MSU poised on the cutting edge…again

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MSU poised on the cutting edge…again

By: John A. Baden, Ph.D.
Posted on January 23, 2002 FREE Insights Topics:

Montana State University will be prominently featured in the history of 20th century environmental thought. Shortly after the first Earth Day of 1970, this university was to environmental policy as Stanford is to semiconductors, the font of constructive and successful innovation.

Unfortunately, despite their positive contributions, the ideas emanating from MSU researchers were not patentable and didn't produce an Intel or HP. Hence the originators didn't generate the billions of dollars now flowing to Stanford and Cal Tech. I played a modest role in this saga of success and setbacks and still support the school's progress.

Here's how it began. Environmental studies focus on two topics, sludge and romance. The most important to health and wealth is sludge, noxious byproducts of society's production and consumption.

Asbestos, dioxin, heavy metals, and sewage are obvious examples.

Political economists at MSU focused on the second category, romance. This includes parks, endangered species, wildlife habitat, wilderness, and roadless areas. They analyzed institutions, the arrangements that influence resource and amenity management.

Political forces commonly produced ecologically and economically inferior outcomes. After careful study, they suggested innovative reforms. MSU researchers advanced the radical view that harmonizing ecology and economy required the creative efforts of environmental entrepreneurs and organizations such as The Nature Conservancy and Ducks Unlimited. They criticized centralized management, especially Green Platonic despots ruling from D.C.

Their analysis was based on both ecological and economic reasoning. They recommended full disclosure, honest accounting, and clear responsibility for the consequences of one's actions. Reforms required new institutions, not mere tinkering.

Forest Service timber sales that returned less than 20 cents for each dollar spent on the administration of those sales were easy targets. These sales fostered logging in high, fragile ecosystems. Thus, public subsidies drove environmental degradation.

The "iron triangle" of commodity groups, agency bureaucrats, and elected officials drove such operations. The MSU professors used public choice economics to critique prevailing natural resource management systems. They explained that sorry results were not aberrations but rather predictable consequences of prevailing opportunities and incentives.

This work was all quite straightforward and widely accepted within the economics profession. Several future Nobel Prize winners became interested in our work and enjoyed occasional visits to our Montana seminars. It was an exhilarating time.

However, many folks were not pleased with this success.

The commodity groups, taxpayers all, were outraged that "their" University would harbor these outspoken critics of crony capitalism. And a generation ago, many Greens had more than a tinge of pink. They were outraged that a bunch of libertarian economists had trespassed into their domain and claimed the intellectual, ethical, and ecological high ground. The federal bureaucracies were outraged that they, the apostles of "scientific management" (and supporters of university research), were attacked with solid data on government malfeasance and causal models explaining it: incentive structures that lead agency budget maximization to trump the public interest.

A generation later, things have changed. Time and the forces of logic and data eroded the pretences and postures that rationalized economic waste and ecological plundering. The once radical notions and proposals of the MSU political economists became the conventional wisdom of many progressive environmentalists.

Here's a current example from Defenders of Wildlife.

In an effort to prevent future conflicts involving ranchers, livestock and grizzly bears, Defenders recently purchased a 16,000-acre grazing allotment near Grand Teton National Park. Predation by grizzly bears has long been a problem to stockmen throughout Greater Yellowstone.

In an interview, Ms. Johnson of Defenders said: "Programs like this have tremendous potential benefit for both livestock owners and wildlife advocates.... Unlike other programs, this offers a permanent solution to grizzlies getting in trouble with sheep."

This was one of the proposals we advocated in the mid 1970s. We were either prescient or politically precocious.

MSU is poised to repeat this success. It's not in the political economy arena this time, but, for example, in biotechnology. Biofilm engineering and gene splicing of plants hold great promise. And unlike political economy, this could be of great financial benefit to the university. Go for it!

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