Do National Monuments Help or Hinder Local Economies?, with Margaret Walls

Notable Quotes

• National monuments create jobs and businesses: “Our central result is that … there is about a 10 percent increase in the number of establishments and about an 8 percent increase in the number of jobs in the areas directly around the monuments. We didn’t find any effect at all on average wage incomes in those areas … an important finding, because one of the things that you hear a lot from folks is … that we’re generating low-wage service sector jobs that don’t pay very well, and we don’t find any evidence of that.” (12:14)
• Impacts of monuments on industry: “We looked at the effect [of national monument designations] on mining, livestock, grazing, and forestry, and we grouped those together. The reason we looked at those particular sectors is that those sectors in that region depend heavily on public lands … When we look at them together, we find no effect—either positive or negative—on jobs in those sectors.” (14:53)
• Value of national monuments beyond the marketplace: “Why are we designating these places in the first place? They are to protect resources, cultural resources, historic resources, artifacts—things that we think have value, but not in the marketplace … I think we need to remember why we set up the Antiquities Act to preserve national monuments in the first place. I’m not saying that it’s not important to look at jobs and economic activity. Absolutely it is, but I think we also need to think about the broader set of values that these places have.” (20:13)

Top of the Stack

• "National monuments and economic growth in the American West" by Margaret Walls, Patrick Lee, and Matthew Ashenfarb
• Cadillac Desert by Marc Reisner
• The Source by Martin Doyle
• "Nuclear explained: Where our uranium comes from" by the US Energy Information Administration

The Full Transcript

Daniel Raimi: Hello and welcome to Resources Radio, a weekly podcast from Resources for the Future. I'm your host, Daniel Raimi. This week, we talk with RFF senior fellow Dr. Margaret Walls. Along with RFF coauthors Patrick Lee and Matthew Ashenfarb, Margaret has just published a study on the economic effects of national monuments. The study looks at how the designation of a monument affects businesses and employment in the surrounding area. While some have argued that monuments stifle economic activity by making land off-limits to activities like oil and gas drilling, others argue that they generate growth in other industries such as tourism. In this new study, Margaret and colleagues provide answers. Stay with us.

All right, Margaret Walls, our colleague here at RFF. Welcome back to Resources Radio. This is your second time on the show. It's great of you to join us again.

Margaret Walls: Thank you. It's great to be here.

Daniel Raimi: So Margaret, I'm not going to ask our standard first question of you, which is, we usually ask people how they got interested in environmental topics, because we did that when Kristin interviewed you a few months back, but instead, I just want to let people know that we're going to be talking about national monuments today. So I want to first ask you if you have any favorite national monuments that you've visited or maybe that you'd recommend to people?

Margaret Walls: Oh, yes, definitely, Daniel. As part of this study, I tried to visit a lot of them that we included in the study. I guess I have to say my favorite one is Grand Staircase-Escalante in Utah. It's a really special place and one of the ones getting a lot of attention right now, but it's worth it because it's a really beautiful place. I would recommend everybody try to go there.

Daniel Raimi: Great. That's one of the most visited national monuments, right?

Margaret Walls: I think so, uh-huh (affirmative), and that’s been on the increase in recent years.

Daniel Raimi: Yeah. Interesting. I've never been there. I would love to go. Maybe next time I'm out West. We're going to talk today about a new paper that's just recently come out from yourself as well as RFF colleagues Patrick Lee and Matthew Ashenfarb. The paper's come out in the journal Science Advances, and it's on the economic impacts of national monument designation. Can you start us off by describing how and by whom national monuments are designated and how those designations might potentially affect local economies, for better or for worse?

Margaret Walls: Yeah, sure thing. I think not a lot of folks know exactly what a national monument is, so it is worth going through that a little bit. National monuments are protected sites that are generally protected by the President under the authority that's granted to him or her in the 1906 Antiquities Act. This act, which was passed during Teddy Roosevelt's era, actually, allows the President to just proclaim a site which might have historic landmarks, historic or prehistoric structures, or objects that are of scientific interest that exist on federal lands. He can proclaim those sites as national monuments, and they are protected.

What protection means is that if there was any kind of mining or oil and gas drilling or anything like that prior to designation, that's allowed to continue, but new leasing and new mining is off-limits. That's the way in which some local communities are concerned or some members of those communities can become concerned that there might be economic opportunities that are taken away from them.

It's particularly an issue in the West on some of the larger national monuments. We have a lot of national monuments in the US that are small sites, historic homes, things like that, but the ones that get the most attention are ones like Grand Staircase-Escalante and some of the larger sites in the West managed either by the Park Service or the Bureau of Land Management, sometimes the Forest Service. And those sites that can be tens of thousands, even hundreds of thousands of acres, even over a million acres, in some cases. In that case, you are putting a pretty large amount of land off-limits to certain activities, not all extractive activities, but some. That sometimes generates some concern.

The flip side of that is there's a lot of folks that feel like, well, actually, protecting these sites can be a boon to local economies because you've told the world these are special places and people come to visit, there's a recreation economy that develops. This is an open question as to whether or not there are positive or negative impacts from these designations.

Daniel Raimi: Right. Am I right in thinking that that, I mean, that's essentially the question that's motivated this research, right?

Margaret Walls: That's the question that's motivated this research. Prior to this study, there had been a little bit of a look at this with people looking at county-level statistics and trends over time. There's one analysis out there I'll mention at the end that's consistent with ours but still uses aggregate data, and those studies aren't able to address the question as fully as you'd like to do and as economists generally like to do. We like to be able to tease out cause and effect. That's what we set about doing in this study.

Daniel Raimi: Great. We're going to talk in just a minute or two about how you go about doing that. But one more background question first, which is probably top of mind for at least some of our listeners: people might be aware that near the beginning of the Trump administration, the Department of Interior conducted a review of existing national monuments, and the President ultimately issued a proclamation reducing the size of two Western monuments. Can you give us a little bit of detail about those two reductions and what the rationale behind them may have been?

Margaret Walls: What happened was in April 2017, President Trump issued an executive order for the Secretary of the Interior to conduct a review, and that review was to be focused on all the monuments that were more than a hundred thousand acres in size and that had been designated since 1996.

The Secretary of Interior carried out this review fairly quickly. Within about three months, I think it was done, and made some recommendations. The review covered 22 national monuments and five marine monuments. There are actually monuments in the ocean that have been created, just a few though. In the end, the review recommended some modifications to, I think about 10 of these monuments, including some changes in the boundaries to shrink the size.

Several months later, in December of 2017, President Trump released two proclamations shrinking the size of two of the monuments, Grand Staircase-Escalante that I mentioned earlier, and Bears Ears. Both of those monuments are in Southern Utah. He shrunk Grand Staircase-Escalante by about 50 percent. It was 1.7 million acres. It's now about 840,000 acres, I believe. Bears Ears, which was created by Obama in 2015 was shrunk by 85%, down to only about 200,000 acres.

That happened in late December. Just about two weeks ago or less, the resource management plans for those monuments were released by the Bureau of Land Management, and some of those sites will be opened up for some leasing and drilling. It's unclear whether that's an economic use of those lands. Nonetheless, those management plans just came out.

I will say one last thing about the status of that. There is some legal question about whether or not the President does have the authority to shrink monuments, so there's a court case that's been dragging on for a little while over that, but nonetheless, that's where we stand right now. The official boundaries have been changed on those two monuments.

Daniel Raimi: Great. Thanks for that update. Yeah, it's interesting to think that the President can giveth, but the President can't necessarily taketh away, or I guess that's what we're trying to figure out in court.

Margaret Walls: Yes, uh-huh (affirmative). That's right.

Daniel Raimi: Now, onto the analysis that you carry out: you mentioned that you're able to sort of look more deeply at this question than some previous research has. My understanding is that that's because you've got this great dataset and you use it to try to measure the economic effects of a monument becoming designated. Can you tell us a little bit about the dataset as well as the major outcomes that you're looking at?

Margaret Walls: The economic data comes from something called the "National Establishment Time-Series Database." That is a unique source of data that is the universe of all business establishments, not just business establishments, but any employer, actually. It could be government, nonprofits. The data includes the location of each of those sites, the number of jobs at each one of them and also what very detailed industry code that they're in.

We have the data for the eight Mountain West states. This is a national data set, but we look only at those eight states in the Mountain West. They're annual data and they cover from 1990 to 2015, so that gives us 26 years of data. We're able to look at about 14 monument designations in that region during that period.

Then the question is: What are we going to look at? There's a lot of different measures of economic activity if you're trying to figure out what are the impacts of some change like this, a monument designation. What is it you really want to look at?

I would group our analysis into three types of things. One is we look at the number of jobs in individual establishments that existed prior to the designation. This is an average number of jobs per establishment. If you have a business near a monument, did the number of jobs go up or down?

The second thing is we look at the total number of jobs and the total number of establishments in areas around the monuments as well as average-wage income in areas around the monuments. There, we're trying to see: is there an effect just on the size of the overall economy?

Then finally, we look at growth rates. Obviously, the US is a growing economy. Over time, the normal thing to happen is that jobs and establishments go up. We look at the rate of that growth, and we tried to tease out whether or not the monument designations increased, decreased, or left that growth rate unaffected. When we do that, we're able to sort of tease apart changes on what we call the extensive and intensive margin.

Over time, every year, we have lots of what tend to be referred to as "births and deaths of establishments." New businesses crop up, new businesses don't last very long, they go away, so jobs come and go. What we try to tease apart in the data is whether monument designations changed any of those births and deaths. What did it do to the rate of growth of jobs and establishments? That's the three analyses we do in this study.

Daniel Raimi: Great. That's super helpful. What did you find? What are some of your major thoughts?

Margaret Walls: Yeah, well, big picture. Big picture is that we find more positive effects than anything. We don't find negative effects in any of those measures that we look at. We find a few things are unaffected by monument designation. Some zero effects, some positive effects, no negative effects.

The first positive effect, and I guess our central result, is that we find that areas around monuments see an average increase. Remember, we're looking at these 14 designations across this region, so we get average effects across all of these designations. We find that there is about a 10 percent increase in the number of establishments and about an 8 percent increase in the number of jobs in the areas directly around the monuments.

We didn't find any effect at all on average wage incomes in those areas. I think this is an important finding because one of the things that you hear a lot from folks is, "Well, we're taking away the 'good jobs' and replacing them with bad jobs." What they mean by that is that we're generating low-wage service sector jobs that don't pay very well, and we don't find any evidence of that. We basically find no effect on wage income.

It's important for everybody to understand the backdrop here. Wages have been stagnant in the US since about 2000, so there's not much wage growth in the US. Especially in rural areas, it's even worse. We're just finding that there's no effect from these monument designations either way on that trend.

Daniel Raimi: Right. Right, that the areas around newly designated monuments are, essentially, equivalent to other areas.

Margaret Walls: Right.

Daniel Raimi: Great. One other question that's related to the wage question that you just raised, which is: How do some of these effects vary across different economic sectors? You mentioned earlier on that the data provides pretty detailed industry data about what sectors these businesses establishments are in. I can imagine intuitively people thinking that if an area is designated off-limits to new oil and gas or mining activities, that the number of jobs in that sector goes down while the number of jobs in other sectors like retail or services that you mentioned might go up. Do you find any evidence of that or other relevant trends?

Margaret Walls: Yeah, we do. We tease this effect on jobs and establishments in areas around monuments. We do some separate estimation by industry. What we find is generating that increase is a boon in the construction industry and in several service industries, namely business services, finance, insurance, and real estate--which is a sector that's usually grouped together--health services and hotels and lodging. All of those saw pretty significant and fairly high increases in both jobs and establishments.

We looked at the effect on mining, livestock, grazing, and forestry, and we group those together. The reason we looked at those particular sectors is that those sectors in that region depend heavily on public lands, so in this data, we're able to actually tease out the livestock grazing part of agriculture and lump that with forestry and mining. When we look at that together, we find no effect either positive or negative on jobs in those sectors.

Daniel Raimi: Interesting. Just one maybe technical question that I should've asked earlier on, which is: When monuments are designated, I think you mentioned that new oil and gas and mining activity is not allowed, what about new grazing activities or existing grazing activities or other types of land use like that?

Margaret Walls: Right, that's a good question. It's a mixed bag. Generally, grazing, which is one of the most important uses of our public lands in the West, generally, grazing is dictated in the resource management plans that are developed by, say, the Bureau of Land Management, if they're managing the site that are developed for each of these sites.

In some cases, grazing has been reduced a little bit after the designation. In others, it's about the same. Grand Staircase-Escalante still has a lot of grazing. There are grazing allotments given out by the federal government for use by private ranchers, and those just vary across the sites, but it definitely is not something that's completely cut-off.

Daniel Raimi: That's really helpful. One more follow-up question to that last one, which is you mentioned that construction activity increased substantially and a couple other related sectors. Were you able to look at over time whether the growth in construction activity was centered shortly after the designation of the monument and then trailed off, or was it pretty consistent over whatever time horizon the monuments existed? If something was designated in the year 2000, does construction peak in 2001 and then fall or does it stay pretty consistent?

Margaret Walls: Well, no, that's a good question. We aren't really able to do that with the data that we have in order to have some robustness, have enough data points, basically. We can't really tease out these effects over time. We can look at the data graphically and we didn't really pick up anything like that, but our methods don't really allow us enough latitude to do that.

I just want to say a little bit more about these null findings, if you will, for mining, livestock, grazing, and forestry, or for, really, about the results as a whole, and that is that we can keep in mind that these are our findings for these 14 sites during this period. A lot of these sites are in the Southwest. There's several Arizona sites, there's New Mexico sites. They're protecting Native American archeological sites and artifacts. Some of these are maybe not the areas where, for example, mining, or especially oil and gas and coal are very economic, anyway.

I would just want to say that it's not clear. We're not saying that any monument that you would designate would have exactly the effects that we're estimating, therefore, the sites that we have, that we're looking at. I think they're a pretty good representation, but of course, it really matters where these places are.

Daniel Raimi: Yeah, that's such a useful point, just keeping in mind that you know, every place is different, especially when we're thinking about natural resources. One last question before we go to our Top of the Stack ending question, which is just broadly, what are some of the key take-home messages that you hope those interested in national monuments will take away and what are some key messages that policymakers might take away from this work when they're thinking about the establishment of new monuments?

Margaret Walls: Right, yeah. Well, thanks for that question. I have thought of two points I want to make. I think our analysis and our study is fairly definitive and it builds on another really good study out there that I should give a shout-out to. That's by two Utah State University researchers, Paul Jakus and Sherzod Akhundjanov who use more aggregate data and look at per-capita income and the effects of monument designations.

I would say their results are pretty consistent with ours. They use similar methods; they just don't have the detailed data we have. They don't look at jobs like we do. They look at income, but they find no effect of monument designations. I think between that study and this one, these are pretty good analyses of the causal effects on local economies of these monument designations.

My feeling is that we have answered this question pretty well, and that it's time to focus on some other issues with monument designations, to maybe take a step back and think about why are we designating these places in the first place? They are to protect resources, cultural resources, historic resources, artifacts, things that we think have value, those things have value not in the marketplace. They just have value because we like to preserve our history and preserve these pieces of culture that we have in the United States. Some of these places are spectacular geologic resources.

I think we need to remember why we set up the Antiquities Act to preserve national monuments in the first place. I'm not saying that it's not important to look at jobs and economic activity. Absolutely, it is, but I think we also need to think about the broader set of values that these places have.

One thing I'll point out is that these sites have to be managed by our federal land management agencies and they are grossly underfunded and not able to do that probably as well as they should. Maybe it's time to start talking about those issues a little bit more. There is a bill in Congress that would create a National Monument Enhancement Fund that would provide some resources to these agencies to manage these sites, but I think it's important to remember why we're doing it in the first place and maybe take a step back and think about those things.

Daniel Raimi: Margaret, I'm actually going to ask you one more question before we go to Top of the Stack because it just popped into my head, which is: Can you talk a little bit about the Antiquities Act itself and how it came about, what some of the motivations were behind the legislators and the President when they were crafting it and enacting it into law?

Margaret Walls: Absolutely, yes. I do know a little bit about that. I'm not a historian, but I've read about it. As I understand it from what I've read, back in the early 1900s, there was some looting and vandalism at archeological sites in the Southwest and people were starting to get really concerned about that. Members of Congress were concerned and wanted to pass legislation to protect particular sites is my understanding but couldn't get their act together to actually pass anything.

Daniel Raimi: Sounds somewhat familiar.

Margaret Walls: Yeah. Yes, things have not changed very much, but what they did do is they decided the better approach would be to pass a law that would give the President the authority to do it and do it quickly. When the President would see that there were problems in a particular area, they would be able to put it under protective status.

That's my understanding about how the law came about. I've read that there was a lot of discussion about the law in the first place, which was there were proposals to limit it only to the Southwest where the sites were being vandalized. I've heard that they wanted to put a clause in to limit the size of national monuments. That ends up being one of the contentious things in the act now. You're supposed to have the site be the smallest size necessary to protect those cultural resources and so forth.

I think there was some debate about it, and it wasn't a slam dunk, but my understanding is that's how it came about. There was some things under threat and they decided to just pass this law to give the President the authority.

Daniel Raimi: Yeah. That's so interesting. I often think about the Congress ceding power to the executive as a more modern thing, but here we go, examples from 1906 as well.

Margaret Walls: Exactly. So interesting.

Daniel Raimi: Now let's move on, Margaret, and talk about what we're interested in and reading and enjoying lately. This is our Top of the Stack feature. I'll get us started with, actually, a relevant news item that I came across recently, which was a controversy that's been going on for quite some time around proposals for uranium mining around the Grand Canyon National Park. I think the Grand Canyon started off as a national monument. Is that right?

Margaret Walls: It did. Many of our national parks started off as national monuments. Teddy Roosevelt created Grand Canyon National Monument, yes.

Daniel Raimi: Then in subsequent years, it's turned into a park and there's been at least some interest in doing some uranium mining, not in the park itself, I believe, but in some areas around the park. It's a very controversial issue. Some local elected officials are in favor; some local tribal groups are not in favor. Environmental groups are mostly not in favor. I was just reading about that lately and learning a little bit about the debate.

Then it prompted me to ask the question: How much uranium do we produce in the US? It actually gave me a really interesting answer, which is in the last few years, we actually sourced a large majority of our uranium from other countries. Only 10% of US uranium that was bought in 2018 came from the US. About 25% came from Canada, 20% from Kazakhstan, 18% from Australia, 13% from Russia, and 6% from Uzbekistan, and 5% from Namibia. That's my factoid of the day that I thought was pretty interesting.

Margaret Walls: That's interesting. Yeah, very interesting.

Daniel Raimi: Yeah. How about you, Margaret? What's on the top of your stack?

Margaret Walls: Well, I can tell you about books I'm reading. They're not related to national monuments, but they're important in the Western setting. I'm actually reading two books at the same time on water. One of them I'm rereading, so I read this many years ago and many people have read it, but it's worth a reread. That's Cadillac Desert. You may have read that, Daniel.

Daniel Raimi: I haven't. I need to.

Margaret Walls: Oh, it's fantastic. It's Cadillac Desert by Marc Reisner. The subtitle is “The American West and its Disappearing Water.” If you want to understand the byzantine structure of water rights and everything else in the Western US, it's a great read. Really interesting.

That's also prompted me to read a new book I found, this was published in 2018 called, The Source. That subtitle is “How Rivers Made America and America Remade its Rivers.” That's by Martin Doyle, who you might know from Duke University. He’s a professor at Duke.

Daniel Raimi: I do, yeah.

Margaret Walls: Yes. It's a great read. A lot of history of how we managed our rivers in the US, including the great Mississippi and a lot of really interesting things about water quality and some really great anecdotes about some key figures in the history of rivers. Both of these things are really great.

Daniel Raimi: Yeah, those both sound fascinating. I'm definitely going for Cadillac Desert. That'll be my next book. That sounds awesome.

Margaret Walls: Oh, yes.

Daniel Raimi: Great. Well, Margaret Walls, a senior fellow at Resources for the Future. Thank you again so much for doing this research and for coming on the show to tell us about it.

Margaret Walls: Thank you, Daniel.

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