Unintended Consequences

This semester we have talked and read extensively about the state of Oregon and its anti-sprawl policies. We have read the pros and the cons as the "experts" see them (which really differs by the value judgments of each expert). I admit that after all the reading and discussions, I plan to never move to Oregon. I am not fond of being told what I can and cannot do. While reading an article in the Wall Street Journal, my notion that government laws and regulations are meant for a static rather than dynamic world were reaffirmed. The government intervenes to improve social welfare or at least that is their intention. But the unintended consequences of that intervention often out weighs any possible positive outcomes.

The article is about pear growers in Oregon. Like many businesses, the current economic downturn (or down slide because downturn just doesn't express the extent of this recession) has affected the pear business. And because of Oregon Senate Bill 100 of 1973, these pear growers are unable to take advantage of business opportunities that would help their businesses out. David D. Lowry an executive for Associated Fruit Co (one of the big three pear growers in Medford, Oregon) said, "It's the worst case of unintended consequences you can image." His company has "plenty of land to sell, but no one willing to buy [it] as long as it is zoned for farming only." Selling this land and buying other land further away from the city would help get the pear companies out seriously financial trouble.

For instance, by selling 70-acre orchard Associated Fruit Co could raise $7 million ($100,000 per acre) if they could sell to a housing developer which would be enough to refinance the company's debt and plant new orchards on land further from the city core. Instead, because of the strict zoning laws created in 1973, "the land is valued at just $10,000 per acre, [Lowry] says, a moot point since there are no takers."

The zoning laws of Oregon are intended to prevent sprawl. The unintended consequences is that it limits economic growth and liberty.