Analyzing the Endangered Species Act

How Can We Save Them All?

Start with the proposition that we want to save as many endangered species as possible. We don't need to quibble about whether this means species, subspecies, or populations--we want to save them all.

The question is, How? Answering this question is a four-step process:

  1. We first need to clearly understand the basic problem--that is, why are species ever endangered?
  2. Next we must look at how well efforts to save endangered species have worked to date.
  3. If they haven't worked, we need to understand why not.
  4. Finally, we must look at other fields to see what tools we can apply that may be more successful.
My analysis, which is detailed in this section, can be summarized in a few paragraphs.

The Basic Cause Is Institutional

It is tempting to view endangered species as an ethical or moral problem: Endangered species are good, anyone who does anything to hurt them is bad. But this view is both deceptive and polarizing.

It is much more productive to view the issue as an institutional problem: Outcomes such as extinction or recovery are a product of institutional design. Given the very same people, some institutional structures are more likely to lead to extinctions while others are more likely to recover rare species.

The Current Act Is Not Working

Our goal, then, is to design institutions that will avoid extinctions and promote recovery of threatened and endangered species. Does the current Endangered Species Act accomplish this goal?

While quantitative analysis is difficult, the short answer is "no" for three reasons.

  1. The law has stopped few of the numerous federal subsidies that pose the real danger to many, if not most, listed species.
  2. Even where federal agencies are supposedly trying to protect endangered species, they often put up obstacles to recovery.
  3. The act has given some private landowners incentives to harm habitat and has certainly produced a serious backlash against endangered species preservation.

    The Act Takes the Wrong Approach

    The Endangered Species Act has failed because it takes a command approach to the problem: In essence, it orders people to save endangered species, often at their own expense and despite whatever counterincentives they may face.

    At best, the law does nothing about existing institutional structures that give people the wrong incentives. At worst, the law itself creates incentives to destroy wildlife habitat. Recent amendments to the law have modified some of the perverse incentives in the 1973 act, but still have done nothing about the perverse incentives that predated that act.

    We Must Fix the Act with Incentives

    If our goal is to save endangered species, and we consider the problem to be institutional rather than moral, then the approach we should take must emphasize incentives rather than command. The best system of incentives ever devised is the free market, because markets respond quickly to need, learn quickly from failure, and fairly assess trade offs and costs.

    Many endangered species aren't easily amenable to markets; if they were, they might not be endangered. But some species could be included in the market, yet are not because of government regulation. Other species may not be marketable, but have proxies that are. Market-like incentives could even be created to save many species that are totally unmarketable.

    Different Drummer will present a detailed set of proposals in part VI: Solutions. But this section will demonstrate that the Endangered Species Act has ignored an important set of tools.

    Understanding Species Decline

    There are several ways of looking at species decline. The standard ecological view blames disappearing species on habitat loss and overhunting. But the question still remains, Why is there habitat loss and overhunting? After reviewing the traditional economic view and the ethical view, we reject both in favor of what we call the institutional view.

    The Economic View

    The standard economic view is that biodiversity and endangered species are diminishing because they are public goods. "Public goods" are not goods owned by the public but goods or services that anyone can use because it is impossible to exclude people from them.

    The classic example is national defense: If your country spends money on an effective defense system, you are just as well defended whether you helped pay for it or not. This situation encourages what economists call free riders: people who enjoy the benefits without paying their share of the costs. To the extent that everyone shares endangered species' benefits--such as healthy ecosystems, potential medical properties, and so on--endangered species are also public goods.

    Just having the label "public goods" doesn't really help us in solving, or even understanding, the problem. We know that markets handle public goods poorly because markets are based on individual transactions. Since no one can be excluded, individuals have little incentive to pay for public goods and every incentive to become free riders.

    But just because markets do poorly doesn't automatically mean that government will do better. Governments tend to favor the strong and rich over the weak and helpless. Democracy doesn't tend to fix this, even if the poor can out vote the rich, because the rich and powerful are better able to influence voters and their elected and appointed representatives.

    Endangered species are not only poor and helpless, they don't vote at all. While they have supporters who do vote, recent elections have shown that that isn't always enough.

    This leads to the classic problem of environmental politics, which is that you can never win, you can only delay losing. Put another away, do you really trust Congress to make the decision about how many species go extinct? Different Drummer doesn't, and so we reject the traditional economic view.

    The Ethical View

    It is tempting to regard endangered species as a clear case of good and evil. Extirpating a species is morally wrong. Since the species, and anyone trying to protect them, are by definition "good," then anyone who stands in the way of species protection must be "evil."

    Eventually, says the ethical argument, everyone will have such a refined sense of ethics that few would willingly contribute to an extinction, just as today few people would not willingly kill or enslave another person. To guard against those few who would harm species, however, we must have strong laws protecting species, just as we have strong laws against murder or slavery.

    We don't reward people for not murdering others; instead, we punish them if they do kill someone. By the same token, endangered species laws should punish people for harming rare species or their habitat. In fact, anyone who would consider harming a rare species deserves punishment, so we should feel no compunction in making such people pay a large share of the costs of protecting wildlife.

    The ethical view has several weaknesses. First, although everyone may agree that murder is wrong, we have far less agreement about other issues, including abortion, drug use, and endangered species.

    A second problem is that not everyone has identical views of "good" and "evil." For some, "good" equates to freedom, including freedom for private property owners to use their property as they see fit, so long as they don't harm other people. From this point of view, endangered species advocates are "evil" if they want to regulate private property use.

    Some believe that this is a backwards view, held only by people whose ethics haven't "evolved" to the point where they include wildlife in their definitions of life that shouldn't be harmed. At one time, people only behaved ethically towards their own families or tribes. Later, they expanded their ethical views to include all men within their own race. Eventually, all races and genders were included. The natural next step, then, is to include wildlife.

    Yet there is little evidence that human ethics actually "progress" or that they will eventually embrace wildlife. Instead, ethics spread through a process of natural selection in response to changes in wealth and technology. As Stephen Jay Gould says with respect to another form of natural selection, "Natural selection is, first of all, a theory about adaptation to changing local environments, not a statement about `improvement' or `progress' in any global sense." Changes in technology and human institutions, not internal ethics, led to a broadening of ethical views from tribe to race to all humanity.

    If ethics progressed rather than evolved, then defenders of endangered species and opponents of abortion would be more or less the same people. After all, the arguments on both issues are essentially the same: freedom of choice vs. reverence for other life. But, in fact, endangered species advocates seem more likely to be pro-choice on abortion while antiabortionists seem more likely to favor property rights over wildlife.

    If these questions are to be decided by majority rules, rather than a consensus over ethics, then the majority must be willing to compel the minority to act contrary to the minority's own ethical standards. Should a raped woman be forced to have a baby? Should a farmer or forest land owner be forced to pay most of the costs of protecting a species that is suddenly found on his or her property? Most ethicists would consider such compulsion unethical.

    Even if the majority is willing to use compulsive force, society may not have or be willing to use the resources needed to gain full compliance. Prohibition showed that the social costs of enforcement of alcohol laws can be far greater than the benefits. The same is almost certainly true for the current war on drugs.

    Different Drummer rejects the ethical view not because it is wrong but because it does not work. It may be ethical to save endangered species. But it is neither ethical nor feasible to force people to save species against their will--or rather, against powerful incentives to destroy species habitat. In fact, attempts at compulsion often lead to more habitat destruction.

    The Institutional View

    An alternate view of endangered species, which to a large degree is mutually exclusive with the ethical view, is an institutional one. The institutional view holds that most outcomes are more a product of institutional design than of human ethics. Given the same people, some institutional structures will produce one outcome, while others could produce very nearly the opposite outcome.

    Compare, for example, Germany in 1930 versus Germany in 1960. The same country; the same people (more or less); totally different institutional structures--leading to totally different outcomes.

    Or compare bison in the nineteenth century versus cattle. The bison were an open-access resource, free for the taking. Anyone who left a few to insure sustainable herds merely saw those few shot by someone else. So no one had an incentive to manage bison sustainably. Cattle are a closed-access resource, and could be legally consumed only by their owners. The owners therefore had an incentive to maintain their herds. The result: North America has plenty of cattle but few bison outside of parks or other reservations.

    Zimbabwe and Zambia are both home to the African elephant, but the two take very different approaches to elephant conservation. Zimbabwe treats elephants as the property of the villages near which they roam. Villages sell hunting rights to the elephants and share in the hunting fees as well as the meat.

    In contrast, elephant hunting in Zambia is illegal. With a less well developed system of property rights, Zambian villages consider elephants a cost since elephants may trample their gardens and eat their crops. Villagers do get a personal gain by guiding poachers--if they are willing to take the risk of getting caught. Elephant conservationists in Zambia have a simple policy: They shoot poachers on sight and leave their bodies for the wild animals.

    Status of elephant herds in Zimbabwe: large and growing. Status of elephant herds in Zambia: tiny and shrinking. People in Zimbabwe are no more ethical than those in Zambia, but the different institutions they face lead to different outcomes.

    Different Drummer supports the institutional view for two important reasons. First, it works: Once the proper institutional structures and incentives are in place, resources are sustainably produced in abundance. Second, this view holds out the hope of resolving environmental issues without polarization because it encourages us to view people as partners rather than enemies.

    Species Decline in the U.S.

    Species decline and extinction became apparent in the U.S. during the nineteenth century. At the time, common law generally applied the "rule of capture" to wildlife, meaning that wild plants and animals are owned by no one unless captured or killed. This meant wildlife were an open-access resource, and--like a bottle of soda pop with two straws--everyone's incentive was to get the wildlife before someone else did.

    The U.S. policy significantly differed from its British precedent. "Throughout much of British history," says bird watcher and property rights advocate R. J. Smith, "the right to harvest wildlife belonged to owners of the land." The U.S. changed this policy on the grounds that it was "undemocratic": Wildlife, Americans believed, should be available for anyone even if they could not afford to own their own land.

    The result of the U.S. policy, says wildlife legal expert Thomas Lund, was that "American wildlife populations fell as if afflicted by a plague." "The affliction upon wildlife must be attributed" not to habitat decline, continues Lund, but to "those democratic policies that were injected into wildlife law."

    The tension between democratic or egalitarian principles and a property rights system that would encourage sustainable wildlife management pervades much of American wildlife history. In Britain, the red grouse has thrived because landowners sold hunting rights and thus had an incentive to enhance grouse habitat and maintain grouse numbers. In the U.S., the prairie chicken, which could have benefited from a similar system, was driven nearly to extinction by hunters.

    Early American sport hunters blamed the decline of prairie chicken and other species on "market hunters," meaning commercial hunters. As a result, commercial hunting is almost completely banned in nearly every state. But hunting for commercial markets is common in Britain; the real problem is the lack of incentives for American landowners to protect habitat.

    The clash between the British and American systems continued as North America was settled--to the detriment of wildlife when the Americans won. The story of the near extinction of beaver due to nineteenth century fur trappers is well known. What is not so well known is that many trappers, including the Montagnais Indians of Quebec and British trappers throughout western North America, managed beaver on a sustainable basis. This worked only so long as the trappers could defend their exclusive rights to trap in certain watersheds.

    Hudson Bay Company trappers managed beaver for decades in the territories that became western Canada and the northwestern U.S. When American trappers insisted on trapping in the same areas, however, Hudson Bay trappers adopted a policy of "trapping out" the beaver so as to drive the Americans away. After the Americans took over the Oregon territory that had been occupied by Hudson Bay trappers, only a decline in the market for beaver furs saved the species from local if not total extinction.

    In the late nineteenth and early twentieth centuries, sport hunters and anglers led by Teddy Roosevelt convinced states to ban market hunting and manage game sustainably for recreational hunting. Efforts to ban commercial fishing were unsuccessful, but sport anglers were able to legally curtail many of the most efficient fishing tools, such as fishwheels and certain types of nets.

    As the twentieth century progressed, state wildlife agencies found it lucrative to promote game fish and wildlife. This sometimes meant destroying species thought harmful to game, including wolves and "trash fish" such as bull trout. At other times it meant introducing exotic species that were in demand by sports hunters and anglers, such as mountain goats in Washington's Olympics and brook trout in many western streams.

    While the states successfully managed and restored many game species, they often refused to take the full responsibility for those species that "ownership" would imply. The traditional rule of capture held that no one owned the wildlife. The states did not want to change that because if they owned the wildlife then they would be responsible whenever the wildlife damaged someones crop or other property.

    If you shoot a deer out of season, the state can prosecute you. Does this mean that the state owns the deer? No, because if the deer trespasses on your property and eats your garden, the state is not liable for the damage. Thus, the states have the rights but not the responsibility (though, to their credit, some states do have compensation programs).

    If the ownership of wildlife is unclear, the ownership of habitat is even more murky. If my sheep cross into your pasture and eat your grass, you are entitled to compensation. If I pay you to pasture my sheep for several years in a row, and then you decide to pave the pasture, I am not entitled to any compensation just because I can no longer use your pasture.

    Yet rights are different if it is not sheep that are eating your crops but some form of wildlife. For some kinds of wildlife, such as coyotes, the government will actually help you kill it or drive it away. But for other kinds, such as deer or elk, you can only do something about it with the government's permission. For still other kinds, such as many insects, you are on your own.

    The rules for fish habitat are even murkier. Legally, many streams are owned by the states. But water is also governed by the rule of capture, meaning I can take it out if I have a water right--even if none is left for the fish. I may leave some in, but I can also pollute it with practices that erode soil.

    States also often preempt the incentives that would encourage private landowners to promote game habitat. Most states discourage private landowners from charging user fees for hunting, and some ban such fees entirely. Even more states forbid landowners from charging for fishing in a stream on their property.

    In 1973, Oregon passed a land use planning law that, among other things, protected wetlands. After an Oregon rancher named Dayton Hyde turned, at great personal expense, one of his pastures into an artificial wetland for waterfowl, Oregon officials told him that, under the new law, neither he nor anyone he sold the property to would never be allowed to use that pasture for anything else. Hyde loves wildlife and wants to encourage other ranchers to improve wildlife habitat--but few will listen if it means they lose the rights to use their property for something else.

    So while federal subsidies to agriculture, water power, timber, mining, and other activities provide plenty of incentives to destroy wildlife habitat, state wildlife management programs offered few to no incentives to protect that habitat. Yes, biodiversity is a public good, but many species--especially game fish and wildlife--could be treated as private goods except that the government stood in the way.

    So before the Endangered Species Act was passed, private landowners had few incentives to protect habitat. Yet, biodiversity is a public good, but the federal government doesn't help when it subsidizes so many activities that are harmful to wildlife. State governments don't help when they preempt potential markets for hunting and fishing on private land. Nor do other states help when they refuse to compensate landowners for crop damage by game wildlife.

    Unfortunately, the Endangered Species Act didn't fix any of these problems. Instead, as described elsewhere in this issue, it added a new misincentive. The act prohibits you from "taking" a member of any listed species, and the Fish & Wildlife Service interprets this to include taking habitat away. The Supreme Court agreed in the Sweethome decision over the spotted owl. This means that if a landowner like Hyde manages their land in a way that happens to be good for a listed species, the federal government can prevent them from ever managing the land in any other way.

    Is the Endangered Species Act Working?

    Is the Endangered Species Act saving species? That is the
    question that proponents must ask themselves. If the law is
    working, then endangered species advocates might be able to simply disregard their opponents arguments and muster the political support to keep the law on the books.

    But what if the law isn't working? What if, no matter how good the intentions and how strong the language appears to be, species aren't being saved? Then endangered species supporters must step back and join with their critics to figure out how to fix the law.

    Unfortunately, it is difficult to measure whether the law is succeeding or failing. One simple way might be to compare the number of species that have gone extinct since the law was passed against the number that have been recovered.

    Since 1973, eight species in the U.S. proper have gone extinct, including one mammal, three birds, and four fish. Three more Puerto Rican species have gone extinct, including one bird and two amphibians. Another six species that had been listed were determined to have gone extinct before 1973.

    During the same time period, fifteen species were removed from the endangered species list and declared "recovered," while ten others were reclassified from "endangered" to "threatened" status. The Fish & Wildlife Service is quick to take credit for many of these delistings, but few were due to any action taken as a result of the Endangered Species Act.

    For example, the agency recently upgraded the bald eagle from "endangered" to "threatened." At the time, Fish & Wildlife Service director Mollie Beatty was quoted as saying, "Without the act in place, we might have lost our national symbol." In fact, a ban on DDT that the Environmental Protection Agency put into place before the Endangered Species Act was passed had more to do with eagle recovery.

    Of all reclassified or delisted species, only three appear to have improved as a result of the act. All three were once endangered; they are now listed as "threatened" but for practical purposes are probably fully recovered. So the scorecard seems to be: eight species extinct, three recovered. But that doesn't prove that the act is failing because we don't know what would have happened if the act had not been passed. Conceivably, without the law, the California condor, black-footed ferret, and several other species might have also gone extinct by now. On the other hand, the Fish & Wildlife Service could have stopped killing prairie dogs or eliminated foxes from the Aleutians without the Endangered Species Act.

    On the other hand, what would have happened if the law had been passed with incentives for recovery, rather than punitive measures for harming a species? Conceivably, some of the extinct species might still be with us and the black-footed ferret might have survived without a captive breeding program. But there is no way to know for sure.

    Yet there are three clear areas in which the act has failed.