Shifting Baselines

Shifting Subsidies And Conservation

US environmentalists are up in arms on farms across the nation because of a recent downward trend in the Conservation Resource Program. The program, established about 25 years ago, pay farmers not to grow on some of their fields. The result has been impressive: 400,000 participating farmers and an area totaling over 36.8 million acres. Duck populations rose to about two million as a result. But now wheat and other crop prices are soaring, and farmers want their land back to…what else…farm. Last year farmers took back an area the size of Rhode Island and Delaware combined.

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Surprised? You shouldn’t be. And those concerned environmentalists should maybe take a business course. The Conservation Resource Program is a subsidy. And guess what? Subsidies are designed to go away.

The United States is a rich nation with strong property rights and secure, standardized transactions. Especially in such environments, indirect methods of biodiversity conservation, such as subsidies, don’t make sense. And in this case – they can go away. The US Government would be better off taking a slightly more direct approach: the cheapest way to get something you want is to pay for you want rather than pay for something indirectly related to it.

As they say…you get what you pay for.

For the story, see the business section of the NY Times.

Comments

  1. #1 Friendly Contrarian
    April 11, 2008

    So the solution is for the government to buy up land with the money they would have used for subsidies and take it permanently out of rotation? I wonder how much could be protected that way, and whether farmers would go for it.

    I’m all for great swaths of publicly protected greenbelt, and I’m willing to pay a little more for food if it protects the environment. But then I’m a middle class Californian. I live in a region that produces tons of food, and I can afford to pay an extra buck a pound for my grapefruit.

    These farming economies in rural areas have different priorities.

  2. #2 bob koepp
    April 11, 2008

    In my experience, conservation-minded farmers didn’t need subsidies to spare, or even to restore natural habitat. As a societ, we should buying environmentaly sensitive areas from whoever happens to hold the current leases, and protecting them in perpetuity. Surely a nation as rich as the USA could do this.

  3. #3 Mike
    April 12, 2008

    Here in NYC, we’re dealing with a preposterous plan to build a multibillion dollar water treatment plan rather than spend a fraction of that cost to purchase the land in the watershed that has always provided high quality, naturally purified water to half the state. Obviously, this makes no economic sense.

    On the other hand, politicians gain nothing material by making wise land use decisions on behalf of the public. They do benefit materially when they do favors for wealthy developers or funnel government money to those that don’t deserve it. I’m not putting the farmers who have every right to grow crops on their land in the latter category. I’m saying that all too often, our elected officials make disastrous decisions because they put their own short term interest ahead of the long term interest of the commons.

  4. #4 doug l
    April 12, 2008

    Shifting Baselines? Meet Unintended Consequences. You two should become best friends.

  5. #5 film izle
    August 10, 2010

    I’m all for great swaths of publicly protected greenbelt, and I’m willing to pay a little more for food if it protects the environment. But then I’m a middle class Californian. I live in a region that produces tons of food, and I can afford to pay an extra buck a pound for my grapefruit.

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