John Lancaster's article {"Frontier Legacy: Mining Public Lands," front page, Aug. 7} reveals a crucial drawback of public land management. Namely, that many of the environmental problems involving wilderness areas and natural resources are caused by bureaucratic control of land.

Since the concept of public land management was made law in the United States, the federal government has used its legal monopoly to give away, subsidize and sell off at absurd prices rights to land and natural resources under their control. This tendency is well-documented in "Protecting the Environment: Old Rhetoric, New Imperatives," a study by Jo Kwong Echard of the Institute for Humane Studies at George Mason University, published by the Capital Research Center in Washington. Because of the government's bureaucratic control, the environment is endangered, resources are wasted and laws governing property rights on federal lands have never been developed.

If the lands had been held privately, laws governing the ownership and use of natural resources would have developed. If a market in wilderness land and natural resource extraction had been free to develop, such areas would not have been used up and left environmentally wasted. The price of land would have adjusted to the value of its uses and the costs of development. Mining, timbering and other extractive activities would have cost much more than the government's fixed fees and prices. The government would have been involved only to ensure the rights of the owners of the property in question, settling disputes in the courts of law and punishing wrongdoers who violated property rights.

The fault for lack of restraint in the exploitation of natural resources, the extensive environmental damage and the misdirection of industrial capital into fragile areas cannot be placed on the companies who have acquired rights to do what they do on public lands. The fault lies with the legal owner and controller of the land who grants the rights -- the federal government.

Rather than finding ways to bureaucratize the problems further by strengthening regulatory controls, legislators should privatize public lands and abolish the government's monopoly. Environmental groups, mining and timbering interests, real estate developers and others then should compete freely and fairly to buy the land. The government should be prepared only to protect the rights of the new owners. CARL O. HELSTROM III Fairfax