March 2, 2015
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The Economics of Smog
Industry groups and Republicans in Congress are calling the proposed air quality standard to cut back on smog (or ground-level ozone) the most expensive regulation ever. But economic analysis reveals that the benefits of reducing smog far outweigh the costs. In a recent article, Michael Livermore and Richard Revesz explore the costs and benefits of the proposed smog rule, writing, “the benefits are so great that an even more stringent rule would be economically justified.” Livermore and Revesz previously published an in-depth exploration of the economics behind National Ambient Air Quality Standards in a New York University Law Review article.
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EPA Climate Leadership Conference
The EPA recently held its Climate Leadership Conference in Washington, D.C., bringing together prominent figures including former Secretary of the Treasury Robert Rubin, Secretary of the Navy Ray Mabus, and National Academy of Sciences president Ralph Cicerone. Policy Integrity’s economics director, Peter Howard, was invited to speak at the conference. Howard gave a presentation about the social cost of carbon, discussing Policy Integrity’s efforts to quantify damages from climate change that are currently omitted from this estimate. More on these efforts can be found here.
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In the News: The Offshore Drilling Debate
The federal government has cleared the way for oil exploration and drilling off the East Coast, and debates are raging over the resulting risks. Policy Integrity senior advisor Michael Livermore recently spoke to NPR about the government’s improper quantification of these risks. “The oil is going to be there in the next five year cycle and the five year cycle after that. We learn about environmental risks, and technology gets better as we wait, and so that value of delay is what the agency has failed to consider properly,” Livermore said. Livemore recently presented oral argument to the D.C. Circuit on a challenge to the offshore leasing program.
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On the Docket: New Supreme Court Brief
The Supreme Court will soon hear a challenge to the EPA’s Mercury and Air Toxics Standards (commonly known as the MATS rule), and Policy Integrity is preparing an amicus brief in support of the EPA for this case. We submitted a brief for an earlier challenge to the rule in the D.C. Circuit, arguing that administrative law and best economic practices support the EPA’s methodology for calculating the rule’s benefits. The ruling in that case affirmed the MATS rule’s legality, as we suggested it should. The Supreme Court challenge will again focus on the EPA’s consideration of costs. The Court will hear oral argument for this case on March 25th.
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Spotlight: Sally Katzen
Sally Katzen, a noted regulatory policy expert who served as administrator for the Office of Information and Regulatory Affairs from 1993 to 1998, chairs the Policy Committee of our advisory board. Last week, she testified before the Senate Committee on Homeland Security and Governmental Affairs, discussing the role of Congress in creating a 21st century regulatory system. “Perhaps before adding another set of requirements and making it more difficult for even the most desirable rules to be issued, Congress should rationalize the current set and/or provide more resources to the agencies to do what they are already required to do,” she told the committee.