Endangered Species From Liabilities to Assets

If endangered species are so important, so valuable, why does the economic system see them as liabilities? The perverse unintended consequence of the Endangered Species Act— forcing people to see endangered species as a liability—is nothing new. Ever since the act was passed some 30 years ago people have been complaining that listing an endangered species places an unfair burden on the private landowners whose land harbors these species. In such cases, they argue, the incentive is not to protect an endangered species but rather to get rid of it fast, before anyone knows it is there. (See Box 9-3.) This is what some have called the "Three Ss Approach to Endangered Species Management": shoot, shovel, and shut up.16

Critics of the ESA have often used this attitude to argue that the act needs to be revised or even dismantled. But rather than throw the legislative baby out with the bathwater, there are other, less drastic approaches. One of these involves a process known as conservation banking. In the 1990s, people began looking for a better way to accomplish the ESA's objectives—one that instead of penalizing private landowners for harboring endangered species would perhaps reward them.

To do this, they created a system reminiscent of wetland banking. Under this system, landowners with an endangered species on their land can get a permit to harm that species (known as an "incidental take" permit in the euphemistic language of the government) if they can show they have compensated for it by creating habitat for that same species somewhere else. Again, as with wetland banking, this has paved the way for private, for-profit, species bankers to create habitat for endangered species, get credit from the government for any new members

SPECIAL SECTION: PAYING FOR NATURE'S SERVICES Banking on Biodiversity

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