The Future of Life

Protecting biodiversity through the private sector


"The 21st century is destined to be the century of the environment, the time we settle down before we wreck the planet," declared Harvard University biologist Edward Wilson in his Bradley Lecture at Washington, D.C.'s American Enterprise Institute on Monday. His speech, based on his upcoming book, The Future of Life dealt with what Wilson calls "the reconciliation of humanity with nature." Because of humanity's misuse of the Earth, Wilson fears humanity is "at risk of losing forever much of the rest of life–creation, if you prefer."

Wilson offered the AEI audience a rather conventional portrayal of the world's environmental woes, pointing to rising human population and rising living standards as the culprits in "the accelerating destruction of the natural environment." However, by focusing on only these factors, Wilson misses the chief reason why the world's biodiversity may be threatened–and the most promising way to protect it.

Wilson believes that the twin forces of population growth and economic growth threaten to destroy half of all species on Earth before the end of this century. A note of caution should be sounded here about such predictions. In 1970, Dr. S. Dillon Ripley, secretary of the Smithsonian Institution, predicted that by 1995 somewhere between 75 and 80 percent of all the species of living animals would be extinct. In 1980, population alarmist Paul Ehrlich predicted that more than nine-tenths of the original tropical rainforests would be gone within the following 30 years resulting in the extinction of half of the species living there.

Ripley was flat-out wrong and there's no reason to believe Ehrlich's ominous prophesy will come true in 2010. Could Wilson be right?

Wilson cites the "Iron Laws of Biogeography" as support for his predictions. Of course, he, along with biologist Robert MacArthur, is responsible for developing the theory of island biogeography in the first place. Basically, this theory says that the bigger the island, the more species it can support. This relationship is captured in the species/area curve. As Wilson explained it, in general if an ecosystem is reduced by 90 percent, the number of different species it can sustain is cut by 50 percent.

However, there's another "iron law" which Wilson overlooked, one that is even more relevant to the fate of life on the earth: the law of the open-access commons.

The main reason that species are being threatened with extinction is that they live in open-access commons. The point is clearest in the case of tropical forests and fisheries. No one owns the forests or fisheries; therefore anyone may exploit them. No one has an incentive to leave any trees or fish behind because if they do, someone else will harvest them and get the benefits for themselves. In other words, those who immediately benefit from exploiting the resource do not bear the long run costs of its ultimate destruction. This mismatch between benefits and costs is a recipe for disaster.

There are two things one can do to try to fix a commons: The first is to regulate it, and the second is to privatize it. Unfortunately, the record shows that political regulation of forests, parks, fisheries, airsheds, and rivers, has not been notably successful in protecting those resources. For example, the government-owned rainforests in Brazil, Indonesia, and the Philippines, continue to shrink. New England's cod fishery is still in near total collapse. Often what ends up happening is that the benefits are privatized while the costs are socialized: Fishers catch and sell the fish; when the fishery collapses, taxpayers buy their boats, pay for job retraining, and other subsidies.

The road not taken often enough, one largely ignored by Wilson, is to privatize a commons. There is usually considerable political resistance to this course of action because people who once had access are now denied it or are forced to pay for something they used to get for free. Corporations don't want to pay full price for the water they use, the minerals they mine, or the trees they cut. Fishermen don't want to pay for the fish they catch. Citizens don't want to pay for visits to national parks.

But privatization of a commons–a forest or a fishery–means that the benefits and the costs are now borne by the same people. History shows that this match-up encourages them to protect a resource. We know privatization works for the same reason that owners tend to take better care of their houses than renters do, and that there is no shortage of Persian cats or chickens, even as bluebirds and Karner Blue butterflies become scarcer.

Privatization works to preserve nature in another way as well. Wilson shortsightedly dismissed tree plantations as not being "real forests." But the fact is that intensively managed tree plantations growing on just 5 percent of the earth's forestlands could supply all of the world's current requirements for wood products. This could spare 95 percent of the world's forests for "nature." Wilson, after offering a few cautionary words, did give a ringing endorsement to the role that genetically enhanced crops must play in preserving wildlands. "We must increase the productivity of the cropland we already have under cultivation by creating an 'Ever Green Revolution' that doesn't depend on massive amounts of fertilizer and irrigation," he declared. "The advantages of genetically engineered crops are simply enormous.

In the case of privatization, a good policy falls victim to a vision of an allegedly perfect policy through which all species are saved. Privatization is often rejected by the environmentalist lobby because it will not give them everything that they want (and they will have to pay for what they get as well). Environmentalists worry, with some justification, that property owners may sometimes want to use their property in ways that do not maximize species preservation goals. However, if species preservation is a legitimate national and international public good–and I think it is–then our responsibilities as citizens toward property owners is the same as for any other use public use of their property: They should be compensated. Whenever we want to build a school, an airport, or a road, we do not simply walk in and take the property. We pay a fair price for it first. Similarly, in pursuing the worthy goal of species preservation, it seems reasonable that we should pay those whose property we take in the service of that goal.

Wilson evidently is not completely unaware of this problem since he lauded the efforts of private conservation organizations to buy and preserve areas in developing countries, particularly pointing to the efforts of Conservation International and the Nature Conservancy to preserve 2 million acres of natural habitat in Bolivia, Guyana, and Surinam. Wilson noted that often it is possible to buy and preserve land in developing countries for as little as $10 per acre, or to purchase the logging rights for even less. But this assumes that governments in developing nations will protect and enforce property rights. Too often, that's simply not the case.

Wilson declared that these private efforts are not enough, that "governments will still have to do the heavy lifting. The world spends some $6 billion per year on conservation now, but $26 billion annually is what is required to save nature and biodiversity which is just one-tenth of one percent of global GNP." But as the World Bank has amply demonstrated, it is possible to spend hundreds of billions of dollars without achieving a great deal. More money is needed for conservation, but Wilson and others who value the natural world must worry a lot more about the institutional arrangements, particularly property rights, that are necessary to help humanity preserve and protect wild nature for future generations.