Economist: Montana has work to do in balancing environment, business

Economic growth is good for the environment, contrary to environmental "gloom and doom" predictions heard in the media, a free-market economist said Wednesday.

But, at the same time, strong environmental protections in Montana are playing a key role in the growth of state economy, Terry Anderson said.

By MIKE DENNISON
Tribune Capitol Bureau

http://www.greatfallstribune.com/news/stories/20040916/localnews/1243226.html

This unusual contrast is good news for parts of the Montana economy — but could be bad news for those who make a living from traditional industries like logging, mining or ranching, he said.

"I don’t think it really leaves us with the Treasure State that we all love and enjoy," said Anderson, a former Montana State University economist who splits his time between Bozeman and Palo Alto, Calif.

Anderson, a senior fellow at Stanford University’s conservative Hoover Institution, spoke at a luncheon sponsored by the Montana Taxpayers Association.

The association includes many of Montana’s larger industries and often lobbies for lower taxes on business.

Much of Montana’s recent growth in areas like Bozeman and Missoula is driven by "outside wealth" moving to the state, fostering construction and other business activity to serve this wealth, he said.

Anderson said things like public lands protected from development help to attract these newcomers.

But this economic boom is driven primarily by a productive economy outside of Montana, and the newcomers might insist on strict protections that hinder things like logging and ranching, he added.

Anderson said it’s possible Montana could strike more of a balance between environmental protections and land-based industries like logging, mining and ranching.

However, he said he’s not terribly optimistic right now. To flourish, these industries need things like lower taxes, the "rule of law" that protects their property rights, and a less-intrusive government, Anderson said.

"I don’t think for one second we’re going to see (those) things we need (in Montana)," he said.

Jim Jensen, executive director of the Montana Environmental Information Center — one of Montana’s most prominent conservation groups — agreed with Anderson’s view of the Montana economy.

"I think it’s clear that we’ve moved past the era of natural-resource extraction … as the economic model working for Montana," he told the Tribune Wednesday. "We have an economy that is expanding here, with low unemployment."

Yet Anderson said people who want to preserve environmental qualities should not fear economic expansion because creating more wealth through economic growth is "the precursor to environmental quality," he said.

Environmental naysayers predicted 30 years ago the world would be overrun with people and pollution by now, and it hasn’t happened yet, Anderson said.

Dennison can be reached by e-mail at [email protected], or by phone at (406) 442-9493.