Remember “reinventing government”? This was the task Bill Clinton assigned to Al Gore when they took the White House in 1993 — and which Gore deemed so vital that he publicized his findings by appearing on the David Letterman show. Among the hidebound government bureaucracies Gore was supposed to ” reinvent” through his so-called National Performance Review was the Environmental Protection Agency — his favorite government office and so important to him that he brought Carol Browner up from Florida to run it.
Gore assigned the EPA the task of “[reinventing] its approach to management” so that it could achieve “increased accountability” and ” decentralization” that would “bolster the role of the private sector by creating competitive government.” And with these instructions from its man in the White House, the EPA swung into action in inadvertently hilarious fashion: It assigned 450 full-time employees to the chore of reinventing itself. Nineteen “Process and Policy Teams” were gathered, whose purpose it was to write “in-depth reports on specific topic areas” under the guidance of a 20- person Senior Leadership Council. This august panel, composed of the agency’s “top political and career executives,” was created to advise EPA chief Browner on “National Performance Review planning and implementation.”
Bill Clinton may have declared an end to the era of big government, but his pronouncement fell on deaf ears at the Environmental Protection Agency. Indeed, the EPA has been growing more aggressive and more intrusive, after keeping a low profile during the president’s small-is-beautiful election campaign. Just as the EPA took a brilliantly bureaucratized approach to trimming bureaucracy, it is now using conservative “get-tough-on-crime” ideas to expand its reach.
Browner and her deputy, Steven Herman, cite as a primary accomplishment their determination to enforce environmental laws more strictly. As assistant administrator for enforcement and compliance, Herman is in charge of seeing to it that the nation’s environmental regulations are not violated. And since his appointment in 1993, he has overseen an increase in the EPA’s staff of compliance agents from 110 to 173 (he wants 200). According to Corporate Counsel magazine, Herman has “broken records for both criminal and civil enforcement action.”
This is a clever tack for Browner and Herman to take because it has thrown the EPA’s conservative critics on the defensive. Laws are laws, after all, and who can complain about their strict enforcement? It ill behooves conservatives who loudly complain about the lax enforcement of law in other areas (drugs, for example) suddenly to turn into clones of the American Civil Liberties Union when it comes to those accused of violating environmental rules.
But conservatives are right to complain, because in this case “stricter enforcement” is actually code language for “the rewriting of laws.” If some police chief decided to expand stop-and-frisk operations in the hope of discouraging blacks from shopping in posh areas, you wouldn’t have to be a card-carrying member of the ACLU to understand that this effort constituted something a bit more than “stricter” law enforcement.
So, too, with the EPA’s “get stricter” policy, especially in the area of air quality. In truth, Browner and Herman are trying to change the law without having to bother with the elected congressmen who have been given the constitutional authority to do that sort of thing. In addition, they are trying to change federal regulations without having to bother with the rulemaking process that every other agency must go through.
Herman’s critics claim that he is using his position to alter federal rules on air pollution wholesale in a most clever way — by acting as though he is altering nothing. All Herman wants to do is adjust the way the EPA measures air quality because, he says, such an adjustment will make it easier for the agency to figure out who polluters are. And that, in turn, will allow him and the EPA to get tougher with polluters.
In his new plan, the EPA can consider “all credible evidence” in determining which businesses are in compliance with air-quality regulations, and which are illegal polluters. That sounds like a mere routine adjustment of procedures, and the very fact that it’s difficult to explain why it is instead an important substantive change shows the kind of power a bureaucrat like Herman can wield.
So, to explain: The way the government deals with air pollution is by declaring that there are certain levels of pollution in the air that are acceptable, and certain higher levels that are unacceptable. Those levels are arrived at on the assumption that firms can meet them — be “in compliance,” in enviro-jargon — by passing periodic on-site tests, of a given duration, measuring what is coming out of their stacks. The standards were not designed to be met on a continuous basis.
Herman wants to change this. Under his “all credible evidence” proposal, businesses will have to be in compliance continuously, 365 days a year, rather than periodically. Again, this sounds reasonable. But not to hear the EPA’s critics tell it. The effect, says William Lewis, a Morgan, Lewis & Bockius attorney who represents several industrial companies, “is to change every substantive standard governing air quality.” And Gerald Hapka, a lawyer at E.I. Du Pont de Nemours, complains that Herman’s new “credible-evidence” rule is not merely stricter enforcement but “back-door legislation.”
Why? According to an unnamed former EPA official quoted in Corporate Counsel, the Herman rule means “standards may be 50 percent more stringent, even though technically they’re the same.” The best way to explain this is by analogy to a diet. Say you are on a diet on which you must average no more than 1,500 calories a day. The word “average” is key here, because it gives you some flexibility. If you ate 1,800 calories’ worth of food on a Wednesday, you could eat 1,200 calories on Thursday and maintain compliance with your diet’s standards.
Now imagine a diet that sounds the same but is defined differently: a diet on which you can never exceed 1,500 calories on any day. Indeed, imagine that you would be thrown in jail if you consumed 1,501 calories. The only way to comply with this rule is to consume far fewer than 1,500 calories a day on average because you could not offset your under-consumption with a bit of an overrun on other days — and because you would be so afraid of going over that you would be almost pathological about staying under.
Thus the notion that businesses forced to comply with the “all credible evidence” rule would be compelled to cut back drastically on their emissions throughout the year. This is in one sense “stricter enforcement,” but more realistically it is a tightening of standards, something the EPA would have difficulty getting past Congress just now.
This is a brilliant bureaucratic ploy. Conservatives have long complained about the ways in which regulations are taking the place of laws; now Herman and Browner have a new innovation according to which the definitions of regulations themselves are taking the place of regulations.
As a result of Gore’s “reinventing government” efforts, the EPA promised to “strengthen ties with its constituents, state and local governments.” On February 14, after three months of meetings with state environmental agencies, the EPA issued a draft of a proposal to turn more authority over to the states, which it dubbed “a natural laboratory for testing new ideas.”
This new devotion to federalism lasted all of 11 days. The states wanted to conduct experiments that would get more bang for every environmental buck. They wanted to test cost-effective approaches, which was supposed to be the point of this exercise in delegated responsibility. In response, the EPA demanded that the states spend any savings stemming from their more efficient attainment of federal environmental standards only in ways approved by the EPA. “The Federal Government will allow states to implement environmental programs in the most efficient possible manner only if states show EPA how cost savings will be spent,” the Environmental Council of the States responded angrily. “We agree to be held accountable for results but refuse to agree to this intrusion into the operation of our agencies.” On February 25, in what the New York Times called “an embarrassing aboutface,” EPA deputy administrator Frederic J. Hansen withdrew the plan. Not a word of protest has been heard from Al Gore or the 450 EPA employees who devoted full-time to reinventing the EPA.
Federalism now rests in peace — along with any notion that EPA regulations should be cost-effective. The president may think it is important for American industry to remain cost-competitive in world markets, but if he does, word hasn’t filtered down to the EPA. In November, the EPA proposed new national airquality standards for soot and smog. (The scientists call them ” particulate matter” and “ground-level ozone.”)
Soot comes from sources such as large power plants and incinerators, smog from car exhausts and smoke-stack emissions. There is no disputing the fact that America’s air is much cleaner than it was 10 years ago: Concentrations of sulfur dioxide, carbon monoxide, nitrogen dioxide, lead, smog, and soot have all fallen. And there can be no doubt that the EPA and its environmentalist supporters deserve considerable credit for this achievement. But no responsible person can question this fact as well: Further improvements in air quality can now come only at much higher cost. As Supreme Court justice Stephen Breyer points out in his brilliant Breaking the Vicious Circle: Toward Effective Risk Regulation, this “tunnel vision” or ” hunt for the last 10 percent” is “a classic administrative disease . . . that . . . carries single-minded pursuit of a single goal too far, to the point where it brings more harm than good.”
The proposed regulations on soot and smog touched off a traditional minuet. Browner announced that “current standards do not adequately protect public health.” She would, wouldn’t she? Businessmen and city officials claimed that compliance with the new standards would be ruinously expensive; one study showed that the city of Chicago faces compliance costs of between $ 2.5 and $ 7 billion. They would, wouldn’t they?
The minuet requires the EPA’s regulators to speak only of improvements in public health, and industry representatives to complain only of the excessive cost of compliance. But in theory, the partners in this dance ought to come together in something called “cost-benefits analysis.” According to this type of analysis, the costs of proposed regulations are compared with the benefits, like reduced mortality rates and medical expenses. The greener environmentalists oppose this exercise on philosophical grounds; they claim it is impossible to put a price tag on human life or environmental amenities. Indeed, the Clean Air Act specifically prohibits the EPA from taking economic costs into account in setting air-quality standards.
But the Clean Air Act does not prevent the administration from appraising the scientific validity and economic consequences of the proposed regulations. Indeed, that is a task specifically assigned to the Office of Management and Budget. And OMB did do such a study on the new soot and smog regulations, concluding that they reflect “a lack of adequate research on fine [air] particles.”
Let’s talk about fine particles. Thirty fine particles can fit in the width of a human hair. According to the EPA, fine particles cause asthma and other diseases, and some 20,000 deaths each year. The Office of Management and Budget isn’t sure about that, and it is right to be skeptical: The EPA’s numbers are based on so-called correlation studies, which don’t rule out the possibility that these health effects instead flow from other causes. (The phrase “correlation does not equal causation” may be the least known and the most important truism of our time.)
Did these doubts prompt the president to ask the EPA to have what our British friends call a “rethink”? Certainly not. Instead, the EPA complained to the White House, and the offending language was dropped from the Office of Management and Budget report on the regulations. That, in turn, prompted House Commerce Committee chairman Tom Bliley to complain that such gamesmanship “defeats the point” of regulatory oversight.
Although, as we have seen, the Clean Air Act prohibits the agency from taking economic costs into consideration in setting health standards, an executive order did require the agency to offer an estimate of costs and benefits along with its proposal. And the EPA’s report on particles is a sunny one: It estimates the benefits of “partial attainment” at between $ 59 and $ 119 billion, and the costs at a mere $ 6 billion. Sounds like a terrific buy, but it’s akin to a comparison of apples and oranges.
The EPA calculates its benefits by including $ 4.8 million per death avoided, a generous estimate (though that is considered by some ghoulish to say). But when it comes to costs, the EPA includes only the costs of controls that now exist — and it admits that those controls are not adequate to achieve the new standards. For example, in the case of California, existmg controls represent only 15 percent of the costs that would be incurred in meeting the new soot standards. An honest calculation of the costs would have to include the development and installation of controls that have not yet been invented, and that would certainly exceed a mere $ 6 billion.
The economics of the smog standards are even worse. The EPA’s own numbers show that the costs will most likely far exceed the benefits — “a startling evaluation of the efficiency of the proposed ozone standard,” in the opinion of the reliable, nonpartisan environmental think tank Resources for the Future.
Which is why the EPA has chosen to link the issue of standards for soot with standards for smog. The EPA wants to focus public attention on death rates associated with soot, says Resources for the Future, so as to “diminish attention to the troubling economic questions about the ozone standard.” “For some cities,” the think tank’s report continues, “meeting even the present ozone standard may actually be impossible.”
This kind of obfuscation should offer a juicy target for Republican congressmen concerned about regulatory excess. And yet they seem paralyzed by fear that a potent environmental lobby will return them to the private sector in 1998 if they raise a fuss. Indeed, many in the Republican congressional majority are reluctant to use even the important power they voted themselves in the heady days after the 1994 elections. Congress is now allowed to push the EPA to defend both its science and its economics. But it hesitates.
Congress apparently fears the existence of some great groundswell of public support for tighter environmental regulations, or at least an aversion to politicians who try to stop the onward rush of new environmental regulations. Those fears are unfounded for two reasons. First, past clean-air regulations have affected mostly big businesses — those with large factories and plants. Complaints about the high cost of compliance from monopoly electric utilities are likely to be viewed with some skepticism. Besides, the costs of compliance are hidden from sight in the electric bill. But the next round of tightening will affect smaller sources, such as cars and power boats. When voters are told to use their cars less, or forced to buy electric vehicles, or told no more barbecues in the summer, their attitude towards these rules might change.
More to the point, and contrary to conventional wisdom, American voters have never put stringent environmental protection at the top of their wish list. In an American Enterprise Institute survey study called “Attitudes Toward The Environment,” Karlyn Keene Bowman and Everett Carll Ladd point out that 62 percent of Americans already believe we are above average in our efforts to protect the environment compared with other nations. (This is not chauvinism at work: Only 30 percent of Americans give us similar high marks in effectively fighting drug abuse and crime.)
Republicans who are disinclined to rubber-stamp the EPA’s latest proposals can also take heart from exit polls conducted by the Los Angeles Times after last year’s presidential and congressional elections. Only 5 percent of all voters listed the environment among the two issues most important to them in deciding how to vote. Even in California, a supposed hotbed of environmental activism, only 7 percent thought the environment one of the two most important issues, ranking it well below moral and ethical values (41 percent) and a half-dozen other matters.
It is an exercise in timidity, and foolish timidity at that, to extend peace-at-any-price Trent-Lottism to environmental questions. Republicans have the tools for a sensible inquiry into the costs and benefits of the proposed new regulations, and the means for opening an important national debate. They should. Otherwise, Al Gore and the Environmental Protection Agency may reinvent the way America does business without anybody in Washington making a peep.
Irwin M. Stelzer is director of regulatory policy studies at the American Enterprise Institute.
