From: C
Sent: Friday, July 27, 2018 7:29 AM
To: [email protected]
Subject: Question regarding Austrian Environmental Economics

Dear Dr. Prof. Walter Block.

Currently, I’m writing my masters thesis criticizing the green growth theories on Austrian grounds. I’m aware of the debate that took place in the QJAE in 2014(2015), George Reisman’s environmental view and of course about Rothbard’s 1982 paper. However, I still find myself with open questions and thought that You might be the best source to contact regarding these issues.

1. The example of Rothbard concerning air pollution, where it is suggested, that affected property owners could file a lawsuit against the owner of the private highway:

Right before this example, he states: “The guilty polluter should be each individual car owner and not the automobile manufacturer, who is not responsible for the actual tort and the actual emission.”, which I find absolutely reasonable. But why should the owner of a private road be liable for any harm done by others on his property in the first place? Would owners of malls or private residential areas be liable for theft, murder or other crimes happened there? Wouldn’t the owner of the private road or the judge say: neither I (the owner) nor anything in my (the owners) possession caused any emissions whatsoever?

2. Austrian answers in a political environment hostile towards private property:

I agree with Your statement, that Austrian economists shouldn’t offer proposals. But You also mentioned, that economists “may properly offer ‘if-then’ statements”. If now the question is raised towards us, “If You want to reduce environmental damage without changing how property rights are defined – then?”, can’t there be an Austrian answer? I certainly agree that the answer wouldn’t be ideal. But does Austrian economics has to come to terms with the fact that other schools offer answers to this question, which indeed increase environmental protection, regardless of the unseen costs and harm it will bring to society? Environmental questions are omnipresent in politics, especially in western Europe, and I at least have the fear that demagogues like Tim Jackson will seize even more influence if we are not able to offer answers that are politically feasible in short-term.

By no means, I want to be hostile by stating these questions, but maybe I’ve overlooked some details or simply looked at it from the wrong angle. Maybe You can offer me some additional reading I’m not aware of. Thank You very much for Your time!

Yours sincerely, C

Dear C: I don’t see even the slightest hint of hostility in your very important questions. So, let me answer them in order.

First, I regard this essay as THE best one ever written on environmental law, and I am delighted to defend it against your well thought out critique.

Rothbard, Murray N. 1982. “Law, Property Rights, and Air Pollution,” Cato Journal, Vol. 2, No. 1, Spring; reprinted in Economics and the Environment: A Reconciliation, Walter E. Block , ed., Vancouver: The Fraser Institute, 1990, pp. 233-279; http://mises.org/story/2120; http://www.mises.org/rothbard/lawproperty.pdf

Take another case. Smith runs a night club. The patrons are very loud, even at 3am. The neighbors complain (in Rothbardian terms, Smith has not first homesteaded the right to engage in sending out sound waves at that time of the night). Then, indeed, Smith is responsible, even though he himself is very quiet. Smith is aiding and abetting others to violate the rights of the neighbors. To return to roads, the highway owner is responsible for aiding and abetting his motorist clients to trespass smoke particles onto the property, and lungs, of the neighbors. I go into this in quite a bit more detail here:

Block, Walter E. 2009. The Privatization of Roads and Highways: Human and Economic Factors; Auburn, AL: The Mises Institute; http://www.amazon.com/Privatization-Roads-And-Highways-Factors/dp/1279887303/ref=sr_1_1?s=books&ie=UTF8&qid=1336605800&sr=1-1; available for free here: http://mises.org/books/roads_web.pdf; http://mises.org/daily/3416; http://www.walterblock.com/wp-content/uploads/publications/radical_privatization.pdf; audio: http://store.mises.org/Privatization-of-Roads-and-Highways-Audiobook-P11005.aspx; http://www.audible.com/pd/Business/The-Privatization-of-Roads-and-Highways-Audiobook/B0167IT18K?tag=misesinsti-20; http://us1.campaign-archive1.com/?u=bf16b152ccc444bdbbcc229e4&id=6cbc90577b&e=54244ea97d
http://www.sanfranciscoreviewofbooks.com/2017/09/book-review-privatization-of-roads-and.html

Second, Austrian economists greatly respect the normative-positive distinction, and stick to the latter, even as members of other schools of economists do not. I don’t think I ever said that “Austrian economists shouldn’t offer (public policy) proposals.” Only that they should not do so qua Austrians. They can of course offer, as professional economists, if then statements. For example, thus and such will be the result if we adopt private property rights. That is the main burden of the Rothbard essay mentioned above. Austrians may also trace the effects of carbon taxes, tradeable emissions rights. We do not oppose empirical work, contrary to the views of some of our critics.

Regarding economic history, as done by Austrians, empirical findings are an integral part of the analysis.

Readings on this would be these books by Mises: Theory and History and The Ultimate Foundation of Economic Science.

The Best of Walter E. Block