Politics, Air Pollution, and Capitalism

LvMIC:

The only redeeming element of political campaigns is that, no matter the winner, the reputations of candidates involved are tarnished by the end.  In a mugger’s game like politics, the more individuals vying for public office are criticized, the better.  Far from a gentlemen’s sport, what politics really breaks down to is scraping enough votes away from your opponent on Election Day.  Doing so requires character assassination attempts similar to those employed by modern pro wrestlers.  It all makes for wonderful political theater as candidates try to paint each other as the worst human beings to ever walk the planet.  And because scum invariably rises to the top in government, there can never be enough mud slung around during campaign season.

The latest gem of a political attack comes from the pro-Barack Obama SuperPAC Priorities USA which released an ad that makes a casual connection between opponent Mitt Romney and the death of a woman from cancer.  In the ad, titled “Scrap Steel,” Bain Capital, the equity firm Romney founded, is accused of laying off numerous steel workers at a mill in Kansas City, Missouri.  One of those laid off employees lost his health insurance and therefore couldn’t provide for his cancer ridden wife.  It turned out that the man’s wife didn’t lose her health insurance till at least two years after the mill’s closing and that she passed away four years later.  Priorities USA has since rescinded the ad but is determined to still cast Bain Capital in a negative light.  To make matters worse for the Romney campaign, Bain’s legacy has also come under scrutiny from the mainstream media.

It is now being reported that in addition to the mill in Missouri, Bain Capital also purchased its sister steel mill in Georgetown, South Carolina.  Like the mill before it, the Georgetown mill would also end up going through bankruptcy.  However there was another issue besides financial difficulty that plagued Georgetown Steel; which was that of pollution.  As the Associated Press informs:

In 1998, Ms. Carter and her neighbors sued Georgetown Steel, then owned by the company Republican presidential candidate Mitt Romney co-founded, Bain Capital. They sought millions in cleanup costs and accused the mill’s owners of leaving their historic Southern neighborhood looking like it had been hit by a “chemical bomb.”

As the class action lawsuit progressed, South Carolina officials determined that the mill was largely at fault for the pollution.  What the pollution entailed exactly was the emission of a red-colored dust that wound up staining surrounding cars, homes, and boats.  While the plant attempted to adjust its methods of production and seal gaps in its buildings, the staining kept occurring.  Eventually, GS Industries, the company that owned Georgetown Steel, declared bankruptcy and settled with the plaintiffs.  The payout was split a number of ways and some parties involved in the lawsuit did not receive adequate compensation.

It should come as no surprise that a story such as this is being accentuated.  Environmentalism has always been a blanket progressives wrap themselves in to justify their support for big government.  As economist Joseph Schumpter brilliantly put it:

Capitalism stands its trial before judges who have the sentence of death in their pockets. They are going to pass it, whatever the defense they may hear; the only success victorious defense can possibly produce is a change in the indictment.

But should supporters of the free market defend Bain Capital or Georgetown Steel for allowing this pollution to take place?  Was it necessary to preserve a way of life?  The answer to both questions is an unwavering no.  Capitalism has nothing to do with pollution; it is a system where the means of production are under private control and individuals are free to conduct market transactions.  Pollution is an aggression against somebody’s property and should therefore be combated with the full force of tort law.

In order to establish if the residents of Georgetown would have a case against Bain Capital under proper, normative law or the application of the non-aggression and homesteading principles, it would have to be determined if the steel mill was established before the community developed.  If so, then whatever emissions came forth from the mill would act as an easement over the surrounding unowned land.  In other words, the owners of the steel mill would have homesteaded the land by releasing the so-called dust upon it.  As Murray Rothbard points out in his invaluable essay “Law, Property Rights, and Air Pollution,”

This homesteaded easement is an example of the ancient legal concept of “prescription,” in which a certain activity earns a prescriptive property right to the person engaging in the action.

According to the report, the red dust admitted by the Georgetown Steel mill didn’t appear till after Bain Capital took over.  Under the control of Bain, wire rods were mass produced which is what likely lead to the increase in pollution.  The ramp up in production occurred during the mid 1990s.  Because the town of Georgetown is the third oldest city of South Carolina, it is clear that most residents bringing the lawsuit were justified because their property was damaged by the emissions.  The red dust that was a byproduct of the mill’s production methods interfered with the resident’s enjoyment of their property and constituted an aggression.  The charge appears to hold up under the application of strict causality.

As for the common misconception that barring all unjust air pollution would put the brakes on economic progress; it does not necessarily follow.  New technology is constantly in development to reduce emissions.  It can be applied and the cost would “ultimately be borne by the consumers of the firms’ products, i.e., by those who choose to associate with the firm, rather than being passed on to innocent third parties in the form of pollution (or as taxes)” as systems engineer Robert Poole Jr. suggests.  Just because a way of life is supported by aggression toward the innocent should not shield it from prosecution.  It certainly doesn’t make sense to claim that because a roving band of thieves is dependent on robbing mansions to maintain their lavish lifestyles, the law should not apply to them.  The same reasoning goes for air pollution.

In all likelihood, this new revelation of Bain Capital owning a steel mill responsible for environmental damage will be used by the Obama campaign to attack Romney.  The $30 million in profits Bain received over the course of managing GS Industries will be vilified and Romney will me made out to be a heartless, Scrooge-like figure concerned with profit above all else.  This is a mistaken premise however.  Bain should be attacked to the extent that it owned Georgetown Steel at the time of it releasing pollutants onto the property of others.

That would be the logical argument.  But like a strict code of ethics, politics is always bound to reject logic.  Making rational arguments doesn’t win elections after all.