Tuesday, May 10, 2011
The economist John Kenneth Galbraith once wrote that “[n]othing in American business attitudes is so iniquitous as government interference in the internal affairs of the corporation.” J. Galbraith, THE NEW INDUSTRIAL STATE 77 (1967). Note the strong word: iniquitous. Iniquity means “wickedness" or "gross injustice." This is indeed a serious issue for American business.
Galbraith’s observation leads well into what I perceive to be another wall or barrier that environmental laws (and scholars of environmental law) come up against: the industrial production process. Instead of being able to focus on how production processes may be resource-intensive or otherwise environmentally-harmful, our environmental laws are often limited to just dealing with their waste outputs. A few examples:
- As exemplified in the early Clean Air Act case National Lime Assn v. EPA (DC Cir, 1980), the EPA has limited ability to influence the inputs to the production process when writing standards. Rather, government has to take the industry as is, setting standards that conform to the way the industry produces. The question for the regulator is not: How could you produce this product in a way that reduces pollution? But rather: Given that you produce it in this way, what is the level of pollution control required?
- The Pollution Prevention Act is in some ways bold and innovative, but it is does not mandate pollution prevention. Why not? Perhaps because it cuts to close to interfering in the internal affairs of the corporation.
- Under the Resource Conservation and Recovery Act, the producers (or generators) of hazardous waste are only lightly regulated. Extensive litigation about what is or is not “discarded” has also limited the government’s regulatory reach with respect to those facilities that engage in the treatment, disposal and storage of hazardous wastes.
- The federal environmental law that had the potential to most affect (or interfere with) the industrial production process is the Toxic Substances Control Act. It has been a failure and reform is currently on the legislative agenda. In 2009, the Government Accountability Office included “transforming EPA’s processes for assessing and controlling toxic chemicals” on a list of 30 high risk areas in government operations. That means it is an area of governmental action that is not working well and has important implications for the country’s economic and political well-being. Another high-risk area identified in 2009 was “modernizing the outdated US financial regulatory system.”
I find myself wondering the following: How far can an environmental law framework that has internalized American business's moral repugnance to governmental interference in production processes take us towards an environmentally sustainable economy?
- Lesley McAllister