16 - Are There Problems With Compensation Test Are...

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Unformatted text preview: Are There Problems With Compensation Test? Are Compensation test is framed as winners could potentially Compensation compensate losers… compensate • • Actual payment rarely occurs. Thus, there are winners and losers, creating political dissent over equity v. efficiency. Arsenic Rule: History Arsenic • • • • 1942: Federal government establishes an arsenic rule setting maximum contaminant level (MCL) at 50 µg/L (50 ppb). 1996: Congress directs EPA to set new standard by Jan. 1, 2000. 1996: EPA asks National Academy of Sciences (NRC) to study health effects. 1999: NRC recommends that EPA “significantly lower current standard” “as quickly as possible”. At 50 µg/L estimate a 1-in-100 chance of cancer. This is a problem, as the EPA usually is attentive to environmental risks at or below 1 in 100,000. Arsenic Rule: Timeline and Controversy Arsenic July 1, 2000: EPA proposes a preliminary rule – 5 µg/L July Jan. 22, 2001: EPA issues final rule – 10 µg/L Jan. • • • Similar to European and WHO standards. Justification based in part on benefit cost analysis which could not justify a more stringent mandate. Rule to become effective on Mar. 23, 2001, with compliance date of Jan. 23, 2006. Mar. 21, 2001: With support from mining industry and Mar. some municipalities, EPA withdraws regulation • Implication is that it is too stringent, and not based on good science. Arsenic Rule: Timeline and Controversy, continued Arsenic July 28, 2001: The House of Representatives votes 218 July to 189 to require Bush Administration to keep restrictions on amount of arsenic allowed in drinking water at least as strict as those set under former President Bill Clinton. • Aug. 2, Senate votes 97 to 1 to require new arsenic standards for drinking water. Sept. 10, 2001: National Academy of Sciences group Sept. charged with revisiting 1999 study concludes that the 10 µg/L standard were justified but not strict enough. Oct. 31, 2001: EPA announces it will accept the 10 µg/L Oct. standard. Some Numbers Behind the Arsenic Rule ($ Millions) Some Arsenic Level (µg/L) 3 5 10 20 Total Annual Total Annual Cost (7%) Health Benefits $698-792 $415-472 $180-206 $67-77 $214 – $491 $191-356 $140-198 $66 - $75 Potential Nonquantifiable Health Benefits - Skin, kidney, nasal passages, liver, and prostate cancer. - Cardiovascular, pulmonary, immunological, neurological, endocrine, reproductive and development effects. Source: Harrison, Box 6-4 and http://www.epa.gov/safewater/ars/econ_analysis.pdf Equity and Other Concerns about the Compensation Test Equity Equity and the Arsenic Rule: Average cost per Equity household estimated to be $31.85 per annum: • • Municipalities with more that 1 million households: $0.86. Municipalities with less than 100 households: $326.82. If we base everything on willingness to pay, then pollution will be located in poorer areas. Nonhuman entities (animals, ecosystems) only reflected in human preferences. Environmental Justice: Environmental • Anthropocentric: Based on human values only Anthropocentric • Presentist: We are only asking present generation’s Presentist preferences • Future generations have to accept our decisions and may have different preferences. ...
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