Donald Trump

Relax: Gutting the EPA Won't Make Your Air Dirtier and Water More Polluted

There have been diminishing returns to federal pollution regulation for a long time



President Donald Trump's proposed cuts in the Environmental Protection Agency's budget "will not 'Make America Great Again', " asserted Conrad Schneider, the advocacy director at Clean Air Task Force activist group. "It will 'Make America Gag Again.'" Schneider and other alarmed activists are conjuring the bad old days of the mid-20th century when America's cities were blanketed with smog and its streams clotted with filth. In his new budget blueprint, Trump wants to cut back Environmental Protection Agency funding by 31 percent and fire 3,200 of agency's bureaucrats.

But would such steep EPA budget cuts really unleash polluters to pump out more smoke and sewage? To get a handle on this question, let's take an amble down memory lane to assess the evolution of pollution trends in the United States since President Richard Nixon cobbled together the Environmental Protection Agency in 1970.

First, with regard to air pollution, air pollution in most American cities had been declining over the course of the 20th century. Why? Many American cities had recognized the problem of air pollution in the late 19th century. Consequently they passed ordinances that aimed to abate and control the clouds of smoke emitted from burning coal in industry, heating, and cooking. For example, Chicago and Cincinnati adopted smoke abatement ordinances in 1881.

American Enterprise Institute scholars Joel Schwartz and Steven Hayward document in their 2007 book, Air Quality in America, that emissions of smoke, soot, ozone and sulfur dioxide had been falling for decades before the creation the EPA and the adoption of the Clean Air Act. For example, ambient sulfur dioxide had fallen by 58 percent in New York City during the seven years preceding the adoption of the Clean Air Act. "Air quality has indeed improved since the 1970 passage of the" Clean Air Act, they claim. "But it was improving at about the same pace for decades before the act was passed, and without the unnecessary collateral damage caused by our modern regulatory system."

They attribute a lot of the pre-EPA improvement in air quality to market-driven technological progress and increases in wealth that enabled households to switch from coal to cleaner natural gas for heating and cooking; railroads to replace coal-fired locomotives with diesels; more efficient industrial combustion that reduced the emissions of particulates; and improvements in the electrical grid that allowed power plants to be situated closer to coal mines and further from cities.

Even if the Clean Air Act did not noticeably speed up the rate of air pollution abatement, the air is nevertheless much cleaner than it used to be. How clean? Since 1980 the index for six major pollutants, carbon monoxide, ozone, particulates, sulfur dioxide, nitrogen dioxide and lead has dropped by 65 percent since 1980. In the meantime, the economy grew more than 150 percent, vehicle miles increased by more 100 percent, population grew by more than 40 percent and energy consumption rose by 25 percent. And yet, a 2016 Gallup poll found that 43 percent of Americans say that they worry about air pollution a great deal.


Schwartz and Hayward persuasively argue, "The public's interest lies in sufficiently clean air, achieved at the lowest possible cost. But federal air quality regulation suffers from incentives to create requirements that are unnecessarily stringent, intrusive, bureaucratic, and costly." Basically, the costs of ever tightening federal air pollution controls are now exceeding their benefits. Since most remaining air pollution (except for greenhouse gases which we will set aside for a discussion at another time) is now concentrated in discrete regions rather than crossing jurisdictional lines, cities, counties and states can be reasonably expected to monitor and regulate those pollutants without much federal oversight.

The EPA also regulates water pollution under the Clean Water Act of 1972. That act prohibits anybody from discharging "pollutants" through a "point source" into a "water of the United States" unless they have a permit issued by the EPA that specifies limits on what may be discharged and sets up monitoring and reporting requirements. In addition, the Clean Water Act requires that each state develop a list of impaired surface waters including rivers, lakes, and estuaries. The states also set limits on the maximum amount of each pollutant that can be present in a body of water called Total Maximum Daily Loads (TMDLs).

The EPA under the Obama administration issued regulations that more broadly defined the waters of the United States to include farm ponds, irrigation ditches, intermittent streams, and prairie potholes. At least 32 states had filed lawsuits seeking to block the implementation of Obama administration's new waters of the United States regulations. In February, President Trump signed an executive order instructing the EPA to begin the process of revising the regulations in line with former Supreme Court Justice Antonin Scalia's plurality opinion in the 2006 Rapanos vs. United States case that would limit EPA regulation of ephemeral and minor sources of water.

Regulation of non-point source water pollution in the form of runoff from agricultural fields and stormwater drainage from city streets is largely accomplished through setting TMDLs by the states. In many ways, this is just the sort of "cooperative federalism" policy that new EPA administrator Scott Pruitt says he intends to pursue. In the past EPA has provided categorical grants to state environmental agencies to help them devise water quality standards and set up scientific monitoring. The new Trump budget cuts such categorical grants to states and localities by 45 percent, falling from $1.1 billion to $597 million. Since the budget document is basically a hortatory wish list, it is not clear to what the claim that "this funding level eliminates or substantially reduces Federal investment in State environmental activities that go beyond EPA's statutory requirements" is referring. Presumably states and localities would be expected to pay more for their own standard-setting and monitoring.

According to most recent water quality data reported by the states to EPA, about 55 percent of the 1,124,000 miles of rivers and streams assessed are considered impaired due to the presence of pollutants like pathogens, excessive sediments, nutrients, and oxygen depletion. Nearly 72 percent of the assessed 18.3 million acres of lakes, reservoirs, and ponds are impaired and nearly 49 percent of the 1.7 million square miles of the assessed estuaries and bays are impaired. The National River and Streams Assessment 2008/2009 reported that 28 percent of the nation's river and stream length is in good biological condition, 25 percent in fair condition, and 46 percent in poor condition. A U.S. Geological Survey report that assessed nitrogen fertilizer runoff trends in the Mississippi River watershed found that they generally increased between 1980 and 2010. Excess nitrogen fertilizer can cause algal blooms that deplete streams, lakes, and estuaries of oxygen producing dead zones.

The sources of water pollutants are always local, but by flowing downstream they become someone else's problem as they cross state, county, and municipal boundaries. Just last week, a federal judge dismissed a lawsuit filed by Des Moines Water Works against three upstream drainage districts in three northwest Iowa counties. The Water Works utility that supplies drinking water to 500,000 Iowans claimed that the drainage districts were responsible for loading up the Raccoon River with nitrate runoff from farmers' fields in their counties. The utility was seeking $80 million to upgrade its nitrate removal equipment from the drainage districts.

A fascinating study just published in January by Iowa State University economist David Keiser and Yale University economist David Shapiro seeks to evaluate the benefits and the costs of the Clean Water Act. Specifically, did the benefits of the 35,000 federal government grants amounting to nearly $1 trillion (2014 real dollars) given to municipalities to improve wastewater treatment plants exceed their costs? To get at this question, the researchers compiled what they claim to be the most comprehensive database on U.S. water pollution trends ever. They find that pollution measures like dissolved oxygen deficits, the share of waters that are not fishable or swimmable, the presence of fecal coliform bacteria, and the amount of sediments in streams had all been improving since 1962 and then flattened out after 1990. Overall they find that during the "period 1972- 2001, the share of waters that are not fishable and the share not swimmable each fell by 11 percentage points."

They do, however, note that "the rate of decrease in pollution slowed after 1972" when the Clean Water Act was adopted. For example, oxygen levels in streams and lakes were improving at a rate of 3 percent per year before 1972 and fell to 1.5 percent thereafter. They suggest that the slow-down could have resulted from the fact that lots of relatively cheap water pollution abatement had been implemented before 1972 and/or that increases in harder to regulate non-point source pollution counterbalanced the improvements achieved through better wastewater treatment.

Keiser and Shapiro try to get a handle on the benefits of the $1 trillion in federal grants spent on wastewater treatment plants by parsing the trends in housing values up to 25 miles downstream. Without going into the details, they calculate based on housing values that the costs of the Clean Water Act wastewater treatment grants were about three times greater than their benefits. They suspect that people value water pollution abatement considerably less than they do reductions in air pollution due to differences in the health consequences of breathing unfiltered air versus drinking water generally filtered through treatment plants. In addition, it is harder to relocate from a polluted airshed than it is to substitute between nearby clean and dirty rivers for recreation.

Nevertheless, the researchers suggest that other amenity values might justify the costs of the grants. For instance, while on a high school band trip from Southwest Virginia in 1970 I recall vividly walking down to the Potomac River at Mount Vernon to see a sign bobbing in the water warning against coming in contact with the water as it was dangerous to one's health. I have now enjoyed many pleasant days boating and sailing on the cleaned up river. In addition, as pollution has abated American cities that once turned inward from their polluted waterfronts have transformed those areas into high rent neighborhoods and entertainment districts.

In addition, to the reductions in the EPA's air and water pollution programs, the Trump budget would cut by $330 million the Superfund program that is supposed to clean up specific hazardous waste sites like abandoned dumps and industrial plants. The program sparks a great deal of litigation that boosts costs and slows clean up. One 1999 study estimated that Superfund remediation would on average avert less than 0.1 case of cancer per site and that the cost per cancer case averted is over $100 million. As Case Western Reserve University law professor Jonathan Adler has argued, "Contamination of soil and groundwater are site-specific, rarely crossing state lines. Due to the local nature of hazardous waste problems, state governments should be given the opportunity to assume leadership of hazardous waste regulation and cleanup." In line with that recommendation, the Trump budget document, instructs the EPA to "look for ways to remove some of the barriers that have delayed the program's ability to return sites to the community."

One other observation: The Trump budget would eliminate the EPA's Endocrine Disruptor Screening Program. Good riddance. Billions of dollars have been spent pursuing the so-called endocrine disruption hypothesis in which trace exposures synthetic chemicals are supposedly causing hormone havoc in people. Two decades of research has comprehensively debunked it. "Taking into account the large resources spent on this topic, one should expect that, in the meantime, some endocrine disruptors that cause actual human injury or disease should have been identified," a group of European toxicologists assert in 2013 review article. "However, this is not the case. To date, with the exception of natural or synthetic hormones, not a single, man-made chemical endocrine disruptor has been identified that poses an identifiable, measurable risk to human health."

Of course, state and local governments will decry the proposed cuts in the EPA grants they expected to receive. Federal dollars are generally treated as "free money" enabling local officials to avoid having to make hard tradeoffs between various programs and amenities and raise state and municipal taxes to pay them. Whatever the achievements of EPA programs in the past – don't forget that rates of air and water pollution abatement didn't actually speed up after the creation of the agency in 1970 – we are well past the point of rapidly diminishing returns when it comes to additional pollution abatement. It is the right moment to make states and municipalities more responsible and responsive to their local citizens when it comes to handling environmental concerns and issues.