Last week Prime Minister Rodriguez Zapatero granted new contamination rights to some companies in detriment to others. He based the decision on “technical arguments.” Are we supposed to believe the solution to contamination lies in politicians and businessmen scheming together? No, the only solution is the free market and the total absence of state intervention.  

According to current theory, contamination is a necessary social cost on the way to enjoying greater economic development. Many believe only state impositions are capable of regulating contamination. Accordingly, the state has nationalized air, streets, air space… making itself the world’s largest trafficker in contamination. In other words, it has built a contamination monopoly by force, by law.   

Imagine you have a house and the state, without asking, sells the right to contaminate in your neighborhood to a company. This has taken place a number of times and most recently in the case of airport construction. Planes take off and land next to occupied housing. Since the state owns Spain’s air space, any action you might take to defend yourself against this contamination, whether smoke or noise, will prove practically useless.

In a free society, all the scarce goods a community values are private –uncontaminated air for example. If you buy a house, you would also be buying the air space surrounding it (now state owned). If a company sets up right next to your house and its pollution invades your private property, you will be able to defend yourself against them by filing individual law suits (an invasion of private property) or, if more profitable for you, selling or renting your air space to the company according to a contract stipulating your exact economic compensation. The problems are innumerable, but in a free society –as compared to an state intervened society- solutions exist and benefit both parties.

Free trade is a voluntary exchange of titles to private property. Every day you exchange some titles to private property for others: your money, for a loaf of bread, for example. No one forces you to make this exchange, both buyer and seller benefit peacefully and voluntarily. When clean air becomes a scarce good, then it can also be commercialized. In truth it is already happening, but as opposed to in a free society, clean air is a state monopoly: the ability to grant licenses makes governments the only ones with a right to “contaminate.”

Government grants are not exchanges of titles to private property, but licenses that feed the state’s power to coerce the community using judges, the law and the police. The state pockets the money companies pay to obtain the “contamination license.” In exchange, the state defends the company by keeping the people affected in line. The result is a long list of net winners and losers.

By nationalizing air space, rivers, streets, seas… the state not only robs something that doesn´t belong to it, but contributes to the Tragedy of the Commons. When a good is not managed according to subjective individual judgment, it vanishes (in our case, clean air).

The only sustainable economy is one which focuses on individuals and the private actions of the people participating in it. When economic fallacies depict certain problems as aggregates, as everyone’s, the state goes into action to “help us.” All it really does is enrich itself at our cost, produce unsustainablity and deteriorate society’s socioeconomic health.

A few countries in North and South America –for various reasons- have already started, or are studying, de-nationalizing streets and “public areas”… Let’s learn from them and go even further. Public “pirate licensing” only benefits the state and hurts everyone else.