Privatise the lot

This isn’t the way that most people will understand this but it is the way that it is. We should be privatising the regulation of fisheries by privatising the fish. For we’ve – again but this time from the environmentalists – the insistence that a profitable fishery is one with a higher level of fish in it than purely the sustainable level. Or rather, the optimal fishery stock for profit is higher than that for mere sustainability. This means that we can leave profit to drive the level of stock – profit will produce a level higher than mere sustainability.

This isn’t, needless to say, the lesson that will be taken from this:

Moving to sustainable catches of the most important species of fish would generate 5,000 new jobs and add more than £300m a year to the economy, after the UK leaves the EU’s common fisheries policy, a new report has found.

More jobs, blah blah, that’s the usual failure to note that jobs are a cost, not a benefit. It’s this which is interesting:

Sustainable management of fish stocks would require limits on fishing for several years, as the current EU policies allow catches greater than populations of some key species can readily recover from, but within about seven to 10 years of setting its own policies the UK could be reaping the benefits, according to Oceana, a non-governmental organisation that focuses on fishing.

However, this outcome would depend not just on the government agreeing to impose smaller catches on fishing fleets for several years, but also on reaching a suitable agreement with other European nations, because many of the UK’s fishing grounds are shared.

Allowing stocks to recover would enable fishing fleets to increase their catch by more than 150,000 tonnes a year, with net profits more than doubling to more than £80m a year, according to the Oceana analysis.

Oceana is this lot, yes, the usual environmentalists just in a different organisation.

So, think through this for a moment. People who own things maximise profit over time. Farmers do fields for example, in a manner in which they all too often don’t common land. A possible solution, as Garrett Hardin insisted, for the Tragedy of the Commons is to make people own things for the long term, thus making them think about the long term profitability of the resource.

But, and it’s a big but, this solution does depend upon the idea that long term exploitation is more profitable than short term. Imagine, go on just imagine, that real interest rates are 50% a year. You’d exploit the hell out of something right now and bugger even the medium term given the discount rate on the future that implies – or means, stronger than just implies.

So, we’d like to check that property rights, private ownership, do in fact conserve. And if a fish stock higher than merely the sustainable level is more profitable then we can conclude that fish stocks when privately owned would be higher than those merely sustainable levels. Simply and only because humans are greedy economic creatures and like to maximise profits.

Thus we’ve our solution to the fisheries problem. Fishermen own fish stocks, as farmers do fields, and we’ll have higher than sustainable levels of fish in the sea. Privatise the regulation itself in order to solve that Commons tragedy, just as Hardin said was possible dependent upon the circumstances.

It also doesn’t matter who we give the stocks to. Sure, we’d start by giving them to our own, obviously. But as Ronald Coase pointed out, it doesn’t matter what the initial allocation is, resources will always end up in the hands of those who value them most, of those who can make the best use of them. Which will be those who can make the greatest long term profit from them – at those higher than sustainable fish stock levels, no?

Privatise fisheries regulation, you know it makes sense.