Government-imposed environmental regulations must constantly weigh the cost to the nation—economic effect—against the benefits to the environment—environmental effect. The Environmental Protection Agency’s regulatory mandates tend to tip the scale in favor of the environmental effect at a high cost to the taxpayers, often with unproven environmental benefits. Superfund Cleanup sites are one example. The proposed Clean Air Act mandates could be another. The EPA’s new air quality standards have caused an uproar since they were proposed last November. President Clinton must decide on July 17 whether or not he will sign the regulations into law. He must weigh the economic effect against the environmental and, in this case, health benefits some say will be achieved. Following is a look at what recent studies show about the cost of these regulations and the expected effects.
A Quick Historical Perspective of the EPA
Since its founding in 1970, the EPA has been responsible for what now represents one-third of all federal laws and regulations. By its own estimates, EPA regulations have cost U.S. taxpayers and businesses $1.4 trillion in the agency’s first two decades; they will cost an estimated $1.6 trillion in the 1990s alone. The hidden costs of environmental rules and regulations passed on to consumers in the form of higher prices easily double and triple the EPA figure.
The regulations mandated by the 1963 Clean Air Act, which was amended in 1970 and 1990, did have a beneficial, and needed, effect on our environment that outweighed the high costs. Cleaning up the air was a national effort. The regulations required industries to install equipment to control pollution and car manufactures to meet strict emissions standards. According to Russell Harding, director of the Michigan Department of Environmental Quality, since 1970 lead pollution has been virtually eliminated nationwide. Cars built in since 1993 emit 97 percent less hydrocarbons and carbon monoxide and 90 percent less nitrogen oxide than a car built 20 years earlier. "Clean coal" burning eliminated up to 99 percent of potential sulfur dioxide emissions. By 2015, emissions will be almost half 1970 levels.
Nevada’s Air Quality
According to the Reno-Gazette-Journal, "Air quality in the Reno-Sparks area has improved over the last decade. A state Bureau of Air Quality report that tracked pollution levels through Nevada between 1988 and 1995 concluded that levels of carbon monoxide and other pollutants remained well below the [EPA] standard." A report from the Foundation for Clean Air Progress, which tracks air quality in major cities, stated that air quality in Las Vegas is 68 percent cleaner in the past five years than between 1985 and 1990.
Benefits of New Air Quality Regulations
If air quality is improving in Nevada and nationwide, why are additional regulations needed? According to the EPA, the new regulations are necessary to decrease rising cases of asthma, which are in turn leading to higher death rates. The new regulations attempt to decrease fine particulates such as soot and dust, and ground level ozone, which is a precursor of smog. However, credible studies, including one from the Centers for Disease Control and Prevention, attribute increased cases of asthma to indoor air pollution such as cigarette smoke, mold, dust mites, pollen, cockroach droppings and other allergens. "Nationwide, no evidence exists that supports the role of outdoor pollution levels as the primary factor driving the changes in the epidemiological pattern of asthma morbidity," stated the CDC’s Morbidity and Mortality Weekly Report in May 1996. Further, a study published in the New England Journal of Medicine on rates of death from asthma in Philadelphia from 1969 to 1991 found "no relation between the death rates and the concentration of major air pollutants." To date, the EPA has not demonstrated how airborne particulates cause asthma and higher death rates. Its own science advisory panel says a new particulate matter rule is not "scientifically defensible."
The panel said the same thing about the proposed lower ozone levels. The advisors say that the proposed ozone level wouldn’t significantly protect public health any better than the current one. It might actually have a negative effect. Here’s what could happen. Ozone screens harmful ultraviolet-B radiation, and reducing ozone levels as proposed would increase malignant and nonmelanoma skin cancer and cataracts, as well as other UV-B health risks, according to a Department of Energy analysis. The analysis indicated the proposed change could result in 25 to 50 new melanoma-caused fatalities annually, 130 to 260 incidences of cutaneous melanoma, 2,000 to 11,000 new cases of nonmelanoma skin cancer and 13,000 to 28,000 new incidences of cataracts each year.
Costs of the New Regulations
The EPA has estimated the new regulations would cost $8.5 billion a year, but the President’s own Council of Economic Advisors estimates it could in fact be as much as $60 billion for the proposed ozone level regulation alone. An analysis by the George Mason University’s Center for Study of Public Choice estimates the annual cost at $54 to $328 billion for the ozone regulation and $55 billion for particulate matter. According to a Wall Street Journal article, "Researchers estimate that the negative health consequences would exceed EPA’s most optimistic estimate of the health benefits by more than $300 million a year." In real terms, the regulations could cost on the low end an estimated $1,000 per family per year.
The effect of the new regulations, if approved, on Nevadans is unclear. The new proposed levels of particulate matter and ground level ozone have not been monitored statewide, therefore the effect of the new regulations is unknown. However, the EPA assumes most cities across the nation will be in "non-attainment." If public sentiment is any indicator of the anticipated effects, a near-record 25,000 people commented on the regulations to the EPA in the past few months.
Reports, statistical data and thousands of phone calls can only try to answer the ultimate question: Do the environmental and health benefits outweigh the economic cost? Because this issue is a regulatory matter, the people have no say in answering this question. Hopefully the President will weigh both sides equally, before he makes his decision in July.
Erica Olsen is a research analyst at NPRI.