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Subject Area: Political Theory

Resources and Bureaucrats as Predators - Leonard P. Liggio, Literature of Liberty, October/December 1979, vol. 2, No. 4 [1979]

Edition used:

Literature of Liberty: A Review of Contemporary Liberal Thought was published first by the Cato Institute (1978-1979) and later by the Institute for Humane Studies (1980-1982) under the editorial direction of Leonard P. Liggio.

Part of: Literature of Liberty: A Review of Contemporary Liberal Thought, 20 vols. 19781-982

About Liberty Fund:

Liberty Fund, Inc. is a private, educational foundation established to encourage the study of the ideal of a society of free and responsible individuals.


Resources and Bureaucrats as Predators

John Baden and Rodney D. Fort

  • Montana State University

“Natural Resources and Bureaucratic Predators.” Policy Review 11(Winter 1980):69–82.

Environmentalists and taxpayers agree that our bureaucratic natural resource managers consistently sponsor policies that: (1) have environmental costs exceeding environmental benefits; (2) are financially extravagant; and (3) increase the coercive governmental sector of the economy at the expense of private, voluntary exchange.

Our government resource managers systematically mismanage and produce suboptional results. This is due to perverse the institutional structures of government in such areas as timber production and range land management.

The U.S. Forest Service obeys political interests rather than market signals. Thus, it engages in inefficient and environmentally harmful logging in economically unproductive timberland. Losses are met by taxes rather than increased productivity. Similar bureaucratic mismanagement occurred in Western States because the Bureau of Land Management (BLM) allowed land to be grazed as a huge common property pasture. With no private property rights defined, this common property resulted in overgrazing, a classic case of what Garrett Hardin terms “tragedy of the commons.” Other BLM measures upset the delicate ecology of vegetation for wildlife and fish.

What leads to such bureaucratic waste and mismanagement? This occurs because that part of the U.S. Treasury allocated to bureaucratic budgets also resembles the “commons.” Rival bureaucratic agencies view the treasury as a common pool resource since it has non-exclusive ownership and thus encourages competitive, wasteful, self-maximizing exploitation of that resource (i.e. taxpayers' money).

What would cure assault on the budget by bureaucrats who are immune to the market discipline of profit and loss? We need a “Bureau of Budgetary Control (BBC) whose key task is to advocate budgetary reductions. The BBC would have built-in incentives to act as a predator to prey upon those budgetary items of rival bureaucracies whose social costs outweigh their social benefits. We can exploit for social benefit the very pathology of bureaucracies to grow and perpetuate themselves. The BBC, acting as the taxpayers' ombudsman, would only continue receiving its current allocated budgetary monies if it was a successful “predator” that exposed waste and ill-conceived programs of rival bureaucracies (such as the Bureau of Land Management). If the BBC, for example, convinced Congress of waste in BLM, the BBC would be awarded a percentage of BLM's former budget as a bounty. This “predator” system would thus rely on bureaucratic self-interest to advance the public interest. The losses incurred by wasteful, ill-managed rival bureaus would create strong incentives for them to avoid projects of dubious utility.