WVpac.org previews articles that are relevant to our mission. Below we take a look at St. Paul economist and writer Edward Lotterman’s article on controlling water pollution. It addresses many of the issues West Virginia faces with stream contamination from strip mining, fracking and other energy related actions. Edward Lotterman writes the “Real World Economics” column for the Pioneer Press.
A very good read indeed…
Real World Economics: Some inconvenient truths about controlling water pollution.
Pioneer Press – Minnesota has a lot of water and we value it, especially our lakes and rivers. These are part of our culture, our collective ethos. But we don’t agree necessarily on how best to protect them.
Gov. Mark Dayton has advocated for strong action. His lead initiative is to require 50-foot wide riparian filter strips along all public waters. Many farmers are grumpy about this, but the effort is moving ahead. This past week, Dayton announced that there will be some compensation paid to farmers for land taken out of cropping for these strips.
Also last week, President Donald Trump signed an order rescinding Obama-administration rules designed to limit stream pollution from coal mining. Opponents of the Obama rule argued that the monitoring costs of the rule were inordinately high relative to pollution abatement achieved.
Both public policies exemplify key economics concepts common to virtually all pollution problems.
Let’s start with the basics.
First, the legal principle that a person should be free to use their property as they see fit as long as doing so does not harm someone else is an old idea, going back to Rome and earlier. Economists call such harm to others “external costs.” Sundry forms of pollution are classic examples of this.
Controlling external costs like pollution is not some liberal notion that inherently reduces property rights. It is rather a conservative principle that goes to the heart of the preservation of rights of private property. Of what value to you is ownership if someone else can destroy your property by some activity that has external effects?
Second, limitations of uses of property that harm others cannot be absolute. They must be subject to some rule of reason. If we didn’t want to hurt others at all we could not mow our lawns, grill steaks, drive automobiles or burn wood in our fireplaces. Trucks could not use engine brakes, body shops could not vent paint booths and so on. Everyone using property eventually uses it in ways that affect others. So we need agreement on common-sense exceptions to the underlying no-harm-to-others principle. But agreeing on what these exceptions are isn’t easy.
Third, years of customary practice can create implicit property rights. If one could burn wood in stoves and fireplaces for centuries, then people take this as a right. If farmers were free to spread manure on sloping, frozen ground ever since Minnesota was settled by Europeans, then banning that practice, and thus requiring farmers to build expensive additional storage, strikes many as a taking of a traditional right. If for decades one could mine coal in West Virginia without having to monitor quality of water downstream from the mine, then new regulations requiring this will be interpreted by some as part of a “war on coal.”
Technology can change customary practices however. We didn’t limit sediment in streams resulting from farmers using tillage practices that increased soil erosion. But over the last 70 years farmers have used increasing quantities of synthetic fertilizers, weed and insect killers and other chemicals. Now soil washing off of a field into a creek or lake inherently carries complex chemicals that can harm human, animal and plant life far away. “Mountaintop removal” coal mining techniques, in which tens of thousands of tons of rock and soil are simply bulldozed over the edge of the hill, cause greater stream quality problems than traditional underground mining.
Fourth, the more diffuse either the creation of the pollution or the harm from it, the knottier the challenges of its control. Fifty years ago, the old Koppers coal distillation plant a couple miles east of my house created very measurable smoke and stench. The sewer outlet from my home town of Chandler visibly affected Chanarambie Creek — anyone could walk to the stream and see sewage flowing toward Edgerton a few miles downstream. Solutions to these problems, though not easy, could be very localized and specific.
But what about hundreds of thousands of gas-powered lawnmowers or charcoal grills? Who is responsible if asthmatics suffer from particulates? What about the hundreds of septic tanks around popular lakes, or cabin owners who want a green lawn stretching down to the shore and a nice sandy beach with no icky weeds growing? What about thousands of hobbyists who spill a little oil in front of their garages when maintaining their cars? Or thousands of cat owners who think it fine that their pets spend a few hours roaming about the neighborhood getting exercise?
All of these actions have small impacts when taken individual by individual, but when aggregated across thousands or millions of people, can cause major damage. There is a fallacy of composition. A septic tank, verdant lawn and vegetation-free sandy beach may improve the life of any single cabin owner. But if all cabin owners construct these, the lake will be ruined for everyone. If tens of thousands of cats are let out, hundreds of thousands of wild birds will die.
Increasing numbers of rural Minnesota towns have to install expensive water treatment equipment because nitrate levels are increasing in the aquifers from which they draw drinking water. That is due to use of nitrogen fertilizers. There are clear economic incentives for an individual farmer to use these at levels beyond what is optimal for society as a whole. But which farmer’s nitrogen ends up in what aquifer? You cannot assign responsibility the way you can if noise from my teenager’s kegger wakes up your baby or if drift from your spraying dandelions kills my tomatoes.
The truth that information is valuable but expensive to compile applies in spades to external costs like pollution. For nearly a century, economists have argued that taxing harmful emissions can reduce pollution far more efficiently than command-and-control rules mandating use of certain technology. A broad set of GOP ex-officials, including Henry Paulson and Robert Gates, just delivered a document to President Trump endorsing this view. Virtually all economists agree with it, it is as uncontroversial a position in my field as the broadly accepted as the gains from trade.
Taxing emissions requires measuring them, however, and while that is easy for point sources like power plants or sewage treatment facilities, it is harder for non-point sources like farm drainage.
So what does that all have to do with this week’s news?
Dayton’s filter strips are a positive measure, but no cure-all for ag runoff problems. The political effort needed to get them in place is a cautionary tale in regard to dealing with even tougher farming-related environmental problems.
Critics of the rescinded coal-water quality rules may have been right. I personally am not qualified to judge the cost of these versus their benefits. But it seems that the rescission was instead an old-fashioned refusal to admit that a problem exists. There was no talk at all of following the “repeal” with any sort of “replace.” Anyone who has ever visited mining areas of West Virginia knows that for 150 years we have erred on the side of allowing environmentally destructive practices. This seems like one more chapter in a shameful history.
St. Paul economist and writer Edward Lotterman can be reached at [email protected]