GOVERNMENT vs. NATURAL RESOURCES by Murray N. Rothbard
4 min readSep 16, 2019
Government vs. Natural Resources
Murray N. Rothbard
I t is a common myth that the near-disappearance of the
whale and of various species of fish was caused by “capitalist
greed,” which, in a short-sighted grab for profits, despoiled the
natural resources— the geese that laid the golden eggs — from
which those profits used to flow. Hence, the call for government
to step in and either seize the ownership of these resources,
or at least to regulate strictly their use and development.
It is private enterprise, however, not government, that we
can rely on to take the long and not the short view. For ex-
ample, if a private investor or business firm owns a natural
resource, say, a forest, it knows that every tree cut down and
sold for short-run profits will have to be balanced by a
decline in the capital value of the forest remaining. Every
firm, then, must balance short-run returns as against the loss
of capital assets. Therefore, private owners have every eco-
nomic incentive to be far-sighted, to replant trees for every
tree cut down, to increase the productivity and to maintain
the resource, etc. It is precisely government — or firms allowed
264
THE FREE MARKET READER
to rent but not own government — whose every incentive is to
be short-run. Since government bureaucrats control but do
not own the resource “owned” by government, they have no
incentive to maximize or even consider the long-run value of
the resource. Their every incentive is to loot the resource as
quickly as possible.
And so it should not be surprising that every instance of
“overuse” and destruction of a natural resource has been
caused, not by private property rights in natural resources,
but by government intervention or crippling of such a mar-
ket. Destruction of the grass cover in the West in the late
19th-century was caused by the Federal government’s failure
to recognize homesteading of land in large-enough techno-
logical units to be feasible. The 160-acre legal maximum for
private homesteading imposed during the Civil War made
sense for the wet agriculture of the East; but it made no sense
in the dry area of the West, where no farm of less than one or
two thousand acres was feasible. As a result, grassland and
cattle ranches became land owned by the federal government
but used by or leased to private firms. The private firms had
no incentive to develop the land resource, since it could be
invaded by other firms or could revert to the government. In
fact, their incentive was to use up the land resource quickly
to destroy the grass cover, because they were prevented from
owning it.
Water, rivers, parts of oceans, have been in far worse
shape than land, since private individuals and firms have
been almost universally prevented from owning parts of that
water, from owning schools of fish, etc. In short, since home-
steading private property rights has generally not been
permitted in parts of the ocean, the oceans and other water
resources have remained in a primitive state, much as land
had been in the days before private property in land was per-
mitted and recognized. Then, land was only in a hunting-
and-gathering stage, where people were permitted to own or
PRIVATIZATION VS. GOVERNMENT OWNERSHIP
265
transform the land itself. Only private ownership in the land
itself can permit the emergence of agriculture— the transfor-
mation and cultivation of the land itself— bringing about an
enormous growth in productivity and increase in everyone’s
standard of living.
The world has accepted agriculture, and the marvelous
fruits of such ownership and cultivation. It is high time to ex-
pand the dominion of man to one of the last frontiers on
earth: aquaculture. Already, private property rights are being
developed in water and ocean resources, and we are just be-
ginning to glimpse the wonders in store. More and more, in
oceans and rivers, fish are being “farmed” instead of relying
on random supply by nature. Whereas only three percent of
all seafood produced in the United States in 1975 came from
fish-farms, this proportion tripled to twelve percent by 1984.
In Buhl, Idaho, the Clear Springs Trout Company, a fish-
farm, has become the single largest trout producer in the
world, expanding its trout production from 10 million
pounds per year in 1981 to 14 million pounds this year. Fur-
thermore, Clear Springs is not content to follow nature
blindly; as all farmers try to do, it improves on nature by
breeding better and more productive trout. Thus, two years
ago Clear Springs trout converted two pounds of food into
one pound of edible flesh; now Clear Springs scientists have
developed trout that will convert only 1.3 pounds of food
into one pound of flesh. And Clear Springs researchers are in
the process of developing that long-desired paradise for con-
sumers: a boneless trout.
At this point, indeed, all rainbow trout sold commercially
in the United States are produced in farms, as well as 40% of
the nation’s oysters, and 95% of commercial catfish.
Aquaculture, the wave of the future, is already here to
stay, not only in fishery but also in such activities as off-shore
oil drilling and the mining of manganese nodules on the
ocean floor. What aquaculture needs above all is the expan-
266
THE FREE MARKET READER
sion of private property rights and ownership to all useful
parts of the oceans and other water resources. Fortunately,
the Reagan Administration rejected the Law of the Sea Treaty,
which would have permanently subjected the world’s ocean
resources to ownership and control by a world-government
body under the aegis of the United Nations. With that threat
over, it is high time to seize the opportunity to allow the ex-
pansion of private property in one of its last frontiers.