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Adjusting the Fifth to a Finite Planet, Part II

by Eric Zencey

Editor’s Note: This is the second piece of a two-part post. You can read Part 1 here.

Eric ZenceyAmong the avenues by which Takings case law could be adapted to the reality of a finite planet are these three:

One: Change the default by changing the definition of what constitutes a reasonable investment expectation. It is no longer reasonable for an individual to expect to profit from using property in ways that would destroy or diminish the property’s ability to provide ecosystem services to the public at large. Instead of the general public having to pay property owners the going market rate for land burdened by regulation–a rate that reflects the most intensive economic use of the land that can be imagined by infinite-growth-believing, financial-risk-taking optimists–land owners would have to compensate the general public when their acts diminish the flow of ecosystems services.

Two: Change the default by promulgating the notion of an ecological servitude. All property that abuts navigable waters in the U.S. is held under a navigational servitude: the public’s interest in maintaining navigable waters trumps the interests of waterfront property owners. As Justice Jackson put it in United States v. Willow River Power Co., “Rights, property or otherwise, which are absolute against all the world are certainly rare, and water rights are not among them.” Given the legitimate authority of government to pursue the public interest in establishing and maintaining navigable waters, he said, “private interest [in the disposition of waterfront property] must give way to a superior right, or perhaps it would be more accurate to say that, as against [the public interest represented through] the Government, such private interest is not a right at all.”

Under current interpretations of the servitude, when public authority exercises its power over navigation in ways that affect the interests of property owners, the public may not be required to pay compensation under the Takings Clause. Land abutting navigable waters has always been subject to this servitude, so the exercise of it does not necessarily constitute a taking or an unforeseeable loss for the property owner.

The notion of an ecological servitude would be constructed by analogy: the paramount interest the public has in maintaining the ecosystems on which civilization depends would supersede whatever particular interests individuals hold in parcels of property. Just as allowing uncontested trespass for a number of years establishes a presumptive public right of way, the public’s enjoyment of ecosystem services has long since established a presumptive right to the continued enjoyment of them. An ecological servitude would acknowledge this. A few cases decided on this ground would give undeniable constructive notice to property owners–a notice already implicit in legislation like the Endangered Species Act and the Clean Water Act–that the bundle of rights conveyed to them by title is subject to this limitation.

“Ecological servitude” is not yet a common phrase in legal circles. This should change as various strands of thought and action cohere around the concept, and as scholars discover that it is implicit in much common law and environmental legislation. A variety of groups and organizations (including the state of Louisiana) talk of conservation easements producing, in sum, a conservation servitude on particular parcels of land. An NGO in Costa Rica allows that it created the first ecological servitude in Central America in 1992.

Wetlands - Lisa Jacobs

Preserving the ecosystems that support civilization should not be financially prohibitive. Photo Credit: Lisa Jacobs

Three: Acknowledge that value in land is created as an externality of decisions made by others, and compensate accordingly. Under this approach, an environmental regulation might still offer grounds for a Takings claim, but the notion of what amounts to “just compensation” would be radically altered. Take the case that led the Court to decide that a demand for off-site compensatory restoration constitutes a taking. Developer Coy Koontz owned 15 acres near Orlando, mostly wetlands, and sought a permit to develop the land by filling some of it. He objected to the permit condition that he must pay for compensatory wetlands restoration elsewhere, refused the permit and brought suit. In a remarkable extension of Takings law, the court decided by a narrow majority that Koontz had suffered a taking even though wetlands filling permits are not granted automatically and even though he had not in fact had any property or money taken from him. What the St. Johns River Water Management District proposed to take from him was nothing more substantial than his expectation of getting a larger profit than he could get if he had to pay for mitigation. But why, exactly, could he expect any profit at all for developing and then selling his land? In central Florida as elsewhere, land values are mostly the result of decisions made by others–population growth and in-migration into the area, construction of nearby infrastructure including roads and schools and water service, and proximity to cultural developments that make the area an attractive place to live for some people. These are all decisions in which Koontz had no, or only a very minor, role. If much of the value of a piece of property is not a result of the owner’s efforts, but is a social creation, why should a private owner be compensated when part of that socially created value is retrieved by the public through regulation in pursuit of a legitimate public interest?

Credit Herman Daly and Joshua Farley with asking the question in their introductory Ecological Economics textbook: “Are individuals entitled to wealth created by society . . . or should this wealth belong to society as a whole?” A reasonable answer to that question would have the effect of diminishing considerably what constitutes “just compensation” under the Takings clause–a result that makes ecosystem-preserving public action less expensive, and thereby puts the continuation of civilization within easier reach of a public treasury that will become increasingly straitened as the era of high-EROI fossil fuel comes to an end.

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No matter what we do we’ll eventually have an ecologically sustainable civilization with a steady state economy, one that’s in dynamic balance with its host ecosystems. That’s because by definition an unsustainable system doesn’t last. We can make the transition haphazardly, through crisis, catastrophe, and collapse, at much cost in human pain and suffering, or we can anticipate the necessary changes and give ourselves a better, less brutal path forward. To find that path we’ll have to identify and correct infinite-planet suppositions wherever they are embedded in our system. Fifth Amendment Takings case law is one such place. Preserving the ecosystems that support civilization should not be financially prohibitive. Current Takings law says it should, and that’s why it needs to change.

The New Economy versus Today’s Flat Earthers

Editor’s Note: This article is presented as part of New Economy Week, five days of conversation around building an economy that works for everyone. 

by Eric Zencey

Eric Zencey

Only madmen and economists, Kenneth Boulding once said, believe exponential growth can go on forever.

Beyond all reason and evidence, standard economics remains dedicated to the idea of perpetual increase in our species’ stock of wealth, income, and material wellbeing. Their infinite planet thinking has a long pedigree: from John Locke toward the end of the 17th century to Adam Smith in in the middle of the 18th, the planet was obviously capable of supporting expansion of the human estate for untold generations to come. In their world, vast reaches of the globe had yet to be mapped by Europeans. Humans everywhere were relatively scarce, their powers not yet global in scale, not yet amplified by the extraordinary energies of coal and oil.

But the seven billion of us who are alive today live on a substantially different planet. It doesn’t have supposedly infinite tracts of untramelled, virgin land, ripe for being ravished by swaggering, overconfident exploiters. We need a new, steady state economy suited to the planet we have, not the one that economists thought we had two hundred years ago. We need a post-infinite-growth economy (and new breed of economist) respectful of the notion that there are ecological limits to economic activity. Absent that, our civilization is set to destroy its root in nature.

But the New Economy Movement is about more than ecological sanity. It seeks other practical and desirable solutions, like:

  • a living wage for workers;
  • a more equitable distribution of the fruits of production;
  • sharp limits to the political influence of corporations and the exceedingly rich; and
  • a relocalization and reduction in the scale of economic activity that will bring production into better relation with workers, customers, neighbors, and the planet.

We seek, in a word, economic justice.

That can seem a very different goal than sustainability, but it isn’t. Ironically enough, mainstream economists recognize the two goals are related. The remedy they offer for the injustice of poverty is the same remedy they offer for environmental problems: more economic growth. Only if we are wealthier, their argument goes, will we be able to afford environmental quality or solve the problem of poverty.

The New Economy Movement must show–must insist–that this is mistaken. It must show that the attempt to solve our ecological and social crises through economic growth is a fool’s task, because both crises have a common cause: an infinite-planet, perpetual-growth economy has met the limits of a finite planet.

When a financial system designed for infinite growth hits a local or planetary limit, it becomes a pump that sucks money from those who have less and gives it to those who have more. On a finite planet, a perpetual-growth economy eventually encounters the source-and-sink limits of ecosystems, either transgressing them and causing species loss, climate change, and ecosystem failure, or crashing because the limit can’t physically be broken.

As absurd as this looks, it is no less absurd than an economic system designed for an infinite planet. Photo Credit: A Siegel

As absurd as this looks, it is no less absurd than an economic system designed for an infinite planet. Photo Credit: A Siegel

In the Infinite Planet Thinking of mainstream economics, human population growth is always a good thing: humans are “The Ultimate Resource,” capable of infinite imagination, infinite invention. But in the world as it is, human invention is limited by physical law: you’ll never have a car that you can push backwards and fill the gas tank. Ultimately, on a finite planet with a human economy operating at its ecological limit, any further growth in human population or the human economy degrades our quality of life, further increases our ecological footprint, and leads to the loss of democracy as we yield to technocracy–rule by environmental experts–or ignore ecological constraints and thereby condemn our civilization to collapse. Meanwhile, population growth produces an oversupply of labor that drives down wages, diminishing the middle class and dividing us into rich and poor, captains and serfs.

Economic growth and human population growth proceed as if the planet were infinite–and those who express concern are challenged with being anti-human, pessimistic, or “neo-Malthusian.” It’s time to change the discourse. With repeated and creative messaging, the phrase “Infinite Planet Thinker” will come to sound as outmoded and ridiculous as “Flat Earth Theorist.” And when that happens, the principles and programs that CASSE and the New Economy Movement seek to advance will be on their way to general acceptance. I think that when they see it framed this way, most people will choose the new, steady state economy. Imagining the possible, and working to make it real, is more realistic than continuing to assume the planet is impossibly infinite.