Tragedy of the Commons
19 August 2001
Many readers will remember or at least recognize the prisoner's dilemma, the concept in game theory that two players can rationally choose actions that create a mutually irrational result. In the classic case, two prisoners, questioned separately, will rationally incriminate each other in exchange for slightly reduced sentences. Although they both could have kept quiet and received little punishment, each prisoner tries to reach the optimal outcome by ratting on a quiet accomplice. A related but less famous concept is the tragedy of the commons. The term, popularized in a 1968 article in Science by Garrett Hardin, is the notion that a series of apparently rational decisions by individuals might destroy a common good. Unlike prisoner's dilemma, the tragedy of the commons shows itself in the everyday lives of most Americans.
One illustration of the concept is the degradation of the communal good of a clean environment by individual decisions to buy polluting cars. Americans want a clean environment, but they also want cheap gasoline and big, powerful cars. Because gasoline is cheaper in America than almost anywhere else in the world, there is little economic incentive for them to purchase vehicles that burn less gas and emit fewer pollutants. Although most Americans respect the need to protect the environment, they have many other interests that affect their choices of the cars and trucks that they buy.
The fuel economy standard for automobiles from any one manufacturer is 27.5 miles per gallon. If a manufacturer falls short of that standard, a gas guzzler tax applies to the responsible vehicles. For light trucks--those with Gross Vehicle Weight Ratings (GVWRs) of under 8,500 pounds--the standard is only 20.7 miles per gallon. Even larger trucks, including the largest versions of the Ford Expedition and the Chevrolet Suburban, are entirely exempt from these benchmarks.
A recent Congressional Research Service report (located here) outlined the growth of light trucks in America in recent years. In 1999, they represented 48.3% of new automobiles (18.6% SUVs, 7.9% minivans, and 21.8% other light trucks). In 1980, light trucks in total represented only 19.9% of the automobile market.
Cars and trucks are also subject to different emissions requirements. Only the smallest of trucks--those with GVWRs of under 3,500 pounds--are now subject to the emissions requirements of cars. Regulations issued last year will gradually bring other trucks, even the "medium-duty" Expedition and Suburban models, under the same limits, but not until the 2009 model year.
For several years, Congress has forbidden the Department of Transportation form spending any money at all to make the fuel economy standards more stringent. An amendment to the energy bill went down to wide defeat last month in the House of Representatives. It would have done nothing to the standards for cars, but it would have raised the standards for all light trucks up to the more stringent car standard over several years.
Any individual decision to drive an SUV or a truck instead of a more efficient car is sometimes a thoroughly rational one: some drivers need large or powerful vehicles for a variety of reasons. But the rise in light trucks from 20% to almost 50% of the automobile market includes millions of SUVs, minivans, and light trucks that replaced station wagons, hatchbacks, sedans, and coupes. The larger replacement vehicles burned more gasoline and emitted more carbon dioxide, soot, and nitrogen oxides than cars would have produced.
It is difficult to blame the individual purchasers for their behavior. Because of their privileged status, light trucks were more powerful and larger than cars could be for the same price. It is easier to blame the manufacturers, but they were building what the public demanded and what the government allowed them to sell. It is best to blame the government for abdicating its role to look out for the common good, in this case the public's interest in both a cleaner environment and a reduction in gasoline usage.
One important purpose of government is to protect the common interests of society. Critics often assail the amount or particular use of money and intellectual energy spent on the military, but rarely do critics assail the concept of armed forces in the modern world. Protection of society requires citizens to pay for the government to provide for the common defense. Yet conservative critics often deride the money or intellectual capital spent on protection of the environment, even though a safe environment is as much in the common interest as safety from potential enemies.
In countries in which gasoline is very expensive, SUVs and other large passenger vehicles are rare, because the extra cost to operate inefficient vehicles is significant. Certainly, Congress could follow the path of much of Europe and impose large taxes on gasoline to encourage efficiency. In a similar vein, the citizens of California, faced with skyrocketing electric rates, have significantly cut their use of electricity this year.
But Congress has other methods at its disposal to make automobiles more efficient. It could increase the financial cost of purchasing particularly inefficient vehicles by increasing the gas guzzler tax. Raising the fuel economy standards for both cars and light trucks over time would encourage the automobile industry to find ways to make its existing products more efficient. Perhaps manufacturers would make their current offerings slightly less powerful and more efficient. Perhaps they would make fewer large vehicles and more small ones. Congress has the need and authority to look out for the common good.
The freedom to buy the cars and trucks that we want come with a price, an invisible tax on our environment and an invisible but significant tax on the country's and the world's dwindling resources. The constraints that current fuel efficiency benchmarks place on manufacturers are certainly significant, but they have not ruined the freedom of American consumers to choose from an immense variety of passenger cars. Forcing automobile manufacturers to sell fewer of the light trucks that have made them quite profitable may be difficult for them in the short run, but it will not toll their death knells. It will, however, force them to include the effects on the common good of their actions in to their manufacturing calculus.
If the government will not help Americans to be rational about the automobiles that they drive, then no one probably can. Maintaining the existing fuel efficiency standards only encourages consumers to buy vehicles that ruin our air and waste diminishing resources. The government has a chance to protect the common good by making good decisions by manufacturers and consumers economically feasible. It also has a chance to continue to foul the commons, supposedly in the interest of freedom, but really in the short-term interest of a few corporations.
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