The Probability Broach, chapter 19

We’ll get back to the proceedings of the anarcho-capitalist legislature soon, but Smith opens this chapter with another quote from one of his fictional mouthpieces that I want to discuss:

I often wonder why the ecology movement attracts leftists—there’s a lesson there you’d think they’d avoid at all costs: the economy is like any other part of the environment, small interferences create elephantine dislocations in later years and unpredictable places. If altering algae populations can cause an Ice Age, it’s equally true that minimum wage laws can cause mass unemployment. If they can learn such things about nature, why can’t they learn them about their own society?

—Mary Ross-Byrd
Toward a New Liberty

This is an argument I haven’t seen before, so let’s spend some time analyzing it.

It’s a clever rhetorical tactic on Smith’s part to compare the economy to nature. It’s true that humans’ well-intentioned interference in nature has sometimes backfired and caused worse outcomes than if we had just left things alone.

The classic example is forest managers being vigilant about stamping out small wildfires, which allows dry tinder to build up on the forest floor. Eventually, this results in catastrophic mega-fires that are impossible to extinguish and cause far more destruction.

Obviously, Smith wants to argue that what’s true for the natural world is also true of economics, and that everyone would be better off if we stood back and stopped trying to interfere with the invisible hand of the market. However, there are some important points of dissimilarity in this metaphor.

The first one is that the economy is a human creation, shaped by human decisions, and therefore it’s more under our control than nature is. We can’t control either one completely or perfectly—as pundits have noted, the president can’t dictate whether the stock market goes up or down, nor is there a dial in the Oval Office he can turn to raise or lower prices—but we do have the ability to create incentives which affect people’s behavior on a large scale.

For example, we can discourage consumption by raising taxes (like with “sin taxes” on alcohol and cigarettes). We can encourage saving and investing by raising central bank interest rates, or stimulate consumer spending by lowering them. We don’t have the ability to influence natural cycles in a similar way.

The second point is that most of us believe we have a moral responsibility to protect our fellow humans, in a way we don’t for other species.

When a lion kills a gazelle or a parasitic wasp lays its eggs in a living caterpillar, we don’t consider that an evil that needs correcting. But most of us do feel an obligation to do something when child laborers are mangled by machinery, or sweatshop workers burn to death in a blaze because there are no fire exits. This tips the balance toward intervention in human affairs, whereas we consider nature to be amoral and not obligated to abide by our notions of right and wrong.

The third point is that, despite what Smith seems to believe, no one—not even the most dedicated ecologist—argues that there should be no interference with nature under any circumstances.

After all (unless you’re an antinatalist), we all agree that human beings have to live on this planet. That means we don’t have a choice about interfering with nature. Whether we take up a lifestyle as cave-dwelling hunter-gatherers, grow crops in industrial monocultures and live in skyscrapers, or build a solarpunk utopia with windmills and organic fields, we can’t avoid having an impact on the planet. The question is what kind of impact we’re going to have, and what interventions we should or shouldn’t allow.

Ecologists and environmentalists do believe that human interference with nature is warranted in some cases. For example, when a deadly pandemic arises, even though that’s a “natural” phenomenon, we still create vaccines and treatments. We breed crops and livestock to be more productive to serve our needs, even if those varieties would go extinct without us.

We also advocate interference in nature to undo our past mistakes. This may take the form of removing invasive species from ecosystems where they didn’t evolve and don’t belong, such as the effort to catch lionfish in the Caribbean, or to stop the spread of zebra mussels in the Great Lakes.

Many ecologists also work on captive breeding programs to restore species that were driven to the brink of extinction by human errors. The successful reintroduction program for the California condor, or the attempt to develop chestnut trees that are resistant to blight fungus, are two high-profile examples.

If I can speak on behalf of ecologists, I’d argue what they really believe is we shouldn’t intervene unwisely. Before we take an action that will interfere with natural patterns, we have to study the downstream consequences, weigh the balance of potential harms and benefits, and act only when we have reason to believe it will yield a better outcome than not acting. Not coincidentally, that’s the same thing we’d say about the economy.

Last but not least—and this is the biggest point Smith glides past—these aren’t separate and unrelated questions. To refuse to interfere in the economy is to interfere in nature, and vice versa.

When chemical plants dump cancer-causing sludge into rivers, developers bulldoze storm-absorbing coastal wetlands to build beach resorts, or factories spew ozone-destroying CFCs or climate-warming carbon dioxide into the atmosphere… Smith’s libertarian logic would have us shrug our shoulders and do nothing, despite the clear consequences that result from letting these industries run amok without regulation. Often, allowing capitalists to ravage nature in the name of profit destroys more value than it creates.

In an earlier chapter, he hinted that individuals could sue polluters. But there are obvious reasons this won’t work, such as the near-impossibility of proving their pollution definitively caused harm in a single case, even if we know it’s harmful in general.

Before taking any drastic action, either with regard to the economy or the environment, it’s always good to cultivate humility and to study the results thoroughly. But that doesn’t mean we should never intervene for fear of unforeseen consequences. That’s not sound ecological thinking; it’s the bad-faith “doubt is our product” marketing used by tobacco companies, oil drillers, and other merchants of death to evade regulation as long as possible.

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Other posts in this series:

• The Probability Broach