Rule of Law in Indian Country

This article on the need for property rights and rule of law by Terry Anderson headlines at PERC:

Mr. Obama can also strengthen the rule of law in Indian country. Some reservations were placed under state jurisdiction in 1953: They have a stronger legal system than those with tribal jurisdiction, and they benefit economically. My own research, published in the Journal of Law and Economics, shows that for tribes with state jurisdiction, per capita income grew 20% faster between 1969 and 1999 than for their counterparts under tribal court jurisdiction. All Indians are less likely than whites to get home loans, but the likelihood of a loan rejection falls by 50% on reservations under state jurisdiction.

However, Jason Oberle of the American Indian Policy Blog generally disagrees with this implementation of property rights, he writes (in an e-mail exchange printed with his permission):

Mr. Anderson proposes that Tribes have their sovereignty sacrificed in order to gain economic development via the rule of law. Although, I agree with much of his discussion on the essential need of the "Rule of Law" I disagree with any notion of relegating or delegating or moving any authority from Tribes to place them in the hands of States. This will be counter productive for Tribes long-term. States have worked to slowly remove power from Tribes by slowly lobbying congress for additional legislation that allows them to regulate Tribal activities.

An excellent example of this is the Indian Gaming Regulatory Act, which requires Tribes to negotiate Gaming compacts with states. Primarily this is an economic issue, States wanted revenues from Tribes Casino operations, and collectively they lobbied Congress to make provisions for such revenue streams and it was placed into the Language of this Act. The act is available here if you are interested in reading the law.

Many of the leaders of Indian Country today are old enough to remember the end of the last attempt of the Federal Government to terminate the Indian people. This was a Federal policy which began in the 1940's and ended about 1962. It was 20 years of very bad times for Indians. During this period, the Federal Government discontinued most or all of its support for Indians, including legal, health and human services, and most importantly refused to honor its contractual obligations (Treaty Rights) with Tribes and Indians.

Considering the aforementioned issues, only briefly, it is difficult for many people full understand Indian people and Indian Country. I argue that it is essential to include Indian Country and Indian Country scholars in federal studies of Indian country because of these and similar cultural issues.

What I would propose as a solution to the "Rule of Law" issues is increased Tribal Sovereignty. Increased sovereignty provides with some critical opportunities to improve issues of "Rule of Law." For example, Midwest and Eastern Tribes which have increased Tribal Revenues by way of casino operations have actually increased their sovereignty on a practical level because many members of Congress, as well as many firms, do not attempt to circumvent or short circuit Tribal Sovereignty out of credible legal concerns.

Some tribes have also identified the rule of law issue and in some case negotiate contracts with a waiver of sovereign immunity and directly identify in the contract the legal jurisdiction which shall be used to settle legal or lawful disputes. Often in contracts I am aware of the state or federal courts are selected to handle these disputes.

In regards to Anderson's comments about "property rights" he indeed is correct about the 'tragedy of the commons' which occurs on some reservations. I have observed where some tribes have addressed this issue by long-term contracts with members. For example, as a member of the Sault Ste. Marie Tribe of Chippewa Indians, I have the ability to negotiate a long-term (99 year) contract with my tribe for the exlusive use of land held in trust by the US government. In many cases this opportunity has given the lease holder adequate incentive to protect the property value or likewise eliminate the risks associated with the 'tragedy of the commons.' Obviously, this is not perfect, but realistically there is not a real difference other than a simple fee land because it establishes ownership for a term which exceeds the households physical lifetime.

Curiously, I am wondering why Mr. Anderson would propose the limiting of sovereignty for Indian tribes and further suggest that simple fee land is the optimal outcome for Tribal lands. His same article points out the fact that Tribes have excelled at control of Tribal lands and exceed the useful production of the U.S. federal government i.e. Anderson's forestry example. It seems to me that this is an argument for less government interference with tribes. Allow tribes to manage Indian land, allow tribes to expand sovereignty, allow tribes to control mineral rights, and allow tribes to negotiate its own contracts with firms and individuals. Not simply to remove legal authority and pass it to the states.

Interesting thoughts from both Oberle and Anderson. It is clearly a complex issue, and it seems that development economists might have a lot to learn about the nature of property rights by studying Indian Country.