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A graduate project submitted in partial fulfillment of the requirements for the degree of Master of Public Administration

By Charles Timothy Shates

California State University, Northridge June, 2005

For Sue, my wife, Julia and Tessa, my daughters, and for future generations



Dedication List of Illustrations Abstract Introduction Chapter One Wild Life: The Endangered Species Act Chapter Two Ground to Stand On: Property Rights Chapter Three Powers That Be: The Corporation Chapter Four Trees and Water: The Pacific Lumber Case Chapter Five Rivers and Highways: The Newhall Ranch Case Conclusion References

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LIST OF ILLUSTRATIONS Table 1. Projected Forest Seral Type by [Selected] Decades. Figure 1. Newhall Ranch sign on Highway 126. Figure 2. The eventual fate of the orange trees. Figure 3. A cross-section of the Santa Clara River Valley. Figure 4. Industrial park development in the town of Castaic. Table 2. Newhall Ranch project permits and approvals required. Figure 5. On one side of the river, housing in Santa Clarita. Figure 6. On the other side of the river from the housing. Figure 7. Traffic makes its way over a bridge. Figure 8. Shopping center along one side of the river. Figure 9. Southern Californias last wild river. Figure 10. The Santa Clara River. Figure 11. In the same general vicinity, the Santa Clara River. Figure 12. The relatively lightly traveled Highway 126. Figure 13. Zoning began with the best of intentions. 48 55 56 57 58 59 60 61 63 64 71 72 72 73 75



This study examines how notions about dominion, self-interest, private property, and economic growth and how the development of environmental protections, property rights, and corporations have influenced the shaping of the country. Two illustrative cases are examined: Pacific Lumber, a large timber-owning concern in Northern California redwood country, and Newhall Ranch, a large planned community in suburban Northern Los Angeles County. The study concludes that a sudden, radical paradigm shift is unlikely, but that accelerated incremental change may result from a convergence of the ideas of stewardship, traditional liberal democratic problem-solving processes or direct regulation, and green consumerismrepresenting fundamental shifts in the definitions of self-interest and the common good, or public interest.

INTRODUCTION The Skeptical Environmentalist, Bjorn Lomborgs popular book, began with the assertion things are getting better and then the book questioned the Litany of our ever deteriorating environment...the view of the environment that is shaped by the images and messages that confront us each day on television, in the newspapers, in political statements and in conversations at work and at the kitchen table (2001, p. 1). Lomborgs point, ultimately, was not that problems dont exist. Rather, his point was that, while things were not necessarily good, they were better than they used to be. To prove his position, he cited such factors as improved sanitation, improved nutrition, and longer life spans. Indeed, modern science has brought a flood of achievements in its wake. It is just this success that has added credence to the mythology of progress which is one of the hallmarks of modernism. It should be noted that findings of fact made by the modern-day United States Congress are supposed to be based upon the best scientific evidence available at the time. In public administration, Any final rule [issued by an administrative agency] must be based on substantial evidence on the record before the agency at the time of the decision (Cooper, 2000, p. 152) [emphasis added]. In the Rules of the House of Representatives, clauses 2(l)(3)(A) of rule XI, and 2(b)(1) of rule X, require that oversight findings and recommendations be reflected in all Committee reports (U.S. House, 1998). The Congress ultimately may make compromises or even disregard findings in the interest of political expediency; unlike administrative agencies, the Congress is directly accountable to the electorate.

Notwithstanding environmental skeptics, such as Lomborg, who decline to acknowledge the darker side of material progress, Section 2(a) of the Endangered Species Act of 1973 begins with a brief enumeration of the following findings of Congress: (1) various species of fish, wildlife, and plants in the United States have been rendered extinct as a consequence of economic growth and development untempered by adequate concern and conservation; (2) other species of fish, wildlife, and plants have been so depleted in numbers that they are in danger of or threatened with extinction; (3) these species of fish, wildlife, and plants are of esthetic, ecological, educational, historical, recreational, and scientific value to the Nation and its people The quality of life issues that the human race confronts at the beginning of the 21st century are caused, in part, by unbridled freedom in the use and development of private property, and in part by market failures. Such problems as traffic congestion, poor air quality, and loss of habitat are often the direct result of mans economic activities. Many problems are caused by the way we build; many by the way we extract and use natural resources. Efforts to alleviate environmental problems through policy have met with only mixed success. This is for two reasons. First, symbolic actions give a sense of having addressed the problem, when they are really only what Smith (1998) called a suture, an attempt to hide the wound that contemporary environmentalists are making to the smooth fabric of productivist discourse (p. 7). According to Cahn (1995, p. 24), policymakers create and sell policy outputs to political consumers, addressing the problem symbolically but failing to address the substantive issues. Second, some of the most successful pieces of legislation have also been the most contentious. This is to be expected, given that, as Cahn wrote, Environmental policy is predicated on regulating the use and development of private property, (Ibid., p. 8) while at the same time private property underpins the

liberal democratic tradition. To the extent that legislation such as the Endangered Species Act has been successful in giving environmentalists a tool with which to fight development interests, there has been also a significant amount of grassroots mobilization in opposition to environmental regulation and generally in favor of liberal property rights. This recent mobilization against environmental regulations has been very successful because it taps into an emotional response to a very powerful American Dream archetype. Individuals may have different versions of the dream, which has evolved over the course of American history. (The dream of a house in the suburbs, for example, is a far cry from the dream of freedom to worship as one pleases.) In a recent development on this theme, Rifkens book, The European Dream (2004), was based on his observation that the American Dream was in decline and would eventually be eclipsed by the new European Dream, which stresses personal development and cooperation within community over competitive accumulation of wealth. This paper explores the conflict between public policy and individual freedom in the context of land use and development. Property rights rank among the most important individual freedoms, but what happens when the exercise of those rights by property owners interested in developing their land, for example, infringes on a neighbors quiet enjoyment? Before the administrative state came into being, there existed a long history of common law, the remnant of which is today known as nuisance law, which governed such infringements. There exists a strong tension between two fundamentally opposing environmental philosophies that have shaped the development of the United States. These philosophies can be summed up as falling under one of two categories of belief about humanitys place

in and relationship to nature. The first category can be called dominion, that which has guided the expansive aspect of American history. It informs extraction and development of natural resources, what Smith (1998, p. 5) called the discourse of productivism. The second category can be called stewardship, and it informs the conservation of natural resources. Freyfogle (2003, pp. 37-38) distinguished these two differing types of energy, as represented by the terms boomers and stickers. The latter were noted for their desire for quiet enjoyment. The birth of the modern corporate form of business, not surprisingly on the dominion side of the equation, has enabled more rapid growth and development of resources because of its ability to generate greater amounts of capital. Growth and development is goodto a point. Cells must grow and divide if an organism is to live, but when cells grow too much, or divide too fast, the result may be harmful to the organism as a whole. There is a name for this condition andwhen malignantit is called cancer.

CHAPTER ONE WILD LIFE: THE ENDANGERED SPECIES ACT Public policy can be defined as a public response to a perceived public problem. In the late 1960s and early 1970s, Congress passed, and the Republican president, Richard Nixon, signed into law, a number of Acts, among them the National Environmental Policy Act, the Clean Air Act, and the Clean Water Act, designed to protect the environment and reverse perceived environmental degradation. The Endangered Species Act of 1973 (ESA) is a public attempt to address the narrow problem of species extinctionthe loss of biodiversity. Is this a legitimate problem? Species become extinct as a normal result of the evolutionary process, but scientific evidence has indicated that mans activities have accelerated the rates of extinction far beyond the background levels that existed previously, suggesting that the environmental impact of these activities is significant. Detractors literally tend to miss the forest for the trees, asking would we rather save an owl or our economic livelihoods. But the bigger picture is far more insidiousfor if all these other species are dying maybe mans environment is becoming unsuitable for man as well. It is particularly distressing to some scientists that the worlds amphibians are rapidly disappearing. These creatures are considered indicator species, like the miners canary that indicates when it is no longer safe in the mine. The reason that animals such as frogs are so susceptible to environmental degradation is in the nature of their biology. Frogs have numerous capillaries near the surface of their skin and obtain a large portion of their oxygen directly from the air and water to which they are exposed. The fact that they have been disappearing has scientists alarmed. The U.S. Geological Survey has instituted a frog watch, asking volunteer

citizens to report on their observations around the country (Where have all the frogs gone?, 2002). From a Darwinian perspective, perhaps man is, by virtue of his large brain, destined to outlive many weaker species in his built environment. Assuming this is the case, man must still make the utilitarian determination as to which species are essential to cultivate for providing his basic needs: air, water, food, medicine, clothing, and shelter. Until man has attained complete understanding of the biochemistry that underlies all life, any loss in biodiversity should be looked upon as an opportunity cost. For example, recently researchers in San Diego have discovered a new species of oceanic bacteria that naturally produces a previously unknown compound that shows promise of being effective in treating cancer (Wilson, 2003). The popular movie Medicine Man (McTiernan, 1992), dramatizes this theme, suggesting perhaps it is better not to burn the forest in the name of progress before such beneficial creatures can be discovered. The ESA has been one of environmentalists most powerful weapons against careless enterprise, but has been under attack recently by those who feel government regulations infringe upon their property rights. In recent court cases, private property owners have brought suits questioning the governments ability to interfere with development on private property. In Rancho Viejo, LLC v. Gale A. Norton, Secretary of the Interior, et al. (2003), the plaintiff sought to develop a housing project in northern San Diego County and a survey, conducted to comply with the ESA, found that the development would likely disturb the habitat of a group of endangered arroyo toads in the area. Rather than accepting an alternative plan proposed by the Fish and Wildlife Service, the plaintiff filed suit claiming the the application of the ESA is

unconstitutional because the federal government does not have the authority under the Commerce Clause to regulate private lands in order to protect the arroyo toads on those lands, because the toads live entirely within California. The United States District Court for the District of Columbia entered summary judgement on behalf of the defendants and plaintiff appealed. Although plaintiff lost on appeal, the dissenting opinion suggests that perhaps a gradual shift has been taking place, and that the pendulum is now beginning to swing the other wayin favor of the industrial paradigm. The following case, dealing with state property, demonstrates the weight of the Endangered Species Act as a federal issue. In Palila v. Hawaii Dept of Land and Natural Resources (1979), the district court carried[the] suggestion of a federal ownership interest in wildlife a step further. In Palila, the court upheld the Endangered Species Act, as applied to nonmigratory species found on state lands, on the basis of the treaty power and commerce clause. It nonetheless suggested that the importance of preserving such a national resource [as endangered species] may be of such magnitude as to rise to the level of a federal property interest (Bean & Rowland, 1997, p. 22). California has usually mirrored the federal environmental laws, sometimes anticipating them. In the 10th Edition of The Guide to the California Environmental Quality Act (Remy, Thomas, Moose, & Manley, 1999), the authors review several important court cases relevant to the issue of the California Endangered Species Act (CESA). The authors discuss how CESA relates to the California Environmental Quality Act (CEQA), and also how the latter relates to the National Environmental Policy Act (NEPA ).

CEQA was passed in 1970 (Public Resources Code Sec. 21000, et seq.) to require public agency decision makerssuch as, for example, a county board of supervisors about to approve a development projectto consider the environmental consequences of their actions. Although CEQA is compared to the National Environmental Policy Act (NEPA) that was passed a year earlier, and upon which CEQA is modeled, the authors point out that Unlike NEPA, CEQA has not been characterized as merely a procedural statute. Rather, CEQA contains a substantive mandate that public agencies refrain from approving projects with significant environmental effects if there are feasible alternatives or mitigation measures that can substantially lessen or avoid those effects (Remy, et al., pp. 2-3). Also, because the environmental review process involves the public, it has become a means of enabling democratic participation. Thus, the California Supreme Court has stated that the CEQA process protects not only the environment but also informed self-government (Ibid., p. 3). The procedural devices, as the authors call them, of the CEQA environmental review can be viewed as various steps in the process. The most familiar of these procedures is the preparation of an Environmental Impact Report, or EIR. The following steps are not sequential; the negative declaration bypasses the EIR process, for example. Simply enumerated, they are as follows: (1) the initial study, (2) the negative declaration, (3) notice of preparation of an EIR, (4) draft EIR, (5) public review of (a) negative declaration or (b) draft EIR, (6) written responses to comments on draft EIRs, (7) certification of a final EIR, (8) mitigation reporting or monitoring program, and (9) statement of overriding considerations.

The principles governing the interpretation of CEQA are illustrated by important California Supreme Court cases. CEQA was interpreted the first time in 1972 in the landmark case Friends of Mammoth v. Board of Supervisors. In its decision the Court set forth the principle that CEQA should be broadly construed within the reasonable scope of its language to protect the environment. In later cases, the court hinted that other considerations may take their place alongside the fullest possible protection for the environment While the court neither distinguished Friends of Mammoth nor explicitly rejected it, the courts willingness to consider economic factors arguably departed from the interpretive principle announced in the 1972 decision (Remy, et al., p. 7). The CEQA Guidelines are found in the California Code of Regulations under Title 14, Sec. 15000 et seq. The Guidelines were first issued by the California Resources Agency in 1973, under the authority granted by Public Resources Code Sec. 21083. Section 15000 characterizes the Guidelines as regulations. Section 15005, however, says that the Guidelines contain mandatory, advisory, and permissive elements. Although characterized as regulations, the court has declined to make a definitive determination on the Guidelines, but has emphasized, however, that, [a]t a minimum, courts should afford them great weightexcept when a provision is clearly unauthorized or erroneous (Ibid., p. 9). The general legislative policies that motivated enactment are identified in Public Resources Code Sections 21000-21003. They will not be enumerated, but following are two examples: 7. to require all agencies that regulate activities to give major consideration to preventing environmental damage while providing a decent home and satisfying living environment for every Californian; 14. to require governmental

agencies at all levels to consider qualitative factors as well as economic and technical factors and long-term benefits and costs, in addition to short-term benefits and costs and to consider alternatives to proposed actions affecting the environment (Ibid., pp. 12-13). Compared to NEPA, The Legislative history of [CEQA] also supports the view that environmental values are to be assigned greater weight than the needs of economic growth.The act thus requires decision-makers to assign greater priorities to environmental than to economic needs.The federal statute requires only that agencies consider the potential significant adverse environmental impacts of their major actions, as described in environmental impact statements (EISs) (Ibid., p. 31). Unlike CEQA, however, NEPA does not create for federal agencies a mandatory duty to act, even if alternatives or mitigation measures are feasible. One NEPA procedural requirement that is more stringent than its parallel requirement under CEQA is that a final EIS must be circulated for public review for at least 30 days prior to project approval. In addition, the alternatives analysis found in an EIS is typically much more detailed than what would be typically found in an EIR.Under CEQA, in contrast, alternatives need only be discussed in meaningful detail (Ibid., p. 33). Because CEQA was modeled after NEPA, the California courts have often looked to federal cases interpreting the latter statute as strongly persuasive authority as to the meaning of the former.Because the California statute is more protective of the environment, however, it seems fair to say that NEPA cases generally set the environmental floor, but not necessarily the ceiling, for interpreting CEQA (Ibid., pp. 34-35). The issue of endangered species is invoked within the discussion of CEQA Guidelines Section 15065, which lists conclusions that would cause making mandatory


findings of significance. Among these conclusions is the potential toreduce the number or restrict the range of an endangered, rare or threatened species (Ibid., p. 176). Whenever any of the named conclusions may occur, an EIR must be prepared, rather than a negative declaration. Furthermore, if an EIR shows that they will occur, an agency cannot approve a project without first issuing certain findings as required by Public Resources Code section 21081 and CEQA Guidelines section 15091. If after making such findings, the project in question will still cause significant impacts that are not at least avoided or substantially lessened, the agency then must issue a statement of overriding considerations before approving the project.Section 15065, in other words, is necessary not only to ensure that EIRs are prepared under proper circumstances, but also to ensure that agencies do not avoid the requirements to make necessary findings, to modify projects where feasible to lessen or avoid significant impacts, and to adopt statements of overriding considerations (Ibid., pp. 176-177). The case of Mira Monte Homeowners Association v. County of Ventura (1985) first gave effect to section 15065. The issue before the appellate court was whether the Ventura County Board of Supervisors abused its discretion under CEQA by certifying an EIR and granting approval of a tentative tract map without first preparing a subsequent or supplemental EIR when new conditions were discovered regarding encroachment of a project on a sensitive wetland area and vernal pool. The court states that Guidelines section 15162 directs that an additional EIR be prepared where[substantial] changes occur with respect to the circumstances, such as due to the involvement of new significant environmental impacts not covered in a previous EIRThe CEQA Guidelines require a mandatory finding of significance where, inter alia, the project has the


potential to threaten to eliminate a plant or animal community, [or] reduce the number or restrict the range of a rare or endangered plantThe Guidelines further provide that a project will normally have a significant effect on the environment if it will substantially affect a rare or endangered species of plant or its habitat or substantially diminish habitat for fish, wildlife or plants. The court found that the discovery that E Street would pave over part of the wetlands was a change in circumstancesand the implementing guidelines dictate that the proper procedure upon discovery of the encroachment should have been further environmental evaluation by way of a subsequent or supplemental report prior to any project approval. By failing to act in this manner, the County did not consider the full range and effectiveness of alternatives and mitigation measures. As Remy described it, the court rejected the respondent agencys argument that substantial evidence supported its experts view that the impact in question was insignificantInstead, the court reasoned that the impact was significant [b]y definition, treating the issue as involving a pure legal question as to which no deference to agency experts was proper (Remy, et al., p. 177). Remy also deals with the issue of endangered species in the discussion of the substantive requirements of EIRs, specifically Impacts on endangered and threatened species (Ibid., p. 406). Focused on the California Endangered Species Act (CESA), which is found at Fish and Game Code section 2050 et seq., Section 2080 provides that [n]o person shalltake or attempt to take any species, or any part or product thereof, that the Fish and Game Commission has determined to be endangered or threatened (Ibid.).


From an intergovernmental perspective, Section 6 of the federal Endangered Species Act (ESA) provides for cooperation with the States, which may include consultation with the States, management agreements, cooperative agreements, allocation of funds, and provides that the Secretary review State programs. The ESA explicitly states (Sec. 6(f)) that Any State law or regulation respecting the taking of an endangered species or threatened species may be more restrictive than the exemptions or permits provided for in this Act or in any regulation which implements this Act but not less restrictive than the prohibitions so defined. The federal law therefore sets a floor on States environmental quality, but not a ceiling. The Act also requires consultation with the Secretary on any federal project that may have an impact on an endangered or threatened species. This section has demonstrated that environmental laws and regulations at both the state and federal levels can play a significant role in determining what an owner can or cannot do to develop his or her property. In one conception of mans proper place and role in nature, developmentor economic growthis absolutely vital to his continued existence.



Our place the ground we stand on is both physical and spiritual, concrete and imagined, real and symbolic. The place we define for ourselves, and the place that is defined for us, is a constant point of reference for seeing the world, and for transforming the world and our "place" in it (Inter Pares, 2003).

The idea of property has its roots in western civilization. When settlers arrived in the New World they found a Native American culture that did not believe in private ownership of land (Zinn, 2003). When the Owens Valley in California was settled, whites pushed Native Americans out and fenced the land where water rights along the Owens River would eventually become an important issue to the growing city of Los Angeles (Halperin, 1993). The Native Americans who inhabited the country had coexisted with nature for thousands of years, but the settlement of the West demanded that water be captured for use. Bean & Rowland (1997) characterized the property status of wildlife in the following passage: In the history of Western thought, there is an almost unbroken tradition, starting at least as early as the Roman Empire, in which wild animals (or animals ferae naturae, as they were called) were regarded as occupying a nearly unique status. The law considered wild animals in their natural state to be like the air and the oceans, in that they were the property of no one. Yet unlike the air and the oceans, wild animals could become the property of anyone who captured or killed them (pp. 7-8). In early New England, wildlife was owned by the people collectively, and state law implicitly and sometimes explicitly allowed the public to hunt on unenclosed land and to fish and forage (Freyfogle, p. 23). As the timber industry grew, and timber operations began to cause environmental degradation (that is, fishermen and resort owners were beginning to suffer economic losses) the state of Maine, considering regulating the timber industry, asked the Maine Supreme Court for an advisory opinion. The Court held that the legislature did have the authority to curtail private rights


whenever, in its judgment, the publics interest was served (Ibid., p. 25). This case demonstrated a central element of ownershipthe obligation of landowners to refrain from activities that cause harm to public interests (Ibid., p. 27). Philosophers have written extensively on the meaning of property, asking what it is and where it comes from. According to Rifkin (2004) it was the French philosopher Jean Bodin who believed common ownership is unnatural and a violation of divine law. Why would God include the commandment Thou shall not steal if he didnt mean to embrace the concept of private property?... (p. 139). As Freyfogle (2003, pp. 16-17) pointed out, Landownership includes more than just the right to put land to use; it also includes the indispensable right to complain when other landowners materially interfere with ones quiet enjoyment. Inevitably, these rights are relative: one owners right to use land is tempered by his neighbors right to remain undisturbed. Nuisance law incorporates this ownership element by providing vital protection for land uses, ordinary as well as sensitive, yet it does so by restricting the ability of all landowners to conduct activities that cause harm. Nuisance law enhances and protects property rights at the same time as it limits them [emphasis added]. Freyfogle wrote about the two rival versions of what private dominion is all about (Ibid., p. 37). The first is an ownership image that has held high a landowners right to live peaceably at home without significant disruptionto be protected in ones quiet enjoyment of the land (Ibid.). The second version is what Freyfogle says might be termed the industrial or developmental perspective, emphasizing opportunity, a release of physical energy, and an owners liberty to act with little restraint. Dominion in this


view is about exploiting the land for personal gain (Ibid., p. 38) and was clearly associated with the idea of manifest destiny. Early research, according to Freyfogle, had developed a limited view of private property, providing comfortable reassurance in the dominant myth of material progress: Everyone shared at first, theory had it, and only later, as populations rose and economies gained sophistication, did true private property emerge. It was a comforting conclusion, for it placed at the apex of propertys evolution a world view based on the individualism and progressive thought of nineteenth-century Europe (p. 44). Continued research in the 20th century created a much more nuanced understanding of the institution and how it evolved, as Freyfogle wrote, Private rights in tribal groups were crafted and allocated to group members in ways that reflected the members needs, economies, and values. Rights to land typically took the form of specific use rights rights to use a given tract for one or more specified purposesTypically, more than one person or family had enforceable rights to use a given piece of land for differing purposes. Moreover, many use rightsto hunt, gather berries and nuts, and the likewere retained by the group as a whole, with all members (but not outsiders) able to exercise them (Ibid.). Freyfogle emphasized that during the period when the United States Constitution was written and adopted, concepts about property were strongly shaped not only by Lockean liberalism, but by English common law as well (Ibid., p. 45). The English common law in turn was shaped by the prevailing hierarchical culture of the manor system. The spatial makeup of a typical English village of the thirteenth century was described as follows: populated by 400 to 600 inhabitants, the landscape was divided into three categories of space: public spaces, where anyone could go, including outsiders; communal places, where inhabitants of the village but not outsiders held distinct use rights; and private places, normally homes and private gardens, where owners expected an element of privacy (Ibid., p. 48).


Although the manor system was eventually replaced by mercantilism, Landownership[remained] a status, and to enter into the status was to enjoy the rights and be subject to the responsibilities that pertained to it. With few exceptions, the community had a voice in the ways people used their lands (Ibid., pp. 49-50) [emphasis added]. In the colonies, there was a vigorous tradition of regulating land uses in the public interest. Owners of attractive sites for water mills could have their lands seized if they failed to use them in the public interest (Ibid., p. 60) [emphasis added]. Timber regulation was commonplace, and as early as 1630, the Pilgrimshad begun restricting the right of timber owners to export their products without the approval of governor and council and In New Hampshire and elsewhere, large trees suitable for ship masts were claimed as public property, even when located on private land (Ibid., pp. 60-61). Perhaps alluding to late 20th Century wise-use and property-rights movements, Freyfogle wrote, As many of these colonial and early federal-era laws illustrate, land-use regulations went well beyond the avoidance of harm to impose affirmative duties on private owners to help achieve social aims. Later generations would resist the imposition of such duties, portraying them as unprecedented, but the generation that led Americas formation seems to have had little trouble with them. Indeed, historian John Hart concludes that the legal record they left behind reveals no sign of the later-imagined right of landowners to be let alone as long as they do not harm others. That idea would gain currency only toward the end of the nineteenth century, after lawmakers had fundamentally reworked laws to support Americas insatiable desires to develop the continent, expand markets, widen choices, and multiply the nations wealth (Ibid., p. 62). It was the Sanderson case, according to Freyfogle, that was pivotal in deciding which version of dominion would hold sway. In that case the Pennsylvania Supreme Court ruled against an ordinary homeowner in favor of The Pennsylvania Coal Company.


With Sanderson, the pendulum had completed its swing, at least in the coalfields of Pennsylvania. From an agrarian property system that protected quiet enjoyment and enforced sic utere tuo firmly, ownership law had swung completely to the industrial property side, freely permitting intensive land uses with only modest concern about resulting harmsProperty law was no longer about the right to remain undisturbed in ones lawful use; it was now chiefly about the right to use land for maximum gain. The mentality of the migrants and boomers had triumphed (Ibid., p. 73). Fast forward to the 21st Century In a recent article about coal mining, Williams (2005) described the latest technique used by the mining industrylongwall mining. This is a form of underground mining where a seam of coal is removed except for a long transverse wall of the seam. Once the seam has been completely mined, the wall is removedallowing for the recovery of the last bit of coal in the seamwhich causes surface subsistence. One of the problems created by this method has been the disappearance of streams and ponds: the permanent alteration of existing watersheds. Another problem is the loss in property when subsistence occurs under private residences. Describing what happened to the former occupants, Williams wrote, Most of the former residents were living in new double-wides and other modest dwellings provided by the companies. For most it had been a step up (2005, p. 46). It had been a step up because the richest coal depositthe worlds richest mineral depositthe Pittsburg Coal Seam, runs like layer-cake filling for 2,000 miles, 300 to 800 feet under Pennsylvania, West Virginia, Virginia, Ohio, Indiana, Illinois, and Kentucky (Ibid., p. 44). He wrote, Longwalling happens anywhere there is coal, but the grossest environmental damage is in the impoverished regions (Ibid.). The liberty celebrated by Americansto be able to pursue the American Dreamwas strongly influenced by the institution of private property. In the formative


years of the country, property was considered indispensable to freedom from tyranny and to providing access to the democratic process. As Americans pushed westward, however, freedom became much more individualized. As Freyfogle (2003) noted, for the drafters of the Declaration of Independence, it was collective liberty that was the primary issue of the day: It was the power of the colonists as a people to govern themselves without interference, not the rights of individuals as such to resist constraint (p. 59). Individual freedom, and the pursuit of happiness, by the middle to the end of the 19th Century, began to take on what Rifkin (2004) referred to as the Horatio Alger storiesthat its possible for every American to go from rags to richesis what the American Dream is all about (p. 26). Throughout the latter half of the nineteenth century, the courts were busy undoing the common law protections for quiet enjoyment. Quoting an 1873 New York Supreme Court decision, Freyfogle wrote, The general rules that I may have the exclusive and undisturbed use and possession of my real estate, and that I must so use my real estate as not to injure my neighbor, are much modified by the exigencies of the social state. We must have factories, machinery, dams, canals and railroads. They are demanded by the manifold wants of mankind, and lay at the basis of all our civilization (2003, p. 74). It is interesting to note that early industrialists were in favor of government interference and regulation for the common good when it benefited their plans for growth and development, often depriving less powerful constituencies of their quiet enjoyment in the process. The irony is that nowadays those who prefer more intensive uses of the land commonly complain about environmental protections as being tantamount to interference by the federal government in state and local matters. In yet another twist, as Freyfogle pointed out, Probusiness critics of government began to


argue that it was the common law alone that defined a landowners rightsthe common law that was now so slanted in favor of industry. Statutes and regulations were part of a different body of law entirely, a body of public law that was seen to threaten private rights (Ibid., p. 82) [emphasis added]. The idea of property is much broader than land, though much of the controversy surrounds land use. The Lockean influence on the founders clearly contributed to the countrys early development. In the Lockean scheme of things, land that is not put into cultivation or put to some other use is wasted. In the early history of the country, land was often given away or sold very cheaply to encourage settlement and development. The Mining Law of 1872, for instance, allowed private development on public lands and led to a privatization of policy (Klyza, 2001, p. 113). The idea of ownership according to Locke is that one owns ones self and the products of ones labor. By placing land into cultivation, a farmer adds increased value and is entitled to the fruits of his labor. From the earliest period, the role of government was seen to be the fostering of the economic development of the country by private citizens and the protection of property thereby acquired by those citizens. The Lockean notion of private property as an incentive to development worked well in the countrys early history, but there were also abuses. These abuses and the growth of the country into a more fully settled stage, required more government intervention in the form of an administrative state. Particularly, the Interstate Commerce Commission and various pieces of legislation such as the Sherman Antitrust Act came about in an effort to curb excesses of the robber barons at the end of the 19th century.


Yet, even today the wealth of these families is notable, and many of their names, such as Morgan, Rockefeller, and Kennedy, continue to be well known. Many writers have described the balance between private property rights and the public interest. Richard Pipes (Property and Freedom, 2000) has attempted to demonstrate the primacy of the right to property as a necessary prerequisite to other freedoms. Other libertarian writers have described the gradual erosion of constitutional protections as the country has grown. Particularly, the advent of the administrative state has led to greater direct government involvement in land use policy (for example zoning laws) and indirectly through other regulations that may impact land use. Ellen Frankel Paul gave a prime example of the libertarian point of view. She claimed that the rise of the environmental movement in the 1970s has had an enormous impact upon the rights of ordinary property owners, and not just the conduct of business enterprises (1987, 6). That august political philosopher of the seventeenth century, John Locke, insisted that governments are constructed by men for one reason only, and that is to protect their property rights. He believed that the right to acquire, possess, and enjoy property is the fundamental liberty upon which all other inherent rights of life and liberty depend. The American founding fathers were deeply imbued with these Lockean notions. They, too, cherished property and the opportunity for personal development it represented. They embraced the idea that government exists to protect people's inalienable rights and should be tolerated only so long as it acts as a rights protector (Ibid., p. 3). According to Locke, property belonged to an individual not because a king granted it to him, but because he "mixed his labor" with it and thereby transformed it into something separate and distinct from the common, unowned land in the state of nature (Ibid., p. 8). Ellen Paul suggested that environmentalists rejection of these Lockean notions represents a slide back toward a feudal notion of the state as the ultimate


authority over the use and disposition of land (Ibid., p. 9). Yet, as Freyfogle demonstrated, land use was well-regulated in the colonies at the local level, not by a farflung evil empire nor by a distant bureaucracy. Ellen Paul claimed, Most proponents of an expanded state role in determining land use do not see themselves as embracing a return to feudalism. Rather, they focus upon the supposed waste and environmental degradation foisted upon society by rapacious developers who are concerned only with profits and care nothing for the welfare of future generations. To replace these individual market decisions, they advocate some form of state or national land-use policy that will collectivize decision making while leaving the ownership of property in private hands (Ibid., pp. 9-10). She asked, Is the quality of our environment a private, local, or state concern, or is it a federal problem? She answered that there has been a steady shift of the balance of power in the direction of federal government and lists a number of new laws that have spawned an elaborate apparatus of controls over the use of land, water, and air (Ibid., pp. 10-11). Included among them are the Clean Air Acts of 1963 and 1970, the National Environmental Policy Act of 1969, the Water Quality Act of 1965, the Water Pollution Control Act Amendments of 1972, the Solid Waste Disposal Act of 1968, and the Federal Coastal Zone Management Act of 1972. What she fails to do, however, is to place these laws within historical context. In other words, she fails to explain that one of the reasons national legislation became an imperative is because these problems were not being addressed at the local level. Not content to criticize only the federal government, she went on to say, But the environmentalist activism of the past few years has not been limited to shifting the locus of control over land use to the federal government. Of equal or even greater impact has been the veritable flood of state land-use programs. These seek to supersede local zoning authorities and regulate land that falls into the nebulous category of land involving state-


wide concern (p. 12). In addition, she pointed out that local control over the use of land has been a decisive force in shaping our land-use patterns since the early twentieth century. If we have unsightly strips of garish neon lighting, if we have cities congested by high-rise office buildings, if we have suburban sprawl and neighborhoods in which it is impossible to do your shopping without hopping into your carall phenomena castigated by environmentaliststhen zoning can take its fair share of the blame (Ibid., p. 13) [emphasis added]. If libertarians such as Ellen Paul had their way, with so little government what need would we have for democracy? Ellen Paul was particularly critical of what she calls the environmentalist movement. She said, To comprehend fully the influences on judges and legislators, one must examine the environmentalists arguments. Environmentalists have been very successful in dramatizing their cause, and their influence upon legal writers dealing with the police power and its proper limits is in no small part responsible for the wave of environmental legislation and for the generally sympathetic review of it by the courts (Ibid., pp. 13-14). She characterized environmentalism as a battle for control of land. suppositions shared by most environmental activists: that mans artifacts and civilization threaten the environment; that our limited spaceship earths finite resources are being eroded; that pollution threatens life on earth and must be eradicated at great cost; and that the root cause of all these impending disasters lies in the unrestricted forces of the market (Ibid., p. 14). She continued, Fundamental to the views of those on the more extreme fringe of the environmentalist movement is a rejection of many fundamental Western values. Both Christianity and the Greek tradition emanating from Aristotle placed the human race at the focus of moral concern and atop the hierarchy of


earthly beings. But, she says, environmentalists believe that Western man, no longer the focus of moral concern, ought to learn from the Zen Buddhists, Asian mystics, and ancient pagans who knew how to live in harmony with nature and natures laws (Ibid., p. 17). The most radical wing of the environmentalist philosophers takes its inspiration from Aldo Leopold and his land ethic, which he enunciated in 1949 in his A Sand County Almanac. These thinkers wish to extend value or rights to nonconscious entities, thus extending the purview of moral consideration beyond humans and animals to include plants, rocks, streams, oceans, and the atmosphere. Although it would be wrong to suppose that all environmentalists fall into this category, the radicals do in a sense set the agenda. By establishing the far reaches of the environmentalists stance, they make less extreme positions appear moderate (Ibid., p. 19). Describing Leopolds land ethic she wrote, His system emphasizes our obligations to nature rather than our privilege to rule over it as mere property. His conception of an interdependent biotic community was definitely not human-centered. Consequently he disparaged the efforts of others who pursued the conservation of nature motivated by an ethic based principally upon human or economic concerns (Ibid.). Way at the other end of the spectrum, she described a dwindling band of moderate ecologists, probably the least favored by activists but the most influential with the general public. This position might be called the right wing of the ecological movement. These thinkers, relatively few in number, reject the Weltanschauung of their more radical colleagues and seek to preserve endangered species or threatened biosystems from an avowedly anthropocentric standpoint. Government, according to them, has a legitimate role to play as arbiter, to determine exactly which natural objects and species ought to be preserved for their future utility to humankind. Although more reasonable than other environmental philosophies, this position still grants to government


decision-making power in an area where personal values decree the result rather than hard, scientific evidence. How are officials to determine the value of a wetlands, for example, when no market competition informs their decision, and they must rely upon their personal understanding of the public interest? (Ibid., pp. 25-26). Here she raised a good question. How do we value such assets? Yet, even though there is no market for them, intuitively we know they have some valueand the less there is of them, that is the more scarce they are, the more valuable they must become. In her view, eminent domain had also become a serious issue as courts have emasculated one of the principal constraints upon the exercise of eminent domain: the public use proviso, which used to mean that property could not be taken merely to transfer it to another private owner. But with the Supreme Courts sanction for the taking of a nondilapidated building that happened to lie within a blighted area destined for urban renewal (in Berman v. Parker in 1954), courts throughout the country have been encouraged to find a public use in a variety of imaginative takings by the states. These takings have only a tenuous connection to public necessity or public purpose, and they often simply transfer property from one private owner to another (Ibid., pp. 28-29). As Cahn noted, eminent domain, which many describe as a government initiative to secure the public good, is more accurately defined as governmental action on behalf of self-interested policy elites (1995, p. 10). Ellen Paul made some good arguments and asked some difficult questions, but failed to adequately address the historical basis of governmental actions. The origin of zoning laws is a case in point. As expressed in Suburban Nation: While government programs for housing and highway promoted sprawl, the planning profession, worshipping at the altar of zoning, worked to make it law. Why the countrys planners were so uniformly convinced of the efficacy of zoningthe segregation of the different


aspects of daily lifeis a story that dates back to the previous century and the first victory of the planning profession. At that time, Europes industrialized cities were shrouded in the smoke of Blakes dark, satanic mills. City planners wisely advocated the separation of such factories from residential areas, with dramatic results. Life expectancies rose significantly, and the planners, fairly enough, were hailed as heroes. The successes of turn-of-the-century planning, represented in America by the City Beautiful movement, became the foundation of a new profession, and ever since, planners have repeatedly attempted to relive that moment of glory by separating everything from everything else. This segregation, once applied only to incompatible uses, is now applied to every use. Perhaps the greatest irony is that even industry need not be isolated anymore. Many modern production facilities are perfectly safe neighbors, thanks to evolved manufacturing processes and improved pollution control. (Duany, Plater-Zyberk & Speck, 2000, pp. 9-11) A dynamic, ontogenetic view of propertyas opposed to a static viewreveals a blind faith in the power of technological progress, or what Smith (1998, p. 5) calls productivism, driven primarily by corporate capital. The hegemony (Cahn, 1995, p. 18; Smith, 1998, p. 16) of this system is such that a packaged and marketed vision of the American Dream has come to be accepted as normal (Silverthorn, 2004).



The capitalist process, by substituting a mere parcel of shares for the wall of and the machines in a factory, takes the life out of the idea of property. It loosens the grip that once was so strongthe grip in the sense of the legal right and the actual ability to do as one pleases with ones own; the grip also in the sense that the holder of the title loses the will to fight, economically, physically, politically, for his factory and his control over it, to die if necessary on its steps. And this evaporation of what we may term the material substance of propertyits visible and touchable realityaffects not only the attitude of the holders but also that of the workmen and the public in general. Dematerialized, defunctionalized and absentee ownership does not impress and call forth moral allegiance as the vital form of property did. Eventually, there will be nobody left who really cares to stand for itnobody within and nobody without the precincts of the big concerns (Schumpeter 1942, p. 142, in Monks & Minnow, 1991, p. 67).

There can be little doubt that the corporation, as a form of organization, plays a significant role in the modern world. As Bakan (2004, p. 1) wrote, A key premise is that the corporation is an institutiona unique structure and set of imperatives that direct the actions of people within it. But precisely what is a corporation, and how did this entity become such a powerful player in all our lives? Bowman (1996, p. 2) defined the large business corporation as an organization possessing all of the following attributes: (1) it is a legal entity (a fictitious and immortal person possessing rights and obligations), (2) it is an enterprise chartered by government and subject to the rule of law, (3) it is a joint-stock company that earns dividends for its stockholders, and (4) it is an economic, political, and social institution through which power is exercised internally (within the enterprise) and externally (in society at large). The corporate form of organization surpassed the sole proprietorship and partnership forms of organization as a tool of economic expansion because it permitted the accumulation of large amounts of capital by pooling investors resources (unlike a proprietorship) and it provided limited liability (unlike a partnership). This form of


organization provided the fuel for the U.S. expansion in the 19th century, being the catalyst for the industrial revolution. A child of nation-building, according to Beatty (2001, p. 10), the professionally managed corporation began in the effort to reach the ever-receding line of settlement by railroad, Americas first big business. Hall (2002, pp. 23-24) provided three explanations for the emergence of the multinational corporation as a powerful influence. The first explanation is imperialism, which he defined as an expansion of corporate markets and reduction of costs by exerting economic power over a weaker nation. Second, he made the somewhat circular argument that local economic independence is impossible for many nations, particularly those with weak political and economic systems. The multinational firm becomes the dominant economic and political form of organization, superseding the traditional nation-state in weaker parts of the world. One could argue that such a condition of dependence is brought on by the imperialistic actions of corporations in the first place, however, and that the second explanation is really an extension of the first. His third explanation was that the multinational corporation is the inevitable result of corporate choices made to implement product-market strategy: As corporations begin to produce a complex range of products, these are to be sold in different markets through multiple channels of distribution. A recurrent theme in Hall was that organizations in general seek to expand their influence over the environment (Ibid., p. 24). For example, with regard to technological, legal, and other environmental conditions, he stated, Organizations do not respond to technological change through simple absorption. Instead, the organizations political process operates through the advocacy of change or stability (Ibid., p. 205).


Since innovation goes against the status quo, one could argue that organizations advocate for stability more often than they advocate for change. He wrote, The pharmaceutical industry has had great success in protecting itself from competition by securing the passage of state and federal legislation. It also was successful in getting organized medicine, through the American Medical Association, to permit the industry to advertise drugs by their brand names rather than by their generic names (Ibid., p. 257). Similarly, Organizations are not benign recipients of laws and regulations. Organizations in all sectors attempt to select the appropriate legal strategy aimed at the appropriate level of government. Organizations are important actors in the development of laws and regulations through their lobbying efforts (Ibid., p. 206). In Halls discussion of the resource-dependence model, he said, Another important aspect of the model is that organizations attempt to deal actively with the environment. Organizations will attempt to manipulate the environment to their own advantageit also contains the idea that the administrators of organizations manage their environments as well as their organizationsThis is the institutional level of operations, in which the organization is linked to the social structure by its top executives (Ibid., p. 265). Furthermore, Interlocking directorates provide opportunities for collusion, co-optation, monitoring, legitimacy, career advancement, and social cohesionInterlocks are a means by which organizations can attempt to manage uncertainty in their environments (Ibid., p. 231). One could argue that since change is a major cause of uncertainty, most organizations attempt to manage uncertainty in their environments by maintaining the status quo and thereby stifling innovation.


Large partnerships and joint ventures permit the pooling of resources, and newer forms of these organizations, such as limited partnerships, provide a certain degree of limited liability to investors. If the concept of limited partnerships had been around in the early 19th century, perhaps they would have become the dominant form of business organization instead. But it was the corporation that existed at that period in our history. The corporation existed in Europe before America was colonized. In fact, the great trading companies of the European empires had a significant influence on how early settlers viewed chartered companies. As Wasserman (1983) put it in his book America Born and Reborn, As a whole the colonists were most thoroughly incensed by Britains exploitation of their commerce and industry (p. 42). The American Revolution was, in Wassermans view, a populist revolt against, not only the Monarchy, but also the excesses of trading companies such as the East India Company. The spirit of American democracy had unleashed the worlds first anti-imperial revolution, only to give birth to a nation that saw itself as chosen by God to rule the world (Ibid., pp. 47-48). The Articles of Confederation formed a loosely knit federation of states that allowed for greater local control and a more direct form of democratic government, but the Founding Fathers realized that their own property interests were at risk. According to Wasserman, Alexander Hamiltonlaid the foundations for the rise of American corporate capitalism. All communities divide themselves into the few and the many, he wrote. The first are the rich and the well born, the other the mass of the people. The mass are turbulent and changing; they seldom judge right. Therefore the rich must have a distinct, permanent share in the government to check the unsteadiness and imprudence of democracy. [As a result] Adams codified a constitutional system built around property qualifications for office-holding and voting, a strong executive, two legislative houses with at least one dominated by the rich, and strict limitations on the abilities of the masses to rulethe Federalist ideal was perhaps best reflected in the state constitution of Maryland.


Among other things it installed an electoral college which doubly removed the election of representatives from the public (Ibid., pp. 50-51). As the Constitutional Convention got underway, suspicion spread through the countryside that the convention was dominated by men who intended to profit directly from the formation of a new government. Supporters and critics alike understood that the Constitution was a document of post-Revolutionary reaction designed to cement the power of what James Madison called a landed interest, a manufacturing interest, a mercantile interest, a monied interest, with many lesser interests. John Jay put it more succinctly. Those who own the government, he said, ought to run it (Ibid., p. 52). The government formed by the Founding Fathers was based on the economic theory of classical liberalism, which was, in the words of Bowman, an affirmation and defense of the freedom and rights of the individual whether they be political, religious, or pecuniary It is the last of these for which liberalism offered the strongest defense, and understandably so, since it sought to justify an economic system that was premised on contractual relations between individuals. A product of both the Enlightenment and the Reformation, classical liberalism also contains a conception of history as material progressa partly economic, partly religious view that identifies industry and acquisitiveness with the social good and heavenly rewards. Furthermore, American liberalism contains a version of material progress that is peculiarly its ownnamely, the doctrine of the open frontier, economic expansion, unlimited opportunity, and upward mobilityin short, the American promise. Adam Smiths economic theory, which was outspokenly critical of the inefficiencies of corporate enterprise within the marketplace of individuals, eventually became a source of the corporations greatest ideological strength. To accomplish this result, the long-held view of the business corporation as a tool of monopoly power would have to be jettisoned for a modern, anthropomorphic conception of the corporation suited to the individualistic premises of liberalism. The unique contribution of American constitutional law to this ideological trick of mirrors, what I shall term the doctrine of corporate individualism, took hold in American jurisprudence in the early decades of the nineteenth


century. Not only did it confer on the corporate entity the legal rights and capacities of the contracting individual during the dawn of American industrialization, but it also personified this legal fiction, thereby transforming a collectivity into an individual (1996, pp. 6-9) [emphases added]. So, from the beginning there was a structure in place that would allow, even encourage, corporate predominance to come to the forefront. Eventually, classical liberalism would give way to corporate liberalism. But until the industrial revolution and the invention of the steam locomotive, corporate power would remain a local phenomenon. Chandler, in his essay The Railroads: The First Modern Business Enterprises, 1850s-1860s, described how this technological innovation brought about the large corporate industrial and financial organizations with which we are familiar in todays global environment: The swift victory of the railway over the waterway resulted from organizational as well as technological innovation. the operational requirements of the railroads demanded the creation of the first administrative hierarchies in American business. The men who managed these enterprises became the first group of modern business administrators in the United States. Ownership and management soon separated. The capital required to build a railroad was far more than that required to purchase a plantation, a textile mill, or even a fleet of ships. With the coming of the railroad boom of the late 1840s, the capital required for railroad construction could no longer be raised Funds for the simultaneous construction of so many large railroads had to come from the older commercial centers of the east. As soon as the American capital market became centralized and institutionalized in New York City, all the present-day instruments of finance were perfected; so too were nearly all the techniques of modern securities marketing and speculation. By the outbreak of the Civil War, the New York financial district, by responding to the needs of railroad financing, had become one of the largest and most sophisticated capital markets in the world. The only significant innovation after the Civil War were the coming of the telegraphic stock ticket to record sales and the development of the cooperative syndicate of several investment bankers to market large blocks of securities. For more than a generation this market was used almost wholly by the railroads and allied enterprises, such as the telegraph, express, and sleeping car companies. As soon as American


manufacturers had comparable needs for funds, they too began to rely on the New York markets. However, except for the makers of electrical equipment, few manufacturers felt such a need until the 1890s. When they did begin to seek outside funds, the institutions to provide such capital were fully developed (1977, pp. 99-108). Throughout the course of the history of corporations, there were periodic challenges to and consolidations of, corporate power. The courts, being the most conservative branch of government, have tended to favor the propertied interests. But populist uprisings, labor unions, and social movements have brought significant challenges to corporate power. These movements have led to the enactment of antitrust legislation and other regulatory reforms. As Beatty (2001) wrote, The post-Civil War economy lacked centers of countervailing power to balance the distending power of the great corporation: Any social history of the corporation in these years must start with that perception. Private economic power is held in check by the countervailing power of those who are subject to it, Professor Galbraith wrote in American Capitalism in 1952, when the worst evils of oligopoly were prevented by vigilant governments, with an arsenal of antitrust and regulatory weapons; strong unions, brandishing the threat of strikes; and nationwide retail chains, which could use their purchasing power to keep prices in line. None of these conditions obtained in the age of incorporation. Government could not exert countervailing power over the corporation because, at all levels, it was in the purse of corporations. Trade unions could not exert countervailing power because they were small and weak, and even peaceful strikes were put down by state militia or federal troops called out by politicians acting for corporations acting for shareholders. (And these were not Mr. and Mrs. Front Porch, with their retirement money invested in 401(k) accounts, but the richest 1 percent of Americans holding more wealth than the other 99 percent). And competition could not exert countervailing power as, in industry after industry, it yielded to combination. The Framers would have seen at once the root of what was coming to be known as the corporation problem how to make the great corporation answerable to society. For them, checks and balances was not just constitutional machinery, but a theory of human nature. If men were angels, Madison said, there would be no need of government (pp. 129-130).


The Civil War era was an ugly episode of American history, and one during which corporate power grew tremendously. The most fascinating result during this period of consolidation of corporate power was the judicial activism which gave the corporate person, a legal fiction, all of the rights of a natural person. As Wasserman wrote, In 1862, with the slaveowners out of Congress, a Homestead Act was passed and signed. The foundations were also laid for the highest industrial tariff in U.S. history, and for an Immigration Act which opened the floodgates to cheap foreign labor. Most important of all, industrial interests began voting themselves gargantuan grants of money and land for expanding the western railway system. With huge profits pouring in from supplying the army with food and materiel, the nascent industrial class solidified its hold on the government. Just as the Confederacy had exempted large slaveholders from fighting, the Union had allowed its rich to pay $300 each to stay out of the draft. Among those who did so were John D. Rockefeller, J. Pierpont Morgan, Andrew Carnegie, James Mellon, Cornelius Vanderbilt, Philip Armour, and Jay Gould. Fattened by war contracts, tariffs, and enormous grants of money and land, this cadre of nascent Robber Barons put a grip on the machinery of government that remains very much intact today. Combining scientific theory and medieval Calvinism, the new Social Darwinist elite declared itself the chosen of both natural selection and a profit-minded deity. The growth of a large business is merely the working-out of a law of nature and a law of God, said the original RockefellerIn the true Puritan tradition, those who had not experienced such divine or natural favor had obviously been condemned as unfit. When it came to the poor, Cotton Mathers old idea to let them starve was back in fashionIn a market economy, workers could be used and discarded with no real concern for where or how they lived. If natural selection was at work in the corporate world, the Supreme Court was its ultimate arbiter. As part of the Black Bill of Rights, Congress had passed the Fourteenth Amendment forbidding the states to deprive any person of life, liberty, or property without due process of law. The Klu Klux Klan and other forces of southern reaction paid the law little heed. But in 1886 the Supreme Court ruled definitively that corporations have human rights, and that 230 state laws regulating big business violated due processFor all intents and purposes, the corporations were now above meaningful public regulation. In 1887 Congress passed the Interstate Commerce Act, only to see the commission it mandated turn into a committee of executives who shuttled back and forth between the government and the companies they were supposed to


regulate. In 1890 Congress tried again with the Sherman Antitrust Act. In the next seven years the Act was used twelve times to break labor unions (1983, pp. 84-95) [emphasis added]. The labor unions were one of the first countervailing powers to emerge out of the industrial revolution, followed by Populist and Socialist movements which paved the way for the reforms of the Progressive Era, and later the New Deal. In the aftermath of the legal and political accommodations of the Progressive Era and the New Deal period, antimonopoly sentiment has been largely contained and legitimized through the public regulation of enterprise (Bowman, 1996, p. 5). In the latter half of the 20th century, new regulatory legislation came into existence as a result of the Civil Rights movement and the environmental movement. In response, corporate power has been further consolidated through mergers and a new partnership with government. As Wasserman pointed out, the Reagan administrations Robber Baron ethic led to the dismantling of the federal antitrust apparatus. One target was FDRs Holding Company Act, which prohibited the interlocking of utility empires. The number of Federal Trade Commission prosecutions for unfair, deceptive, or anticompetitive business practices dropped from sixty-eight cases in 1980 to fifteen by 1982. I think, said George Bush, weve started to see this philosophical shift, the end or the beginning of the end of this adversary relationship between government and business. Government shouldnt be an adversary. It ought to be a partner. That government-business partnership, meant a green light for a new wave of mega-mergers. Billions of petro-dollars now fueled a merger mania. By the end of the decade the largest 200 industrial concerns controlled 64 percent of the nations manufacturing assets, up from 46 percent in 1950. Oil company profits accounted for what Business Week called a mind numbing 40 percent of all industrial profits, money now fueling the final centralization of the industrial system (1983, p. 265).

In addition to this marked centralization of power, the evolution of the multinational corporation has in many ways put corporate power even beyond the reach


of national governments. What about the impact of corporate power on democracy and culture? Democracy is defined as government by the people; a form of government in which the supreme power is vested in the people and exercised directly by them or by their elected agents under a free electoral system. Democracy is a part of culture, which is defined as the sum total of ways of living built up by a group of human beings and transmitted from one generation to another. Korten described how multinational corporate power has evolved outside of the democratic process. He wrote, It is helpful to understand how the corporate globalization agenda has been crafted and carried forward largely outside the public discourse. It is not a matter of a small elite group meeting in secret to craft a master plan for taking over the world. It works much more like any networking or shared culturebuilding process out of which alliances among individuals and groups emerge and evolve. There is no conspiracy, though in practical terms, the consequences are much as if there were (2001, p. 135). The most troubling impact on democracy, as described by Korten below, has been the corporate influence over public opinion through the media which has undermined the democratic election process. Before the 1970s, business interests were represented by oldfashioned corporate lobbying organizations with straightforward names: Beer Institute, National Coal Association, Chamber of Commerce, or American Petroleum Institute. As aggressive public-interest groups succeeded in mobilizing broad-based citizen pressures on Congress, business decided that another approach was needed. Corporations began to create their own citizen organizations with names and images that were carefully constructed to mask their corporate and sponsorship and [sic] their true purpose. The National Wetlands Coalition, which features a logo of a duck flying blissfully over a swamp, was sponsored by oil and 36

gas companies and real estate developers to fight for the easing of restrictions on the conversion of wetlands into drilling sites and shopping malls. Corporate-sponsored Consumer Alert fights government regulations of product safety. Keep America Beautiful attempts to give its sponsors, the bottling industry, a green image by funding anti-litter campaigns, while those same sponsors actively fight mandatory recycling legislationThe views of these and similar industry-sponsored groupsare regularly reported in the press as the views of citizen advocates. The sole reason for their existence is to convince the public that the corporate interest is the public interest and that labor, health, and the environment are special interests. With the growing role of television in American life and the decline of the U.S. labor movement, costly television-based media campaigns have become increasingly central in deciding election outcomes. As a consequence, the grassroots organization that was once the foundation of the Democratic Party structure has disintegrated, causing it to lose its populist moorings and leaving those who once constituted its political base feeling unrepresented (Ibid., pp. 144-148). Originally commercial speech was protected because it was deemed to have social value by providing consumers with information, but the approach to corporate advertising has changed dramatically from one of providing information about a product to one of associating a product with a particular lifestyle. And the courts have supported this asymmetry. Since Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, federal courts have shifted from consumer-based assessmentsthat commercial and corporate speech is protected if it enhances consumer decision-makingto the view that laws and regulations limiting advertising restrict free speech (Soley, 2002, p. 256). Coleman (1982, pp. 102-104), writing about the asymmetry of relations between corporate actors and natural persons said, One consequence is that the corporate actor nearly always controls most of the conditions surrounding the relation. The corporate actor controls much of the information relevant to the interactiontypically by advertising, propaganda, market research, public opinion research, credit ratings of customers, and dossiers of other sorts. Information expressly designed to serve the


interests of the person is far less in evidencePersons have become, he wrote, in a sense that was never before true, incidental to a large fraction of the productive activity in society. This is most evident when the person who occupies a position in a corporate actor is replaced not by another person but by a machine. Then the general irrelevance of persons is clear. But the invention which made this possible was not a technological invention which replaced [people with machines]; it was a social invention which created a structure that was independent of particular persons and consisted only of positions. Once this was done, it became merely a matter ingenuity to devise machines that could carry out the activities which those positions required. Coleman emphasized that it is the social structure that is the culprit. The irrelevance of persons in the structure is not a question of machines, it is a question of the form of the structure. In management training programs in many firms, there is a game that is used as part of the training program: the in-basket gameThe aim of the in-basket exercise is to make the transition from one manager to the next unnoticeableto make the manager as a person irrelevant to the functioning of the plant. This is good for the smooth functioning of the organization; but it takes away something of central importance to each of us: the sense of being needed. Beatty, writing about Emersons views on Trade, said, Emersons optimism about the beneficent effects of trade was wisdom in advance of its time, or so it looks today. He identified a new kind of powersoft power, one political scientist calls it, the propaganda of the good life, that is palpable in the world today. In the century now beginning the hard power of the nation-state is yielding to soft power, which rivals totalitarianism in its capacity to make change, but without coercion. Soft power, the


amalgam of economic and cultural influence spread through the new media of communications (2001, p. 123). Klein, in her popular book No Logo, described the cultural imperialism of modern-day global enterprises. She blamed much of what was wrong with globalization on a tendency of moving away from product-centered values and toward image-centered values. The astronomical growth in the wealth and cultural influence of multinational corporations over the last fifteen years can arguably be traced back to a single, seemingly innocuous idea developed by management theorists in the mid-1980s: that successful corporations must primarily produce brands, as opposed to products (2001, p. 3). And for the longest time, the making of things remained, at least in principle, the heart of all industrialized economies. But by the eighties, pushed along by that decades recession, some of the most powerful manufacturers in the world began to falter. A consensus emerged that corporations were bloated, oversized; they owned too much, employed too many people, and were weighed down with too many things. The very process of producingrunning ones own factories, being responsible for tens of thousands of full-time, permanent employeesbegan to look less like the route to success and more like a clunky liability. At around this same time a new kind of corporation began to rival the traditional all-American manufacturers for market share; these were the Nikes and Microsofts, and later, the Tommy Hilfigers and Intels. These pioneers made the bold claim that producing goods was only an incidental part of their operations, and that thanks to recent victories in trade liberalization and labor-law reform, they were able to have their products made for them by contractors, many of them overseas. What these companies produced primarily were not things, they said, but images of their brands. Their real work lay not in manufacturing but in marketing. This formula, needless to say, has proved enormously profitable, and its success has companies competing in a race toward weightlessness: whoever owns the least, has the fewest employees on the payroll and produces the most powerful images, as opposed to products, wins the race (Ibid., p. 4). The branded multinationals may talk diversity, but the visible result of their actions is an army of teen clones marchingin uniform, as the marketers sayinto the global mall. Despite the embrace of polyethnic imagery, market-driven globalization doesnt want diversity; quite the opposite. Its enemies are national habits, local brands and


distinctive regional tastes. Fewer interests control ever more of the landscape. Dazzled by the array of consumer choices, we may at first fail to notice the tremendous consolidation taking place in boardrooms of the entertainment, media and retail industries. Advertising floods us with the kaleidoscopic soothing images of the United Streets of Diversity and Microsofts wide-open Where do you want to go today? enticements. But in the pages of the business section, the world goes monochromatic and doors slam shut from all sides: every other storywhether the announcements of a new buyout, and untimely bankruptcy, a colossal mergerpoints directly to a loss of meaningful choices (Ibid., p. 129). Ahmad, in an article titled Whos Wearing the Trousers? (2001), answered Kleins claim that consumers were being manipulated by big corporations and their brands, and wrote Historically, building a brand was rather simple. A logo was a straightforward guarantee of quality and consistency, or it was a signal that a product was something new. For that, consumers were, quite rationally, prepared to pay a premium. The new marketing approach is to build a brand not a productto sell a lifestyle or a personality, to appeal to emotions. But this requires a far greater understanding of human psychology. It is a much harder task than describing the virtues of a product. The attempt by brands to adopt a social componentto embrace a lifestyleis giving consumers a lever to influence the behaviour of the companies that stand behind them. The No Logo proponents are correct that brands are a conduit through which influence flows between companies and consumers. But far more often, it is consumers that dictate to companies and ultimately decide their fate, rather than the other way round (Ibid.). Ahmad concluded the article with the following statement, The founders of some of the world's oldest [brands]Hershey, Disney, Cadbury and Boots, for example devoted their lives and company profits to social improvements, to building spacious towns, better schools and bigger hospitals. The difference in the future will be that it will be consumers, not philanthropists, who will dictate the social agenda (Ibid.). In the age of globalization, countervailing power to multinational corporations is being provided not only by consumers and governments, but by civil society


organizations (CSOs), whose actions were described by Oliviero and Simmons (2002, p. 77), as being responsible for the increased expressions of corporate social responsibility in recent corporate publications. Global corporations did not wake up one morning and decide to become socially responsible citizens, however. They were instead awakened, sometimes roughly, by the concerted efforts of civil society organisations (CSOs), which can today boast a global reach equal to that of their corporate counterparts. Despite the spreading faith in corporate good citizenship, investment analysts are notably unmoved. Corporate leaders have repeatedly complained that analysts, whose interpretations of a companys effectiveness influence stock prices, focus on quarterly earnings. The benefits of investments that are associated with corporate citizenship are not usually evident in the short term, and analysts are often hard-pressed to pay attention to much else; and reputational risk, a significant consideration in corporate board rooms, is not yet on the list of issues that concern analysts (Ibid., pp. 79- 80). Civil society is pushing the concept of partnership yet further, attempting to establish social reporting instruments comparable to the financial reporting instruments now standard throughout the world. Some CSOs are attempting to establish voluntary, industry-specific reporting mechanisms that measure the social and environmental performance of companies. Other CSOs labour to establish a process of social audits and the certification of auditors. A few CSOs propose an instrument that would transcend national boundaries and maintain a professional uniformity from country to country and business sector to business sector. Coalition for Environmentally Responsible Societies (CERES) is the author of one standard-setting initiative. CERES, which came to prominence in the wake of the 1989 Exxon Valdez disaster in Alaska, is a coalition of environmentalists, corporate executives, and concerned citizens who have promoted an agenda for environmental sustainability. Its Global Reporting Initiative (GRI) emerged in response to the increasing number of examples of environmental and human rights abuses committed by corporations, incidents which have resulted in no penalty or even challenge by national or international agencies (Ibid., p. 90). Monitoring may take several forms, but at the core it is the delivery mechanism for the transparency so essential to any society that aspires to be open and free. The process usually focuses on two broad areas: working conditions, including freedom of association, and the environment.While civil society is filling an important gap through its role in monitoring and standard setting, in a perfect world this work might be led by official international agencies or governmentsOne need only


to look at the Enron scandal in the United States to see that even institutionalised methods of accountability (e.g. compliance with domestic regulations and oversight by a board of directors) and the presence of an active and unfettered press can fail to prevent massive fraud and deception. Civil society faces a daunting task, not the least part of which is establishing what should be monitored and what constitutes corporate responsibility (Ibid., p. 91). Ultimately what may win over the corporate world is the profit motive. Profits are affected by both negative and positive publicity, and in the case of the former it seems that, even if the publicity does not have a great impact on sales, it can still alter the corporate mindset (Ibid., p. 99). According to the study, however, civil society is limited in what it can do. For example, in order for negative publicity to have an impact target corporations must be large and visible companies with brand names but not so large that one division of the organization can be socially responsible and mask the questionable activities of another divisionFinally, there are somecampaigns the public refuses to embrace. Americans continue to buy highly inefficient sports utility vehicles, manufacturers are unrepentant about making them, and elected representatives resist imposing higher gasoline taxes and increasing automobile fuel efficiency standards (Ibid., pp. 100-101). The study concluded, In the end, of course, social values and norms will have to change if the world is to become a safer, healthier place, and it is here that CSOs will always play one of their most important roles. Multinational corporations will not institute change, nor will governments legislate it, if the public does not care. By changing the way that people think about the world and their place in it, civil society organisations are creating the conditions under which human rights, environmental integrity, and social progress may be fully realised (Ibid., p. 105). Americans will eventually realize that there is a distinction between free enterprise and democratic freedom. The material comforts we take for granted today


came about largely as a result of the fusion of the Protestant work ethic with the corporate form of organization. But this work ethic led to what Innes has called the Protestant dilemma, i.e. industriousness and frugality brought wealth, which in turn brought temptation and worldliness (Beatty, 2001, p. 14). Much has been gained through the industrial revolution and the coming of the scientific age. If we assume that Maslows hierarchy is relevant, then the increase in material well being of more and more people may enable them to rise above the struggle for the basic necessities of life to become self actualizing. But what has been lost in the balance? According to Korten, early American culture was the mass marketers worst nightmare. Frugality and thrift were central to the famed Puritan ethic that the early Puritan settlers brought with them to America. The Puritans believed in hard work, participation in community, temperate living, and devotion to a spiritual life. Their basic rule of living was that one should not desire more material things than could be used effectively. They taught their children, Use it up, wear it out, make do, or do without. The Quakers also had a strong influence on early America and, although more tolerant and egalitarian, shared with the Puritans the values of hard work and frugality as important to ones spiritual development. Ralph Waldo Emerson and Henry David Thoreau, both important early American writers, viewed simplicity as a path to experiencing the divine (2001, p. 152). Modern Western Civilization is sorely lacking a consumer ethic, without which a consumer democracy will have little power. Beatty (2001) suggested that the time has come for a world government. The countervailing power wielded against the corporation by the federal government and the


labor union between the Civil War and World War II took place in the context of a nationalizing economy. Regulation and the union wage became part of the cost of doing business in America. But todays multinational corporations dont necessarily have to do business in America. Given the mobility of capital and technology, they can in theory and increasingly in practice escape American countervailing power. In relation to the globalizing economy, perhaps, we are at 1900 in the nationalizing economy, with the corporation-domesticating reforms of the TR/Wilson era and the New Deal still ahead of us. Only whats needed now is a global version of the New Deala task to occupy the first half of the twenty-first century. The dimensions and duties of government were transformed to match the power of the corporation. A new kind of national sovereignty had to be fashioned. Will the global corporation, in the dialectic of countervailing power, usher in the kind of global sovereignty its critics see in embryo in the World Trade Organization? (p. 407). The corporation does serve a vital function. No other force could have produced the vast number of products for satisfying societys basic necessities. This enables greater numbers of individuals to become more or less independent of the struggle for mere existence and to be able to approach Maslows concept of self-actualization. The downside has been the unnecessary proliferation of brands and luxury products that add little to the satisfaction of basic needs. Another downside is the exportation not only of products, but of culture and lifestyle. To those who value diversity, there is a danger of worldwide homogenization through the process. American society has not yet evolved to the point where it is ready for pure democracy. That time will not come until the majority of the people prove they have


individualized to the point that they are no longer able to be led like herd animals. At that time, consumers themselves will become a countervailing power, avoiding products that are harmful or unnecessarily wasteful, and supporting products that are beneficial. This ethical consumption is the flip side of corporate social responsibility. The exercise of property rights unfettered by the community and its notion of the common good, has led to increasing degradation of the environment. In one resource extraction industry, excessive clear-cutting of trees for lumber has created a blighted countryside. Runoff from timber activities, including road building, has silted once pristine streams and rivers, and threatened the habitat of threatened species of salmon and trout. Many species, including the now famous spotted owl, depend on old-growth forest as their primary habitat.


CHAPTER FOUR TREES AND WATER: THE PACIFIC LUMBER CASE Cahn wrote that Free-market environmentalistsargue that property rights encourage responsible management and that Property owners recognize the need to maintain the long-term value of property (1995, p. 125). Pacific Lumber, however, illustrates the exact opposite. After a leveraged buyout, the company had to increase timber production above sustainable levels to be able to service its debt and continue to pay dividends to its shareholders. The Pacific Lumber Company (PL, Palco), once a model corporate citizen, now a wholly-owned subsidiary of Maxxam Corporation, is one example of what is wrong with corporate power and growth-oriented resource extraction. It is a model case study, an example of the markets failure to appropriately value dwindling resources. In his book The Last Stand, David Harris (1996) told the story of PL, describing how the company was taken over by corporate raider Charles Hurwitz, and dramatizing the environmentalists war against him. In 1985, with the help of junk-bond financier Michael Milken and arbitrageur Ivan Boesky (who both later served time in prison), Hurwitz (who himself escaped prosecution) was able to buy PL using a leveraged buyout. As a result of PLs huge new debt, Hurwitz ended up having to increase its cut of lumber substantially. Describing the tender offer agreement, Harris wrote, The documents only direct mention of just what Charles Hurwitz had in mind for Pacific Lumber once it was his came in a paragraph on page eighteen, under the heading Debt Service: The Purchaser expects to require funds substantially in excess of the amounts currently generated by the operations of the company in order to pay the principal of the bank loans and Notes [so] the Purchaser has consideredincreasing the Companys annual lumber productionto a level whichwould equal two times or more the Companys 1984 production [and] may consider selling some or all of the Companys cutting and welding operations [and]


takingactionto cause surplus assets held by the Companys defined benefit [pension] plan to revert to the Company (pp. 55-56). Before Hurwitz acquired it, PL was a model of sustainable forestry. It was owned by the Murphy family for several generations before becoming a publicly traded company. One of the Murphys, Albert Stanwood (Stan), who became president of the company in 1931, laid the foundations for the identity assumed by Pacific Lumber for the next half-century (Ibid., p. 17). One of the policies Stan Murphy put in place was the selective cut, at a time when clear-cuttingfelling every one of the trees in any stand during harvesting, leaving behind a bald patch of mountainsidewas the industrys standard technique. PL cut a maximum of 70 percent of the mature trees in a stand, leaving the younger, most vigorous redwoods to hold the hillside and seed a new generation of forest (Ibid.). The other significant policy Stan Murphy instituted was sustained yield: [PLs] annual cut would always be limited and never exceed its timberlands new growth (Ibid., p. 18). As a result of these policies, in 1985 PLwas timber rich[and] having limited its cuts, [it] now owned almost 70 percent of the remaining ancient redwood forest that was still in private hands (Ibid., p. 19). Harris wrote, Using the companys own timber estimates, Salomon Brothers calculated that Pacific Lumber was worth between $60.28 and $77.96 a share. In light of those numbers, Hurwitzs $38.50 tender offer was clearly inadequate (Ibid., pp. 7374). Hurwitz was offering $840 million for a company worth between $1.3 and $1.7 billion. When valuable resources are so undervalued, there is clearly a market failure. The reason is that the market only values short-term profit, return on investment, not


long-term assets. As a matter of public policy, assets which are important to the American people should be protectedbut the market fails to provide a mechanism for doing so. Because of the market, Pacific Lumber went from being managed for sustainability to being increasingly managed for liquidation. (See Table 1).

Seral Type Forest Opening Young Forest Mid-successional Late Seral Old Growth Hardwood Prairie Non-timber Total

Decade 0 12,616 38,502 87,772 53,236 6,444 4,266 3,832 5,038 211,706

% 6 18 41 25 3 2 2 3 100

Decade 6 16,012 66,199 96,027 20,973 2,136 1,489 3,832 5,038 211,706

% 7 31 44 10 2 1 2 3 100

Decade 12 21,732 58,575 77,030 41,886 2,136 1,477 3,832 5,038 211,706

% 10 27 36 19 2 1 2 3 100

Table 1. Projected Forest Seral Type by [Selected] Decades. Old growth (already seriously depleted by 1998, the date of the draft document), late seral, and mid-successional forests will have all declined, while young forest and forest opening will have increased, over the 120-year life of the plan. Additionally, the plan describes buffer zones (also called WLPZs, or Watercourse and Lake Protection Zones) along Class I and Class II streams and lakes, but Forest Practice Rules require only equipment exclusion and limitation zones on Class III streams, which happen to make up 76% of the watercourses on PALCO lands, capable of sediment transport into Class I or II watercourses. Close examination of the plan reveals a corporation willing to meet legal minimum requirements, but nothing more. (Source: Headwaters Habitat Conservation Plan/Sustained Yield Plan.

As a result, a number of environmental problems have developed. The first and most obvious problem is the loss of old growth forest that provides habitat for several threatened and endangered species. The spotted owl and marbled murrelet, to name just two, make old growth forest their home. The second problem, also obvious to those affected, was the loss of water quality in local streams and rivers. As a result of logging on steep slopes and road-building activities, the streams and rivers began to build up sediment. This not only impacted the habitat of salmon and steelhead trout, but also property owners along the affected waterways. 48

Pacific Lumber is an example of corporate power gone awry. On February 24, 2003 the Humboldt County district attorney filed a civil fraud suit against PL under Californias Unfair Competition Law (UCL). People v. The Pacific Lumber Company (2003) alleges that PL fraudulently withheld information that would have reduced the amount of timber it could harvest under its Sustained Yield Plan (SYP). When PL was unable to have the suit dismissed, Paul Gallegos, the district attorneyand an elected officialfound himself facing a recall election. James Tressler (2004) reported in the Eureka Times-Standard that Palco and Maxxam had poured nearly $250,000 into the recall attempt. (It was a year of recalls in California; Governor Gray Davis also faced a recall challenge, which he lost in a special election held October 7, 2003). Quoting, in a supplemental brief, language from the Second Amended Complaint charging that Pacific Lumber had violated the Unfair Competition Law (UCL), the district attorneys office wrote: Defendants' actions deprived the public, the director of CDF, and all other affected public agencies of an administrative process and of permits untainted by fraud. The review process was so tainted by fraud as to lack all legitimacy, and constituted a fraud and a sham. As a proximate result of the aforesaid conduct of defendants, (a) the public and the government have been deprived of the benefits of a fair administrative process, (Supplemental Brief, 2004, p. 5). In the same document, the D.A. emphasized the corporate nature of the defendant, as shown in the following passages: Defendant, a corporation, is charged with engaging in a fraudulent business practice with the government and public. If, therefore, this Court in this case were to disallow the district attorney from bringing this action under the UCL, it would be sending a catastrophically cynical, harmful invitation to every dishonest corporation dealing with government: no DA will get you--so lie as you please (Ibid.). if district attorneys were prevented from prosecuting UCL actions against corporations committing fraud in public dealings, such


corporations would then be encouraged to commit fraud in their private dealings (Ibid., p. 8). One of the casualties of PLs abuse of corporate power is the democratic process. Of course there are the usual problems of corporate influence through lobbying and political contributions, but when a corporation, because of its access to greater resources and political connections, attempts to circumvent the law by engineering a recall election, the people need to wake up. Just before Governor Gray Davis was recalled from office, he signed SB 810 into law, much to the chagrin of lumber companies operating in Northern California. Up until that time, lumber operators primarily had to concern themselves only with the California Department of Forestry. Now, the California Water Board was going to get a chance to get into the act. As reported in the Sacramento Bee, Over the objections of the states timber industry, Gov. Gray Davis has signed legislation that gives regional water boards new powers over logging on private land, particular on the North Coast. The measure, SB 810, probably will have little impact in the Sierra Nevada But it represents a major victory for North Coast environmentalists, who have a new tool in blocking Pacific Lumber Co. and other firms that are logging coastal redwoods. Introduced by Senate President Pro Tem John Burton, D-San Francisco, SB 810 allows regional water quality control boards, for the first time, to veto any harvest that could degrade a waterway already listed as sediment-impaired (Leavenworth, 2003). In Pacific Lumber Company v. California State Water Resources Control Board (2004), PL disputed the water control boards ability to monitor water quality from timber harvest operations. The trial court held that the Department of Forestrys jurisdiction was exclusive and issued a writ of mandate. On appeal, however, the First Appellate District reversed, stating in part,


The Legislatures grant of final authority to the Department of Forestry and State Board of Forestry to decide on THPs (Pub. Resources Code, 4582.7, subd. (e)) does not alter its equally clear grant of final authority to the State Water Board to decide on water quality monitoring (Wat. Code, 13267-13268). On June 16, 2004, the California Supreme Court granted a review of the case. Pacific Lumber has threatened to file bankruptcy if new regulations cause a reduction in the amount of lumber it can cut, which may invalidate environmental protections on its land that were part of the Headwaters Agreement (Reiterman, 2005). Under the Clean Water Act, the Environmental Protection Agency (EPA) is empowered to establish standards for sediment impaired waters. This was upheld by the federal courts in Pronsolino et al. v. Marcus et al. (2000) and on appeal in Pronsolino et al. v. Nastri et al. (2002) which considered whether Section 303(d) of the Federal Water Pollution Control Act of 1972, later renamed the Clean Water Act, authorized the Environmental Protection Agency to determine total maximum daily loads for rivers and waters polluted only by logging and agricultural runoff and/or other nonpoint sources rather than by any municipal sewer and/or industrial point sources [emphasis added]. According to the North Coast Regional Water Quality Control Board fifty-nine percent of the waters in the covered watershed are sediment impaired because, in part, the water quality does not support certain beneficial uses. As stated on its website, The Clean Water Actrequires the establishment of total maximum daily loads (TMDLs) for the water bodies that do not meet applicable water quality standards (North Coast, 2004). There has been a push at the regional level to establish these standards. This trend was foreshadowed in an earlier EPA memorandum which stated, in part, Wemeaning each of you, each of our State, local, and Tribal partners, and all of us in the Office of Waterare making the transition from a clean water program based


primarily on technology-based controls to water quality-based controls implemented on a watershed basis (Perciasepe, 1997). One novel solution to the market undervaluation of timber assets would be the enactment of a progressive timber yield tax. Such a tax, by being progressive, could dynamically balance the resources short-term value against its long-term value. By fine tuning the tax rate tables, lawmakers could make unsustainable extraction prohibitively expensive, and similarly, continue to provide tax incentives for preservation. Section 38115 of the California Timber Yield Tax Law provides for a flat 6% rate on the total immediate harvest value (2003, p. 8). In addition, land zoned as Timberland Production Zone (TPZ) is exempted from property taxation (Ibid., p. 50). This special zoning is subject to certain rules and regulations (Government Code, 51100, et seq. and Revenue and Taxation Code, 423, et seq.) similar to restrictions placed on agricultural land under the Williamson Act (Ibid., p. 58). The Pacific Lumber case illustrates how a resource extraction industry can cause harm to the environment and diminish the amount of a resource available for the common good. Resource extraction is not the only industry having a large effect on the environment. Another example is the large-scale development of real estate to build at the edges of our cities. These developments create sprawl, leading to traffic congestion and increased air pollution, and decrease the amount of available open space. In addition, development often occurs on floodplains of river valleys, which is the best agricultural land, so we lose productive farmland in the bargain.


CHAPTER FIVE RIVERS AND HIGHWAYS: THE NEWHALL RANCH CASE On March 25, 2003 the Los Angeles County Board of Supervisors approved the largest housing project in the countys history: the 5,000-acre Newhall Ranch Specific Plan. There, property once belonging to the Newhall Land and Farming Company (now merged with a joint-venture of the Lennar Corporation) had been in orange orchards for generations of the Newhall family. In this study the term Newhall simply refers to the company that owns the Newhall Ranch. Historically, the Newhall Ranch was owned by the Newhall Land and Farming Company which, incidentally, was not a corporation but rather a publicly-traded limited partnership. The Board of Supervisors approved the project in spite of concerns expressed by by citizens who attended the hearing; even the Significant Ecological Area Technical Advisory Committee (SEATAC), in its minutes of the meeting on January 14, 2003, expressed twenty-five comments and recommendations for the project. In general, SEATAC stated The entire watershed of the Santa Clara River should be considered a buffer zone. No developments should be allowed that will change natural drainage patterns or increase runoff and water pollution (SEATAC, 2003, p. 4). Explaining his lone dissenting vote on the project, Supervisor Yaroslavsky made the following statement: I think the issue of sprawl in this county and in this region is one of the biggest if not the biggest environmental issue that we face as a region. When is enough enough? That's the question that this board should be asking itself, and for those who say, "Well, we waited nine years, why at the 11th hour?" I'm reminded of the words of Barbara Tuckman, the great historian, who defined folly, in her book The March of Folly, as a perverse persistence in a policy that is demonstrably the wrong course, and we are on a course that is demonstrably wrong. And I would suggest not just this development and not just this specific plan, but that we need


to take a look regionally at what's going on in terms of development in the outlying areas of our county. beyond the environmental issues that are generic to the property and to that area, there is the issue of traffic. And while the public hearing was going on, we called Caltrans. And I just want to give you just a kind of an order of magnitude, just to give you a little flavor of what's coming. This development, on the average, by the testimony of our own public works traffic engineer, will generate 340,000 trips and taking his ridiculous figures at face value that only 10% of those 340,000 are going to ever leave the Santa Clarita Valley on any given day, let's say 35,000 trips a day, and taking his figures that 85% of those or close to 30,000, in the peak hour I should -- sorry, average daily trips, 85% of those 35,000 are going to come down the I-5, that will add to the current estimate of traffic on the I-5 and the 405 somewhere between 10 and 20% to the traffic on those two freeways. Now, why is that significant? It's obvious -- I think it's self-evident why it's significant. But what really was the straw that broke the camel's back for me was this experience I've had in the last four to six weeksout in the Conejo Valleywhen it came to the issue of widening the 101 freeway through Studio City, Sherman Oaks, Encino and Tarzana, they had no problem with us, with Caltrans and the MTA voting to wipe out a thousand homes to make room for them. So talk about increasing the housing stock? Excuse me? Increasing the housing stock? We are now building a constituency in the North L.A. County area for freeway widening, for home destruction, for condemnation, for double decking, for all of the things that none of us want to see happen in our own backyards, and we're seeing that develop as we saw it now in the Conejo Valley. That's what's coming, and that's not smart growth. I would urge that this be the last time that we go down this road and that next time, if there is a next time, that somebody comes in with a development plan of this magnitude, the biggest in the history of the county, a 10-fold increase in their entitlements, 10 times: 2000 to 21,000 [homes], that the next time we have something like this happen, that we take a closer lookI know that we have differences of opinion and reasonable people can differ on something of this magnitude, no question about it, and I suspect this'll be resolved some day outside of this room and probably in a court of law, but I do think it deserves a closer look and a closer look at [previous] experience (Meeting Transcript, 2003, pp. 108-114).


Figure 1. Newhall Orchard sign visible from Highway 126 in Ventura County (taken February, 2005).

Environmentalists and others opposing the project, unable to dissuade the Los Angeles County Board of Supervisors from certifying the projects Environmental Impact Report (EIR), have expanded the scope of conflict by filing lawsuits over various elements of the project, described as the largest single development in the Countys history. Under the specific plan, the new community would add 59,707 people, 22,038 housing units, and 19,226 jobs to the Santa Clarita Valley (Vega v. County of Los Angeles, 2002). The specific plan establishes the development regulations, policies and programs for the implementation of the proposed Land Use Plan. The plan allows for the following types of land uses:


21,615 dwelling units 423 second units 630 acres mixed use development, including 4,493 of the 21,615 dwelling units 67 acres of Commercial uses 256 acres of Business Park land use 37 acres of Visitor-Serving uses 1,106 acres of Open Area 5,032 acres in Special Management Areas (permanent open areas) 55 acres in 10 neighborhood parks a 15-acre lake a public trail system an 18-hole golf course 2 fire stations 1 public library 1 electrical substation 5 elementary school sites a 6.9-million gallon per day Water Reclamation Plant other associated community facilities, such as roads and bridges (Ibid.)

Figure 2. The eventual fate of the orange trees. Once upon a time, Orange County and the San Fernando Valley were known for their luscious orange orchards (taken February, 2005).


Figure 3. A cross-section of the Santa Clara River Valley; if Newhall gets its way, this area will soon be a sprawling development project (taken February, 2005).


Figure 4. Industrial park development in the town of Castaic. The eastern portion of the Santa Clara River Valley can be seen in the distance (taken February, 2005).

The Newhall Project involves a myriad of governmental agencies. Table 2 on the following page lists the agency approvals, consultations, or permits that Newhall must obtain before commencing with construction. The film End of Suburbia (Silverthorn, 2004) described how the suburbs began and evolved into what they have become. At first, the suburbs were an escape from the new factory cities that had grown out of the nascent industrialism of the mid- to latenineteenth century. The first suburbs, places such as Llewellyn Park, consisted of large homes in a park-like setting. In the early part of the twentieth century, the street car suburb made its appearance. Developers paid for streetcar lines in order to make the


Government Agency U.S. Army Corps of Engineers U.S. Fish and Wildlife Service California Dept. of Fish and Game California Dept. of Transportation Regional water control board South Coast Air Quality Management District Local Agency Formation Commission

Permits or Approvals by Agency Sec. 404 permit under the Clean Water Act Sec. 7 and/or Sec. 10 consultations as required by the Endangered Species Act Sec. 1601/1603 permit under state fish and game code Encroachment permit National Pollution Discharge Elimination System permit and Sec. 401 permit under the Clean Water Act Various permits for air emissions regulation found in the Air Quality District Management Plan Approval of new county sanitation district

Table 2. Permits and approvals required. (Source: Whats Involved?: A look at the governmental approvals needed for Newhall Ranch to proceed, 1998).

land in the countryside around the cities commercially viable. According to the film, each of the streetcar stops developed into its own little main streetmerchants shops, townhouses, smaller houses, and bungalowsall quite walkable. The 1920s saw the development of the automobile mass democratization of the American countryside. The resulting housing boom ended with the depression and the interruption continued through the Second World War. In Bulldozer in the Countryside, Rome (2001) wrote about how the adoption of mass production techniques intensified the environmental impact of homebuilding. For the first time, builders put hundreds of thousands of homes in environmentally sensitive areas, including wetlands, steep hillsides, and floodplains. Builders also began to use new earth-moving equipment to level hills, fill creeks, and clear vegetation from vast tracts. The result was more frequent flooding, costly soil erosion, and drastic changes


Figure 5. On one side of the river, housing in Santa Clarita (taken February, 2005).

in wildlife populations (p. 3). After World War II, as told by Rome, Homebuilding was a driving force in the economythe core of a suburban-industrial complex. But the power of the industry went beyond jobs and profits, because the single-family home was one of the defining symbols of the American way of life (Ibid., p. 7). Rome brought attention to the balance of good that resulted from increased development. Low and moderate income housing has long been a problem in this country, and liberal, New Deal Democrats were looking for ways to improve the lot of the common man. Rome wrote, Keynes pointed the way. The state did not need to restructure the basic institutions of society in order to promote social welfare. Instead, the government could use a variety of Keynesian tools to achieve sustained economic growth, and the tool kit included policies


to expand the housing market (Ibid., pp. 31-32). Although energy conservation was a part of the war effort, after the war, The obstacles to energy efficiency in the 1950s and 1960s were tremendous. The postwar housing industry was driven by the demand to produce as cheaply as possible: For both builders and buyers of homes, the

Figure 6. On the other side of the river from the housing, office and light industrial space (taken February, 2005).

mortgage payment was the critical concern, not the cost of utilities. By the early 1950s, the price of energy had reached all-time lows, so the economic argument for conservation lost force. The postwar economic boom brought the first taste of affluence to millions of Americans, and the conservation ideal soon ran up against a powerful desire to enjoy pleasures that once seemed extravagant or simply inconceivable for working-class families (Ibid., p. 47). The mass democratization of housing led to a conformity in housing developments that can be easily discerned. These developments are sometimes 61

disparagingly called cookie cutter communities, because of the lack of variation in the design of houses, the uniformity of lot sizes, and other factors. Conformity in commercial developments has taken several directions, depending upon whether development occurs within a downtown area (redevelopment) or in a suburban area. Newhall Ranch is of the latter type, and one need only look at Santa Clarita (and Valencia) to see the kind of commercial development offered there: (1) the outdoor strip mall which usually includes a grocery store but may or may not also feature one or more big box stores, (2) the large indoor mall shopping center with its host of large anchoring department store chains, (3) the small neighborhood strip mall, and (4) clusters of light industrial/office space. There is not much, if any, mixed use within this suburban development model, uses are irrationally separated from one another and the car is king, without it one cannot easily get to work or buy food and other necessities. Duany et al. (2000) offered sharp criticism of the suburban model, writing, Americans may have the finest private realm in the developed world, but our public realm is brutal. Confronted by repetitive subdivisions, treeless collector roads, and vast parking lots, the citizen finds few public spaces worth visiting. Ones role in the environment is primarily as a motorist competing for asphalt (p. 41). The development that is called Newhall Ranch is described as a self-contained community that will be home to 60,000-70,000 people. Critics complain of the impacts such a large project will have on the environment and that it is a continuation of the urban sprawl model.


Figure 7. Traffic makes its way over a bridge across the Santa Clara River to shopping centers in Santa Clarita (taken February, 2005).

The suburban model of development continues to be popular for several reasons. First, it is fed by fear. And fear is promoted by the present system. It began with white flight from inner cities. While not as blatantly racially motivated as it once was, it is featured on the nightly news broadcastsit is fear of crime. The suburban model of development suggests that one can be safe locked in ones home, far from the urban center of unrest. There is a sense of isolation, and not knowing ones neighbors, a sense of distrust. This way of thinking carries over to the most popular mode of transportation: the private automobilethe second reason the suburban model is so successful. Its opponents have accordingly renamed the project as Newsprawl Ranch.


Figure 8. Shopping center along one side of the river. Land uses are widely separated, requiring automobile travel (taken February, 2005).

According to David Magney, Newhall has a long history of violating environmental laws, and getting away with it because the state and federal agencies are understaffed, their consultants are gagged, and Newhall contributes handsomely to local, regional, and statewide politicians (Newhall Ranch Development, 2003, p. 4). Newhall was charged with illegal grading in an area where an endangered plant that was thought to be extinct since 1929, the San Fernando Valley Spineflower, was discovered. Because the grading was intentional, the California Department of Fish and Game (DFG) filed criminal charges against Newhall, but the charges were eventually dropped when Newhall entered into an agreement to dedicate 64 acres as a preserve where the spineflower had been found.


CEQA documents reveal that Newhall knew about the endangered plant on the Newhall Ranch property. According to a document entitled Spineflower Chronology, (Final Additional Analysis Vol. III, 2003, pp. 803 et seq.) in May 2000 the spineflower was confirmed in one location, with unconfirmed spineflower colonies found elsewhere. Details of the find were not provided to CDFG [California Department of Fish and Game], although they requested it. Access to the colony was also denied. According to a pre-2002 survey, 2,874,286 spineflower plants were counted at three locations; after grubbing, terracing, and illegal grading by Newhall, 44,063 plants were counted in the same locations (Ibid.). In June 2002, Marlee Lauffer, a Newhall spokesperson, was quoted as saying we had no knowledge that spineflower were growing in the area And, in another article she was quoted, we have continued farming operations that have historically been done on that site (Ibid.). A fax cover sheet dated May 25, 2002, from Steve Zimmer, a Newhall executive, to Dillon, Worthington (Tom Worthington is the principal of Impact Sciences, the firm under contract to prepare Newhalls Environmental Impact Report) was discovered in the documentation for the court case (Newhall Ranch Additional Administrative Record, pp. 118435-118438) containing a hand-written note that said Interesting article. Check out Routine and ongoing agricultural activities. The note referred to a May 2002 California Water Law and Policy Reporter (p. 209.) which stated, in part, Landowners who participate in local programs by implementing wildlife-friendly agricultural practices are not prohibited by the California Endangered Species Act from incidentally taking non-fish listed species during routine and ongoing agricultural activities.


Responding to the allegation that Newhall had violated the Writ of Mandate issued by Judge Randall on August 2, 2000, the company stated in Topical Response 8: Compliance with the Courts Decision (Final Additional Analysis, 2003, p. TR-60) that Newhalls position is that the activities conducted on its Newhall Ranch Property, which gave rise to CDFG and District Attorney concerns, were part of its legitimate on-going agricultural activities. The Writ had suspended any or all specific Project activity or activities that could result in an adverse change or alteration to the physical environment (Ibid.). After obtaining a search warrant in May 2002, CDFG surveyed 800 acres of ranch at Grapevine and Airport Mesas. CDFG confirmed the extensive presence of spineflower on both mesasareas surveyed by CDFGare almost exclusively planned for developmentConsequently the great majority of the take of spinefloweroccurred on land planned to be developed under the Newhall Ranch Specific Plan. CDFG staff concluded that based on the evidence, spineflower would have extended into the flat mesa area (i.e. the development areas) if the areas had not been graded and grubbed (Final Additional Analysis Vol. III, 2003, pp. 803 et seq.). The Newhall case is distinguished from the Pacific Lumber case in one very important regard: the Los Angeles District Attorney refused to go after Newhall, whereas the Humboldt County District Attorney did go after Pacific Lumber. According to one reporter, the Newhall case was simply a matter of political influence: Newhall hands $70,000 in campaign contributions to L.A. County Supervisor Mike Antonovich over the course of his career. Antonovich helps invent D.A. Steve Cooley. And Cooleys minions call off the dogs. And Deputy Dist. Atty. Diana Callaghan and her supervisor, Richard Sullivanwanted to throw a felony perjury and conspiracy case at Newhall, arguing the company wasnt telling the truth about the spineflowers on its property. But they were shoved aside by Cooley toadies who blocked a planned search of Newhall offices, and then filed a


single misdemeanor charge against the company. But Cooley wasnt done blowing kisses at these guys. His office dropped the charge in exchange for the sweetheart 64-acre deal (Lopez, 2003). In contrast, the Humboldt County D.A., Paul Gallegos, refused to drop his case against Pacific Lumber. In an interview for California Connected he said he feared the consequences if he didnt do what was right, of having to live with himself (Shelley, 2003). The botanist who submitted a specimen of spineflower to the Santa Barbara Botanic Garden for identification was prohibited from disclosing the exact location [where it was found] by her client, Newhall (Magney, 2003, p. 3). Newhalls use of confidentiality agreements with their consultants was an issue of contention, and one of the conditions imposed by the Los Angeles County Board of Supervisors in the final approval of the project was that Newhall make all information available to the County. It is amazing that the County certified the initial Environmental Impact Report (EIR) without knowing all the details about the property. Environmental groups filed a lawsuit (United Water Conservation District vs. County of Los Angeles, et al. 2000), joined by neighboring Ventura County, and the Kern County court determined that the EIR was inadequate. Nonetheless, after additional analysis had been performed to address the courts specific issues, the Los Angeles County Board of Supervisors approved the Draft Additional Analysis in May 2003 and gave the project the go ahead. It was reviewed by the Kern County court and was finally given the courts blessing in October 2003, after Ventura County dropped out of the suit. In return for Ventura Countys dropping out, Newhall Land will dedicate to the public 1,517 acres of the Salt Creek wildlife corridor, a natural animal travel route in Ventura County (Sullivan, 2003). Now, The Army


Corps is the last regulatory body that must sign off on the Newhall Ranch project as a whole (Stillar, 2004). The Corps of Engineers filed a Notice of Intent in the Federal Register, January 29, 2004. On February 19, 2004 the Army Corps and the CDFG jointly held a public meeting to accept comments on possible environmental concerns and other issues of public interest for the proposed Newhall Ranch project regarding issuance of a Section 404 Permit from the Corps and an Incidental Take Permit from the CDFG (US Army Corps of Engineers, 2004). As a direct response to the Newhall Ranch spineflower incident, Assembly Member Jackson filed Assembly Bill 406 (Jackson & Pavley, 2003) to have the environmental review process strengthened. In particular, confidentiality agreements would be disallowed. The bill passed in the Assembly but did not have sufficient support in the Senate and died in committee at the end of the 2003-2004 legislative session. The California Chamber of Commerce opposed the measure because it impeded affordable housing by placing more restrictions on project applicants; specifically, it prohibited enforceability of confidentiality agreements and mandated unrestricted property access for public agencies, staff or consultants (Floor Alert, 2004). Joining the Chamber of Commerce in opposition to AB 406 were the following organizations: California Association of Realtors California Building Industry Association California Business Properties Association California Cattlemens Association California Council for Environmental & Economic Balance California Farm Bureau Federation California Manufacturers & Technology Association California State Council of Laborers Construction Materials Association of California Consulting Engineers and Land Surveyors of California Home Ownership Advancement Foundation Resource Landowners Coalition 68

Sempra Energy Southern California Edison Tejon Ranch Company Western States Petroleum Association (Ibid.)

With such powerful economic interests opposing the bill, it is easy to understand why the measure failed to garner the support needed to pass the legislature. Had it passed, it still would have had to be signed by the governor, and Arnold Schwarzenegger has been outspoken in his support of business and economic growth in California. Project opponents more recently have pursued having the San Fernando Valley Spineflower listed as a federal endangered species as well. John Buse, an attorney for the Environmental Defense Center (EDC), describes the importance of this shift in the scope of conflict from the state to the federal level: Federal designation for the species is important because the state and federal governments analyze development impacts differently, the federal part of the process is coming up, primarily with the Army Corps of Engineers. The Corps analyzes impacts on wetlands under the Clean Water Act. The spineflower isnt a wetlands species, but if it has endangered status, it is something that would be considered during the federal analysis. We hope the Army Corps will look more broadly (than the state) to protect the spineflower. And if enough species in the area are federally protected, it could create a nexus that would prompt a higher level of federal involvement through a habitat conservation plan, a tool used to protect multiple endangered species. EDC eventually intends to seek such a plan for the Newhall Ranch (Worden, 2003). Another, and arguably the more important, aspect of Newhall is the availability, or rather the lack of availability, of water. The scope of conflict involving water has quickly moved into the courts. In order to satisfy Newhalls demand for water, the Castaic Lake Water Agency (CLWA) entered into an agreement to purchase water from the Kern County Water Agency. CLWA certified an EIR which was based upon an earlier EIR. This practice is known as tiering. A public interest group, Friends of the


Santa Clara River, filed a lawsuit challenging the adequacy of the EIR prepared by CLWA. Friends was unsuccessful in trial court, but while appeal was pending, the Court of Appeal for the Third Appellate District found the earlier EIR inadequate and ordered it decertified. Since the CLWA EIR was tiered upon this now decertified EIR, the Court of Appeal for the Second Appellate District reversed and vacated the CLWA EIR (Friends of the Santa Clara River v. Castaic Lake Water Agency, 2002). The Santa Clara River Valley, is eloquently described by Mike Davis in his book Ecology of Fear (1999): More than a generation after the last fruit trees were bulldozed to make way for tract houses in the San Fernando and San Gabriel Valleys, the Santa Clara River Valley still looks much as it did before 1940. Here, the formal order of the orchards offsets the wild angularity of the sedimentary hills. The citrus towns of Piru, Fillmore, and Santa Paula initially strike the hyperreality-hardened visitor as movie sets or nostalgia theme parks with all the hackneyed charm of Norman Rockwell paintings. There are no mini-malls or fast-food strips, just quiet main streets with old-fashioned stores, soda fountains, and the town movie theater. It is shocking to realize that these are, in fact, real towns, homes to orchard owners and their Mexican workers, and not just clever simulations designed for the pleasure of tourists (p. 59). Davis described the geography of Los Angeleshow the L.A. basin was a huge alluvial floodplain subject to flooding from the Los Angeles River. He wrote, Olmstead and Bartholomew emphasizedthat flood control could be accomplished by different combinations of landuse [sic] planning and public works. Their preference was to strictly limit private encroachment within the 50-year floodplain. They wanted to conserve broad natural channels in which storm waters could spread, irrigating and fertilizing the riverside landscapes that out of flood season would serve the public as nature preserves, recreational parks, and scenic parkways. The opposing solution was to deepen and armorthat is, pave a narrow width of the rivers channel in order to flush storm runoff out of the city as efficiently as possible, and thus to allow extensive industrial development within the floodplain. Beneficial to large landowners, this strategy would force the natural river into a concrete straitjacket


destroying the riparian ecology and precluding use of the riverway as a greenbelt (Ibid., p. 69). The Santa Clara River is the last wild river in Southern California. We now know that all of the areas other rivers have been hardened. Opponents to the Newhall Project have focused on endangered species that inhabit the river as a way to slow the development. The project is now seeking its Section 404 permit from the U.S. Army Corps of Engineers. Environmentalists are hoping the presence of endangered and threatened species will help to make Olmstead and Bartholomews vision of limited encroachment on the floodplain a reality.

Figure 9. Southern Californias last wild river, the Santa Clara River (taken April, 2004).


Figure 10. The Santa Clara River in Los Angeles County (taken April, 2004).

Figure 11. In the same general vicinity, the Santa Clara Riverafter the heavy rains of December, 2004 and January, 2005 (taken February, 2005).


Finally, another quality of life issue, traffic, is already a problem on Interstate 5. Another city of 60,000-70,000 people is not going to make things any better. The Southern California Association of Governments (SCAG) has recently adopted its 2004 Regional Transportation Plan, Destination 2030. This plan covers a huge geographic areait is truly a regional effort, involving six counties and numerous towns, cities, and unincorporated communitiesand is the type of planning that must be done in response to such huge development projects as Newhall.

Figure 12. The relatively lightly traveled Highway 126. In the near future this section of the highway will be heavily traveled. The tower in the distance marks the location of Six Flags Magic Mountain amusement park. The authors shadow appears in the foreground (taken April, 2004).

Although the Newhall Ranch Project is in Los Angeles County, the scope of conflict with regard to traffic tends to be regional. The Newhall Ranch Project is a good


example of this concept: The Los Angeles County Board of Supervisors approve a project that will have spillover effects on the residents of the City of Santa Clarita and Ventura County. Of course air quality and traffic go hand in hand. So another player enters the picture: the Air Quality Management District (AQMD). This represents yet another change in the scope of conflict. Clearly a project the size of Newhall has impacts well beyond the immediate project area. It is understandable that litigation would be taking place, given the spillover effects the project will have on other areas. Ventura County has been a party to many of these proceedings because it neighbors the project to the West, and the Santa Clara River flows through Ventura County on its way to the Pacific Ocean. It meanders through Ventura Countys citrus belt, and one of the fears is that any changes to the hydrology of the river could affect agriculture in the area. The effect on the residents of the nearby municipality, the City of Santa Clarita, will be tremendous. Although the project may afford some opportunities to these residents, it is not clear whether those benefits will be worth it, given the impacts on their quality of lifeparticularly traffic and air quality.


Figure 13. Zoning began with the best of intentions. But today it seems that cities are saddled with irrational compartmentalization (taken February, 2005).

CONCLUSION The usual approaches to environmental problems are largely symbolic and often ineffectual. This is because the existing paradigm relies on development for its very existence. As Smith (1998) wrote, we are unable to engage in a profound reassessment of this productivist/industrialist/expansionist ethic because its utopian profile is central to the very construction of Western consciousness (p. 6). It is neither possible nor necessary to exhaust the content or totalitarian character of productivist discourse. It is the air we breath. It is the blood in our veins (Ibid., p. 11). The prevailing view of reality has prevented people from even being able to see the problem. According to Smith, we continue to see the problem as the type of consumption, rather


than consumption itself as the problem. Our cultural environment is so pervasive that we are in many ways simply blind to it. In the popular film, The Matrix (Wachowski & Wachowski, 1999), the character Morpheus says to the character Neo, You have been blinded by the world that has been pulled over your eyes. We are like the fish whose last discovery is water. As some writers suggest, perhaps only through a complete paradigm shift will a lasting solution will be possible. It is doubtful, however, that the prevailing viewpoint can be turned on its headresulting in a completely new way of looking at reality. In order for such a shift to take place and become the norm, a majority of people would need to adopt a more ecocentric perspective. Given the political climate in America, such a shift indeed seems unlikely. Is a paradigm shift even possible? The radical ecologists, representing the ecocentric point of view, offer the only other paradigmgenerally the viewpoint held by indigenous people before industrialization. This viewpoint continues to be marginalized, however, primarily because it contradicts the basic thrust of Enlightenment thinking: the idea of progress. The alternative viewpoint is seen as a regression to a more simple primitive state from a more advanced technological state. Given that advanced technology has already proven itself through many improvements offered by modern lifethe many conveniences Westerners take for grantedthere is no incentive for overthrowing the industrial hegemony. As quality of life deteriorates, and more people question the status quo, the industrial hegemony tends to accommodate those challenges through green marketing, symbolic legislation, and restructuring through globalization,


permitting industry to relocate externalities to underdeveloped countries that are more accommodative. Underdeveloped countries are not likely to restrain themselves, in the name of the greater good, from seeking a higher quality of material life. As seen after the depression in postwar America, middle class people wanted to avail themselves of the new conveniences that industrial society afforded them. As Brown (2001) noted in his book Eco-Economy, the Chinese plan to base their economic growth on the automobile (p. 17). Can the world really afford to double the number of cars without straining existing oil supplies and increasing greenhouse gasses? There is no new technology on the horizon to solve this dilemma. As pointed out in the film, End of Suburbia (Silverthorn, 2004), hydrogen fuel cells are not the answer for the simple reason that it takes electrical energy to create hydrogen. The hydrocarbons that we burn to produce much of our energy are a form of stored sunlight that took many millions of years to accumulate. Yet, the West is consuming this resource at an alarming rate. How can we expect the underdeveloped world to show restraint when we have not? In the West, a growing minority continues to be dissatisfied as quality of life continues to deteriorate. Much of this deterioration is caused not so much by the industrial processes as by the products themselves. Much of the air pollution is caused by the vast number of cars and trucks congesting the nations highways. This congestion also contributes to long commutesanother loss in quality of life. As a result, the pace of life has increased, as more people try to accomplish their goals in less time. This malady of haste has led some to seek the simpler way of life represented by the alternative viewpoint. Some books have been published, and there are a few proponents


of this lifestyle, but the mainstream media does not embrace the idea that less is more. The mainstream media, if anything, seems to have accelerated its pace to an even more distracting level. Those who are caught up by the mainstream media seem to exist in what Kunstler called the consensus trance (Ibid.). Those who oppose such development projects as Newhall Ranch, oddly enough, have something in common with those who protest globalization at World Trade Organization (WTO) meetings. What these two groups oppose is the herd conformity or consensus, if you prefer. This acquiescence to the prevailing viewpoint was expressed by Lessig (2002) in his book, The Future of Ideas, when he wrote about the future of the Internetthe direction we are taking. The one we are taking is easy to describe. Take the Net, mix it with the fanciest TV, add a simple way to buy things, and thats pretty much it. It is a future much like the present. The promise of many-to-many communication that defined the early Internet will be replaced by a reality of many, many ways to buy things and many, many ways to select among what is offered. What gets offered will just be what fits within the current model of the concentrated systems of distribution: cable television on speed, addicting a much more manageable, malleable, and sellable public (p. 7) [emphasis added]. Smith wrote According to many who write about consumerism, most people are trapped by their own herd instincts in obedience to advertisers. At the same time, it seems that the captains of capitalism feel compelled to reassure shoppers that they are responding to the demands of their customers (1998, p. 28). And who are these customers? It seems that the consumer is much like a goat the aimless creature, with its attraction to glittering trinkets, wanders erratically about, consuming anything ... (Ibid., p. 8).


The kind of conformity protested at WTO meetings is that of the American business model exhibited by the large, successful corporations: chains of stores and fastfood restaurants. It is also expressed by the large brands. Brand imaging allows the seller to differentiate a product which is really quite homogeneoussuch as cola. Defenders of branding argue that the brand breeds confidenceand if the product injures there is recourse to the seller of the brand. One could argue that money spent advertising different brands could instead be spent just making sure the product was safe in the first place. Conformity is one of the key forces of conservatism. It is the illusion that everyone is the same: the same as everyone else around and also the same as everyone was yesterday. The psychology of conformity is deeply rooted in the psyche, its an us versus them phenomenon that has much to do with how we identify ourselves. But if one is always the same, how does one change? Change is inevitable. It is said that it takes seven years for all the cells of the human body to completely replace themselves. If that is the case, the body is literally not the same seven years later. Yet, we still have the perception of being the same person. Apparently conformity is important for maintaining that sense of self, as well as the culture that the self exists within, that continues unchanged from day to day. It simply is not possible to be a completely new person every day; though the idea may have appeal to some, it would result in chaos. Instead, change usually occurs incrementally, almost unnoticed, in front of our very eyes. There have been rare occasions of radical change throughout history, brought on by new inventions and sudden innovations. But as Lessig


argued, innovation tends to be stifled as the kings of yesterdayprotect themselves against the kings of tomorrow (2002, p. xix). Rather than argue for radical change, I believe that a model for accelerated incremental change may point the way to a solution. The first component of such a model is Callicotts notion of stewardship: The Judeo-Christian stewardship environmental ethichas much greater potential than so far tapped to enlist the support and energies of a sizable segment of the public on behalf of environmental concerns. For the very large community of people who accept its premiseswho believe in God, divine creation, a preeminent place and role for human beings in the world, and so onit represents, in my opinion, the most coherent, powerful, and practicable environmental ethic available (1999, pp. 193194). As Wallis wrote, Gods politics challenges narrow national, ethnic, economic, or cultural self-interest, reminding us of a much wider world and the creative human diversity of all those made in the image of the creator. Gods politics reminds us of the creation itself, a rich environment in which we are to be good stewards, not mere users, consumers, and exploiters (2005, p. xv). The second component of the model for accelerated incremental change is Dryzeks notion of environmental problem solving, which relies on traditional liberal democratic problem-solving methodologies: Environmental Problem Solving is defined by taking the politicaleconomic status quo as given but in need of adjustment to cope with environmental problems, especially via public policy. Such adjustment might take the form of extension of the pragmatic problem-solving capacities of liberal democratic governments by facilitating a variety of environmentalist inputs to them; or of markets, by putting price tags on environmental harms and benefits; or of the administrative state, by institutionalizing environmental concern and expertise in its operating procedures (1997, pp. 13-14).


In particular, market-based solutions are beginning to show promise. The Kyoto Climate Treaty to limit greenhouse gases took effect on February 16, 2005. The Europeans embraced emissions trading, which was first developed in the United States to control acid rain brought about by sulfur emissions from coal-burning power plants. Under cap and trade, a cap is established and permits are issued to companies to allow emissions up to the cap. Companies that are effective at reducing emissions can sell permits to companies that want to exceed the cap. This is one way the market is capturing externalities and internalizing them into the cost structure of industrial production. One problem with this approach is that it only captures a portion of greenhouse gases produced. According to Malakoff (2005) More than 12,000 large carbon dioxide emitters have been issued credits. But those emitters represent only 40 percent of overall emissions, so Europe will also need to find ways to promote clean automobiles and to encourage people to save energy at home. This provides a clue as to why the Bush administration refused to participate. With more cars than any other country, the United States would have a hard time meeting the standards of the treaty. Change in the United States in this regard is going to have to depend entirely on individual initiativeon consumer-driven change. As Bakan (2004) stated, however, it is dubious to presumethat consumers make decisions about what to buy with social or environmental purposes in mind (p. 146). Monks has suggested that shareholders can reign in abusive corporations, in what may be called a shareholder democracy; but as Bakan pointed out, this approach disenfranchises about half of the population that doesnt own stock. Furthermore, it is not democracy at allrather than one man, one vote it substitutes one dollar (or more


accurately one share) for one vote (Bakan, 2004, p. 147). Other problems with this approach are that many shareholders own relatively few shares of a broad range of companies through mutual funds, pension plans, and other diversified investments. Thus their power is diluted. Even when pension fund managers, such as for California Public Employees Retirement System (Calpers), use their voting rights to exercise corporate governance, there is still the problem of accurate representation. In addition, as Goff (2004) wrote, voting their consciencehas some investor groups also straying well beyond traditional [corporate] governance ground and into such areas as ethical pricing and workers rights (p. 62). In response to such investor activism, Governor Schwarzenegger planned to force all new public employees to join [self-directed] defined contribution plans [which] would mark the beginning of a long and slow death for the states public defined benefit plans (OConnor & Jacobius, 2005). Ultimately, as Bakan (2004, p. 147) suggested, consumer and shareholder democracies have serious limitations. In addition to the above, there is a fundamental market imperfection that is not addressed by either of these approachesthe lack of information. Without traditional government regulation, there is no way to force corporations to provide meaningful and timely information to consumers or shareholders. The third component of a model of accelerated incremental change relies on a combination of green consumerism together with a Rawlsian shift toward a culture where individual self-interest is tempered with communal responsibility (Cahn, 1995, p. 130). This change can only be brought about gradually, by systematically educating the young to appreciate the scientific method while recognizing it is only a tool. As a tool, science does not inform our values, but science does provide a means of breaking out of


the age-old, superstitious religiosity represented by so many of the worlds fundamentalists. In the face of technological improvements, and an improved quality of life, the old religious prejudices will gradually lose their grip. It is interesting that religious fundamentalists are still fighting the teaching of evolution in public schools, insisting that creationism be taught alongside evolution. More interesting still is the challenge of intelligent design, which in the end, I believe will win out. But, ironically, belief in a creative intelligence behind the universe does not invalidate the theory of evolution, which is, in my view, simply the method that this creative intelligence uses. I see the teaching of intelligent design as being synergistic with the theory of evolution, rather than opposing itthough the proponents of intelligent design may not see it that way. The values that replace the old systems of religion will depend on the direction that scientific education takes. As Buhner noted, the idea of Cartesian dualitya mechanistic view of the universeleads to a dead, empty way of life (2002, p. 41). In fact, it led to the current industrial hegemony. The recent film What the Bleep Do We Know Anyway? (Arntz, 2004) introduced the ideas of quantum physics to the masses. I believe this film represented an attempt by the producers to set a paradigm shift in motion. Their goal was to reach 100 million people and to begin a dialog about the ideas in the film. In the competing marketplace of ideas represented by the media, however, the film is perhaps only a bleep on the radar screen. But at the very least the film may suggest a more spiritual direction in the science education curriculum. According the Buhner, Public schools are completely enveloped in the perspective that the universe is not alive. The entire curriculum, except for a rare literature


course or unique teacher, contains this embedded communication. Every day for the twelve to twenty years of formal schooling children are taught that they are alone on a ball of rock hurtling around the sun and that the other residents of that ball of rock are resources to be used or managed. The textbooks, their authors, and the teachers are all presented as authorities on the nature of reality, and the universe-as-machine epistemology is carefully inculcated in the children. Despite the fact that increasing numbers of scientists acknowledge that mechanistic reductionism is either incorrect or has serious limitations, it continues to be taught (2002, p. 67) [emphasis added]. If science educators can embrace the human need for spiritual meaning in life, and allow for the mystery of life to have a place in the science curriculum, then change for the better is possible. By bringing on board the intelligent design contingent and the Christian stewardship contingent, a critical mass could be achieved, leading from incremental change to a true paradigm shift, a new way of looking at reality. Individuals need to start learning to give up some of those material luxuries that set them apart from their common fellow men; the sooner they do so, the faster they will embrace the change in their world. Rifkin wrote of this change in his groundbreaking new book, The European Dream: Stripped to its bare essentials, the European Dream is an effort at creating a new historical frame that can both free the individual from the old yoke of Western ideology and, at the same time, connect the human race to a new shared story, clothed in the garb of universal human rights and the intrinsic rights of naturewhat we call a global consciousness. It is a dream that takes us beyond modernity and post-modernity and into a global age. The European Dream, in short, creates a new history. If the European Dream represents the end of one history, it also suggests the beginning of another. What becomes important in the new European vision of the future is personal transformation rather than individual material accumulation (2004, pp. 7-8). Not all writers are as optimistic as Rifkin. In an alternative vision of the future, Reg Whitaker, in his book The End of Privacy, painted a harsh picture of the new political economy of cyberspace:


Neither individual free enterprise nor an aggressive interventionist state are particularly relevant to the new political economy of cyberspace. Hardware and software are produced by corporate giants such as IBM and Microsoft, and the infrastructure of the Internet is currently a bone of contention between the telephone and media/cable giants. The real frontier is the commodification of information by capital. To shift metaphors, cyberspace is like the commons under attack from enclosures. The relentless emphasis in recent years on 'intellectual property' as a crucial element in international trade agreements points us clearly in the direction that the so-called Information Revolution is traveling. The architecture of cyberspace may well look very much like William Gibson's fictional vision: vast, mysterious collections of data looming like megafortresses fiercely guarded by giant corporationswhile the 'real world' wallows in urban squalor, petty criminality, violence, and tawdry escapism (1999, pp. 68-69). This evokes the image of the siege mentalityone of holding the gates against the barbarian hoards. Davis (1998) wrote that Los Angeles alone has adopted an official nightmare (p. 359) and pondered what kind of dystopian cityscape, if not Blade Runners, might the unchecked evolution of inequality, crime, and social despair ultimately produce? (p. 362). Davis then proceeded to offer an extrapolative map of a future Los Angeles that is already half-born: the spatial hierarchy into which the struggle for the survival of the urban fittest supposedly sorts social classes and their respective housing types. As imagined by academic social Darwinism, it portrays a human ecology organized by the biological forces of concentration, centralization, segregation, invasion, and succession. My remappingpreserves such ecological determinants as income, land value, class, and race but adds a decisive new factor: fear. Is there any need to explain why fear eats the soul of Los Angeles? Only the middle-class dread of progressive taxation exceeds the current obsession with personal safety and social insulation. With no hope for further public investment in the remediation of underlying social conditions, we are forced instead to make increasing public and private investments in physical security (Ibid., pp. 363-364). Change is inevitable. Only the direction it takes is unknown. Will humanity continue to rush headlong into the dystopia of a corporate Leviathan as suggested by


Whitaker? Or will humanity be able to embrace a new paradigm, a new vision, such as the one suggested by Rifkins European Dream? Time is running outand only time will tell.



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