UNIVERSITY of CALIFORNIA Los Angeles Economy and Ecology

UNIVERSITY OF CALIFORNIA Los Angeles Economy and Ecology: Power, Protecting Nature, and Institutional Change in the United States and Germany A dissertation submitted in partial satisfaction of the requirements for the degree of Doctor of Philosophy in Sociology by Christopher Rea 2018 c Copyright by Christopher Rea 2018 ABSTRACT OF THE DISSERTATION Economy and Ecology: Power, Protecting Nature, and Institutional Change in the United States and Germany by Christopher Rea Doctor of Philosophy in Sociology University of California, Los Angeles, 2018 Professor Ching Kwan Lee, Co-Chair Professor Michael Mann, Co-Chair This is a study of nature protection in an era of markets, and more broadly, a study of the historically and contextually constrained ways that people try to resolve perennial tensions between economic growth and ecological protection in modern, capitalist political-economies. The substantive focus of the study is somewhat peculiar: it is a comparative and historical analysis of the development of market-oriented ecological offsetting schemes in both the United States and in Germany. These are exchange-based systems of creating, restoring, buying, and selling units of nature used by land developers who are required to “offset” ecological harm caused by their building projects. In essence, ecological offsetting is a market-oriented regulatory means of \improving" and protecting nature in one location in order to help \make up" for harm to nature someplace else nearby. ii If ecological offsetting itself is esoteric, however, its features allow for a careful examination of contemporary efforts to transcend basic conflicts between economic development and ecological sustainability. Empirically, the case offers an opportunity to study how nature protection develops and evolves at a time when strengthening environmental regulation is politically fraught, when market-oriented policy is ascendent, and when regulatory expansions are frequently opposed by business interests and their political allies. Methodologically, it turns out that ecological offsetting itself developed in almost perfect historical parallel in the United States and in Germany and yet did so quasi-independently, that is, without substantial evidence of direct diffusion across the cases. This means that these two country cases provide an unusual opportunity to pinpoint the social-historical and political-ecological dynamics that drove the emergence of market-oriented forms of environmental protection in both countries, and that may be linked to the development of comparable institutions in a wide variety of other political and organizational contexts. At a lower-level of analysis, this comparative design also makes it possible to identify the ways that nationally distinctive contexts shaped the development of case-specific institutional features|for example, the ways that broad-based conceptions of \nature" in Germany lead to the development of exchanges in highly fungible units of ecology, whereas in the U.S. a focus on \wild" and \sacred" forms of nature led to exchanges in less highly fungible and more \ecological" units. Finally, the comparison of the two national cases also offers leverage for understanding how bureaucrats and policymakers can weave market-like exchanges directly into the administrative and regulatory fabric of modern states. In this way, an analysis of the parallel development of market-oriented ecological offsetting offers insights into how and why bureaucrats inside the state can drive ahead institutional and policy changes, and how new regulatory institutions emerge and change in general, particularly in an era of markets, and particularly insomuch iii as these institutions relate to nature protection and ecological sustainability. Concretely, I find that ecological offsetting schemes in the United States and in Ger- many emerged and developed out of parallel political pushes for administrative liberalization and public austerity, on the one hand, and that they also developed out of con- comitant pushes for expanded|not reduced|levels of environmental protection, on the other. These regulatory expansions were not driven by protests and highly visible activism, but by mundane and persistent actions in courts, bureaucracies, and through the dynamics of local-level politics|processes that were themselves filtered through nationally and even sub-nationally distinctive cultural-organizational contexts and pathways that produced nationally-particular institutional features in each country. I expand on these dynamics in great detail in six substantive chapters, guided by what I call the Power, Institutions, Contention, and Context (PICC) approach. After an intro- duction, I begin in chapter 2 by showing how regulatory institutions in general|institutions intended to shape and control human economic and ecological action|can be differentiated in terms of the ways they crystalize distinctive combinations of authoritative and economic dimensions of social power. (I define social power simply as the ability to get an actor to do something that she might not otherwise do; authoritative power amounts to direct and le- gitimate commands; economic power amounts to indirect incentives or creating \situations" that make some actions more appealing than others, absent direct commands.) This, in turn, implies that the emergence and development of different \kinds" of regulation|including market-oriented nature protection|is a matter of explaining how and why different crystal- lizations of economic and authoritative social power emerge when and where they do, which is itself, I argue, a politically contested and historically-specific process. With this in mind, in chapter 3, I examine how markets in nature work as regulatory institutions|abstractly, iv how they wield authoritative and economic dimensions of social power|and carefully detail the empirical features of actually existing ecological offsetting institutions in the United States and Germany. In chapter 4 and onwards, I shift decidedly from a focus on power and institutions per se to an analysis of the patterns of contention and the contexts that drove the emergence of the institutions described in chapters 2 and 3. Chapter 4 itself focuses on the macro- historical dynamics that favored the emergence of market-oriented ecological offsetting in both the United States and in Germany. Pushes for public austerity, liberalization, and de-bureaucratization were key in both places; so were nationally distinctive patterns of pro- environmental political advocacy and mobilization. With this macro-historical context in mind, in chapters 5 and 6 I shift to an examination of meso-level features that shaped and constrained marketization and institutional change in each country: in chapter 5 I show how nationally distinctive understandings of nature itself shaped political contention and the development of markets in nature in each place; in chapter 6 I show how nationally particular legal traditions and organizational architectures of the state similarly channeled and influenced institutional development and change. In the last analytical segment, in chapter 7, I shift at last to a micro-level of analysis to show how activist bureaucrats| ecological \bureactivists" as I call them|drove ahead institutional change \on the ground" in both countries. I conclude the study in chapter 8 by reviewing the central empirical findings of the previous chapters; briefly reflecting on the merits of a power-based approach to understanding institutional emergence, change, and marketization; and also pointing to the implications of the study for understanding contemporary efforts to grapple with ever- present tensions between promoting economic growth, on the one hand, and protecting nature, on the other. v The dissertation of Christopher Rea is approved. Fred Block Hannah Louise Landecker Edward T. Walker Ching Kwan Lee, Committee Co-Chair Michael Mann, Committee Co-Chair University of California, Los Angeles 2018 vi Contents Abstract of the Dissertation ii List of Figures xiii List of Tables xv Acknowledgements xvii Vita xxi Preface \Muddling Through" Ecological Crisis 1 1 Paradoxes and Puzzles in Economies of Nature 11 Big Questions, Small Cases 18 Markets as Regulation: A Global Trend 27 Puzzling Over Ecological Offsetting 33 Summary and Chapter Outline 42 2 The Nature of Regulation 49 Laying Theoretical Groundwork 53 Social Power and Regulation 61 vii Contents Putting It All Together: Animating Emergence 72 3 The Character of a Market 81 Ecological Offsetting: Fundamentals 85 Markets in Nature? 97 Offsetting Incarnate 101 Markets as Regulatory Institutions 122 4 It's Capitalism, Stupid? 127 The Big Picture: Political Economy and Ecology 133 Trajectories of Institutional Change 149 Conditions for Expanding Economic Power 160 Conditions for Expanding Authoritative Power 174 Capitalism, History, and Institutional Change 185 5 National Natures 189 Returning to the Endogeneity of Institutional Change 194 The Nature of Nature in Germany 198 The Nature of Nature in the United States 211 The Cultural Organization of Conflicts and Settlements 226 6 Organizing Environmental Politics 231 States Organizing Politics 239 Understanding \Standing" 243 Two Federalisms 248 Organizing Institutional Change 266 viii Contents 7 Of Bureactivists and Entrepreneurs 271 Individuals and Institutional Change 276 Institutional Change in Bureaucracy 286 Ecological Bureactivism 296 Regulatory Entrepreneurialism 314 The Timing and Sequence of Marketization 325

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