ENVIRONMENT POLICIES COSTLIER BUT LESS EFFECTIVE, REPORT SAYS

ENVIRONMENT POLICIES COSTLIER BUT LESS EFFECTIVE, REPORT SAYS

The cost of environmental policies has risen steadily while their effectiveness has not, according to a report for the Center for the Study of American Business at Washington University.

In the report, "Why is the Cost of Environmental Regulations So High," Robert Crandall, a senior fellow at the Brookings Institute, cited recent amendments to the Clean Air Act as an example of inefficient regulation."Given nearly 20 years of experience with the environmental policies that were launched in the 1970s, one would hope that Congress and the administration would not repeat the errors of the past that resulted in a federal government policy that is absurdly inefficient," Mr. Randall wrote.

But, he said, the 1990 Clean Air Act's automobile emissions standards ''apply equally to New York City, Boise, and Dubuque, even though the air- quality problems differ enormously across such cities."

He also cited studies that showed compliance with environmental legislation has reduced economic growth by 0.2 percentage points per year from 1974 through 1985, totalling $150 billion.

However, even this estimate may be low, since these studies did not include the effects of regulatory policies deliberately biased against new

investments, he stated.

"It is very difficult to measure the effects of investments not made," Mr. Crandall said.

The 1980 Superfund law, which addresses past disposal of hazardous wastes, was "perhaps the most notorious of the environmental policies of the Reagan era," Mr. Crandall said.

He said the perception that hazardous wastes are a pressing public health problem is inaccurate, adding that the EPA's own assessment suggests that current disposal of hazardous wastes adds no more than 100 new cancers per year.

"Hazardous waste policy is not only inefficient and of doubtful effectiveness, but it seems deliberately designed to penalize dynamic, growing industries," he said, citing the "feedstock" taxes placed on petroleum refiners and chemical companies.

The list of hazardous substances grew when, "prompted by intense environmentalist lobbying, Congress wrote. . .a requirement that about 150 chemicals be regulated by the. . .maximum available control technology" for all major sources.

"Once again, Congress has legislated uniform, technology-based standards - standards that are not at all calibrated to the degree of risk or the number of people exposed," he said.

"Perhaps more important is the fact that these extremely costly regulations will have an adverse impact on some of the country's most productive and dynamic industries, such as chemicals, pharmaceuticals, and electronics.

"Ironically, Congress has chosen to reduce the burden. . .only for the steel industry, despite the fact that its coke ovens produce some of the potentially most hazardous emissions in many of the country's most densely populated urban areas."

Mr. Crandall also cited examples of inefficient regulations covering, acid rain, automobile fuel-economy standards, and sulfur-oxide regulation.

In a separate survey, Mr. Crandall's observations were supported by a majority of environmental managers who said the federal government issues excessive environmental regulations, fails to enforce environmental laws adequately and does not spend enough money on pollution prevention and cleanup.

These conclusions were drawn by 127 members of the National Association for Environmental Management in a survey conducted by the association and the Bureau of National Affairs Inc., an information service.

Survey respondents represented manufacturing companies, retail chains and insurance companies, schools, and environmental consulting firms.

The survey found 51 percent of the respondents rated environmental laws as ''excessive," 49 percent said the government's enforcement of its environmental mandates was "inadequate," 50 percent rated the government's spending on pollution prevention and clean-up as "inadequate," and 49 percent said environmental regulations have had a "major" impact on their organization's ability to do business.