Monday, January 22, 2018

The Paradox of Property Rights in Paradise

Teton County, Wyoming, is about as close to paradise as you can get. Of its 4,000-odd square miles, Grand Teton and Yellowstone National Parks account for 45 percent, the Bridger-Teton and Caribou-Targhee National Forests for another 51 percent, and the National Elk Refuge for another 1 percent. That leaves 3 percent for private property, the $15 billion assessed value of which averages out to $200,000 an acre.

Teton County Commissioner Mark Newcomb recently sent me a link to a talk he gave on the “epic struggle” of managing that paradise. Zoning and property rights are a key battleground. Recent skirmishes have been fought over such issues as whether sixty-eight homes or only seven should be allowed on twenty-one rural acres, whether six houses authorized on another parcel must be clustered, and whether additions should be permitted on houses located near streams.

It’s hard to know whether the existing 97/3 split strikes the right balance between public and private property, when, as Newcomb points out, no one can put a dollar value on the area’s environmental amenities. The only sure thing is that those amenities account for the high value of the remaining private property. But the question of the overall public/private balance is an issue for Congress, not the county commission.

Instead, the commission’s job is to oversee the existing 3 percent of private property. Newcomb’s talk reflects some doubts over whether current regulations are doing that job well.
First, he raises the issue of administrative fairness:
The system is arbitrary in that it is not rooted in any real analysis, let alone valuation, of the ecosystem services in question. It is arbitrary in that it can result in reasonable development being thwarted because the process is too onerous, or conversely for unreasonable development to be entitled because the cost to challenge it is too high, the pockets of the special interest behind it too deep. It is messy.
Second, he notes that the country’s 80-odd pages of land use regulations are not really about protecting private property rights, in the sense of “entitlements of individuals against the majority.” Rather, they are mainly motivated by the majority’s desire to dictate to individual owners.
I guarantee that these 80 pages of regs governing what you can and can’t do with your property were not requested by the property owners trying to exercise their property rights. They were requested by neighbors, neighbors expressing a diminishment of their rights to natural amenities such as viable and healthy wildlife populations, natural soundscapes, and scenic vistas.
Third, he notes the paradox that the more restrictive regulations become, the more their benefits become concentrated on the few. What would happen, he asks, if someone with deep pockets started buying up most or all of the country’s $15 billion-worth of private land?
Ironically, the more that buyer bought up, the more valuable anything left over becomes…right? Because whatever is left behind is surrounded by that much more space, that much more wildlife, offering that much more opportunity to . . . you guessed it, “Stay Wild.” In other words, everyone wants to live here, especially if no one else lives here.
That, in a nutshell, is the ultimate paradox of property rights in paradise. What’s a poor county commissioner to do?

Reposted from

1 comment:

  1. When this was reposted at [ ] a reader asked me to explain more clearly what I mean by the "paradox of property rights in paradise." Here is my reply:

    Sorry, I had a strict word limit in the original version of this post. Let me try to explain more clearly what I saw as the paradox.
    What I had in mind is a contrast between traditional and more modern ideas of property rights. Traditionally, property rights have been thought of as protecting the rights of individual owners to use their property as they see fit, so long as their use does not harm others. At least that is true of the the libertarian tradition, in which "does not harm others" meant direct, physical invasion or nuisance, such as building a smoky factory or opening a noisy dragstrip. Beyond that, property owners were supposed to follow a "live and let live" policy. (For more, see, e.g., Murray Rothbard on the physical invasion standard.)

    In practice, though, zoning has brought on a new concept of collective property rights, in which owners have essentially a veto over anything other owners do that impacts their property value even in the most subjective way. That can mean building in a style others don't like, building "affordable" housing--since everyone likes low-wage types as workers in their gardens and restaurants, but not as neighbors--or just something as small as hanging clothes on a clothes line.

    A further aspect of the paradox is that traditionally, the left has been suspicious of property rights as an institution that supports elites at the expense of the working class, but when the environment is in play, as in this case, the left makes an alliance of convenience with elites by supporting zoning that simultaneously minimizes the human footprint in a pristine environmental area and maximizes property value for the elites who live there.

    I don't want to be doctrinaire about this, but it does seem to me that in both prime rural areas like Teton County and prime urban areas like San Francisco, the balance has swung too far in favor of the collective version of property, as embodied in zoning, as opposed to the more traditional, and less elitist, individualist version of property.