The Economy and the Environment s EPA Journal begins in A 1979 its fifth year of pub­ lication, the magazine takes a look at a critical issue-the impact of the environmental cleanup on the economy. Unquestionably one of the most difficult problems EPA must grapple with is how to press the cleanup efforts with­ out crippling industry and con­ tributing to unemployment. To review this complex and controversia I subject. the views of a wide range of authorities are presented. Among those offering their insights are EPA's leadership including Administrator Doug­ las M . Costle, Deputy Admin­ istrator Barbara Blum. and William Drayton. Assistant Ad­ ministrator for Planning and Management. From outside the Agency per­ ceptive comments are made by such distinguished observers as Dr. Paul Samuelson. the Nobel prize-winning economist. and Senator Gary Hart of Colorado. winner of a national award for '9•978 ~E'RBt...oc:::~ his leadership in protecting air quality. Copyright 1978 by Herblock in the Washington Post An engrossing account of the tragedy caused by chemicals Another aspect of the impact ported by Robert Mitchell and Charles Warren, explains how dumped in Love Canal near ot the environmental cleanup on Kathryn Utrup of Resources for Congress acts on EPA's budget. Niagara Falls. N.Y., is provided the economy is reported by in­ the Future. Key facts on the economy by Eckardt Beck, EPA's Region dustrialist Richard Hoard, who Jn other stories, Federal aid and the environment are pro­ 2 Administrator. The Journal notes that the business of sell­ available to help ease the im­ vided in a special one-page plans to review the national ing pollution control equipment pact of pollution cleanup is report. Also reported is the problem of hazardous waste is booming. reported by Edwin Clark. II. a start-up of the new Regulatory disposal in its next issue. Public support for environ­ special assistant to the EPA Council, with streamlining and mental cleanup remains strong. Administrator. The Director of improvement of Government even with today's economic EPA's Office of Legislation. rules as one of its main con­ concerns. suggests a polJ re- cerns. D United States Office of Volume 5 Environmental Protection Public Awareness (A-107) Number 1 Agency Washington, D.C. 20460 January 1979 &EPA JOURNAL Douglas M. Costle, Administrator Joan Martin Nicholson, Director, Office of Public Awareness Charles D. Pierce, Editor Truman Temple, Associate Editor John Heritage. Chris Perham, Assistant Editors L'Tanya White. Staff Support Articles EPA is charged by Congress to The Benefits of a Cleaner The Economy and The Public's View protect the Nation's land, air and Environment 2 Regulatory Reform 1 O Robert Mitchell and Kathryn water systems. Under a mandate Administrator Douglas M. Costle An interview with Assistant Utrup report on attitudes toward of national environmental laws reviews the issue of the economy Administrator William Drqyton. cleanup costs. focused on air and water qual­ and the environment. ity. solid waste management and The Environment Regulatory Savings the control of toxic substances, An Economist's and Economics 15 Douglas Costle predicts huge pesticides, noise and radiation, View 4 A fact sheet highlights progress, savings possible with regulatory the Agency strives to formulate Observations by Nobel prize­ benefits, and costs. reform. and implement actions which winner Dr. Paul Samuelson. lead to a compatible balance The Love Canal How EPA between human activities and A Lawmaker's Tragedy 16 Gets Its Money the ab'llity of natural systems to View 6 A report by Eckardt Beck. The budget process in Congress support and nurture life. Senator Gary Hart discusses the is explained by Charles Warren. real cost of cleanup. Cleanliness Pays 20 A report by Richard Hoard on An Environmental Industry Cleanup Savings. Balance 9 The view of Deputy Adminis­ Cleanup Impact Aid 22 trator Barbara Blum. Edwin Clark II explains Federal aids to ease the cost of cleanup. Departments Almanac 26 People 34 Update 38 Nation 32 News Briefs 37 Front cover: Construction workers Photo credits: Terry Eiler•, Love Text printed on recycled paper. are shown in this photo by Burt Canal photos courtesy of Buffalo Glinn of Magnum. Courier-Express and Niagara Gazette. Boyd Norton•, Lee Lockwood•, ENTHEos·, Burt Glinn/Magnum, Ernest Bucci , Ray Thacker • Documerica The EPA Journal is published Views expressed by authors do not and other materials. Subscription: monthly, with combined issues necessarily reflect EPA policy. Con­ $10.00 a year. $1 .00 for single July-August and November-Decem­ tributions and inquiries should be copy, domestic; $ 12. 50 if mailed to ber. by the U.S. Environmental addressed to the Editor (A-107). a foreign address. No charge to Protection Agency. Use of funds for Waterside Mall, 401 M St .. S.W ., employees. Send check or money printing this periodic!ll has been Washington, D.C. 20460. No per­ order to Superintendent of Docu­ approved by the Director of the mission necessary to reproduce ments. U.S. Government Printing Office of Management and Bur:lget. contents except copyrighted photos Office, Washington, D.C. 20402. Environmentally Speaking .. ,... ~ . .,.. .. .•• .. .. ..~, ' '•- ments and price increases that don't reflect increased product value. But there are other The Benefits of reasons as well, including possibly the effect of costs imposed by regulations. So a Cleaner Environnient we must continually evaluate our actions to be sure that they are not unduly inflationary. As measured by standard yardi;ticks, By Douglas M. Castle, one of us can be unconcerned that such as the Consumer Price Index, EPA's N prices continue to rise, that Ameri­ programs do contribute modestly to infla­ EPA Administrator cans are again jittery about havinJ to pay tion. Our most recent analysis, done by the more and more for the essentials-food, respected firm of Data Resources, Inc., shelter, and clothing. estimates that EPA's air and water pollu­ As the President leads the attack on in­ tion control programs will add an average of flatlon, we at EPA must be concerned about 0.3 percentage points annually to the Con­ whether the environmenta I program con­ sumer Price Index from 1970 through 1986. tributes to the inflation rate. Thus, if the Index were to increase by Some say the root of inflation is in the 6.0 percent in a particular year without pol- government's monetary and fiscal policies. Others emphasize excessive wage settle- 2 EPA JOURNAL increased prices for food. energy, housing, environment is to them, and the pot Is have and medical care and on avoiding the consistently shown that they are demand­ wage-price spiral set off by these increases. ing such an environment. For instance, a More importantly, the fact that environ­ recent poll for Resources for the Future mental regulations do slightly increase the found that those surveyed would choose by Price Index does not itself mean they are a 3 to 1 margin to pay higher prices to truly inflationary. Projections in the Index protect the environment. do not take into account the benefits of I'm often asked by people. "Who are regulation, such as improved public health, these environmentalists?" My answer Is, reduced property damage, and increased they're your children, your spouses, and in crop yields that result from pollution con­ many cases, perhaps, yourselves. Most trol spending. people don't enjoy living or working in a Such benefits lead to a lower cost of polluted environment, and they are telling living. If the Price Index were adjusted to us that they think the benefits of environ­ take them into account. pollution control mental cleanup are worth the costs. spending would not appear inflationary, as We can all think of cases where environ­ long as the benefits exceed the costs­ mental protection is (or would have been) which I believe is generally the case. clearly worth the investment. The Federal environmental program, For example, the Kepone contamination closely coordinated with State and local of the James River in Virginia has shut efforts, has already achieved significant down the fish and shellfish industry in the results, which are paying off in more bene­ area-probably for decades-because it fits to society. From 1970to 1977,totat would cost billions of dollars to clean the smoke and dust were reduced by 12 per­ river bottom of the contamination. Prevent­ cent. Nationally from 1970 to 1977 sulfur ing the problem in the first place surely dioxide was reduced by 30 percent. Some wou Id have been less costly. rivers that were contaminated, even flam­ Similarly, the cost of disrupting fishing mable, are now open to fishing and swim­ in and near the Hudson River by PCB con­ ming. tamination has been estimated at more These environmental improvements re­ than $11 million a year by New York State. sult in anti-inflationary effects such as fewer These are graphic examples where the illnesses, fewer lost workdays, lower medi­ benefits of pollution control would have cal bi Its, less material damages, and more been obviously reflected in increased per­ recreational opportunities. These must not sonal incomes. Far more common are cases be ignored when considering whether where the benefits are measured in fewer pollution or pollution control is more cancer patients or fewer schooldays or inflationary. workdays lost by asthmatics. Another way of looking at this problem We would like to measure those benefits is to note that for many years polluters im­ that have economic value more accurately posed additional costs of living on con­ than we're now able to. We're working on sumers, in many cases without their knowl­ that. edge. Now, it seems irrational to me to In the meantime, the Agency must and automatically call inflationary the programs will rely on judgment.