Your Professor: Joe Serres

What will you learn in this unit? •         Discuss the role balancing plays in the use of chemicals in production and their appearance in consumer and producer goods •         Explain how uniform standards effect the environment and the economy •         Discuss economic issues regarding air and waterborne emissions of toxic materials •         Discuss handling, transporting, and disposing of hazardous substances and the economic issues with each •         Explain environmental federalism and its role in the economy 

 

Unit 9Unit 9Environmental Policy in the US:Environmental Policy in the US:Federal policy on toxic and hazardous substances, state and local environmental issues

Federal Policy on Toxic and Hazardous Federal Policy on Toxic and Hazardous SubstancesSubstancesHazardous and toxic materials have characteristics that present unique problems for monitoring and control.

1. They are ubiquitous in the modern economy; each year sees the development of new chemicals. This makes it difficult even knowing what substances are being used and in what quantities. It accounts for the fact that much public policy has been directed at simply getting better information about quantities of hazardous and toxic materials at various places in the system.

2. With the thousands of substances in use, each with different chemical and physical properties, it is extremely difficult to be fully informed about the levels of danger that each one poses to humans and other parts of the ecosystem.

3. In many cases the quantities used are relatively small, as are the quantities that end up as effluent. This substantially increases monitoring problems. It also makes it easier for users to carry out surreptitious disposal. It is easy to see the plume of smoke coming out of the stack of an industrial plant; it is harder to track the much smaller quantities of chemicals used in production.

4. The damages caused by exposure to hazardous materials often can take many years, even decades, to show up. And whenever there is a long time gap between cause and effect, there is a tendency to downgrade the overallseriousness of the problem.

Economic Issues in Laws Governing Economic Issues in Laws Governing ChemicalsChemicalsin Production and Consumer Productsin Production and Consumer Products

Perhaps the most important question in the use of chemicals is the criterion for determining acceptable levels of exposure or protection.

The Federal Insecticide, Fungicide and Rodenticide Act (FIFRA) is used by the EPA to regulate pesticides. A pesticide, to be legal, must be registered with that agency and must be shown not to present an “unreasonable risk to human health.” Under the Food, Drug and Cosmetic Act (FDCA), the EPA must establish tolerances for the maximum amount of pesticide residues permitted in or on food and feed. In setting these tolerances the legal criterion is that EPA must have a “reasonable certainty of no harm.” Under the Toxic Substances Control Act (TSCA), the EPA must regulate any chemical that presents an unreasonable risk of injury to human health or the environment.

If a chemical is banned, either altogetheror in particular uses, the full impact depends on what other substance might be used as a replacement. Thus, to assess a particular substance we have to know not only its own characteristics, but also what products would replace it if it were controlled, and what the full characteristics of these substitutes are.

UNIFORM STANDARDSOne is the issue of whether the standards should be uniform. Another is the issue of how markets ordinarily function to take accountof risks present in workplaces and consumer products.

Economics of Pest Resistance

TABLE 16.2 The Four Primary Pollution Control Statutes as They Affect Toxic Emissions

The primary regulatory approach to regulating toxic emissions has been the use of technology-based effluent standards.

Management of Hazardous Wastes

The control of airborne and waterborne toxic residuals does not address the major issue of the large quantities of hazardous materials that are left over after production (and recycling) is completed, and which must then be disposed of.

Resource Conservation and Recovery Act (RCRA) of Resource Conservation and Recovery Act (RCRA) of 19761976

RCRA does essentially four things:

1. Defines hazardous waste.

2. Creates a manifest system, essentially a paper trail so that material can be tracked through the system from production to disposal.

3. Requires the EPA to set standards for treatment, storage, and disposal facilities.

4. Directs the EPA to establish a permit system for approval of RCRA landfills and incinerators.

Taxes on hazardous wastes, levied at the place where they are generated or where they are disposed of, are a feasible way of providing the incentive for reducing the quantities produced, as well as directing the flow of wastes toward various channels. These have come to be called waste-end taxes.

One way of turning these incentives around is to offer a subsidy for hazardous materials disposed of in approved ways. This, of course, would require a source of funds. A possibility would be to institute deposit-refund systems for hazardous materials.Firms would pay a deposit per unit of hazardous chemical at the time of purchasefrom a chemical supplier. They would then be paid a refund on materials when they were properly disposed of.

RCRA & Environmental RCRA & Environmental JusticeJustice

The preponderance of evidence to date does indicate that RCRA sites tend to be located in areas where there are relatively large numbers of low-income and minority populations. Having established this pattern, the next question is, why has it occurred? There are essentially two ways this could have occurred:

1. The siting process itself has worked against people of color and poor people. This could be either because of rank discrimination, in which undesirable activities are foisted onto certain people, or because in the political process surrounding these siting decisions, certain people lack the political influence necessary to ward off these facilities.

2. The dynamics of the land and housing market may lead to this type of pattern, even though the original siting decisions were not discriminatory. If these facilities make local neighborhoods less desirable, the better-off people may be motivated to move out. Furthermore, if the facility works so as to depress land prices, it could make housing there more attractive to low-income families. This could also happen if racial or income discrimination in general relegates certain people to less desirable neighborhoods.

There are two types of radioactive wastes: high-level wastes (HLW) and low-level wastes(LLW). HLW is made up primarily of spent fuel from nuclear power plants and wastes from government nuclear processing facilities. LLW comes from a variety of industrial and medical processes that utilize small amounts of radioactive material, and includes the material itself together with all manner of items that have become contaminated in normal production operations.

Radioactive WastesRadioactive Wastes

CERCLA established Superfund:

The law established:

1. A financial fund derived from taxes on petroleum and chemical feedstocks, a corporate environmental tax, and payments made by those responsible for past dumping. The fund is used to carry out site investigations and cleanup actions. The legal authority for the taxes expired in 1995, so now the fund is supported entirely by payments from responsible parties.

2. A method for selecting sites for cleanup actions. This is called the National Contingency Plan (NCP) and specifies procedures for identifying and investigating sites, determining cleanup plans, and deciding on who will pay for it. Part of the procedure involves a state-federal effort to create the list of sites that are in greatest need of action; this is called the National Priorities List (NPL), and it involves a hazard-ranking system taking into account the types and quantities of hazardous materials at the site and the possibility of human exposure.

3. Authority for the EPA to clean up sites itself or to identify responsible private parties to clean up the sites.

4. A liability provision for natural resources damage. Besides cleanup liability, CERCLA has a provision for holding responsible parties liable for damages to natural resources stemming from spilled or released toxic materials. Thus, if a chemical is accidentally released into a river, the people causing the spill can be held liable for the damages this causes; or if an old landfill leaks toxic compounds, responsible parties may be held liable not only for cleaning upthe site but also for damages to surrounding groundwater resources.

States and communities are playing three primary roles:

• Contributing to federal laws; most federal policies permit, require, or encourage some type of contributing state action, especially in enforcement.

About three-quarters of the environmental enforcement actions undertaken in the United States are carried out by the states.

• Adopting companion policies that express the particular environmental values, goals, or circumstances of individual states; these have often been a source of innovative policy ideas.

• Dealing with certain major issues that have been left for the most part to the states.

Environmental federalism refers to the question of whether, and to what extent,environmental regulations ought to be established at the national level, or decentralizedfor independent actions of the individual states.

In cases where valid (i.e., constitutional) environmental laws have been enacted at the federal level, these normally preempt state action.

Policy Innovations at the State Level

State & Local Environmental State & Local Environmental IssuesIssues

Municipal Solid WasteMunicipal Solid WasteThe municipal solid waste (MSW) stream is actually a trickle at the end of a long and very large flow of materials used in the U.S. economy.

More recently, a number of complete cap-and-trade (CAP) programs have been put in place to help address some of the nation’s most significant air pollution problems.

We define the following terms: TM is total materials used, by a firm or industry or economy, in a period of time; VM is virgin materials used; and RM is recycled materials used. Then it must be true that for any time period:

TM= VM + RM

TABLE 17.2 Municipal Solid Waste, Selected Data, p.361

Total materials use can be reduced in two ways: by reducing the rate of economic activity or by reducing the materials intensity of that activity. By “materials intensity” we mean the quantity of materials used per unit of production or consumption. And this in turn can be done in two ways: (1) by rearranging the composition of output and consumption away from products that use relatively large amounts of materials and toward those that use less (e.g., a shiftaway from tangible goods toward services) and (2) by decreasing the materials intensity of particular products (e.g., reducing the amount of packaging material in consumer electronics or food products). The other alternative is recycling. This means reaching into the waste stream to extract materials that may be reused.

Economics of Recycling

FIGURE 17.1 Recycling Consists of a Number of Markets Linking Generators and Users, p. 361

TABLE 17.5 Individual and Community Benefits and Costs in Product Choice and Recycling, p.369

Your text has various examples that illustrate the economics of recycling, and I want to discuss the plastic bag issue~ as illustrated by Exhibit 17.1 on page 372. Sunset from Steens Mountain, SE

Oregon

Land Use Control PoliciesLand Use Control PoliciesLand-use issues, and the public control over land-use decisions, are also matters that historically have been left to the individual states and communities of the United States.

Within any localized region there are usually lands that have special environmental value, because of strategic ecological linkages or aesthetic values, or both. Some cases of this are

• Wetlands, which provide important environments for plants and animals and are linked into other components of the ground and surface water system.

• Coastal lands, where scenic and recreational qualities are important.

• Critical habitats, where land-use patterns affect the health or survival of plant and animal species.

• Scenic and open land, where people may find vistas and experiences that have spiritual significance and recreational value.

Suppose there are three mutually exclusiveoptions for the parcel: (a) It may be developed without public restraints, (b) it may be preserved in its current state, or (c) it may be developed but with certain restrictions set by the local environmental agency. The illustrative numbers in Table 17.6 (P. 375) show the returns and costs of these different courses of action.

REGULATORY TAKINGSREGULATORY TAKINGSThe fifth amendment to the U.S. Constitution contains the following language: “No person shall be . . . Deprived of life, liberty, or property, without due process of law; nor shall private property be taken for a public use, without just compensation.” This authorizes the government to “take” private property, but only if it is for a public purpose and only if the owners receive just compensation. Land may be taken physically (e.g., for a public park, or highway) under eminent domain, and the main question will revolve around how much the compensation should be.

When a community passes land-use regulations, for example to protect water quality or scenic views, the issue is not a physical taking, but whether the regulations substantially reduce the value of the affected property, constituting what is known as a regulatory taking.

Review Key TermsReview Key TermsBalancing- Contrasted with either outright prohibition on the one hand, or unconstrained use on the other.

Eminent Domain- Authorizes the government to take private property but only for a public purpose and only if the government receives compensation.

Environmental Federalism- Refers to the question of whether, and to what extent, environmental regulations ought to be established at the national level, or decentralized for independent actions of the individual states.

Environmental Justice- The term used to describe the search for programs that are equitable to the less advantaged members of society.

Financial Fund- Derived from taxes on petroleum and chemical feedstock, a corporate environmental tax and payments made by those responsible for past duping is used to carry out site investigations and clean ups.

Hazardous Waste- Consists of a diverse set of materials either in liquid or solid form that is not considered environmentally safe.

High Level Radioactive Waste- Made up primarily of spent fuel from nuclear power plants and waste from government nuclear processing facilities.

Discussion BoardDiscussion BoardThis week’s Discussion will deal with industry and recycling. A way of increasing the use of recycled material by industry is to subsidize its purchase of materials taken from the waste system.

Discuss how this environmental policy is likely to affect the collection of recycled materials.

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AssignmentAssignmentSubmit your essay to the dropbox by the end of Unit 9:

 

Many communities have “pay-as-you-throw” programs to mange their solid waste. For any particular community, what are the economic factors that determine how effective a pay-as-you-throw system will be? Formulate a solution to this problem to determine what would be an effective way to manage solid waste?

 

 

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•         Length should be 3-5 pages, excluding cover page and references page •         Viewpoint and purpose should be clearly established and sustained •         Assignment should follow the conventions of Standard American English (correct grammar, punctuation, etc.). •         Writing should be well ordered, logical and unified, as well as original and insightful  •         Your work should display superior content, organization, style, and mechanics