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Economic Efficiency vs. Distributive Equity the _quot;Sagebrush Rebellion_quot;

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					            Economic Efficiency vs. Distributive
             Equity: the "Sagebrush Rebellion"
                                       Frederick W. Obermiller


                  The purpose of this paper is to interpret, from the viewpoint of an economist, some
             of the causes of the 'Sagebrush Rebellion,' a contemporary land reform movement
             directed toward the Bureau of Land Management and its control of the public domain.
             Distributive equity concerns on the part of 'Sagebrush Rebellion' supporters are
             identified, as are the contributions of neoclassical welfare theory to the debate. Reflec-
             tions of those social and theoretical concerns in Federal legislation and agency policy and
             regulations are explored.




   The purpose of this paper is to provide an                  The primary thesis advanced here is that
economic interpretation of some of the                      distributive equity, or more precisely the
causes of the "Sagebrush Rebellion," a con-                 perceived lack thereof in the minds of tradi-
temporary land reform movement directed                     tional users of public land resources, explains
toward the Federal government and its con-                  much of the current concern with federal
trol of the public domain. The rebellion is                 land use planning processes and decisions. It
focused, primarily, on the Bureau of Land                   is not argued that equity considerations
Management (BLM) and its administration of                  should be of paramount importance in the
public rangeland resources. However, the                    public land use decision-making process; nor
land reform movement has much broader                       is it alleged that decision-makers at any level
implications for levels of government, agen-                are insensitive to the real or imagined conse-
cies of government, and groups interested in                quences of resource allocations on traditional
the use of public land and water resources.                 users. Rather, it is maintained that the in-
                                                            stitutional framework within which federal
                                                            land use decisions are made and implement-
Frederick W. Obermiller is an Associate Professor and       ed has changed. The effect of that change is
Extension Resource Economist in the Department of
                                                            to limit both lay participants and public ser-
Agricultural and Resource Economics at Oregon State
University. He is indebted to four graduate students        vants who ultimately must make and imple-
David K. Lambert, Gerrit C. VanKooten, Linda M.             ment decisions to a set of criteria which slight
Eppley, and Kevin J. Boyle - for their support in           and sometimes exclude relevant distributive
acquiring and analyzing many of the references cited        issues. Arguments which would dismiss equi-
here. The thoughtful reviews and comments on earlier
                                                            ty implications as irrelevant decision vari-
drafts of the paper provided by Professors Joe B. Ste-
vens, John A. "Jack" Edwards, and Jean B. Wyckoff are       ables in public land use planning simply add
gratefully acknowledged, as are suggestions provided by     fuel to the "Sagebrush Rebellion."
the Editor of the Journal and two anonymous reviewers.
                                                               The paper consists of four parts. In the
An earlier version of this paper, "Distributive Equity:
The Missing Ingredient in Federal Land Use Planning?"       introductory section, distributive equity ver-
was presented at the 15th Annual Pacific Northwest          sus economic efficiency are identified as
Regional Economic Conference, Boise, Idaho, May 1,          underlying concerns expressed by supporters
1981.                                                       of the "Sagebrush Rebellion." The debate
                                                            among economists concerning the relation-
Oregon Agricultural Experiment Station Technical Pa-
per No. 6250, Oregon State University, Corvallis, Feb-      ship between economic efficiency and dis-
ruary 1982.                                                 tributive equity is summarized, and distribu-
                                                                                                           253
December 1982                                                   Western Journal of Agricultural Economics


tional issues relevant to the analysis of the       tive of an economist, there are two central
economic dimensions of the "Sagebrush Re-           themes in these concerns: (1) economic equi-
bellion" are noted, in the second section.          ty, more specifically, the lack of distributive
The third part of the paper summarizes the          equity in the interregional and intersectoral
body of Federal legislation, policy, and regu-      senses vis-a-vis national economic efficiency
lations which have served as proximal causes        and environmental quality as decision
of the land reform movement; and the                criteria in the public land use decision-
economic implications of that legislation are       making process; 1 and (2) the inadequacy of
highlighted. The concluding section deals           national efficiency criteria as guidelines for
with recent attempts by the Bureau of Land          management of and investment in public
Management to resurrect distributive equity         land and water resources.
decision criteria in its land use planning and
management processes.                               The Economic Debate on Efficiency
                                                    and Distributive Equity
An Economic Interpretation of the
Sagebrush Rebellion                                    Even among economists there is consider-
                                                    able debate over the appropriateness of effi-
   In essence, the "Sagebrush Rebellion" is a
                                                    ciency and equity criteria applied to public
challenge to federal control over the public
                                                    investments. In 1973 Haveman argued that
domain in the western United States. "What
                                                    government agencies misuse benefit-cost
is needed is an entirely new foundation and
                                                    analysis in project evaluation. Reflecting the
framework for the utilization and manage-
                                                    neoclassical emphasis on national efficiency
ment of the public domain lands" [League for
                                                    criteria in resource development decisions
the Advancement of States' Equal Rights, p.
                                                    he stated: "Even more discouraging is the
515]. At one extreme, proponents would di-
                                                    failure of inappropriate efficiency concepts -
vest the federal government of public lands,
                                                    secondary and regional benefits... - to be
releasing the public land resources of the
                                                    cast aside in recent efforts to reform evalua-
West to the states and/or to private owner-
                                                    tion standards" [Haveman, p. 876].
ship. Not all supporters of the "Sagebrush
                                                       Within a few years these "inappropriate
Rebellion" favor divestiture, however. Many
                                                    efficiency concepts" had, indeed, been cast
advocates would be content with a change in
                                                    aside. As the lead agency for policy formula-
management philosophy and priorities: a
                                                    tion dealing with the economics of project
change which would "... demonstrate an
                                                    evaluation, the U.S. Water Resources Coun-
ability to deal with public land issues in a fair
                                                    cil in 1979 dropped regional economic devel-
and equitable way" [Beef, p.79].
                                                    opment from its earlier national objectives
   Support for the "Sagebrush Rebellion" is         and accounts as a relevant decision criterion;
not confined to the rangeland livestock in-         i.e., secondary and/or regional benefits and
dustry. Other supporters emphasize differ-          costs no longer were to be evaluated [Federal
ent resource uses, notably mining and timber
harvesting, but common concerns are clear.
The federal government is perceived to have         1As used here, efficiency refers to the relationship be-
                                                     tween social benefits and social costs without reference
failed to invest sufficiently in the public do-
                                                     to the incidence of those values. Equity refers to wel-
main; to have allowed the productivity of            fare experienced by individuals or groups of individu-
public land resources to diminish through            als, over space and time. Distributive equity is the
improper management; and to have neglect-            system of stratification, or classification, applied to the
ed to consider the opportunity costs to tradi-       streams of social costs and social benefits. By implica-
                                                     tion, the monetary values of social costs and social
tional users of land use decisions designed to
                                                     benefits (given the standard neoclassical assumptions),
preserve or enhance environmental quality.           when evaluated on the basis of the incidence of those
   To argue the validity of these charges            values, approximate the distributions of welfare losses
serves no useful purpose. From the perspec-          and gains.

254
Obermiller                                                                       Sagebrush Rebellion

Register, September 10, 1973, and May 24,           tifice is reflected in four assumptions which
 1979]. The direction provided by the Water         have been used to justify the omission of
Resources Council is reflected in the project       equity from economic decision criteria in
evaluation guidelines and procedures cur-           project evaluation.
rently employed by the Bureau and most                  First, all individuals are assumed to have
other public land management agencies.              equal marginal utilities of income, meaning
   Meanwhile, others were arguing that              that the welfare of all individuals is influ-
"without... a better measure of the distribu-       enced in a consistent manner by the alloca-
tional impacts (of public land allocations), the    tive decision. A second, and closely related,
application of efficiency criteria may not give    assumption is that the weights individuals
unambiguous results concerning changes in          attach to marginal changes in benefits or
welfare" [Wyckoff, pp. 18-19]. Of special          costs are all equal, "... regardless of the peo-
concern to Wyckoff was the limited informa-        ple who received that benefit or who bore
tion being used in the decision-making             that cost" [Weisbrod, p. 182]. These two
process - particularly information related to      assumptions mean that all members of socie-
the distribution of costs and benefits among       ty value income gains or losses attributable to
population groups and geographic areas.            resource reallocations equally. Interpersonal
                                                   utility comparisons with respect to money
                                                   income are made possible, but are not neces-
The Theoretical Basis for the                      sary, since enhanced allocative efficiency
Efficiency-Equity Dichotomy                        necessarily implies increased welfare.
   The academic debate touched upon here is        Among the several problems with these as-
 of ancient vintage. Its basic inconclusiveness    sumptions is the possibility of interdepend-
 leads to decisions, lamented by both Have-        ence between income and nonmonetary de-
 man and Wyckoff, made in the political arena      terminants of utility, e.g., access to "free"
and largely uninfluenced by economists or          public goods. Individuals who by virtue of
economic analysis. That inconclusiveness is        place of residence enjoy greater degrees of
due to the interdependence between                 access to public land and water resources
economic efficiency and economic equity,           may well value income changes consequent
since both are rooted in interpersonal utility     to public resource reallocations differently
comparisons. To treat the two criteria as          from individuals having more limited access
distinctly separate is, in itself, a value judg-   to the same resources. As Weisbrod put it,
ment. If economists are to contribute to the       the assumptions cannot bear scrutiny, and
public land decision-making process, and if        economists have made them simply for con-
they are to do so objectively, both efficiency     venience.
and equity implications of alternative deci-       The third assumption used to separate
sions are legitimate ends of research and equity from efficiency considerations is that
information delivery. To do less, i.e., to con- any action affecting resource allocations is so
fine the scope of economic analysis to either small in the national context that the net
efficiency or equity, is to provide "... conclu- distribution of income among members of
sions (which) can possess no validity outside society will be unaffected by its implementa-
the circle in which these values find accept- tion. Hence, the social effects of income re-
ance" [Hicks, p. 696].                           distribution may be disregarded. The prob-
   Weisbrod views the failure of economists lem with this assumption is that public land
and economics to provide useful guidance on and water resources are relatively fixed in
the illusionary dichotomy as a matter of sim- location. Actions which increase the availa-
ple expediency, and he implies that econo- bility of resources for commodity uses gener-
mists sometimes forget the artificial nature of ate benefits in the form of income gains
their separation [Weisbrod, p. 180]. The ar- which tend to be captured locally, and vica

                                                                                              255
December 1982                                                                Western Journal of Agricultural Economics


versa. Public land and water management                              These observations suggest that existing
policies can have significant impacts on in-                      efficiency and equity criteria for public land
come distributions within and among subsets                       use planning are inadequate because the
of society, i.e., public land dependent com-                      underlying theoretical construct is incom-
munities [Obermiller, 1980].                                      plete. Pending the emergence of more gen-
   It is partly in recognition of the redistribu-                 eral theory and appropriate decision criteria,
tional consequences of resource reallocations                     economists can make a positive contribution
that the fourth assumption is made: Any un-                       to the decision-making process by recogniz-
favorable distributional effects from a project                   ing that distributive equity concerns may
may be eliminated by a compensating redis-                        have validity, and by providing decision-
tributional program, but if the efficiency ef-                    makers and society as a whole with sound
fects of the initial project are positive, there                  information on the distributional conse-
is no need for actual compensation. This                          quences of public land resource allocations
fourth argument, popularly known as the                           [Haveman and Weisbrod].
"Kaldor-Hicks Compensation Principle," has                           What might the relevant distributional
been invoked to allow economists to separate                      consequences be? Clearly, "Sagebrush Re-
the production effects of economic policy                         bellion" supporters and other traditional
from their distributional consequences. Nu-                       public land dependent interests feel that the
merous writers have criticized the principle,                     interpersonalcosts and benefits of land man-
but the empirical validity of the Kaldor-Hicks                    agement and use allocations are important.
test remains in doubt unless "costless" com-                      Many of their arguments are couched in
pensation does in fact occur. In reality, an                      terms of the selective impact of federal land
appropriate test of the hypothesis may be                         policies on commodity groups, or industries,
impossible because existing states of market                      connoting the relevance of intersectoral im-
competition and resource allocation are in-                       pacts. The fact that 14 western states (Neva-
consistent with those (perfect competition                        da, Oregon, Washington, Idaho, Montana,
and full employment) assumed.                                     California, New Mexico, North Dakota,
                                                                  South Dakota, Arizona, Alaska, Utah, Wy-
Resurrecting Distributive Equity                                  oming, Colorado) have recently considered
as a Relevant Decision Criterion                                  and in some cases actually passed legislation
                                                                  which would place within the state respon-
   If these four assumptions are, in fact, theo-
                                                                  sibilities for management of the public do-
retically invalid or inconsistent with reality,
                                                                  main - responsibilities now vested in the
then equity criteria may well be relevant to
                                                                  federal government - is an obvious ex-
the public land allocative decision. The dis-
                                                                  pression of the relevance of interregional
tributional effects of such decisions may be
                                                                  distributions of costs and benefits. The crea-
no more nor less important considerations
                                                                  tion and rapid rise in influence of the West-
than national income gains or losses.
                                                                  ern Governors Policy Office (WESTPO),
Moreover, the efficacy of the efficiency
                                                                  which seeks to ensure that western interests
criteria themselves can be seriously ques-
                                                                  are safeguarded and amply rewarded as their
tioned. 2
                                                                  natural resources are developed in accord-
                                                                  ance with national objectives, further illus-
2If individuals have different marginal utilities of in-
                                                                  trates the merit in considering interregional
 come, and also weight marginal changes in benefits and           impacts. Finally, the intertemporal dimen-
 costs differently, a utilitarian social welfare function         sion of distributive equity is applicable. It is
 cannot be constructed, and interpersonal utility com-
 parisons are not possible. Hence, the pareto optimum
 efficiency frontier is not measurable, and it is impossi-        benefit-cost ratio greater than one) move society to-
 ble to conclude whether resource allocations generating          ward, or away from, a more efficient pattern of resource
 total social benefits in excess of total social costs (i.e., a   allocation.

256
Obermiller                                                                  Sagebrush Rebellion

  not only the long-run consequences, "...a gress to limit and control use by domestic
  combination of balanced and diverse uses livestock of the public rangelands. During
  that takes into account the long-term needs the late 1800s a series of laws were passed
  of future generations for renewable and non- giving what was to become the Forest Ser-
  renewable resources..." [Federal Land Pol- vice the authority to regulate grazing in the
  icy and Management Act, Section 103(c)], Forest Reserves (National Forests); and
 which are of concern. Many traditional users under the leadership of Gifford Pinchot such
 find short-run reductions in resource availa- a regulatory system was developed and im-
 bilities, even though long-run supply may be plemented. Only ranchers who owned or
 thereby enhanced, to be of significance as controlled base property in or near the public
 well. As one rancher put it in commenting on forests, and even then only those who could
 a proposed reduction in his grazing permit: demonstrate dependency on public land for-
 "If you cut me 34 percent (as a cost-effective age supplies, were permitted to use those
 approach to enhancing long-term range con- resources. Further, permittees were charged
 ditions), I would have nothing and would a grazing fee. Ultimately, nomadic sheep
 have a net loss of about $1,500 last year. operations were forced off the Forest Re-
 That's the economic impact of myself' serves, but they and others continued to
 [Bureau of Land Mangement, 1980(b), p. C- enjoy unlimited access to the open public
 98]. To translate, short-term private costs rangelands [Malin; Matthews].
 may not be offset by long-term public bene-
 fits. Or alternatively, the promise of in- Intent, Content, and Implications
 creased rangeland forage supplies 15 years of the Taylor Grazing Act
 hence may not satisfy the present permittee
                                                   Their access ceased with passage of the
 if he must go out of business in the interim.
                                                Taylor Grazing Act in 1934, a law patterned
                                                after the statutes and policies of the Forest
 The Contribution of Federal Legislation        Service. While hotly debated, ultimate pas-
 to the Sagebrush Rebellion                     sage of such legislation was inevitable: "To
                                                stop injury to the public grazing lands by
    The "Sagebrush Rebellion" is neither preventing overgrazing and soil deteriora-
 novel nor unprecedented [Matthews]. Wes- tion, to provide for their orderly use, im-
 terners have for years "rebelled" against provement, and development, to stabilize
 Federal (often paraphrased as eastern inter- the livestock industry dependent on the pub-
 ests) control over the land and water re- lic range." The Act placed in the Secretary of
 sources of the Interior West, their develop- the Interior full responsibility for regulation
 ment and disposition. Examples include the of public rangelands pending their final dis-
populist-led agrarian revolt of the 1890s, the posal. Grazing districts and grazing fees were
western-backed Stock-Raising Homestead authorized. As with the Forest Service,
Act of 1916, and to some extent even the "Preference shall be given in the issuance of
furor over overstocking and exploitation of grazing permits to those within or near a
the public rangelands leading to the Taylor district who are landowners engaged in the
Grazing Act of 1934.                            livestock business" [Taylor Grazing Act, Sec-
    Unrestricted use of public rangelands, par- tion 3].
ticularly overgrazing by nomadic bands of          The Taylor Grazing Act was clearly orient-
sheep whose owners had little or no base ed toward production of forage for use by
property, and hence minimal vested interest public land dependent ranchers. Range im-
in maintaining the land's productivity, led to provements were authorized. Improvements
severe rangeland deterioration early in the were to be financed from grazing fees, with
twentieth century. Between 1899 and 1934 50 percent of the fees paid by permittees
bills were introduced in each session of Con- within a grazing district to be remitted to the
                                                                                         257
December 1982                                                 Western Journal of Agricultural Economics


state within which the district was located        public at large, to define grazing rights and to
"... to be expended as the State legislature       protect those rights by regulation against
may prescribe for the benefit of the county or     interference." 3 It can and probably should be
counties in which the grazing district is          argued that from 1934 through the mid-
situated" [Taylor Grazing Act, Sections 2 and      1960s, equity considerations in public range-
3].                                                land management and development worked
    The wording of the Taylor Grazing Act          to the advantage of local interests and tradi-
suggests that Congress was concerned with          tional users.
both economic efficiency (especially but not
exclusively in the regional context) and dis-      Precursorto Change: Activities of the
tributive equity (in the intersectoral and in-     Public Land Law Review Commission
terregional sense). Interpersonal equity con-
siderations were also implied. Not only were          As the body of laws and regulations gov-
landowners with proximal base property to          erning the administration of federal lands
be preferred permittees: The Act gave pref-        grew, they also became more complex and
erence to owners of contiguous lands in the        internally inconsistent. In recognition of that
purchase of public rangelands offered for          problem, and perhaps due also to the emerg-
sale; directed that prior occupants who had        ing social concerns for the environment and
made range improvements would be reim-             for the multiple uses of the public domain,
bursed for their expenses by subsequent per-       Congress established the Public Land Law
 mittees; and authorized the Secretary to de-      Review Commission in 1964. The general
 crease or remit fees if forage supplies were      charge to the Commission was to review
 reduced during a grazing season due to natu-      existing public land laws and make recom-
 ral causes.                                       mendations concerning any necessary revi-
    Operating under the auspices of the Taylor     sions.
 Grazing Act the Grazing Service, and since           The hearings and studies undertaken by
 1946 the Bureau of Land Management,               the Commission were broad in scope, both
 adopted a largely custodial role toward public    geographically and in subject matter. Follow-
 land management. "For at least 30 years, one      ing lengthy public hearings, the Commis-
 of the most important clients in the total        sion's findings and recommendations for pub-
 BLM bureaucratic machine was strictly local       lic land management were presented in 1970
 - by law and practice the national interest       [Public Land Law Review Commission].
 was defined to be the local interest" [Matt-       Many of its recommendations related to fu-
 hews, p. 28]. Grazing cuts to dependent           ture management and use of public range-
 ranchers were avoided; and the public range-      lands; and of these several referred to
 lands were managed so as to stabilize and          economic efficiency and/or distributive equi-
 improve the economic welfare of dependent         ty as relevant decision criteria.
 communities.                                          The relevance of efficiency criteria gener-
     Judicial interpretation of the Taylor Graz-    ally surfaced in the recommendations that:
  ing Act and, consequently, of the legislated      (1) use of public rangelands be regulated in
  role of the Federal government in the admin-      such a way that deterioration of the resource
  istration of the public rangelands of the In-     base be prevented; (2) users of public range-
  terior West, further emphasized stabilization     land resources be assessed a fair market value
  of the rangeland livestock industry and de-
  pendent communities as a management ob-           3
                                                     Red Canyon Sheep Co. vs Ickes, 1938, 98 F. 2d 308, 69
 jective. In case after case, the purpose of the
                                                     App. D.C. 27; see also Chournos vs U.S., C.A. Utah
  Act was interpreted to "... provide for (the)      1951, 193 F 2nd, certiori denied, 72 S. Ct. 1074, 343
  most beneficial use possible of (the) public       U.S. 977, 96 L Ed. 1369; Hatahley vs U.S., Utah 1956,
  range in (the) interest of grazers and (the)       76 S. Ct. 745, 351 U.S. 173, 100 L. Ed. 1065.

258
Obermiller                                                                            Sagebrush Rebellion


in exchange for their use privilege; and (3)        Catalyst: The Federal Land
federal decision-makers design rangeland            Policy and Management Act
management policies to attain "... maximum             With the passage of the Federal Land Poli-
economic efficiency in the production and           cy and Management Act (FLPMA) in 1976,
use of forage from the public lands" [Public        and its counterpart for the Forest Service -
Land Law Review Commission, Recommen-               the National Forest Mangement Act, an era
dation 37]. As has been shown elsewhere,            officially ended. Public land use policy
virtually all of the Commission's recommen-         changed dramatically, and perhaps not coin-
dations for economic efficiency as a relevant       cidentally, some traditional public land users
public land management decision criteria            began to express their resentment. 5 Due less
subsequently were incorporated in federal           perhaps to the substance of the legislation
legislation [Carver].                               than to its radical departure from the decrees
    However, the Commission also concluded          of the Taylor Grazing Act, a seed of the
that national efficiency criteria should not be     "Sagebrush Rebellion" was sown. National
the sole economic consideration in federal          economic efficiency and nontraditional uses
land use planning. Regional economic                of public rangeland resources emasculated
growth was seen as a proper objective in            regional economic growth and historically
public land forage policy; and it was suggest-      dominant uses as public land management
ed that regional economic efficiency as a           objectives.
decision criteria would promote, or be con-            Policy Directives and Their Equity Im-
sistent with, interregional distributive equity     plications. The Federal Land Policy and
as a public land management objective [Pub-         Management Act's Declaration of Policy says
lic Land Law Review Commission, p. 106].            more than that the public domain will remain
Concern for interpersonal equity was implied        public, managed under multiple use princi-
in Recommendation 43 which would have               ples. Authorizing the Bureau of Land Man-
afforded public land dependent ranchers             agement as a full-fledged federal land man-
some measure of protection for their proper-        agement agency with broad regulatory and
ty rights by controlling access to and use of       enforcement powers, the policy directives
public rangelands so as to avoid unreasonable       place national objectives and environmental
interference with authorized livestock use.          protection in positions of primacy. The first
Intersectoral equity considerations were sug-        directive retains public lands in Federal own-
gested in Recommendation 42, which found             ership. The eighth directive suggests that
that some lands were chiefly suited to live-         land use goals and objectives include preser-
stock production, and that in these areas such       vation of environmental qualities and cultural
use should be considered dominant.
    Not all of these recommendations were
 adopted by Congress, however. Subsequent
 legislation did retain the recommended effi-       4
                                                     Representative Wayne Aspinall (Colorado) introduced a
 ciency criteria, although not in the suggested      bill in the 93rd Congress which would have incor-
 regional context. The same legislation also         porated all of the Public Land Law Review Commis-
                                                     sion's recommendations bearing on efficiency and equi-
 adopted the recommendation that all public          ty criteria as referenced above. The bill was strongly
 lands be retained in Federal ownership.             opposed by certain interest groups and was not passed.
 However, recommendations for interregion-           Especially odious to these groups was the concept that
 al, intersectoral, or interpersonal distributive    certain lands may have a "highest and best use" [Muys].
 equity as relevant criteria in public rangeland
                                                    5The forest products industry apparently was more sup-
 management were not retained; nor was sub-          portive of the National Forest Management Act than
 sequent legislation to recognize the principle      was the rangeland livestock industry supportive of the
 of dominant use. 4                                  Federal Land Policy and Management Act [LeMaster
                                                     and Popovich].

                                                                                                       259
December 1982                                                 Western Journal of Agricultural Economics


resources, lands in their natural state (wil-        management under the Taylor Grazing Act to
derness areas), fish and wildlife habitat, do-       preservation and conservation of rangeland
mestic livestock habitat, outdoor recreation         resources for the benefit of future users and/
opportunities, and human occupancy and use           or generations. An implied consequence was
  -in that order. The ninth directive implies        reduction in licensed grazing of domestic
that subsidization of traditional uses and us-       livestock, leading traditional users to ques-
ers must end. The eleventh directive pro-            tion the intertemporalequity of the Congres-
vides for protection of areas of "critical envi-     sional initiative. By awarding equal priority
ronmental concern." Not until the twelfth            in management objectives to uses of public
objective are commodity uses of public               rangeland resources which historically were
rangeland resources explicitly recognized,           not dominant, traditional commodity inter-
and even then only consistent with the "Na-          ests such as the rangeland livestock industry
tion's need." The final directive does refer to      were led to question the intersectoralequity
a form of distributive equity, but only as it        of the new Act. Finally, by acknowledging
relates to 'in lieu of taxes' payments to state      that the public lands were to be managed and
and local governments [Federal Land Policy           used for the benefit of all Americans, those
and Management Act, Section 102].                    who traditionally had depended on public
   Elsewhere in the Act indirect reference is        rangelands for their economic livelihood
made to intertemporal equity. Title II directs       were led to attack the interpersonalequity of
that, in future federal land use planning, the       the law.
Secretary shall "weigh long-term benefits to
the public against short-term benefits." A              Coping with Expanded Bureau of Land
hint of equity of a different sort is implied in     Management Responsibilities. In a very real
the statement that allotment management              sense, FLPMA was the Bureau of Land Man-
plans shall be "... prepared in consultation         agement's "Organic Act," giving that agency
with the lessees or permittees involved...           a full range of executive powers, duties, and
which... prescribe the manner in, and ex-            functions, as well as consistent appropriation
tent to, which livestock operations will be          authorization. Only now was the Bureau in a
conducted in order to meet the multiple-use,         position to truly manage the public domain in
sustained-yield, economic and other needs            pursuit of national goals and objectives.
and objectives as determinedfor the land by             With those duties came the need for the
the Secretary" [Federal Land Policy and              BLM to aggressively implement other laws
 Management Act, Section 103(K)(1)].                 bearing on the management and use of public
   Quite clearly, FLPMA changed the status           lands. Several of these related laws, enacted
of traditional rangeland users and local com-        during the period of growing social con-
munities as interpreted by the BLM when              sciousness and environmental concern of the
that agency was operating under the auspices         1960s and early 1970s, provided for special
of the Taylor Grazing Act. Nowhere in                uses or protection of the public domain and
 FLPMA is there evidence that local interests        its resources. Examples include the Wil-
are of any special significance; indeed, pre-        derness Act of 1964, Wild and Scenic Rivers
cisely the opposite is true (i.e., local interests   Act of 1968, Wild Horses and Burros Protec-
 are implicitly assumed to be identical with         tion Act of 1971, and the Threatened and
 the national interest). Hence, the residents        Endangered Species Act of 1973. Written
 of public land dependent communities could          into the language of FLPMA were provisions
 be expected to feel that the new law, and           insuring compliance with these pieces of
 Bureau actions consistent therewith, were           legislation (see especially Sections 102(8),
 inequitable in the interregional sense.              103(a) and (c), 404, and 603).
 FLPMA also formalizes the shift from the               Of more significance was the need for the
 production-orientation of public rangeland          Bureau of Land Management to abide, in all
260
Obermiller                                                                        Sagebrush Rebellion


of its planning and project evaluation             economies shall be considered" (Subpart
processes, by the provisions of the National       1601.0-8(d)). Further, resource management
Environmental Policy Act of 1969 (NEPA).           plans must not ignore the degree of local
Section 102 of NEPA required all federal           dependence on resources from public lands
agencies (or state agencies with federal fund-     (Subpart 1601.7-4(7)). The intertemporal
ing) which undertake actions affecting the         equity issue is implied by the stated principle
quality of the human environment to prepare        that "long-term benefits and detriments to
statements documenting associated environ-         the public shall be weighed against short-
mental impacts.                                    term benefits and detriments" (Subpart
   However, the Council on Environmental           1601.0-8(i)). No direct reference to either
Quality did not issue regulations for the im-      interpersonal or intersectoral considerations
plementation of NEPA until 1978. In the            appears in the code of regulations.
interim each federal agency was to develop
and implement its own set of guidelines.           Can Recognition of Distributive Equity
Prior to 1976, the Bureau was at a disadvan-       Concerns Avert the Sagebrush Rebellion?
tage, relative to other agencies, in its efforts
                                                     Few would disagree that, as of this writing,
to implement the NEPA process. Those ef-
                                                   the procedures developed and implemented
forts were judged to be insufficient when, in
                                                   by the Bureau, at least with respect to
1974 and 1975, the Natural Resources De-
                                                   economic analysis guidelines, are inade-
fense Council filed and won two lawsuits
                                                   quate. In fact, it is questionable whether the
against the BLM, one directed toward range-
                                                   existing procedural guidelines conform with
land, and the second toward forestland plan-
                                                   the scope and intent of the Bureau's own
ning [LaFollette]. Since that time the Bureau
                                                   code of regulations [Bureau of Land Man-
has attempted to comply with the letter of
                                                   agement, 1980(a)]. These deficiencies are
the law, under the watchful eye of the courts,
                                                   recognized by the BLM, and are implicitly
by preparing site-specific environmental im-
                                                   acknowledged in the agency's March 1981
pact statements.
                                                   "Social and Economic Analysis" policy and
   Not until August 1979 were the procedural       action plan.
guidelines for present Bureau of Land Man-            "The changing environment of public land
agement planning processes and environ-              management requires that the quality of so-
mental     impact     statement     preparation      cial and economic analysis in BLM be im-
codified. The code does not specify how              proved, that the development and use of
                                                      rigorous social and economic analysis tech-
economic analysis is to be done, but it does          niques be pursued efficiently, and, most im-
imply the types of economic issues to be             portantly, that more efficient, equitable, and
considered. Economic efficiency is identified         timely management decisions be made, in-
as a relevant planning and decision criterion:        cluding strategies for improved impact miti-
"the estimated sustained levels of the various        gation when national needs conflict with local
                                                      preferences and fiscal capability" [p. 6].
goods, services, and uses that may be at-
tained under existing biological and physical         The policy and action plan sets in motion a
conditions and under differing management          process to achieve three goals: (1) policy and
practices and degrees of management inten-         procedural guidance; (2) enhanced meth-
sity which are economically viable under           odological capability; and (3) guidance on
benefit-cost or cost effectiveness standards       mitigating the adverse impacts of public land
prescribed in national or State Director guid-     use decisions. Interim procedural guidance is
ance" (Code of Federal Regulations, August         provided by existing instructional memoran-
7, 1979, Subpart 10601.5-4(4)]. Interregional      da, e.g., [Bureau of Land Management,
equity considerations likewise are relevant,       1979, 1980(c), 1981(a)]. These existing
in that "the relative significance of the public   guidelines are consistent with the U.S. Wa-
land products, services, and uses to local         ter Resource Council's emphasis, in its 1979
                                                                                                261
December 1982                                               Western Journal of Agricultural Economics


version of the Principles and Standards, on      1980s: The "Sagebrush Rebellion."
national economic efficiency and environ-
mental quality as decision criteria. However,
these interim guidelines also are somewhat       References
inconsistent with the distributive equity con-
cerns expressed in the Code of Federal Reg-      Beef, '"Sagebrush Rebellion' Leaders Attack Short-Term
                                                   Problems," March 1981, pp. 79-81.
ulations and in the Bureau's recent policy
and action plan.                                 Bureau of Land Management, United States Depart-
   In December 1981 the BLM issued In-             ment of the Interior, Washington Office Instructional
structional Memorandum 82-106, the pur-            Memorandum No. 80-57, "Revised AMP Economic
pose of which is to establish a process for       Analysis Procedures," October 26, 1979.
developing new economic analysis proce-
                                                 Bureau of Land Management, United States Depart-
dures and criteria for rangeland investment        ment of the Interior, Washington Office Instructional
[Bureau of Land Management, 1981(c)]. The          Memorandum No. 80-704, "Social and Economic
memorandum        acknowledges       that  the    Analysis in Management Framework Plans and Re-
Bureau's techniques for project evaluation         source Management Plans/Environmental Impact
                                                   Statements," August 13, 1980(a).
have not kept pace with changing policy, and
that these techniques have been subject to       Bureau of Land Management, United States Depart-
criticism by Congressional representatives,        ment of the Interior, "Final Ironside Grazing Manage-
members of the livestock industry, university      ment Environmental Impact Statement," Oregon
economists, and the Office of Management           State Office, October 1980(b).
and Budget. The process to be followed in-
                                                 Bureau of Land Management, United States Depart-
volves the explicit collaboration of a team of     ment of the Interior, Washington Office Instructional
Bureau economists, senior managers, and            Memorandum No. 81-99, "Guidance for Social and
"western university economists" prior to the       Economic Analysis in Grazing Environmental Impact
adoption of the new criteria and procedures        Statements," November 25, 1980(c).
for economic analysis by the BLM. The chal-      Bureau of Land Management, United States Depart-
lenge facing both agency and university            ment of the Interior, Washington Office Instructional
economists will be to recommend both               Memorandum No. 81-296, "Proposed Rangeland Im-
criteria and procedures which are consistent       provement Policy," March 3, 1981(a).
with the re-emerging emphasis on distribu-
                                                 Bureau of Land Management, United States Depart-
tive equity as a decision criterion in public
                                                   ment of the Interior, Washington Office Instructional
land use planning.                                 Memorandum No. 81-315, "Social and Economic
   Some observers might conclude that the          Analysis: Policy and Action Plan," March 11, 1981(b).
apparent change in philosophy within the
Bureau of Land Management is a response te       Bureau of Land Management, United States Depart-
                                                   ment of the Interior, Washington Office Instructional
a shift in national sentiment. Others might
                                                   Memorandum No. 82-106, "Development of Econom-
take a more cynical view toward bureaucratic       ic Procedures and Criteria for Ranking Proposed
adaptation to a new adminstration. Suppor-         Rangeland Investments," December 2, 1981(c).
ters of the "Sagebrush Rebellion" well may
claim that their voices have been heard, and     Carver, J. A. "FLPMA of 1976: Fruition or Frustration?"
                                                   Denver Law Journal, 54(1977):387-444.
their concerns heeded. Any or all of these
views may be valid. The Bureau has come to       Code of Federal Regulations, "Public Lands and Re-
recognize that distributive equity issues do       sources; Planning, Programming, and Budgeting,"
have a legitimate place in the public land use     Department of the Interior, Bureau of Land Manage-
decision-making process. Time will deter-          ment, 43 CFR Part 1600; published 44 F.R. 46386,
                                                   August 7, 1979.
mine whether that recognition successfully
averts, or has come too late to suppress, the    Federal Land Policy and Management Act of 1976,
American land reform movement of the               Public Law 94-579, 94th Congress, October 21, 1976.

262
Obermiller                                                                                   Sagebrush Rebellion

FederalRegister, "Principles and Standards for Planning   Matthews, D. J. (ed.), "An Economic Evaluation of the
  Water and Related Land Resources," Washington,           Transfer of Federal Lands in Utah to State Owner-
  D.C., September 10, 1973.                                ship," Utah Agricultural Experiment Station, Utah
                                                           State University, Logan, May 1980.
FederalRegister, "Principles and Standards for Planning
  Water and Related Land Resources," Washington,          Muys, J., "The Public Land Law Review Commission's
  D.C. May 24, 1979.                                       Impact on the Federal Land Policy and Management
                                                           Act of 1976," Arizona Law Review, 21(1979):301-09.
Haveman, R. C., "Efficiency and Equity in Natural Re-
  source and Environmental Policy," AmericanJournal
  of Agricultural Economics, 55(1973):868-78.             National Environmental Policy Act of 1969, Public Law
                                                           91-190, 91st Congress, January 1, 1970.
Haveman, R. C. and B. A. Weisbrod, "Defining Bene-
 fits of Public Programs: Some Guidance for Policy        Obermiller, F. W., "The Local Costs of Public Land Use
 Analysis," Policy Analysis, 1(1975):169-96.               Restrictions," in Beef Cattle and Range Resources,
                                                           Special Report 583, Oregon Agricultural Experiment
Hicks, J. R. "Foundations of Welfare Economics,"           Station, Oregon State University, Corvallis, May
 Economic Journal, 49(1939):696-712.                        1980.

                                                          Public Land Law Review Commission. One-Third of the
LaFollette, C., "Taking Stock of BLM Planning," Forest      Nation's Land. Washington, D.C.: U.S. Government
  Planning, July (1980):4-6.                                Printing Office, June 1970.

League for the Advancement of States' Equal Rights,       Taylor Grazing Act of 1934, Public Law 73-482, 73rd
  "Agenda for the 80s: A New Federal Land Policy,"          Congress, June 28, 1934.
  Proceedings of the National Conference on States'
  Rights, the Sagebrush Rebellion, and Federal Land       Weisbrod, B. A., "Income Redistribution Effects and
  Policy, Salt Lake City, Utah, November 20-24, 1980.      Benefit-Cost Analysis," in S. B. Chase (ed.) Problems
                                                           in Public Expenditure Analysis. Washington, D.C.:
LeMaster, D. C. and L. Popovich, "Development of the       The Brookings Institution, 1968, pp. 177-209.
  National Forest Management Act," Journal of Fores-
  try, December (1976):806-08.                            Wyckoff, J. B., "Allocative Problems of Public Lands in
                                                           the West," Western Journal of Agricultural Econom-
Malin, L., "Rangeland Policy: A Look Back," in J. B.       ics, 2(1977):11-20.
 Wyckoff (ed.) Federal Land Use Policy: Improving
 Citizen Participation,Oregon State University Exten-
 sion Service, Corvallis, 1980.




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