The Ramazzini Institute
for Occupational and Environmental Health Research   

Who Are We?

Eavesdropping on Gewirth
What Jefferson Would Have Heard
About Cost/Benefit Analysis
     In the Wren Great Hall at Williamsburg, Virginia, Thomas Jefferson the student listened to the lectures of Scottish philosopher William Small. Had he been in the Hall in 1982, he would have heard some familiar issues discussed again by American philosopher Alan Gewirth. These ideas touch on the challenge to the Clean Air Act mounted in the year 2000 before the Supreme Court of the United States, and embodied in the Court’s response in the second month of the year 2001. MORE

The Washington Game: The Case of Clean Air
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     November 26, 1996, then EPA Administrator Carol Browner proposed lowering the ozone standard from 0.12 parts per million to 0.08 parts over an eight-hour period. She also proposed lowering the size of particulate matter to be controlled from 10 to 2.5 microns. These particles come from motor vehicles, power generation and even fireplaces and wood stoves. Over the past two decades, using the old standards, air pollution from these sources had shown slow, but steady, reduction.
     Besides new technologies resulting in decreased industry emissions, the technologies for measuring pollutants has changed radically from the time of the Donora, Pennsylvania air pollution disaster of 1948, when the states and federal government were dependent on a scattering of crude dust buckets on telephone poles to catch the “rocks” in the air in a few states in a few obvious places. Monitoring is now able to catch dust twenty times thinner than a human hair in thousands of locations over the entire nation. Epidemiologists were able to match the samples with death and clinical records of lung and heart disease. Even missed days at school and work. The elderly, children, and those with diseases like asthma were shown to suffer most, and die earlier than expected.
     Not all “susceptible” populations were studied by EPA, such as those with genetic differences that might make them more sensitive to dust. Research resources are limited and prioritized by the Congress and the Executive Branch. Indirectly, however, the standards address some of the inequities under existing standards in the protection of vulnerable populations, by reducing the environmental pollutants that might cause the expression of some genetically-based diseases. [See Genetic Profiles in past issues of GEE!]
The Real Debate Begins
     The process of setting the standards is “transparent” and participatory. The industry and environmentalists not only knew about the decade of research and discussion that preceded the proposal, they were participants in the decision though advisory committees, joint studies, conferences and private meetings. Thus, the night the proposed standards made the news the battle lines had already been drawn. Carol Browner, on the Jim Lehrer News Hour said that the decision was a political decision. “The argument isn’t really about science,” she said. “The argument is over whom do we protect, and against what effects.”
     “The people will decide,” said Browner, responding to C. Boyden Gray, spokesman for the largest industry-commerce coalition ever organized on an environmental issue. A long-time former White House aide to President George Bush, the elder, Gray had more than 500 companies and trade groups behind him. Their demand: another “decade is needed for more research on the risks…” so that a “cost-effective strategy” can be devised.
     Boyden Gray’s decade for additional research would have to be added to the years it takes for state implementation plans to be written [that’s the place in the process where the law mandates economic considerations.] After approval of the implementation plan, the states allow additional time for the industries to put new or less polluting technologies in place. Added to the decade it took to write the current standards, it could be half a century before reductions in exposure to pollutants result in improved rates of death and disease. Support for Gray’s position came from Richard Klimsch, an auto industry engineer, who said the standards are based on “schlocky” science. The effects of the existing ozone levels, he believes, “are not that serious. What we are talking about,” Klimsch said, “is a temporary loss in lung function of 20 to 30 percent. That,” he emphasized, “ is not really a health effect.”
Enter the Experts
     Governments rely heavily on the experts. The National Academy of Sciences, for example, was chartered by the Congress at the suggestion of Abraham Lincoln to provide scientific advice to the government. Lincoln understood that the Supreme Court is not a science court, and that there are more lawyers than physicians and scientists in the Congress and White House.
     In 1975, at the request of EPA, the Academy published a report of experts representing a broad spectrum of interests and disciplines on Decisionmaking for Regulating Chemicals in the Environment. After a year of study, a committee of the Academy published a report concluding that health data should be displayed in a framework, but not in a calculus, along side economic and other risk management data, to prevent distorting the management of risk by methods such as cost/benefit analysis. “Value judgements about noncommensurate factors in a decision such as life, health, aesthetics, and equity should be explicitly dealt with by the politically responsible decision makers and not hidden in purportedly objective data and analysis”, the Academy reported.
     Not every expert has been happy with this conclusion. The Washington Game has a rule: if you don’t like what one posse of experts tell you, organize one of your own. Industry and their opponents in the environmental, public health and labor movements support alternatives to the Academy. In 1998, the American Enterprise Institute and the Brookings Institute formed a “Joint Center for Regulatory Studies”, primarily for economic studies of regulation.
     The “Joint Center” has entered the controversy with a brief Amici Curiae to the Supreme Court, on the side of the industry. The signers, more than forty prominent economists, including Nobel Laureates Milton Friedman, Kenneth Arrow and Robert Solow, seven former chairmen of the President’s Council of Economic Advisers, two former directors of the Office of Management and Budget [OMB] in the Office of the President, a former director of OMB’s Office of Information and Regulatory Affairs, and John D. Graham.
     Graham, founder of the Harvard Center for Risk Analysis funded by 100 of Mr. Gray’s 500 industry clients, is President George W. Bush’s new Director of OMB’s Information and Regulatory Affairs Office. The Office has an important history; it has its roots in the Roosevelt-Truman concern during World War II over the burden of paper work and regulation on industry and business. Its function is not well-known beyond Washington’s beltway, but it is nonetheless critical in whether or not a proposed rule ever becomes law. The office reviews and approves - on behalf of the Chief Executive, the President - all economically significant government regulations.
     Since 1981, all presidents through OMB have required RIAs, formal regulatory impact assessments that include risk/benefit and cost/effective analyses, by all federal regulators. An RIA was done by EPA for the new clean air standards. In fact, it was reviewed by industry, the environmentalists and the AEI-Brooks Center.
     The AEI-Brookings group, in their brief, contends that the RIA “could be interpreted as suggesting that the ozone standard should not be lowered while a new PM standard for fine particles should be introduced to protect public health.”
     Thus, the industry charge that EPA did not consider economics and do cost/benefit analyses in making their decision is refuted by the amicus brief. What the Administrator didn’t do under one law, the Clean Air Act, she did under another. After looking at all the facts, for ten years, EPA’s regulators considered [as the Congress mandated] a spectrum of values to guide the decision on the regulations that included costs, but money wasn’t the “bottom line”.
A Difference in Values
     The AEI-Brookings brief doesn’t completely contradict the 1975 NAS report. “Not all impacts of a decision can be quantified or expressed in dollar terms…care should be taken to ensure that quantitative factors do not dominate important qualitative factors” such as equity within and across generations.
     The economists’ real demand is summarized in the first paragraph of the AEI-Brookings press release announcing the filing of their brief.: “EPA should be allowed to consider explicitly the …costs, benefits and any other relevant facts.” Since EPA is not only allowed, but instructed to do this under another law, what the forty economists were saying is that the Clean Air Act ought to be changed or interpreted so that cost/benefit analysis is done and considered yet again, albeit by the same people in the same agency. Having reviewed the agency’s economic studies and noted the agency’s estimated [well reviewed and publicized] cost for the standards, $50 billion, contradicting themselves, they then score EPA for ignoring “costs totally.” If EPA had ignored the costs, EPA couldn’t have made the estimate. At stake in the controversy is how to set priorities among differing human values, not methods of studying economic factors such as cost/benefit analysis, a question to be decided by the Congress, not the Supreme Court.