Brookings Institution Report: Time for Second-generation Strategies

Published January 1, 1999

Nearly 30 years have passed since the first Earth Day was held and the Environmental Protection Agency established. There is no question that great strides have since been made in cleaning up the nation’s air and water.

But the time has come to evaluate the cost of those success, both in economic and political terms, and to determine what the next generation of environment policy should look like.

According to one observer, the methods used by EPA during the first generation of environment policy are inadequate to face the problems of the next millennium.

“How can we maintain the first generation’s commitment to a clean environment, develop new strategies for attacking problems that the first generation left unanswered, and crack the tough economic and political dilemmas that the first wave of environmental regulations left in its wake?” asks Donald F. Kettl in The Brookings Institution’s October Policy Brief, “Environmental Policy: The Next Generation.”

Kettl, a nonresident senior fellow at the Washington, DC-based Brookings, is director of Brookings’ Center for Public Management; he also directs the Robert M. La Follette Institute of Public Affairs at the University of Wisconsin-Madison.

While the nation continues to celebrate its environment successes, achieved during a period of escalating population, auto traffic, and industrial production, companies have become increasingly vocal about the rising costs of compliance with environment mandates, pegged between $144 billion and $185 billion annually. Those costs, argue business leaders, lead to unemployment and make it difficult to remain competitive in a global market.

In the political arena, environment issues have put the two parties at odds. In 1995, Republicans blamed environment regulations for the high cost of implementing federal rules. Democrats attacked the GOP strategy, promoting themselves as the protectors of clean air and water.

Despite having survived numerous political attacks, EPA now finds itself “squeezed between a status quo increasingly hard to defend and new problems that existing policies are inadequate to solve,” wrote Kettl. “EPA would not be killed, but neither could it remain unchanged.”

During the first generation, EPA effectively addressed “point sources” of pollution: cars, factories, and other forms of pollution that could easily be inspected for cause and effect.

But not all pollution can be reduced simply by adding catalytic converters and smokestack scrubbers to the source.

“While there has been substantial progress in reducing point source pollution, further gains are increasingly costly because the easy victories from technological improvements have already been won,” notes Kettl.

EPA did virtually nothing to address “non-point” sources such as contamination from large poultry ranches, fertilizer runoff from farms, and lawn pesticides used by homeowners. Those contaminants, if they reach rivers, can result in fish kills and damage the long-term sustainability of agricultural land.

Also a challenge for tomorrow’s environment policymakers are the many untreated Superfund toxic waste sites and the radioactive sludge and toxic material created by a half-century of nuclear weapons production. Kettl projects it will take billions of dollars and decades to remedy those problems.

Among the second-generation strategies Kettl contends will be necessary to address future environmental problems:

  • Elimination of the medium-based approach to handling pollution and replacing it with a place-based strategy. The former relies on regulation by air, water, and soil that requires “a parade of different inspectors” into corporate facilities. A place-based approach utilizes one set of standards to cover an operation; one integrated set of permits to regulate them; and one inspector to oversee compliance.
  • Emphasizing performance rather than compliance to increase efficiency. One market-based approach involves emission trading. Trading programs allow companies with a record as heavy polluters to meet their emissions reduction requirements by purchasing credits from businesses that have earned the credits by keeping their emissions low.
  • New federal-state relationships that give the latter a larger role in maintaining environment standards.
  • Because certain problems, such as global warming, may have worldwide effects, a complex set of partnerships will be created between governments, businesses, and citizens.

“The second generation of environmental policy promises to create the mother of all devolution projects, with implications even greater than welfare reform,” Kettl wrote. “The political and administrative relationships are, if anything, more complex. Yet the state of knowledge is far less than in welfare.”