service's fourth director. As late as the Nixon Administration, the Interior Department was dominated by hard-core conservatives, such as Nathaniel Reed, who were also hard-core environmentalists.

Since 1980, the environmental movement polarized and drove most of the conservatives away from its ranks. But it is not too late to bring them back. Conservatives don't like breathing dirty air any more than you do, and they appreciate mountain views and spectacular scenery as much as anyone.

Don't Try to Find Common Enemies

Identifying and organizing people against a common enemy is one of the most powerful political tools in the book. But it won't work very well with conservatives and modern environmentalists for two reasons.

First, you don't have many common enemies. To conservatives, the enemies are advocates of big government. Since many environmentalists fall in that category, you have to be careful lest you be branded as the enemy. To many environmentalists, the enemies are greedy individuals, who are celebrated by conservatives as the true American heroes.

Second, many true conservatives know that the idea of "enemies" is a fiction. People are people, and they will act like people. While ideas may conflict, the people who hold different ideas are not necessarily "enemies." Trying to label people as immoral or unethical will merely antagonize conservatives.

Look for Win-Win Solutions

The political system promotes polarization and a narrow view of social problems in two ways. First, political organizing is most successful when people have a threat or enemy to organize against. This causes interest group leaders to demonize the opposition--not because they necessarily believe that their opponents are demons but because such rhetoric promotes memberships, contributions, and other forms of political support.

Second, the apparent power of the federal government leads people to imagine that--if only their side can win--they can get everything they want and make all their enemies pay. This leads people into thinking narrowly of win-lose solutions. Any thing that could cause the enemy to win must be suspicious, so it is immediately opposed--even if it would be good for both sides.

Environmental problems, at least, offer many win-win solutions that could benefit all sides. One reason this is possible is that so many environmental programs are run by highly inefficient government agencies. Reforming those agencies could save taxpayers money and improve environmental quality without sacrificing the resources available to commodity users.

For example, Environmental Protection Agency rules mandate that companies that pollute the air with benzene coming out of smokestacks must eliminate such pollution. A major oil refinery noted that 90 percent of the benzene pollution that it produced didn't come from a smokestack, and that it could clean up that 90 percent much cheaper than the 10 percent that came from a smokestack. Such a clean up would produce far less pollution and save the company money, but EPA wouldn't let the company do it.

Don't Focus on Corporate Welfare

Many environmentalists try to appeal to conservatives by finding examples of subsidies they can cut--particularly subsidies to corporations. But conservatives know that nearly everyone is subsidized, and when someone says "cut their subsidy" they usually also mean "but don't cut mine!"

Many conservatives aren't particularly enamored of large corporations, preferring to promote small businesses. But environmentalists and conservatives will find more common ground in discussing radical reforms of government than in focusing on a few subsidies.

Focus on Government Failure

Ever since Gifford Pinchot, the classical environmental story has been, "the market isn't working, let the government take over on behalf of the people." The result has been the creation and growth of government bureaucracies such as the Forest Service, Bureau of Reclamation, and Bureau of Land Management. While these agencies have done some good, they have also done lots of harm to the environment and many environmentalists long for their abolishment.

To conservatives, the failure of such agencies and the harm they cause are completely predictable. The apparent faith that conservatives have in free markets is better understood as a faith in government failure. According to the conservative view, markets may be imperfect but governments are perfectly bad.

So environmentalists can establish an immediate rapport with conservatives by sharing stories of government failure. Focus not on the flaws of individual bureaucrats but on the institutional problems of agencies and their relationship to Congress.

Conservative Literature

A number of books can help environmentalists understand the conservative view of government and government failure. Here are a few:

P.J. O'Rourke, Parliament of Whores (New York, NY: Atlantic Monthly Press, 1991), 233 pp. A humorous view of big government.

Jonathan Rauch, Demosclerosis: The Silent Killer of American Government (New York, NY: Times Books, 1994), 260 pp. Shows that government gridlock is caused by the fact that nearly everyone in America is now a member of one or more special interest groups.

Brian Kelly, Adventures in Porkland (New York, NY: Villard Books, 1992), 271 pp. Kelly, a writer for the Washington Post, is not exactly a conservative, but he delves in depth into Congressional pork follies.

Ronald Bailey (ed.), The True State of the Planet (New York, NY: Free Press, 1995), 472 pp. Many conservatives simply dismiss environmental claims of doom--which, it must be admitted, are sometimes exaggerated. In contrast, several of the ten articles in this book propose conservative means (markets, decentralization) to reach environmental goals (species preservation, environmental clean up).

Gordon Durnil, The Making of a Conservative Environmentalist (Bloomington, IN: Indiana University Press, 1995). Durnil chaired the Indiana Republican Party during the 1980s, helping Dan Quayle into the Senate. When Bush-Quayle took office, Durnil was appointed to the International Joint Commission, which oversees environmental problems between Canada and the U.S.--which primarily means in the Great Lakes. This opened Durnil's eyes to serious environmental issues and turned him into a flaming environmental radical. Although a strong supporter of free markets, Durnil doesn't do a good job of figuring out market solutions to environmental problems. Still, his book shows that conservatives can be just as moved by environmental problems as liberals.

Charles Murray, Losing Ground--American Social Policy 1950-1980 (New York, NY: Basic Books, 1984), 323 pp. Not about the environment, but shows how government programs stemming from President Johnson's War on Poverty can actually make problems--in this case, poverty--worse.

Myron Magnet, The Dream and the Nightmare: The Sixties' Legacy to the Underclass (New York, NY: Morrow, 1993), 256 pp. Says that the victim mentality of the 1960s has as much to do with today's hard core poverty as the welfare system.

Thomas Sowell, A Conflict of Visions: Ideological Origins of Political Struggles (New York, NY: Morrow, 1987), 273 pp. Sowell suggests that some people view social problems in moral terms--"pollution is immoral"--while others view them in pragmatic terms--"pollution is a market failure." The moralists want people to stop polluting because it is the right thing to do, while the pragmatists want to change institutions so people will have an incentive to stop polluting. Sowell doesn't use the terms "liberal" or "conservative," suggesting that there are moralists and pragmatists on both sides.

3 -- Book Review: Forfeiting Our Property Rights

Forfeiting Our Property Rights, by Congressman Henry Hyde, is not about endangered species but about the war on drugs. But the book tells numerous stories about the results of giving government too much power over private property that should worry even the most hard-core endangered species' advocates.

Under anti-drug laws passed in the 1980s, any property on which a drug crime has been committed is automatically forfeited to the federal government. The government gets the land even if no one is ever convicted of the crime and even if the owner was unaware of the crime. When local police are involved, they can sell the property and keep 85 percent of the receipts. You can imagine what kind of incentive this creates.

One story that I hadn't heard when putting together the Different Drummer issue on National Parks dealt with the Santa Monica Mountains National Recreation Area, near Los Angeles. Almost none of the land in this 150,000-acre area was federally owned when Congress designated it in 1978. Today, nearly 90 percent is still non-federal.

The Park Service wanted to buy a ranch owned by a man named Donald Scott, but he refused to sell. So Park Service officials trespassed on his ranch searching for signs of marijuana. They didn't find any, but decided to serve a search warrant on him so they could see the entire ranch. They falsely told Los Angeles police that Scott was growing marijuana, so they got a search warrant.

They could have sent a process server to deliver the warrant. Instead, 30 local, state, and federal (including Park Service) agents busted down his doors. Scott, who was on the second floor, heard his wife scream, and ran downstairs carrying a gun. He was shot dead.

Later investigation revealed that police had no evidence of marijuana. But they did have a complete appraisal of Scott's property, suggesting that the main goal of the raid was to confiscate Scott's land for the Park Service. This was the conclusion reached by CBS's 60 Minutes.

Most of the other stories told by Hyde don't end in death, but they are disturbing anyway. According to Hyde, people have lost homes and farms because their neighbors have merely alleged that they were using or growing marijuana. In Florida, the police routinely stop drivers and confiscate any large amounts of cash they may be carrying, since only drug dealers would carry so much cash. Airport ticket agents receive bounties for turning people in who pay for tickets in cash.

Once you lose your property, the burden is on you to prove you are innocent. If you are, you may get it back. But often the government keeps 10 to 25 percent for "administrative purposes."

These stories sound unbelievable, but they ring true. I have a close friend who nearly lost his automobile after driving across the Canadian border into the U.S. with a passenger who turned out to have a tiny amount of marijuana in his pocket. After many months, my friend got his car back, but only because it was co-owned by the bank. Banks are presumed innocent, but people are not.

The drug forfeiture laws strongly resemble the takings provisions of the Endangered Species Act. In both cases, innocent people can suddenly lose the use of their property through no fault of their own. In both cases, the burden of proof is on the property owner, not the government.

In both cases, the laws are justified by the greater good they do for society. In both cases, the laws' proponents imagined that the burden would fall mainly on the truly "guilty" or truly wealthy--in the drug laws, on big drug dealers; in the endangered species, on large corporations. But in both cases, the law has often if not most frequently fallen on ordinary people.

I do not feel comfortable living in a society where I could lose my house because a neighbor told police that he smelled marijuana smoke coming from a bedroom window. And I can see why rural landowners don't feel comfortable living in a country where the discovery of some little known animal can cause the government to force me to completely change my use of my land.

Anyone who thinks that the Endangered Species Act shouldn't be altered should read Hyde's book, which is under 100 pages long and which was just published by the Cato Institute.

4 -- The Replicator Society

As noted in the last issue of Subsidies Anonymous, the real polarization over environmental issues is not liberal-vs.-conservative but urban-vs.-rural. As noted in the most recent Different Drummer, for example, ruralites are far more likely to hunt than urbanites. More importantly, ruralites are more likely to have a "wise-use" view of the environment, while urbanites are more likely to be "preservationists."

What is the source of this difference? It is partly because urbanites are less likely to make their living directly from resource use. More and more urbanites work in services. Even those who work in retailing, manufacturing, or other areas remain remote from actual resource extraction.

An even more subtle factor is at work, however, something that Idaho writer John Rember calls the "replicator society." Just as some kids reputedly don't know that milk comes from cows, most urbanites see no connection between the things they buy in stores and the production of raw materials. Food, clothing, and other purchasers aren't made; they are simply replicated.

This increases urban naivete in two important ways. First, urbanites remain unaware of the trade-offs involved in their purchasing decisions as well as in their political decisions. Sure, we know that Pampers use paper, but who among us really knows whether all of the environmental costs of Pampers are greater or less than the environmental costs of cloth diapers?

The second problem is that retail replication is so transparent to users that few urbanites are aware of the incredible complexity of the market place. A typical supermarket sells tens of thousands of products from every inhabited region of the world, products made by thousands of different companies and purchased by the supermarket through dozens of different distributors. Markets must be very careful about their purchases, particularly since many have a short shelf life and profit margins are slim.

The most complicated version of FORPLAN, the computer program used by the Forest Service to plan its national forests, could handle a maximum of 160 different products. As sophisticated as our computers are, they couldn't manage a single grocery store much less a large chain like Safeway or Krogers.

So how can some stores handle as many as 220,000 different products? What is it about the United States that led Boris Yeltsin to say (in 1989 before the fall of the Soviet Union) that, to understand America, "at least 100 million Soviets must pass through the American school of supermarkets. Their supermarkets have 30,000 items of food. You can't imagine it. It makes people feel secure."

The answer is "markets" (in the sense of "free markets" as opposed to "supermarkets"). Markets, not computers, allow stores to operate with 30,000 to 200,000 items on their shelves. Markets tell producers what to make out of milk and other raw materials. Markets tell retailers what prices to set for their products.

Markets can do these things by reducing all trade-offs to a single common denominator. Is it better to buy milk from a dairy that is closer to market, meaning transportation costs are lower? Or is it better to buy from a dairy further away, where land costs less? Instead of trying to assess this trade-off, the market simply translates transportation and land into a single denominator: money.

The debate over Pampers vs. cloth diapers is a problem because not all of the costs of paper and energy are built into the market. One solution is to have a government agency write an environmental impact statement to assess these trade-offs. But the government can't even do FORPLAN correctly even when a forest has less than 160 products. How can it be expected to correctly assess the trade-offs for Pampers and hundreds of other paper and energy-consumptive products?

The better solution is to build all paper, recycling, energy, and other costs into the price users must pay for goods. Then users won't have to ask if every thing they buy is environmentally friendly. The only questions they need ask is what does it cost and how much do they want it?

Urban environmentalism makes many legitimate arguments for land and resource protection and preservation. But the best way for environmentalists to achieve these goals is through the market, not a government bureaucracy.

Electronic Drummer | Subsidies Anonymous