The Once-ler Protects His Long-Term Interests

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As part of a series called “Capitalism Is Saving the Planet,” Isaac Orr reviews the forestry industry in Minnesota for the Center of the American Experiment:

Did you know that Minnesota’s forests are flourishing? According to research from the U.S. Forest Service, forests account for 17.7 million acres of land in Minnesota out of a total of 54 million acres, meaning forest cover about 35 percent of the state. Furthermore, this number is increasing due in no small part to the fact that 51 percent of forested land in Minnesota is owned by the timber industry.

From 2012 to 2017, Minnesota’s forested land area increased by 755,000 acres, which equates to an increase of 1.7 percent. During this time, the number of live trees increased by one billion trees, increasing from 14 billion to 15 billion, which is a 7.1 percent increase in the number of trees in our state.

The image of the industrialist Once-ler denuding the world of Truffula trees for his own selfish gain does not appear to apply.  The companies are trying to balance their profits with preservation, utilizing new technologies and techniques to be more efficient.

The forestry industry has incentive to preserve the resource on which it depends.  So, even if we disregard people’s sense of right and wrong (which we shouldn’t do), self-interest is not divorced from reason.  Just so, workers who come into your home have incentive not to steal from you because the long-term benefit of trustworthiness is more valuable than just about anything in your house.

We should recognize, however, that all of this may apply only in a limited range of economic activity.  Cutting down and milling trees is a relatively difficult activity, so the barriers to entry are high, the participants relatively few, and the cutting relatively easy to track and regulate (whether through government or industrial practice).  In circumstances in which the profits are high and the players many, the tragedy of the commons will be more likely.

In other words, what this case study does most effectively is to remind us of the danger of blanket analyses and categorical thinking.  A moralistic children’s story can create a humanoid monster willing to destroy the planet for just a little profit, but we shouldn’t apply him for cookie cutter analysis of every business.



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