A Modern Tragedy of the Commons: Gold Dredging on the Rogue River

In a post a couple of days ago I was discussing how cultural attitudes towards homeownership shape the supposedly universal principles of the free market.  Here's another instance.

In this case, it's about the area of land ownership that has historically been the most difficult to assign property rights to, use of rivers.  After several dams on the Rogue River were taken down, it seems largely for environmental reasons, a rush (if 1000 permits warrants the term) of dredgers flocked to the river to search the accumulated silt and gravel for gold.  This has proven to be a disturbance to local property owners that use the river and to people wishing to use the river for forms of recreation beside dredging (while I don't know for sure, this doesn't sound like an extraordinarily lucrative opportunity to me).

As river issues go, this one isn't very complex.  It's a simple tragedy of the commons ameliorated through government intervention limiting dredging and subject to further legislation by the state.  However, unlike many other uses for public land, this particular use has comparatively large externalities that are being imposed on others.  I don't know enough about the subject to come down on one side or the other of this particular dispute but I did think it was a great example of how very basic conceptions of property right, in this case that rivers are effectively non-excludable due to downstream impacts so must be publicly managed rather than privatized, lead to unpredictable impacts in other areas. 

If we did have a conception of property right that gave sole control over rivers to those owning adjacent land (or alternately allowed rivers to be bought and sold independently of the land on either side, though I'm not aware of any society that has done this) the property owners would have control over whether or not someone dredged.  Of course, since dredging effluent would then still flow downstream and have effects on the wildlife that removing the dams was supposed to help this wouldn't make the problem any more solvable. 

In any case, you still have a free market no matter how your conception of property rights applies to rivers but the free market will behave very differently in its impacts on individual decision making depending on which specific institutional form of property rights applies to your society.  Which is an example of why it is a fundamentally flawed approach to seek to explain economics or society through a focus on individual action, individual action is only comprehensible against a background of socially constitutive norms and these norms are derived not from individual but from social action.  This is why libertarianism makes absolutely no sense to me, social norms and forces must be understood prior to understanding individual action and from everything I've read, libertarianism, and authors such as Hayek, seek to reverse this direction of understanding society.