In the News

In a report last year by New York University School of Law’s Institute for Policy Integrity, the state got the discouraging mark of D+ for its process of reviewing regulations. One of Cuomo’s goals should be to make our state a model for the nation: tightening rules that don’t adequately protect New Yorkers from harm, but loosening those that slow job growth without sufficient benefit.

Tuesday’s announcement could be the last best chance, said Michael Livermore, executive director of the Institute for Policy Integrity. “One granting programme obviously isn’t going to be a game changer in terms of advanced biofuels,” he said.

Cutting the $6bn subsidies for corn ethanol would be a far bigger boost. But Livermore added: “It’s kind of a reality test to ensure that there is genuine interest and this is not just a government boondoggle. If they don’t show interest, it is a real sign that maybe this isn’t such a good avenue in the future.”

Recently, a choir of industry voices has risen up in opposition to strengthened controls on smog proposed by the Environmental Protection Agency. As with other recent environmental rules, opponents have made lots of noise about the potential economic harm and job losses, while attempting to downplay the environmental benefits. House GOP members, for example, decried the “potentially devastating impacts of [the EPA’s] proposed new standards on the U.S. economy and jobs.” But these and other alarmist calls all suffer from the same flaw: They’re premised on studies that disregard basic best practices in cost-benefit analysis in order to force their point.

In our struggling economy there are policies that could help boost employment if anyone cared to do so. Reducing distortionary taxes on work, like the payroll tax; helping workers relocate for jobs; or raising the Earned Income Tax Credit—these are all measures that would help improve the labor market and ultimately cut unemployment.

On the other hand, cutting environmental regulations would do little, if anything, to address the jobs crisis and would cost the American public billions in economic benefits.

It turns out that clean air is a really, really good investment. For every dollar that we put into cleaning our air, we get twenty five dollars back in return benefits.

According to a study by the EPA, we spent $53 billion in 2010 on the rules stipulated by the Clean Air Act and reaped $1.3 trillion in benefits from things like increased property values and avoided pollution-related deaths and doctors visits.

Scott Holladay over at Fast Company wrote up a very comprehensive rundown on the math behind the figures, click over and give it a read.

President Obama’s recent announcement of new fuel economy standards will help reduce U.S. dependence on foreign oil, save drivers money at the pump, and curb harmful emissions and pollutants.

But the effectiveness of the standards will depend on the details and implementation—too many loopholes and the benefits could be watered down. For example, overly generous credits for electric cars might be good for battery makers, but will reduce the environmental and consumer savings of the rule if it causes lower-cost efficiency technologies to sit on the shelf.

Of course, since the EPA was created in 1970, the U.S. has seen recessions, bubbles, flush times, and dire straits. But not one of these macro episodes was caused by anything the EPA has done. Instead, they were caused by financial crises, like the 2007 mortgage crisis and the savings and loan crisis in the late 1980s, or external shocks, like the 1970s oil embargo (made all the worse by the country’s addiction to gasoline).

But whenever the economy declines, the same anti-environmental rhetoric is trotted out, with those on the right calling the EPA a bunch of “hot shot junior lawyers and zealots” (Stockman, 1980s), or even worse, “the Gestapo of government” (Tom DeLay, 1990s), and accusing the agency of wanting to “put the American economy in a straightjacket” (Joe Barton, 2010s).

How many times must these dire predictions about economic doom from environmental protection be proven untrue before we collectively stop listening?

This week, the Washington Times ran an op-ed by Steve Milloy in which he asks the EPA to “show him the bodies” of victims of polluted air. He questions whether the agency has “tangible evidence” that emissions from power plants are “causing actual harm to real people.”

It is tempting to go line by line through the piece debunking each point. But Milloy makes a specific request to see “bodies,” and sadly, that is easy enough to show him.

When faced with regulation, industry will generally choose the cheapest way to comply. As long as they achieve stringent pollution goals, this is a good thing: Economically efficient rules get less resistance and blowback than those that create unnecessarily heavy burdens on business.

So it makes sense for EPA to choose more flexibility whenever legally possible. But in upcoming proposals to control greenhouse gases, some signs point to a political calculation that may steer the agency away from this tactic.

A.E.P. shuttering its attempt at carbon capture and sequestration (CCS) technology is a good example of the consequences of the lack of clear signals from the government on climate change policy. Potential innovations like these will continue to fall by the wayside unless there is a meaningful sign from Washington that clean energy requirements are on the horizon.

Without a penalty for carbon emissions, the return on investment for CCS projects is non-existent. Why would profit-seeking companies incur extra costs when they don’t have to? Unless businesses are not required to foot the bill for the environmental damage they cause, there is no reason to expect that one morning they will wake up and start spending shareholder money to contribute to the public good.