Economics and the Environment, 10th Edition

PART IIIHOW CAN WE DO BETTER?

In Part II of this book, we reviewed the current regulatory picture and discovered that after more than four decades of dedicated national efforts to control pollution and expenditures of hundreds of billions of dollars, our accomplishments are decidedly mixed. Outside of the big success stories in reducing air pollution and cleaning up urban waterfronts, with a few exceptions, regulation has essentially held the line against economic and population growth. It a number of cases, it has failed to achieve its stated objective of substantially reducing many pollutant concentrations to “safe” levels.

We have also identified one main and three subsidiary obstacles to successful government action to control pollution. The principal issue relates back to the first question in this book: How much pollution is too much? In a representative democracy like the United States, with substantial checks and balances, a well‐organized minority can block change on any issue. Thus, without a solid bipartisan agreement on the need for reducing pollution there is limited ability for government action, regardless of what previously passed laws may seem to require. This is because of imperfect information: given enough time, the EPA has lots of legal wiggle room to either advance or roll‐back many regulations.

Even assuming a return of bipartisan support for stricter or more cost‐effective regulation, we also identified three challenges with the regulatory process. First, ...