Environmental Philanthropy and Public Policy

Environmental Philanthropy and Public Policy

Description

In recent years, the dominant role of the federal government over environmental regulation has been under attack in the public policy sphere. For example, a recent report commissioned by the Senate and House Appropriations Committee calls for Congress and the EPA to give states, communities, and businesses greater flexibility and autonomy in addressing environmental problems, forging a “new partnership…based on ‘accountable devolution’ of national programs and on a reduction of EPA oversight when it is not needed.” Congress has made some modest movers toward shifting regulatory authority to states, reflected in the Uniform Mandates Reform Act of 1995 and the 1996 amendments to the Safe Drinking Water Act, the Endangered Species Act, and the Superfund statute. The Environmental Protection Agency is also rethinking the appropriate balance of authority between the federal government and the states. Critics of decentralization paint a gloomy scenario of these recent developments, arguing that decentralization will reduce social welfare. They maintain that a predominant federal role is necessary as a result of a “race to the bottom,” the presence of interstate externalities, and public choice problems resulting in the underrepresentation of environmental interests at the state level. First, the “race to the bottom” rationale for federal environmental regulation posits that states, in an effort to induce geographically mobile firms to locate within their jurisdictions, will offer them suboptimally lax environmental standards so as to benefit from additional jobs and tax revenues. Second, the problem of interstate externalities arises because a state that sends pollution to another state obtains the labor and fiscal benefits of the economic activity that generates the pollution but does not suffer he full costs of the activity. Under these conditions, economic theory maintains that an undesirably large amount of pollution will cross state lines. Third, a public choice claim posits that states political processes will systematically undervalue the benefits of environmental protection or overvalue its costs. This essay, which builds upon much of my prior work in the area, takes issue with these three arguments for centralization, showing that they do not justify the broad role over environmental regulation accorded to the federal government in the United States. The essay then seeks to define an appropriate role for the federal government. This discussion shows that federal intervention is necessary to address certain pathologies that otherwise would result. Importantly, the federal government has not made sufficient efforts with respect to regulatory activities that cannot be effectively carried out at a decentralized level: the control of different kinds of interstate externalities; the provision of scientific information necessary for regulation, such as the preparation of risk assessment; and the guarantee of a minimum level of public health. Thus, there is a mismatch between the areas in which the federal government can have a desirable impact and the focus that federal regulation has taken. The federal government overregulates problems that have only in-state consequences but leave inadequately addressed problems with respect to which federal intervention is necessary. The assessment of the impact of devolution is therefore complex. This analysis giver rise to three important conclusions regarding philanthropic action in the environmental area. First, it casts doubt on the social desirability of supporting the types of categorical claims against devolution made by some of the national public interest groups. Second, it provides a blueprint for focusing attention at the federal level on issues that the federal government has underregulated, and that certain forms of devolution might threaten further. For example, Rodger Schlickeisen, president of Defenders of Wildlife, has rightly assailed efforts to devolve responsibility over biodiversity protection: “Some influential members of the U.S. Congress want to turn over major parts of the federal government’s endangered species and other biodiversity conservation programs to the states. But…most states do not earn a passing grad exercising even their current responsibilities for stewardship of their natural ecology.” Third, it refutes the claim, fueled by advocates of centralization, that the funding of groups operating at the state and local level is likely to be ineffective or even futile. For example, one commentator has recently focused extensive energy on casting doubt on “environmentalists’ relative ability to represent their causes effectively at the state level.” A preliminary analysis of the larges grants given by foundations for environmental projects suggests that in recent years the center of gravity has been moving from the national to the state and regional level, both with respect to the identity of the recipient and the purpose of the grant. It would be unfortunate if this trend was halted as a result of unfounded concerns about devolution.

Source Publication

Philanthropy and the Nonprofit Sector in a Changing America

Source Editors/Authors

Charles T. Clotfelter, Thomas Ehrlich

Publication Date

1999

Environmental Philanthropy and Public Policy

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