The Case for Shale
The political economy of the United States is often described as a free-enterprise system — "free," because the American political system protects individual rights of life, liberty, and property; "enterprise," because those rights encourage Americans to become entrepreneurs. The most innovative Americans create new fields of industry and endeavor, and they use their freedom to circulate the benefits of their innovation to everyone else in this country and beyond. Americans have seen this creative cycle play out time and again — in the automobile industry in the first half of the 20th century, the pharmaceutical field in the 1980s, or the "dot-com" boom in the 1990s.
The most recent free-enterprise success story comes from the energy sector — the "shale revolution." In the late 1990s and early 2000s, small American energy companies perfected technologies to extract oil and natural gas from rock formations previously thought to be impermeable. The technologies are called "unconventional" drilling techniques; the impermeable rock is called "tight" rock; and the most commonly drilled rock formations are called "shales." The shale revolution refers to the surge in U.S. energy production, when domestic energy companies started applying unconventional technologies to extract oil and gas from shales and other tight rock. The shale revolution has reduced America's dependence on foreign oil and gas, created valuable jobs for many Americans, and expanded American consumers' purchasing power and freedom of action in countless ways.
Yet the shale revolution faces a serious political threat. In the culture and in politics, environmentalists criticize unconventional production as exploitative and polluting. Grassroots environmentalists and concerned residents are lobbying states and local governments to ban shale production.
And so far, critics of shale production seem to be gaining the moral high ground. They indict shale production in moral terms. Unconventional energy producers are accused of "polluting" sources of fresh water and the air, and of "exploiting" the landowners from whom they lease. By contrast, defenses of shale production are fairly apolitical, often resting on economic statistics about wealth and jobs. To date, however, the shale revolution's supporters haven't developed or effectively publicized an account of why the shale revolution is also just, a success story on a moral level as well as an economic one.
In other words, the debate about the shale revolution is becoming lopsided in the same way as many other debates about business regulation. In arguments about "cultural" or "social" issues — immigration, gun control, or abortion, for instance — both sides have well-developed accounts of what a just political community looks like, what individual rights such a community cherishes, and whose rights are threatened by the other side's proposals. All too often, however, in debates about business regulation, interventionist journalists and grassroots activists indict a field of business for being dirty, hypercompetitive, or predatory. When legislators then propose to restrict the field of business, supporters argue from a defensive position. Instead of linking the business in question to a moral good, they defend it with uninspiring apolitical arguments.
In ongoing debates about shale production, supporters shouldn't shy away from making a moral defense of the shale revolution. And such a defense in the energy arena may also offer us a better sense of how champions should be defending our system of free enterprise more generally.
THE SHALE REVOLUTION
The shale revolution is the product of a technological breakthrough. Until recently, most oil and gas was produced from large subterranean reservoirs. It is cheaper and easier to tap these large reservoirs than it is to explore for small pockets of oil or gas trapped in shales or other impermeable rock formations. Even so, according to 2013 estimates by the International Energy Agency, around the world, there is more oil recoverable from unconventional resources than from conventional resources (3.2 trillion barrels versus 2.7 trillion barrels), and about three quarters as much natural gas recoverable from unconventional resources as from conventional ones (330 trillion cubic meters versus 460 trillion). Worldwide petroleum prices increased steadily over the last 30 years, and at some point they were bound to increase past the break-even point for shale exploration — if prospectors could develop technology making it feasible to explore.
Throughout the 1980s and 1990s, American energy producers tried to develop such technologies. In the late 1990s, a few producers discovered a successful formula combining three elements. One is hydraulic injection — which opens up shale rocks with water pressure, so that oil or gas can escape. (This pressurized fracturing gives shale exploration the names "hydraulic fracturing" and "fracking.") But fractures can close quickly, before oil or gas escapes, once the stream of water is shut off. To avoid this possibility, fractures are kept open with the second element: "proppants," consisting of sand or artificial ceramic beads.
The last element is horizontal drilling. When energy producers construct wells, they drill and install a vertical pipestem, usually one and a half or two miles deep. They then "arc" horizontal pipes at right angles away from the vertical pipestem, in the middle of the layer of shale being fractured. By snaking multiple horizontal pipes (usually six to eight) away from the pipestem, producers minimize the damage and inconvenience they inflict on the surface. And because these horizontal pipes often run two miles from their vertical pipestems, they help a company extract all the oil or gas from shale rocks in a five- or six-mile-diameter cylinder.
Since energy companies started using these three techniques together, American energy production has surged. From 2000 to 2015, American natural-gas production increased by about 42%, and American crude-oil production increased by 62%. In 2000, shale gas and tight oil contributed almost nothing to American production; as of 2015, each constituted about half of U.S. production of natural gas and crude oil. Thanks to hydraulic fracturing, the United States stopped being a net oil importer in 2011.
The shale revolution benefits Americans in many ways. The surge in domestic oil and gas production deserves much of the credit for offsetting the effects of the 2008 recession and for stoking much of the recovery (such as it is) that the country has experienced since then. Shale exploration has created hundreds of thousands of jobs in the energy industry, and many more in transportation and other fields that benefit indirectly from cheaper and more plentiful oil and gas. Many of these jobs are risky, not only because shale production is a boom-or-bust industry but also because oil drilling presents health and safety dangers. But the jobs are also lucrative; an industry website estimated that, when fracturing took off in North Dakota, entry-level workers were earning $66,000 annually, and the average annual salary in the industry was over $112,000.
The shale revolution has also helped consumers. In 2013, crude oil sold on world markets at more than $110 per barrel; as of early 2016, thanks in large part to increased American production of shale oil and gas, crude is selling just above $30 per barrel. By one rough estimate, the increase in the supply of natural gas gives Americans on average $150 more in purchasing power per capita per year.
To be sure, drops in oil and gas prices will discourage new shale production in the near future. But the companies that have led the shale revolution are researching how to lower their break-even points. And prices for oil and gas will eventually go back up, as cheaper prices stimulate higher energy consumption and that consumption increases in developing countries around the world. In short, the shale revolution has already helped Americans prosper and will continue to do so — unless cultural and political developments pressure energy producers to give up on shale exploration.
THE ENVIRONMENTALIST CRITIQUE
As the shale revolution took off, some environmentalists were quietly supportive. They believed that natural-gas use is desirable in the short and medium terms, because gas is a cleaner-burning substitute for coal. Yet other environmentalists believe that fracturing is risky and disruptive to the neighborhoods where drilling takes place. Others worry that the oil and gas produced by fracturing exacerbate climate change, and still others fret that shale production perpetuates the mindset that we can all rely on fossil fuels forever. And in the last five years, these and other similar views have turned environmentalist donors and leaders decisively against fracturing.
In fall 2015, in the middle of an NFL Monday Night Football game in Charlotte, two environmental activists rappelled off of a stadium balcony to display a banner protesting a Charlotte-based bank's loan to an energy company for a fracking project. Several anti-fracking movies have been released, the leading one being the 2010 HBO documentary Gasland. The film suggests that energy companies trick the landowners they bargain with and leave their neighborhoods polluted and impossible to clean up. It also suggests that hydraulic fracturing causes nearby residents to suffer chronic illnesses, pollutes fresh-water sources, and in one case made tap water flammable. And Gasland also suggests that energy producers have undue influence in politics. At the behest of energy producers, the movie warns, Congress included in a 2005 federal energy law an amendment exempting hydraulic fracturing from the federal Safe Drinking Water Act.
Cultural criticisms like these have stoked political and legislative efforts to reform fracking. The federal Environmental Protection Agency is reviewing scholarship and case reports on whether hydraulic fracturing contaminates underground fresh-water supplies. In their campaigns for the Democratic nomination for the presidency, Hillary Clinton and Bernie Sanders both promised to use federal regulatory powers to stop fracking.
Today, however, most of the political controversy occurs at the state and local levels. Localities can try to use their powers to regulate zoning and land use to restrict fracking, and state environmental and energy agencies have jurisdiction over energy production as well. The Vermont legislature banned fracking in 2012, though that ban was purely symbolic because there aren't shale plays in Vermont. Governor Andrew Cuomo used his executive powers to impose an indefinite moratorium on hydraulic fracturing in New York, and the Maryland legislature enacted a moratorium on fracking for at least two years — far more consequential maneuvers, since New York and Maryland both sit over the Marcellus Shale Play. City councils and voter initiatives have banned or delayed fracking in some towns — most notably in Denton, Texas, but also in municipalities in Pennsylvania, Ohio, and Colorado. Some of these restrictions (like Denton's) have been voided by state laws stripping localities of power to interfere with energy production; others (like those in two Colorado towns) have been declared invalid by state courts because they conflict with state-level energy laws and regulations. But even if most of these early efforts have been stopped, they have inspired similar efforts in other states — North Carolina, Georgia, Florida, Ohio, and Michigan, among others.
In these debates, environmentalists claim to be on the side of right. Gasland portrays fracturing as a morality play with villains (energy producers) and victims (landowners). Real-life local political debates are likewise cast with evildoers and righteous victims. An anti-fracking group, Frack Free Colorado, identifies the moral stakes for its advocacy: "[t]o protect Coloradans' basic rights to clean water, clean air, a safe home, and a sustainable future." Another Colorado critic accuses energy companies not only of polluting "our water, air, homes, and natural landscapes" but also of "pollut[ing] our democracy."
More ominously, supporters of the shale revolution are tacitly ceding the high ground. Of course, supporters do attempt to refute the unfounded accusations of critics. For example, Colorado's oil and gas commission found that Gasland's "flaming faucet" occurred because of biogenic methane seeping into water sources naturally, not thermogenic methane pushed into water by drilling or hydraulic injection. Supporters also make practical arguments. For example, in voter referenda on fracking, supporters often warn local voters that they put themselves on the hook for big litigation bills when restrictions on fracking are challenged and thrown out of court. But most often, supporters cite the economic benefits of shale exploration and gas production: new wealth, new jobs, economic growth, and increased tax revenues for schools and other public services.
In politics, however, it's not enough to refute every inaccurate accusation or make arguments based exclusively on economic statistics. Exposés on fracturing and grassroots political campaigns both aim to shape public attitudes against fracturing over the long term. Even if supporters refute most of the criticisms and beat back most of the legislative proposals, they'll lose the contest over public opinion.
By ceding the moral high ground, energy producers neglect two important dimensions of politics. First, shale supporters neglect the role that public arguments play in a mass democracy. Many observers mistakenly assume that policy gets made primarily by two processes — direct decision-making in voting booths, and special-interest lobbying in legislatures and regulatory agencies. This portrait leaves out the role played by a certain kind of advocate. As Joseph Schumpeter explained, in a democracy, "the mass of people never develops definite opinions on its own initiative." Opinions are shaped through arguments and campaigns conducted by public intellectuals, who make it their "interest...to work up and organize resentment, to nurse it, to voice it and to lead it."
While state and local grassroots environmental leaders and anti-shale journalists stoke public opposition to shale exploration, a few influential thinkers have attempted to bend public opinion in the other direction. For example, Phelim McAleer, an independent filmmaker, used crowd-funding to finance FrackNation as a response to Gasland. But there aren't nearly enough influential leaders doing such work.
Second, shale supporters neglect the role that justice plays in cultural and electoral debates about politics. Although a political debate on any issue will have many different facets, the most effective way to gain control of such a debate is to articulate how one side violates people's rights or threatens a community's just way of life.
This is why many arguments for fracturing thus far have seemed uninspiring or defensive. There is not a lot of rhetorical force in warning residents of a city that it will be expensive to defend a municipal ban on fracturing. Cities are often asked to support proposals, at considerable public expense, for new sports stadiums or ambitious redevelopment projects. The politics of these proposals turn on whether voters are convinced that these projects are "giveaways" to sports teams or local developers, or instead are "investments" in projects that will be "anchors" or "catalysts" for prosperous community life. Similarly, a local ban on hydraulic fracturing may seem worth the cost and headaches of litigation — unless supporters can teach local citizens why the ban interferes with a legitimate activity and, more important, the community's well-being.
Nor is it persuasive or inspiring to cite the wealth and jobs that shale exploration creates. Supporters of legalized gambling often argue that new casinos will create new jobs and wealth. Sometimes these arguments succeed. But sometimes they don't — not when opponents paint commercial gaming as an industry that preys on risk addiction and contributes to family break-up and other social pathologies. Although the energy sector differs in basic ways from the casino business, it's telling that critics have likened energy production to "speculation," "profiteering," and reckless gambling ever since the first oil rushes. Unconventional energy producers need to make the case that their activity is not predatory but legitimate free enterprise.
In energy scholarship and policymaking, many specialists think it's enough to defend an activity like shale exploration using value-neutral methods, like cost-benefit analysis. Cost-benefit analysis is helpful in many settings, especially administrative settings, because it forces administrators to clarify and compare the consequences of different proposals. But cost-benefit analysis isn't as effective in the political arena — precisely because it talks about political tradeoffs in an apolitical way. In legal and economic scholarship, it's often taken for granted that personal-injury judgments incentivize companies to take precautions against accidents only when the precautions are cost-effective. In practice, however, one of the most devastating pieces of evidence a plaintiff's lawyer can use against a company defendant is a memo balancing the costs and benefits of such precautions in dollars and cents. Companies are taking risks with consumers' safety, jurors intuit, and unjustly presuming to assign dollar values to risk choices that belong to consumers.
Similar intuitions drive the politics of shale exploration. For ardent environmentalists, cost-benefit analysis implies that dollars count for more than goods that are hard to quantify but ennobling — beauty, cleanliness, and fairness. Supporters need to justify shale exploration in similar terms.
MORALITY AND PROPERTY
Here, supporters of shale exploration should take a lesson from their critics. Environmentalists often cite fundamental rights to support their indictments of hydraulic fracturing. When the town of Longmont banned fracturing, it cited a passage from the Colorado constitution, which "confers on all individuals in the state, including the citizens of Longmont, certain inalienable rights, including 'the right of enjoying and defending their lives and liberties; of acquiring, possessing and protecting property; and of seeking and obtaining their safety and happiness.'" These constitutional passages follow the cadences of the Declaration of Independence. They resonate with ordinary voters because they appeal to moral rights. But the moral principles that justify those rights can also supply the moral dimension currently missing from defenses of unconventional energy production.
The Colorado constitution and the Declaration of Independence set two ultimate goals for political life — protecting the "safety" of the citizenry, and creating conditions in which citizens can pursue their own forms of "happiness." A moral defense of free enterprise follows from the basic rights and liberties implicit in these goals: the liberty to compete, the liberty to work, and property rights. Free competition empowers all citizens to develop and market skills or trades and decide how much their labor is worth. The right to work empowers every person to make a living by specialization, with a skill set that others deem valuable enough to hire.
Property rights are more complicated. Citizens' basic rights to safety and the pursuit of happiness entitle them all to equal opportunities to acquire resources and to use those resources for their well-being. Sometimes (as with waterways or roads), the best way for all citizens to enjoy a resource is for the government to own it and manage it as a public resource open to all. More often, however, government enlarges people's opportunities to acquire and use resources by protecting private property. Private property encourages owners to discover unknown resources, and to invest in, improve, and produce useful goods and services from known ones. When owners then sell the products they make, they give other citizens new opportunities to acquire and use new resources in pursuit of their own goals.
This basic account adds much of the moral dimension missing from debates about shale exploration today. When energy companies discover new oil and gas reserves, they expand American consumers' freedom of action, by expanding the supplies of fuel, food, plastics, and other products available to everyone. If and when expanded supplies drive prices down, energy production increases consumers' liberty a second time, by letting them reroute savings from basic needs (especially fuel and energy bills) to other, more satisfying parts of their lives. And new energy discoveries also empower the citizens who take the new jobs they produce. So statistics about wealth creation and new jobs do matter — but are more effective in arguments about giving consumers and workers greater freedom of action to pursue their own happiness.
To maximize the advantages of this empowering system of free enterprise, however, well-designed property law is key. Only four countries in the world currently produce commercially useful quantities of tight oil or shale gas — the United States, Argentina, China, and Canada. American production exceeds the combined production of the other three by a factor of 10. And it is reasonable to suspect that the United States' system of private-property rights is the greatest factor facilitating the shale revolution. In virtually all other countries, minerals are considered public resources. By contrast, the United States and Canada treat the subsurface as private property, except where government holds the land in question as public land, or where (as has happened quite often in Canada) the government reserves the mineral estate when it conveys the land to private owners. In the rest of the world, when a prospector wants to search for minerals, he must get the government's permission; in most of the United States (and to a lesser extent Canada), prospectors ordinarily only need to convince private owners.
American law's treatment of the subsurface as private property is consistent with the principles of natural law and rights that have been hardwired in the common law since before the United States was founded. The principles are based on British jurisprudence. Until Parliament nationalized the United Kingdom's subsurface in the first half of the 20th century, judges had treated the subsurface as private property for centuries, by linking ownership of the subsurface to ownership of the land over that subsurface.
The fullest defense of this rule was published in 1628, in the first part of a treatise on the laws of England by the jurist Lord Edward Coke. According to Coke, the earth deserves to be private property because it "doth furnish man with many other necessaries for his use, as it is replenished with hidden treasures...and also with great varietie of precious stones, and many other things for profit, ornament and pleasure." In other words, the subsurface should be considered private property because it contains resources that can contribute to people's flourishing. Some of those resources (Coke cited clay and iron) supply "necessaries" helpful for survival, while others (useful metals and treasure metals) contribute to "profit, ornament[,] pleasure" and happiness. But no matter what use these resources serve, someone needs to find them, capture them, improve them, and start using them. Private property gives proprietors the protection and encouragement they need to start that process of discovery and circulation.
The Western natural-law tradition also identifies several reasons why private property is so much more effective than public management. One is a natural protection against neglect. As Aristotle explained, "What belongs in common to the most people is accorded the least care." Another reason concerns the character traits brought out by private ownership and public management. As John Locke put it, private property brings out people's "Industrious and Rational" qualities, while public management encourages people to become "Quarrelsome and Contentious," arguing whether and to whom the government should give a resource up.
Although these generalizations are simple and rough, there is a lot of impressionistic evidence confirming that they're on the mark even in the particular case of shale exploration. The experience of Poland confirms the concern about neglect. The Polish government has tried to encourage shale exploration and fracturing in reserves held by the government. But (state-supported) domestic energy companies have not been adept at exploration and production; they have focused on importing oil and gas (especially from Russia). Outside companies have petitioned for exploration permits. Yet although the Polish government wants to support shale exploration, its permit reviewers have been slow and unresponsive, so subsurface hydrocarbons remain untapped.
The political climates in many other countries confirm Locke's point. In most of the rest of the world, opponents use permitting processes to slow shale exploration. Environmentalists have successfully hampered exploration this way in the United Kingdom, France, and many other European countries. Permitting processes also give local residents input, to make sure that their lands and land uses aren't threatened.
In other countries, shale exploration has also been slowed or derailed by entrenched energy companies. Quite often, state-run or state-supported producers of conventional oil or gas intervene to oppose applications to explore for shale resources; they don't want competition from alternative sources of energy. In the most colorful cases, conventional energy suppliers use environmentalist groups as fronts. Environmental non-governmental organizations have stopped shale exploration in Lithuania, Romania, Bulgaria, and Ukraine. These NGOs' efforts are suspected to have been financed by Gazprom, the Russian energy supplier. When NGOs and local environmentalists stop energy exploration on environmental grounds, they keep their local citizenries dependent on Gazprom's oil and gas. The contentious politics created by these interest groups, be they environmentally or profit-minded, keep publicly owned resources from being produced and used.
By contrast, the American common-law, private-ownership approach toward mineral rights allows private landowners to make their own choices, protect their interests, and profit from the land they own by dealing with companies directly. By law, shales and other subsurface rocks could be treated as resources separate from surface land. Yet such an approach would create many practical complications. Shale-exploration companies might fight with each other over resources, and they might disregard the concerns of surface owners about health and pollution. In most states, American common law avoids these and other complications; it not only treats the minerals as private resources, but it also bundles them into the same legal unit as the surface land. By settling mineral ownership with a clear and simple rule, it encourages energy producers to be "industrious and rational" in their negotiations with landowners — and not to undercut them or compete with each other.
That fact, if properly explained, can put a mineral lease in a different, more sympathetic light. Gasland and other environmentalist works make landowners seem like rubes or victims. But leasing in fact has a positive moral dimension. When an owner leases carefully and intelligently, he exercises a property right, and he does so in a way that helps make both him and his bargaining partner happier than they were before. Landowners need to bargain carefully and remain skeptical of energy producers in addressing royalties, nuisances caused during oil and gas drilling, and other possible concerns. If owners do bargain carefully, however, they help the public by facilitating exploration that produces savings and useful goods for everyone else. And it's fair and just for them to help themselves in the process.
Some smart landowners benefit a great deal. In 2011, Kiplinger reported on Jeff and Pamela Barnes, a couple who leased mineral rights beneath their dairy farm in Lawrenceville, Pennsylvania. As of 2011, they were receiving $8,000 to $35,000 in royalties per month. They used these royalties to free themselves of debt, create an emergency fund in case farm equipment needed to be replaced, and start college-savings funds for their young sons. They were using their property rights as a well-designed system would suggest — and in doing so they were helping the shale revolution go forward smoothly. This is how the free exercise of property and prosperity go together, and voters ought to be reminded as much.
PROPERTY RIGHTS AND REGULATION
Natural rights of property and commerce have supported and enabled the shale revolution in the United States. The moral principles that justify those rights also justify restraints on those rights — and legal regulations to enforce the restraints. By the same token, however, those same principles also limit the acceptable goals and forms of regulation. Proponents of energy exploration and fracking must make a moral argument for distinguishing among different kinds of regulation. In a free country devoted to free enterprise, an activity should be presumed legitimate until it is proven otherwise. When restrictions can't meet that burden, they are not legitimate regulations but invasions of legitimate activity protected by basic rights.
As of now, that burden can't be met by the most controversial restrictions being advanced against shale exploration — bans and long-term moratoria. These restrictions suffer from three major problems. One is arbitrariness. Bans on fracturing are sometimes justified on the grounds that shale production accelerates climate change. We do not need to get into debates about whether climate change is occurring or how severe it is to see a serious problem with this rationale. If climate change is a problem, it doesn't justify singling out shale oil or gas. To the extent that they're motivated by concerns about climate change, state and local bans on shale production are restricting the free exercise of some property rights without applying the same restrictions to other energy sources creating the same ostensible risk.
Second, proposed restrictions often get the burden of proof wrong. This tendency is illustrated by New York's moratorium on hydraulic fracturing, which was justified on the grounds that fracturing might threaten state fresh-water supplies. The state department of health didn't find proof that fracturing was likely to threaten fresh-water supplies; rather, it recommended that the New York governor enforce a moratorium "[u]ntil the science provides sufficient information to determine the level of risk to public health...and whether the risks can be adequately managed." In other words, the health department banned fracturing without proof one way or the other, and put the burden on energy producers to demonstrate that fracturing is safe. The department framed the issue backward. Because shale exploration constitutes the legitimate exercise of a property right, New Yorkers deserve the freedom to explore for shale resources unless the available science proves conclusively that exploration is dangerous.
The last problem is that many of the regulations run contrary to the available evidence. The best research shows that hydraulic injections don't threaten fresh-water sources. Now, the possibility does need to be considered seriously. Citizens' rights to health and secure property entitle them to be free from contamination of their drinking-water sources. Fracturing injects large quantities of pressurized water into the ground, and the additives in injection water could migrate throughout the subsurface.
But "possibility" isn't the same as "likelihood," and existing evidence doesn't suggest that fracking is contaminating fresh-water sources. To begin with, before injection fluids could reach fresh-water aquifers, they would need to travel thousands of feet upward, usually more than a mile. Furthermore, although hydraulic fracturing relies more heavily on pressurized injection than other energy exploration does, energy companies have been relying on injection in more conventional production methods since at least the 1940s. Since this use hasn't led to water contamination in the past, fracturing-based hydraulic injections should get the benefit of the doubt today.
Recent studies confirm this course of action. In 2004, in a review of existing evidence about fracturing in coal-bed-methane extraction, the EPA concluded that hydraulic injections posed little threat to underground sources of drinking water. (That study confirmed the judgment of most members of Congress that the Safe Drinking Water Act hadn't been meant to cover hydraulic injections, and helped convince them to pass the 2005 amendment so often criticized.) In 2011, the EPA issued a draft report suggesting that an aquifer beneath Pavillion, Wyoming, had been contaminated by fracturing-related hydraulic injections. The Pavillion case is often cited by fracturing critics as proof of the danger of water contamination. In 2015, however, on assignment from the EPA, the Wyoming department of environmental quality and an environmental consulting firm found it "unlikely" that fracturing water "ha[d] risen to the depths" of fresh-water wells, and a "negligible" likelihood that injections "ha[d] led to fluids interacting with...the study wells."
Most recently, in 2015, the EPA surveyed all the scientific literature and reported any data it could find on the dangers of hydraulic injections to fresh ground water. The EPA didn't find evidence that the "mechanisms" by which injected fluids could contaminate ground water "have led to widespread, systemic impacts on drinking water resources," and the "number of identified cases" where fresh-water sources were affected was judged "small compared to the number of hydraulically fractured wells."
This background information provides a context for talking about fracturing regulations. The possibility of water contamination justifies some regulations. State regulators may justly issue standards for how energy companies should line and seal their pipes, or how they should store fracturing fluids and flowback. In case water does get contaminated, regulators may also order energy companies to perform subsurface water tests shortly before, during, and regularly after shale exploration. But historical evidence suggests that hydraulic injections aren't inherently or regularly dangerous to underground fresh water, and more recent studies confirm as much. So when state and local governments ban or impose moratoria on hydraulic fracturing, they're not regulating the activity to protect fresh water but are instead violating property rights.
ARGUING FROM THE MORAL HIGH GROUND
The rights-based account of American property law referenced here helps explain why the shale revolution started in the United States. This account doesn't render irrelevant any data about jobs and wealth created, but it does make it clear that those data are standing in for more significant and meaningful moral phenomena. The shale revolution is an instance of free enterprise in action. Shale explorers are discovering a resource that people find useful for a wide range of pursuits. And in their efforts to satisfy energy consumers, explorers are incidentally empowering landowners and workers as well.
This account also clarifies when shale exploration should be deemed dangerous enough to require regulation. Here, too, this account doesn't eliminate arguments about risks — say, about the likelihood of climate change or the likelihood of water contamination. But it does put those risks in a moral context. Shale exploration isn't a "mere" business activity threatening rights to a clean environment or fresh water. As non-regulation can threaten these rights, so too unfounded regulations can threaten valuable rights to property, labor, and commerce.
And more generally, this rights-based account has a reasonable prospect of improving and deepening our ongoing debates about shale production. In culture and politics, it's not enough to argue that a policy is likely to be advantageous. Voters are interested in whether a given activity is advantageous for themselves and their communities, and they do often understand "advantage" in hard-nosed and self-interested terms. But voters can also be impressed by news stories, movies, or political arguments suggesting that a practice is dangerous or threatening to their community's way of life. And if they're persuaded of such indictments, they won't find the activity so "advantageous" to themselves, and they may be moved more by others' concerns about wrongs or threats to the common good. The shale revolution is being criticized in these terms, and these criticisms call for a better response.
In a community in which anti-fracking rhetoric dominates, life and politics are characterized by scarcity and fears. That climate denies everyone — workers, consumers, and landowners — opportunities to help themselves. By contrast, in a system of free enterprise, owners use their land to make their own lives better, and everyone benefits when energy companies increase the supply of energy available for all. The shale revolution needs more champions who can remind American citizens why. And so does the American system of free enterprise generally.