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Founded by current Chairman John Baden in 1985, FREE has its
roots in the Center for Political Economy and Natural Resources,
which Baden established at Montana State University in 1978.
Much of the pioneering work on the “New
Resource Economics” was done by Center personnel. Using
public choice economics, they critiqued prevailing natural resource
management systems. Sorry results were explained not as aberrations,
but rather as the predictable consequences of incentives and institutional
arrangements.
This work was quite straightforward and widely
accepted within the economics profession. Several future Nobel
Prize winners became interested in the Center’s work and
paid occasional visits to Montana. It was an exhilarating time.
However, some were not pleased with this success.
Some commodity groups were outraged that "their"
University would harbor these outspoken critics of crony capitalism.
And a generation ago, many Greens had more than a tinge of pink.
They were livid that a bunch of libertarian economists had trespassed
into their domain and claimed the intellectual, ethical, and ecological
environmental high ground.
Federal bureaucracies, such as the Forest Service,
were irate that they, the apostles of "scientific management"
(and supporters of university research), were attacked with solid
data on government malfeasance and causal models explaining it:
incentive structures that lead agency budget maximization to trump
the public interest.
External pressure on the Center and the
University grew and eventually the program fell casualty to academic
politics. (You can find a 1982 peer review of the Center’s
work by Professors M. Bruce Johnson and Vernon W. Ruttan here.)
Baden left MSU in 1982 to found the Political Economy Research
Center (PERC), of which he was Chairman until creating FREE in
1985. PERC, now known as the Property and Environment Research Center, and FREE have no formal relationship.
FREE has consistently fought corporate
subsidies (see “A
Welfare Act for U.S. Oil” and “Spare
that Tree”) fostering exploitation and strongly advocates
such efforts as wolf reintroduction to the federal lands of the
West. The intellectually naïve confuse FREE’s classical
liberal, pro-market process orientation with that advocated by
supporters of a subsidized, pro-business position that exploits
the environment (e.g., below-cost timber sales on the national
forests).
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