Property Rights & Climate Change at AALS

I presented on a plenary panel discussing the implications of global warming for property law at the AALS Mid-Year meeting earlier this month.  My thesis, in short, was that concerns about global climate change do not justify abandoning or reconceiving traditional property norms.  To the contrary, I suggested, environmental problems generally – and the threat of global warming in particular – should prompt us to place an even greater emphasis on traditional property rights institutions.  A summary of my remarks is below the jump.  Eduardo Peñalver generously responded to my presentation at Prawfsblawg.  I will respond to his comments in an addendum or a follow-up post.

For several decades environmental thinkers have called for a reexamination of traditional property norms and reconsideration of property rights as defined and protected in American law.  Property scholar Joseph Sax, among others, suggested environmental protection could necessitate “a reconsideration of the notion of property rights.”  He and others postulated both that legal protection of property rights could impede governmental efforts to safeguard environmental resources and, more provocatively, that the institution or property itself, and the resulting subdivision of the landscape, were a contributing factor to the impeding environmental crisis.

I reject the ecological critique of property.  As I have argued in several papers (see, e.g., here and here), traditional notions of property rights are not a threat to environmental protection, but the foundation of sound ecological stewardship.  Environmental problems are quite real, but property rights are not the cause.  To the contrary, well-defined and defended property rights encourage greater resource stewardship and sustainable use and tend to mitigate the consequences of cultural ignorance about the ecological effects of human activity.  At the same time, regulatory infringements on property rights tend to discourage stewardship (as I discussed at length here).  If one looks at ecological resources around the world, those resources that have been successfully integrated into property rights institutions are in better shape – far closer to sustainability – than those managed politically.  Fisheries are the textbook example, but there are others.  Extending property institutions to incorporate environmental resources is not always easy to do, and we are often too impatient to allow the organic evolution of property institutions (and often with good reason), but the bottom line is clear: private rights in nature have tended to do more good than harm. In his seminal essay, Garrett Hardin identified two potential paths out of the tragedy of the commons.  The first, “mutual coercion, mutually agreed upon,” has produced mixed results, at best.  The second, the creation of property rights, has largely been forgotten.

Extending property rights in natural resources does not necessarily mean establishing individuated ownership.  Property rights come in many forms with many textures, including various forms of cooperative property or condominium-like ownership structures.  As I’ve detailed in some of my work on fisheries (here and here), such institutions may evolve in complex forms, often without state intervention or support.  Furthermore, while property rights are the foundation of market institutions, the creation of property rights does not exclusively empower those who seek to pursue profit.  America’s conservation history is filled with examples of individuals and groups who used property institutions to protect politically unpopular places and resources, ranging from the early Audubon Society and the founders of Hawk Mountain to those who rescued the American bison from brink of extinction to which it had been driven by federal policy.

Establishing property rights in the global atmosphere is obviously not possible, and likely never will be.  But approaching climate change from a property rights standpoint can clarify the nature of the problem and help identify desirable policy responses.  As I argued in this paper, climate change is likely to have effects that should concern those who believe property rights are important.  Specifically, I argued that even “conservative” assessments of climate science suggest that human activity will contribute to a modest warming that, in turn, will contribute to measurable increases in sea-level, flooding lands of those who have not done much to contribute to global climate change.  In my view, this provides ample basis for responding to climate change independent of whether one is convinced that climate change threatens ecological disaster.  Whether or not global climate change threatens massive net welfare losses in the U.S. or elsewhere, the likelihood of property violations, such as those caused by coastal flooding, should be enough to prompt a meaningful policy response.  Furthermore, application of a property rights framework, in my view, supports claims for compensation, as suggested by the work of Dan Farber (among others), as well as calls for the imposition of a fully-rebated, revenue-neutral carbon tax – what could be conceived as an atmospheric user fee.

Greater reliance on property rights will also help with necessary efforts to respond to climate change’s likely effects.  If current projections are correct, some amount of climate change is inevitable.  We know climate change will cause disruptions and changes, but we don’t (indeed can’t) know precisely what those changes will be.  We know that greatest effects will be in parts of world that are least prepared and least able – and this is due in part to the fact that such parts of the world are the least developed and least market-oriented. Farmers in U.S. will have ample incentive and ability to adjust to climatic changes – and could even benefit from some prospective changes; farmers in sub-Saharan Africa, not so much.

In preparing for changes due to warming – indeed to be well-prepared for any environmental change generally, (human caused or otherwise) – we need complex adaptive systems.  Specifically we need systems that can respond relatively rapidly to changes, that discover, disperse and process time/place specific information about changes and consequences, and that allow reallocation of resources in response to changes and challenges.  Centralized regulatory systems tend to have real deficiencies in this regard.  Property-based systems, on the other hand, readily fit the bill.  A prime example is water.  As I discussed here (and at greater length here), climate change will cause considerable uncertainty regarding future water availability.  Centralized management of water is a disaster already, and won’t be able to respond adequately to climate-induced changes.  Greater use of water markets and recognition of rights in water could allow for more efficient reallocations and encourage greater conservation and more efficient use.  Even the IPCC has acknowledged that  “improving the functioning of water markets could help create the kind of flexibility needed to respond to uncertain changes in future water availability.”

My closing thought was that environmental problems are real and complicated.  Climate change in particular is a “super-wicked” problem that defies easy solutions.  Applying and adapting property rights institutions to environmental concerns will often be difficult.  But it is a mistake this difficulty does not mean other approaches are more promising, or that the effort is not worth the reward.  And it is a mistake to think such difficulties provide an excuse to abandon or undermine traditional notions of property rights.