"With the right incentives our federal land management agencies could be a source of wealth to all Americans."
"Our nation's federal land management agencies fail to meet any reasonable standard of fiscal responsibility, making the public foot the bill with hundreds of millions of tax dollars," charges Holly Lippke Fretwell of the Political Economy Research Center. "Twenty percent of the nation's land area is controlled by the Forest Service and the Bureau of Land Management," Fretwell reports. "This federal estate encompasses a wealth of forests, grazing lands, minerals, wildlife, and recreational amenities with enormous potential to generate revenues for the public good. Yet," she says, "from 1994 through 1996 these agencies lost an average of $290 million on timber, $66 million on grazing, and $355 million on recreation."
Fretwell points out that, unlike their federal counterparts, "state land management agencies are controlling costs and generating revenues from trust land. They too sell timber, lease grazing land, and collect recreational fees, but unlike our federal agencies they earn a profit." How can state and federal agencies performing the same service achieve such different results? "The Forest Service and the Bureau of Land Management rely on Congress for their budgets and turn over revenues to the general treasury," Fretwell explains. "With no connection between money spent and money earned, efforts to encourage financial responsibility are futile. Managers have little incentive to generate more revenues because they cannot be retained by the agency."
Fretwell points out that "state lands have incentives more like private companies where the bottom line matters. Unlike federal lands," she notes, "state trust lands must generate revenues for the public schools and other trust beneficiaries. State trust land expenditures are funded from revenues generated by the lands or from state general funds. In either case," Fretwell continues, "there is a connection between expenditures and revenues because state trust lands have beneficiaries, similar to shareholders, who have a claim on 'profits.' These beneficiaries, including parents, teachers, and school administrators, become the self-appointed watchdogs for the state land agencies."
There's nothing like the discipline of having to earn a living! "If federal land managers had to fund their operations out of revenues," Holly Lippke Fretwell argues, "red ink would vanish. Eliminating the congressional budget dole," she adds, "would provide a badly needed incentive to minimize costs and generate new revenues."
That it would. Better yet, of course, would be to take Uncle Sam out of the land management business altogether. Rather than having the demonstrably inefficient federal government continually encroaching on the property rights and land management prerogatives of the states, why not reverse the process? Why not cede or sell all federal lands back to the states and the people, to which they rightfully belong? Those federal lands that are now unproductive or counterproductive would, under state or private management, instead become valuable revenue-generating assets. The cost to the federal government of maintaining its property would disappear, and its tax receipts would increase even as tax rates declined. Who but a power-mad bureaucrat could object to that?
