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Gonzaga Debate Institute 2008 1

Scholars Regulations/Free Market Toolbox

Regulations/Free Market Toolbox


Regulations/Free Market Toolbox ..................................................................................................................................1
***Command and Control Bad – General .....................................................................................................................4
Command and Control EPA Indict..................................................................................................................................5
Command and Control Fails – General...........................................................................................................................6
Command and Control Fails – Flexibility, Cost..............................................................................................................7
Command and Control Fails – Cost................................................................................................................................8
Command and Control Fails – Clarity ...........................................................................................................................9
Command and Control Fails – Flexibility.....................................................................................................................10
Command and Control Fails – Environment.................................................................................................................11
Command and Control Fails – Small Business ............................................................................................................12
Command and Control Fails – Diminishing Returns....................................................................................................13
Command and Control Bad – Coercion .......................................................................................................................14
Command and Control Bad – Coercion .......................................................................................................................15
Federal Command and Control Bad – States Better ....................................................................................................16
Regulations Fail – Clarity.............................................................................................................................................17
Regulations Fail – Cost.................................................................................................................................................18
Output Regulations Fail – Cost.....................................................................................................................................19
Technology Standards Fail – Innovation.......................................................................................................................20
RegNeg Good................................................................................................................................................................21
Fees Bad – Too Low, Competitiveness.........................................................................................................................22
Permits Fail – Innovation..............................................................................................................................................23
Liability Laws Good – Innovation................................................................................................................................24
Liability Laws Bad – Filing Deadlines.........................................................................................................................25
Liability Laws Bad – Burden of Proof..........................................................................................................................26
Liability Laws Bad – Cost............................................................................................................................................27
Disclosure Good – Accountability................................................................................................................................28
Disclosure Good – Accountability .............................................................................................................................29
Waste Disposal Tax Bad................................................................................................................................................30
***Regulations Bad – Regs Death................................................................................................................................31
Regulations Bad – Economy ........................................................................................................................................32
Regulations Bad – Economy/Resource Tradeoffs.........................................................................................................33
Regulations Bad – Competitiveness ............................................................................................................................34
Regulations Bad – Poverty ...........................................................................................................................................35
Regulations Bad – AT: Innovation ...............................................................................................................................36
***Regulations Good – AT: Regs Death ......................................................................................................................37
Regs Good – General Econ...........................................................................................................................................38
Regs Good – Innovation...............................................................................................................................................39
Regs Good – Innovation...............................................................................................................................................40
Regs Good – AT: Hurts Econ........................................................................................................................................41
Regs Good – AT: Job Loss............................................................................................................................................42
Regs Good – AT: Competitiveness................................................................................................................................43
Regs Good – AT: Poverty..............................................................................................................................................44
C&C Good-Solves Pollution.........................................................................................................................................45
C&C Good-AT: Inefficient............................................................................................................................................46
***Tax Credits Good....................................................................................................................................................47
Tax Credits Good – Key to Alternative Energy ...........................................................................................................48
Tax Credits Good – Expansion Key to Alternative Energy..........................................................................................49
Tax Credits Good – Solve Oil Dependence..................................................................................................................50
Tax Credits Good – Laundry List .................................................................................................................................51
Tax Credits Good – Laundry List .................................................................................................................................52
Tax Credits Good – Laundry List .................................................................................................................................53
Tax Credits Good – Tax Revenue ................................................................................................................................54
Tax Credits Good – Income Adjustments.....................................................................................................................55
Tax Credits Good – Cost Competition .........................................................................................................................56
Tax Credits Good – Commercialization ......................................................................................................................57
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Tax Credits Good – Innovation ....................................................................................................................................58
Tax Credits Good – Better Than Command & Control ...............................................................................................59
Tax Credits Good – AT: Economically Infeasible ........................................................................................................60
***Tax Credits Bad ......................................................................................................................................................61
Tax Credits Bad – Not Cost Competitive .....................................................................................................................62
Tax Credits Bad – No decrease in conservation ...........................................................................................................63
Tax Credits Bad – Not meeting current goals ..............................................................................................................64
Tax Credits Bad – Hard to manage ..............................................................................................................................65
Tax Credits Bad – Hot Spots ........................................................................................................................................66
Tax Credits Bad – Zero Sum (Enviro and Econ) .........................................................................................................67
Tax Credits Bad – Econ Infeasible (Permits better) .....................................................................................................68
Tax Credits Bad – AT: Raises revenue .........................................................................................................................69
***Free Market Bad – Misc..........................................................................................................................................70
Incentives Bad – Environmental Justice ......................................................................................................................71
Rewards Fail – Cheating...............................................................................................................................................72
Refund Bad – Cost........................................................................................................................................................73
Subsidies Fail – Burden, Environment.........................................................................................................................74
Subsidies Unpopular.....................................................................................................................................................75
Incentives Bad – AT: Their Evidence ...........................................................................................................................76
***Free Market Good ..................................................................................................................................................77
Voluntary Best – Motives..............................................................................................................................................78
Voluntary best – pilot programs....................................................................................................................................79
Voluntary Best – Empirics............................................................................................................................................80
Voluntary Best – Industry Bonds..................................................................................................................................81
Incentives Best – Business and Labor...........................................................................................................................82
Incentives Best – Laundry List.....................................................................................................................................83
Incentives Best – Results..............................................................................................................................................84
Incentives Best – Cost...................................................................................................................................................85
Incentives Best – Small Sources...................................................................................................................................86
Incentives Best – Innovation.........................................................................................................................................87
Refund Good – Small Sources......................................................................................................................................88
Subsidies Good – Environment.....................................................................................................................................89
AT: Regs Bad – Innovation...........................................................................................................................................90
AT: Regs Bad – Innovation...........................................................................................................................................91
AT: Incentives Bad – Non-Unique/Solve Advs. of C & C............................................................................................92
***Emissions Trading ..................................................................................................................................................93
Emissions Trading Fails – cheaters...............................................................................................................................94
Emissions Trading Fails – Cheaters..............................................................................................................................95
Emissions Trading Fails – Verification.........................................................................................................................96
Emissions Trading Fails – International verification....................................................................................................97
AT: Trading/New Markets Good...................................................................................................................................98
***Capital Flight DA....................................................................................................................................................99
Capital Flight DA 1NC (1/2).......................................................................................................................................100
Capital Flight DA 1NC (2/2).......................................................................................................................................101
Capital Flight – Uniqueness: Investment UP..............................................................................................................102
Capital Flight – Link: Environmental Regulation.......................................................................................................103
Capital Flight – Impact: World Econ..........................................................................................................................104
***AT: Capital Flight DA...........................................................................................................................................105
Non-Unique: Capital Flight Up...................................................................................................................................106
Turn – Capital Flight Good – Investment ..................................................................................................................107
Turn – Capital Flight Good – Environment ...............................................................................................................108
No Link – Environmental Regulation.........................................................................................................................109
***EPA Administration DA........................................................................................................................................110
EPA Administration DA (1/2)......................................................................................................................................111
EPA Administration DA (2/2)......................................................................................................................................112
Uniqueness: Environmental groups going to courts...................................................................................................113
AT: We Don’t Use the EPA .........................................................................................................................................114
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AT: EPA Not Administrative.......................................................................................................................................115
Administrative/Judicial Tradeoff Links .....................................................................................................................116
2NC Link: Consent Agreements.................................................................................................................................117
2NC Link: Penalty Reductions....................................................................................................................................118
AT: EPA Rules Good...................................................................................................................................................119
Impact Extension: Turns Case.....................................................................................................................................120
***AT: EPA Administration DA.................................................................................................................................121
2AC: EPA DA (1/2).....................................................................................................................................................122
2AC: EPA DA (2/2).....................................................................................................................................................123
Extension: Congress-EPA conflict..............................................................................................................................124
Extension: Bush administration-EPA conflict.............................................................................................................125
Extension: Courts hurt the environment.....................................................................................................................126
Extension: EPA helps the environment.......................................................................................................................127
Extension: EPA regulations not resisted......................................................................................................................128
Non-Unique: Courts not helping the environment......................................................................................................129
***DOE Good/Bad.....................................................................................................................................................130
DOE Good – Quarterly Checks .................................................................................................................................131
DOE Good – Regulations ..........................................................................................................................................132
DOE Bad – Management ...........................................................................................................................................133
DOE Bad – Cost control ............................................................................................................................................134
DOE Bad – Risk Assessment .....................................................................................................................................135
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***Command and Control Bad – General


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Command and Control EPA Indict


Command and control fails, only serves to prop up the EPA

Lee 1 (Dwight, Ramsey Prof at the Terry College of Business, U of Georgia, Vol. 51 No. 9, http://www.fee.org/publications/the-
Freeman/article.asp?aid=3690))
I hope I don’t sound outrageously cynical when I say that employees of the EPA are willing to sacrifice
environmental quality for personal gain. I hasten to add that I am not singling out EPA employees for
special criticism. They are just like the rest of us. We all do things for personal benefit that harm the
environment (almost everything we do causes some environmental harm). It shouldn’t be surprising that
EPA employees do the same. Command-and-control policies are not the best for protecting the
environment, but they are great for protecting (and expanding) EPA budgets and jobs. The EPA has
more to do when it is involved in the details of pollution control than it would if decisions were shifted
to those with more information on local conditions. As The Economist pointed out, “The EPA exists to
regulate things, not to see the market do the job for it.”1
Few things are easier than convincing yourself of the social virtue of things that serve your interest, so
most EPA officials are likely convinced that command-and-control policies are justified.
But even if they are motivated by civic virtue, EPA officials benefit by reducing pollution through detailed
regulation. And since they are well organized and considered experts on pollution control, their views have
significant influence on environmental policy.
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Command and Control Fails – General


( ) Command and control regulations are vastly over-costly, inefficient, and fail to secure
substantial environmental benefits
Stephen M. Johnson, Associate Professor of Law, Walter F. George School of Law, Mercer University, Winter
1999, Washington & Lee Law Review, 56 Wash & Lee L. Rev. 111
Academics have criticized command and control regulation on several grounds for over a decade. n4 Critics
argue that command and control regulation is not cost-effective because it normally requires all
polluters to comply with the same pollution limits even though one polluter may be able to reduce its
pollution more cheaply than another polluter n5 and even though it may not be necessary for all
polluters to reduce their pollution to the levels required by the uniform limits in order to achieve
pollution reductions that protect human health or the environment. n6 Critics also argue that command and
control regulation (i) imposes unreasonable information-gathering burdens and exorbitant costs on
government; n7 (ii) often imposes disproportionate burdens on new pollution sources; n8 and (iii)
provides no incentives to polluters to develop new strategies to reduce their pollution beyond the levels
required by law.
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Scholars Regulations/Free Market Toolbox

Command and Control Fails – Flexibility, Cost


Increases command and control prevent flexibility, not cost-effective

Doul et al 96 (John, Department of Pharmacology, Toxicology and Therapeutics, Kansas University Medical Center, Bernard Goldstein,
Director, Environmental and Occupational Health Sciences Institute and Chairman, Joshua Lederberg, President Emeritus, Rockefeller
University Sheila McGuire, President, Iowa Health Research Institute David Rall, Former Director, National Institute of Environmental Health
Sciences Virginia V. Weldon, Senior Vice President for Public Policy, “Commission on Risk Assessment and Risk Management”, June 13,
http://www.riskworld.com/nreports/1996/risk_rpt/html/nr6aa001.htm#TC1)
In some cases, OSHA may be an exception, we may have reached a point of diminishing returns, in that
each incremental improvement in human health- and environmental-risk reduction comes only with a
large increase in control costs, or benefits of additional regulation may be slight because so much has
already been invested in environmental risk reduction. In still other cases, the cost of risk reduction is
aggravated by the rigidity of the underlying command-and-control regulatory system. Rule-makings
and permitting processes become de facto design standards sanctioning the use of specific technologies
for pollution control. There may not be adequate flexibility for tailoring remedies to reflect the
circumstances of individual sources and locations, including the relative advantages that different
companies might have in choosing risk-reduction options. For some, especially small businesses, there
may be a preference for design standards because resources for research and innovation are limited.
For progress to continue, we must look beyond command-and-control regulatory programs. The call for
alternatives to command-and-control regulations was particularly strong in presentations received by the Commission outside of Washington, D.C. In
addition, federal agencies emphasized their commitment and cited their projects aimed at finding effective alternatives to command-and-control regulation.
This subsection discusses several analytic tools for identifying when environmental protection is improved and risk reduced, and endorses a number of
alternatives to command-and-control regulation that should be considered when there is interest in going beyond current levels of protection and risk
reduction.

Command and control regs prevent the best local solutions, become caught up in EPA
politics

Lee 1 (Dwight, Ramsey Prof at the Terry College of Business, U of Georgia, Vol. 51 No. 9,
http://www.fee.org/publications/the-Freeman/article.asp?aid=3690))
The EPA can never acquire all the information necessary to know the cheapest way for each of a large
number of polluters to reduce its pollution. And even if by some miracle it did have the information, it
wouldn’t use it properly for reasons that I will explain. Not surprisingly then, the EPA regulations do not take
different circumstances into account. Instead, the EPA typically imposes uniform regulations on very
different situations, making it unlawful for polluters to control pollution in the cheapest way possible.
Imagine the federal government’s taking over shoe production and making all shoes the same size. Ridiculous, right? But no more ridiculous than some of
the consequences of the EPA’s “manufacturing” one-size-fits-all pollution-control commands.
For example, one EPA regulation mandated that 30 percent of the organic matter be removed from the inflow into sewage treatment plants, probably a
defensible regulation in most cases. But not in Anchorage, Alaska, which is blessed with some of the purest water in the world because it comes from nearby
glaciers. Anchorage officials asked the EPA for a waiver, since its untreated inflow was cleaner than the treated outflow in most jurisdictions, and removing
30 percent of almost nothing would require building a new $135 million treatment plant. The EPA refused to grant the waiver. So Anchorage officials had
fish guts dumped into the water and then removed most of them—surely exceeding the 30 percent requirement by a wide margin. Anchorage taxpayers
saved buckets of money and EPA mandates were satisfied, but the water was dirtier than before.1
Such one-size-fits-all regulations obviously prevent polluters from protecting the environment in the
most cost-effective ways. The people closest to the situation, who know the most about reducing their
pollution, should be allowed to utilize that knowledge to reduce pollution as cheaply as possible.
If the EPA quit telling people how to reduce pollution and simply told them how much to reduce, each
polluter could use its localized knowledge to reduce pollution in the cheapest way possible. This would
be an improvement over the prevailing practice of imposing uniform approaches to pollution control.
But it takes more than allowing people to reduce pollution at least cost to minimize the cost of reducing pollution. The EPA would also
have to require a pattern of reduction that equates the marginal cost of reduction for all polluters.2
The EPA could never collect all the information necessary to determine how much each firm should
reduce pollution to achieve the least-cost pattern. The information is too dispersed and sensitive to
local circumstances, and too subject to change, to be collected, processed, and updated in order to be
appropriately considered by the EPA. Therefore the agency operates in an informational vacuum and
couldn’t fine-tune its commands to fit local circumstances even if it wanted to. And it wouldn’t want to.
Even if the EPA had all the information necessary to determine the least-cost pattern of pollution
reduction, political considerations would insure that it would not be used properly.
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Scholars Regulations/Free Market Toolbox

Command and Control Fails – Cost


Command and control misses multiple opportunities to reduce operating costs,
implementation is arbitrary and unfair

Lee 1 (Dwight, Ramsey Prof at the Terry College of Business, U of Georgia, Vol. 51 No. 9,
http://www.fee.org/publications/the-Freeman/article.asp?aid=3690))
The least-cost pattern of reduction will generally require that some polluters (low-cost reducers)
reduce a lot while others (high-cost reducers) reduce very little. This will seem arbitrary and unfair,
since the implications of differences in marginal costs of pollution reductions are hard to explain in
concise and compelling language. (If such explanations were easy, the marginal value of economists would
be even lower than it already is.) So any attempt to force some firms to reduce pollution a lot more than
others is sure to motivate polluters to lobby politicians and bureaucrats to reduce their control
requirements. These lobbying efforts will be not only expensive, but effective as well, and the result will
have little to do with reducing pollution economically. For example, a firm that should reduce its pollution
a lot because it can do so cheaply may be in a district whose congressional representative chairs a committee
that can influence the EPA budget. Does anyone believe that in this situation the EPA would put the goal
of least-cost pollution reduction ahead of its budget? Of course not!
The evidence is clear that the command-and-control approach of the EPA misses opportunities to greatly
reduce the cost of achieving a given level of pollution control. For example, it has been estimated that the
marginal capital cost of removing a kilogram of biological oxygen demand (BOD)—a standard measure of
water pollution—varies from one penny for one firm to $59.09 for another.
In other words, if the first firm reduced BOD by one kilogram more while the second reduced it by one
kilogram less, $59.08 would be saved with no degradation in water quality.3 The saving would add up as the
first firm continued to substitute BOD reduction for the second until each had the same marginal cost of
reduction. The total saving can be substantial in each of a large number of pollution control situations.
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Command and Control Fails – Clarity


Environmental regulations fail – clarity
Volokh 97 (Alexander, Associate Professor at Georgetown University Law Center, speech delivered at UrbanEco97,
American-Russian Conference, "A Safe Environment for Big Cities on the Threshold of the 21st Century," February
4-6, 1997, San Diego, Calif. ,http://volokh.com/sasha/russian.html )
Unclear laws and regulations defeat the very purpose of environmental regulation. The success of the
environmental regulatory scheme depends on how well people follow the regulations' mandates and
prohibitions. But if no one knows what he is supposed to do or not do, the regulations will not achieve
the intended result. The more complex the regulatory regime, the less clear the laws and regulations,
the more difficult it is for the most well-intentioned individual to comply because he cannot ascertain
what is expected.
EPA Administrator Carol Browner has noted that the existing environmental regulatory scheme is "a
complex and unwieldy system of laws and regulations and increasing conflict and gridlock." The
Supreme Court has commented on the complexity of the Clean Water and Clean Air Acts. The statutes
themselves can be hundreds of pages long, and combine detailed congressional micromanagement with
extensive delegation to the EPA. The regulations that implement the statutes take thousands of pages in
the Code of Federal Regulations. The laws and regulations are supplemented by policy
pronouncements in the Federal Register, judicial opinions, guidance documents, letters of agency
interpretation, verbal advice given over hotlines by employees of EPA contractors, and litigation
positions taken in civil and criminal enforcement actions.
Two-thirds of corporate lawyers surveyed in 1993 by the National Law Journal admitted that their
companies had violated some environmental statute during the previous year, largely because of
uncertainty and complexity. Seventy percent believed that full compliance with all federal and state
environmental laws was impossible.
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Command and Control Fails – Flexibility


Command and control fails, reducing pollution requires market information

Lee 1 (Dwight, Ramsey Prof at the Terry College of Business, U of Georgia, The Freeman: Ideas on Liberty -
October 2001 Vol. 51 No. 10))
The Environmental Protection Agency’s attempt to reduce pollution with command and control suffers
from the same problem as attempting to direct the economy with socialism—central authorities dictate
outcomes without knowing what the outcomes should be or how they are best achieved. The EPA isn’t
any better at socialism than the former Soviet Union (or anyone else for that matter). Reducing pollution
efficiently requires information from many firms and coordination of their activities. This is clearly a
task for markets, since market prices excel at communicating widely dispersed information to those
who can respond to it most effectively by coordinating their actions with the actions of others.
But markets require private ownership, and pollution problems exist because our waterways and
atmosphere aren’t privately owned. If they were privately owned, there would be no pollution problems
because prices for discharging our waste in these resources would arise that would reflect the costs imposed
on others. But how can we use markets to reduce pollution if we cannot divide up, and parcel out as
private property, these resources? As we shall see, we can create an imperfect market that will reduce pollution far more
efficiently than the command-and-control approach.

Markets create effective pollution solutions, command and control fails

Lee 1 (Dwight, Ramsey Prof at the Terry College of Business, U of Georgia, The Freeman: Ideas on Liberty -
October 2001 Vol. 51 No. 10))
In most markets price communication determines not only how much of a good goes to each consumer, but
also how much is supplied. When consumers want more of a good, they communicate that through higher
prices, and suppliers respond by increasing production as long as the marginal value to consumers (the price
they are willing to pay) is greater than the marginal cost of production. If oceans, lakes, rivers, and the
atmosphere could be privately owned and every owner could charge everyone whose discharges pollute
his water or air, then market transactions would determine the efficient amount of pollution. If
polluters wanted to pollute more, they would communicate that desire by offering to pay a higher price
to do so, and owners of air and water would allow more pollution until its marginal value (the price
polluters are willing to pay) is greater than its marginal cost. As I explained in my May and June
columns, the bargaining needed to determine this efficient amount of pollution is not likely to take place.*
So no market we create will determine the right amount of pollution reduction. That decision will
generally be made politically. But once made, we can create a market that achieves the reduction at far
less cost than can command-and-control policies. The EPA would issue transferable permits for a
particular type of pollutant; each permit would allow a given amount of discharge over some specified
period, with the total adding up to the allowable discharge of the pollutant. Because the permits would
be transferable, a market would quickly develop in which the permits are bought and sold at a price
that clears the market—equates the number of pollution permits demanded with the number that
exists.
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Command and Control Fails – Environment


Command and control legitimizes environmental destruction, as long as they have a permit
Yandle 99 (Bruce, Alumni Distinguished Professor Economics at Clemson University, April, The Freeman: Ideas
on Liberty - Vol. 49 No. 4)

This was changed with the passage of federal legislation that effectively nationalized air and water quality in
the United States. What was becoming private property was made public property, almost a commons. The
new system of command-and-control regulation allowed polluters to operate legally if they had a
permit. With permits in hand, new polluters could enter already crowded river basins. The new regime
provided political access to industries and municipalities that hoped to postpone the day of reckoning
in common law courts. Environmentalists ran interference, since they typically preferred political
solutions to remedies based on property rights, markets, and the rule of law. A triumph on the
commons was reversed. Tragedy once again reared its head.

US command and control measures hurt the environment, land conservation proves

Badan and Ethier 93 (John A and Robert, founder and chairman of the Foundation for Research on Economics and the Environment
and Department of Agricultural, Resource and Managerial Economics, Cornell University, The Freeman: Ideas on Liberty - Vol. 43 No. 9)
As the U.S. works to promote free markets in Eastern Europe, the costs of its own environmental autocracy
are ignored or heavily discounted. Many of the government's resource agencies, such as the Forest Service, the Bureau of
Land Management, and the Bureau of Reclamation, operate in a perverse world in which they have incentives both to degrade the
environment and to lose money.
Bureau of Land Management lands are among the most degraded and eroded in the west. Yet the
agency continues to encourage, even require, overgrazing. Ranchers, who pay far below market rates
for grazing rights, have little incentive to invest in soil conservation or water storage. If they attempt to
rest an area through reduced use they are threatened with revocation of permits for underuse.
Many of the National Forests lose money while hurting the environment. They build roads whose costs
are not covered by the revenues from the timber sales they facilitate, while the environmental costs are
unaccounted for. Far more is invested in replanting than would be in a private forest, where natural revegetation is a realistic
option. Budgets are maximized while the environment and the taxpayer suffer.
It is essential that environmental groups realize the negative effects of command-and-control policies
on the environment. While politics may seem to be the cheapest route to environmental control, recent
conflicts over preserving old growth timber for spotted owl habitat show that environmentalists cannot
count on the political process. By replacing political-bureaucratic management with market forces,
property rights, and private management, we promote conservation and economic progress.
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Command and Control Fails – Small Business


Command and control measures sacrifice small businesses for help big business

Lee 1 (Dwight, Ramsey Prof at the Terry College of Business, U of Georgia, Vol. 51 No. 9,
http://www.fee.org/publications/the-Freeman/article.asp?aid=3690))
Command-and-control regulation typically increases the costs of doing business. But those costs are
often easier for a big business to handle than a small business, because large firms already have legal
departments to deal with the inevitable litigation that comes with environmental regulation, and they
can spread the costs of pollution control over more units of output.
Also, pollution-control regulation often reduces an industry’s output. This can increase industry profits
by allowing firms to raise prices and act like a monopoly cartel, something that is normally illegal. For
example, EPA regulations for reducing sulfur in gasoline have recently improved the profit outlook for
refiners by causing them to shut down some plants.2
Sometimes command-and-control policies are intentionally used to protect an industry against
competition at the expense of the environment. One blatant example involves air-pollution policy. The
1970 Clean Air Act established acceptable levels of several pollutants, including sulfur dioxide (SO2), the primary pollutant of coal-fired
electric generating plants. While requiring those generating plants to reduce their SO2 emissions, the Act did not specify how. The
cheapest way to reduce SO2 emissions is often to shift from high-sulfur eastern coal to low-sulfur
western coal, and that is exactly what many coal-fired plants did, even some in the east. The alternative
is to install stack scrubbers that remove much of the sulfur from the flue gas, but they are expensive,
consume large amounts of energy, and often do less to reduce SO2 emissions than simply burning western
coal.
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Command and Control Fails – Diminishing Returns


( ) Command and control fails – remaining sources of pollution require non-C&C
approaches
Stephen M. Johnson, Associate Professor of Law, Walter F. George School of Law, Mercer University, Winter
1999, Washington & Lee Law Review, 56 Wash & Lee L. Rev. 111
For almost three decades, the federal government and state governments have addressed environmental
problems primarily through "command and control" regulation. Under this traditional approach, the
federal government establishes uniform national pollution limits ("command") that the federal or state
governments impose on individual polluters through a system of permits or other controls. n1 However, as
the command and control approach has eliminated many of the most prolific sources of pollution, the
incremental cost of cleaning up the remaining pollution has risen dramatically, n2 and command
[*112] and control regulation has become politically less attractive. In addition, command and control
regulation may be too rigid to address many of the remaining major environmental problems, such as
nonpoint source water pollution.
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Command and Control Bad – Coercion


Command and control is built from the idea that the federal government can legitimize
polluting on public land, common action holds everybody accountable

Adler 94 (Jonathan, Associate Director of Environmental Studies at the Competitive Enterprise Institute in
Washington, D.C, The Freeman: Ideas on Liberty, Vol. 44 No. 4, April)
If the federal government is mediocre at protecting environmental values, and spends much of its time
inflicting ecological damage, one may ask whether the federal government should be engaged in
environmental policy at all. The common law was premised on the protection of persons and their
properties and, as a result, was often used to prevent what is now considered environmental harm.
Polluters were not guilty of despoiling “public” water or lands, rather their crime was the violation of
the rights of others. In their chapter “Clean Water Legislation: Reauthorize or Repeal?” Meiners and Yandle
note that “The common law relies upon individuals seeking protection of their rights, not on group
lobbying before Congress.” This not only curtails efforts to politically impose ecological asceticism, but
in some cases “the common law often sets standards far tougher than those set by statutes.” Under
common law protections, no political entity could unilaterally impose a pollution easement upon
private lands. From this standpoint, it seems that the best a government could do is to transfer all that
is common into private hands.

Command and control allows environmental regulations to be shaped by the political


process, statist intervention fails

Adler 94 (Jonathan, Associate Director of Environmental Studies at the Competitive Enterprise Institute in
Washington, D.C, The Freeman: Ideas on Liberty, Vol. 44 No. 4, April)
Heyne finds principled opposition to the conventional environmental agenda not in neo- classical economics,
but in a traditional standard of justice that emphasizes individual rights and the rule of law. This
approach will not only facilitate a free political order, it will also allow for the pursuit of many goals,
environmental and otherwise; “A regime of clear and stable property rights, as it turns out, will be
supportive of both efficiency and justice.” Indeed, by protecting rights and the rule of law, “efficiency
will • largely take care of itself.” The alternative of statist intervention in all facets of life—whether for
the environment or any other end—will fail on both counts. As Heyne astutely observes, “the command-
and-control approach will almost inevitably substitute arbitrary decisions for the rule of law.”
Moreover: “Allowing environmental regulations to be shaped by a political process that is dominated
by special interests is another ethically indefensible procedure.” The reality of both failings are amply
demonstrated in the balance of the book.
Free market advocates are often branded “anti-environmentalists” for their seeming indifference to
environmental harms. To most self-proclaimed environmentalists, fealty to free market ideologies will end in
ecological if not total—devastation. Yet, as this volume suggests, perhaps it is the modern
environmentalist whose outlook will lead to ruin. As Heyne concludes, “When we take the whole
environment seriously, we will acknowledge that our primary moral obligations are to respect the
persons, the liberties, and the rights of those among whom we live. After all, these are the people upon
whose cooperation we must ultimately rely, whether it is to ‘make a living,’ to ‘save the earth,’ or to see
the realization of any other of our larger aspi rations.”
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Scholars Regulations/Free Market Toolbox

Command and Control Bad – Coercion


Reliance on the government to protect the environment cedes our agency, erodes freedom

Shaw 95 (Jane S., Senior Associate of PERC, The Freeman: Ideas on Liberty – March, Vol. 45 No. 3)
In contrast, Americans live in a world that is extremely safe. The vast majority survive to a healthy
adulthood; a child born today can expect to live 75 years. Today, death is tragic in part because it is so rare.
Yet the actions of Americans imply the opposite. Americans have allowed their government to
intervene with the goal of protecting them against risks. The government now bans many chemicals,
controls emissions of small quantities of chemicals from industrial plants, clamps down on pesticide
residues on vegetables, and slows down the introduction of potentially valuable new drugs—all in the name
of greater safety.
Most of the risks being addressed are small. These policies may actually be increasing our risk by
reducing our self-reliance and frittering away resources that we need if we are to deal with our
problems individually. Reliance on the government in this area erodes freedom just as it does in every
other area.
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Scholars Regulations/Free Market Toolbox

Federal Command and Control Bad – States Better


State command-and-control alone better than federal

Marzulla 98 (Roger, fmr head of the U.S. Justice Department's Land and Natural Resources Division, Sept 1,
http://www.heartland.org/Article.cfm?artId=13827)
Most states now have sophisticated environmental protection programs. Because they are run locally,
those programs are much more effective and efficient than command-and-control programs run from
EPA's offices in Washington. Even the federal government admits this. The principal obstacle to
shifting power to the states is the reluctance of federal bureaucrats who now hold power to give it up.
When they are freed of the straitjacket of federal over-regulation, states not only do a better job of
protecting air and water, but they are able to integrate environmental protection with economic
development, transportation, housing, and community development. EPA can't do that.
In fact, the way the federal environmental laws are set up, EPA is often required to oppose projects that
would not only benefit the state and community, but would improve the environment in the process by
building ecological concepts into the facilities and plans from the beginning. It is a lot easier to avoid
environmental problems at the design stage, but federal laws often prohibit simple solutions that would
minimize waste and pollution by avoiding its creation in the first place.
Gonzaga Debate Institute 2008 17
Scholars Regulations/Free Market Toolbox

Regulations Fail – Clarity


Unclear regulations confuse industry, increase litigation costs
Marzulla and Volokh 96 (Roger and Alexander , Assistant Attorney General, Environmental and Natural Resources divisionUSJD,
assistant policy analyst at the Reason Foundation.., “ENVIRONMENTAL ENFORCEMENT: In Search of Both Effectiveness and Fairness,
Policy Study No. 210, August, http://www.reason.org/ps210.html)
Many permit "violations" merely involve the failure to follow every element of a complex monitoring
protocol. Under the NPDES, permitted individuals can be required to perform composite sampling—
collecting a variety of grab samples and following certain procedures to create a composite sample of the
grab samples. If the permittee doesn't follow the sampling protocols exactly, the entire sample is invalid.
This means that there could be a permit violation even though the actual samples may be within permit
limits. Erroneous test data could make the permittee change his discharge and accidentally be out of
compliance the next month. These problems are compounded by two- to four-week delays in getting
test results back.
Another result of unclear laws and regulations is "regulation by litigation." When no one can
understand the regulations, they often end up in court, where judges, on a slow, inconsistent, case-by-
case basis, decide what the law means. "Regulation by litigation" tends to lead to a new cycle of unclear laws, as the courts
reward sloppy lawmaking by often resolving ambiguities in the government's favor.
In U.S. v. Standard Oil (1966), for example, the Supreme Court found the statutory term "refuse matter" to include commercially
valuable gasoline. In U.S. v. Phelps Dodge Corporation (1975), a federal district judge ruled that the terms "navigable waters" and
"waters of the United States" in the Clean Water Act could encompass "normally dry arroyos through which water may flow." And it
took the Supreme Court more than 20 years to finally decide the meaning of "harm" as used in the Endangered Species Act, in Babbitt v.
Sweet Home (1995)
Gonzaga Debate Institute 2008 18
Scholars Regulations/Free Market Toolbox

Regulations Fail – Cost


Command and Control fails – multiple sources create high costs, inefficiency

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Traditional regulatory approaches normally operate through one of three means: source-specific
emission limits, output specifications, or technology requirements. A brief description of each alternative illustrates both
the strengths and weaknesses of traditional forms of regulation. The first alternative applies emission (or effluent) limits to specific sources as a means of
achieving health standards or environment-based ambient standards. The total amount of pollutants that are released could be limited by setting emissions
standards for individual sources, such that total emissions just equaled the sum of the individual contributions from each source. Other pollution allocation
formulas that do not treat new sources more harshly than existing sources could also be used. One such formula, for example, determines a set weight of
pollution that can be released per unit of output.
Unless the authority responsible for controlling pollution is able to identify which sources have the lowest incremental costs for controlling pollution and
insist that those sources implement their pollution controls first, this source-specific approach to emissions will not be cost-effective. As Figure 3-1 depicts,
each source will usually have a number of options for controlling emissions. The least cost option (#1 in the figure) will control some emissions. Other
It is very difficult in practice to identify
successively more expensive measures may be implemented until all emissions are controlled.
the least cost strategy for controlling emissions from multiple sources. If all control measures and their costs are
known, linear programming or other modeling techniques could be used to find the least cost strategy for every level of emission control
for the sources taken as a whole. However, in most cases all potentially available control measures are not known,
and, even if they were, pollution control laws typically do not allow an agency to impose strict controls
at one source and relatively lenient control burdens on another, even if their control costs are quite
different. Generally, similar sources must be treated the same. Furthermore, incremental control costs include more than simply the
costs that sources must bear in order to comply with regulations, as noted earlier. It is likely to be difficult to predict in
advance how emission limits would affect production technology, energy and other input use, and other
cost elements. Economic instruments avoid the problems that a pollution control agency would have in
identifying the least cost methods of meeting a pollution control objective by harnessing market forces
to identify cost-effective solutions.
Gonzaga Debate Institute 2008 19
Scholars Regulations/Free Market Toolbox

Output Regulations Fail – Cost


Output regulations not cost-effective

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
The second alternative specifies certain characteristics of outputs that are destined for the product
market. Some examples include fuel efficiency requirements for automobiles, product specifications for
gasoline, and regulations regarding the ability of products to be recycled and the recycled material
content of consumer products. The regulatory strategy of imposing limitations on the polluting
characteristics of products is affected by the same issues noted above that make it difficult to regulate
emissions in a cost-effective manner. For example, the cost to individual refineries of meeting a sulfur
limit in gasoline is likely to vary significantly. It would be more efficient to allow trading among
sources to meet pollution reduction obligations than to apply uniform standards to each source.
Gonzaga Debate Institute 2008 20
Scholars Regulations/Free Market Toolbox

Technology Standards Fail – Innovation


Tech standards not cost-effective, hurt innovation

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf
Technology standards (or more accurately de facto technology standards) are likely to be less cost-
effective than emission or effluent standards, since the latter give sources the freedom to choose the least
costly method of compliance. Further, technology standards tend to lock firms into one accepted method
of compliance, which discourages technical change and innovation. However, when emissions cannot be measured or
concerns exist about the feasibility of enforcing tax or trading systems or both, technology standards provide a practical way to reduce pollution.
identifying the strategies that should be implemented to control pollution at the
From a dynamic perspective,
least cost is more problematic. Technology is not static. Over time, the number of possible options
increases. Most of the options offer improvements over earlier technologies, in terms of cost,
environmental performance or both. A traditional regulatory strategy to identify and mandate least
cost controls can lock firms into technologies that become progressively less effective, and thus less
attractive, over time.
Gonzaga Debate Institute 2008 21
Scholars Regulations/Free Market Toolbox

RegNeg Good
Regulatory negotiations create effective environmental solutions while accommodating
business

Doul et al 96 (John, Department of Pharmacology, Toxicology and Therapeutics, Kansas University Medical Center, Bernard Goldstein,
Director, Environmental and Occupational Health Sciences Institute and Chairman, Joshua Lederberg, President Emeritus, Rockefeller
University Sheila McGuire, President, Iowa Health Research Institute David Rall, Former Director, National Institute of Environmental Health
Sciences Virginia V. Weldon, Senior Vice President for Public Policy, “Commission on Risk Assessment and Risk Management”, June 13,
http://www.riskworld.com/nreports/1996/risk_rpt/html/nr6aa001.htm#TC1)
Consensus, Mediation, and Dialogue Projects. Negotiated rule-making and dialogue projects, such as
EPA's Common Sense Initiative, offer opportunities for stakeholders to design new standards and
solutions that protect human health and the environment more reliably and with greater cost
effectiveness and public acceptance. With the Common Sense Initiative, begun in 1994, EPA has convened
consensus-oriented teams of stakeholders to look for opportunities to turn complicated and
inconsistent environmental regulations for six major industries--automobile manufacturing, computers
and electronics, iron and steel, metal finishing, petroleum refining, and printing--into comprehensive
sector-specific strategies for environmental protection. Several industrial sectors have launched their own
initiatives such as Responsible Care by the Chemical Manufacturers Association.
Gonzaga Debate Institute 2008 22
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Fees Bad – Too Low, Competitiveness


Foreign competitiveness concerns prevent fees from being set high enough

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Although fees can generate substantial revenues for the government agency that imposes them, they tend to
be set at rates too low to have a significant impact on pollution. Generally speaking, if pollution fees or
taxes were set at rates equal to the incremental damage being caused by the pollution, or at a level that
would force changes in business or personal behavior, they would be controversial. Concerns about the
competitiveness of U.S. businesses would be raised if foreign companies were not subject to similar
fees. Consequently, the rates of most of these environmental fees and taxes are not set high enough to
achieve U.S. environmental goals, although in some specific cases fees and taxes are working well as a
mechanism for controlling pollution.
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Permits Fail – Innovation


Permits that limit pollution and input performance standards prevent innovation

Scott et al 98(V. J. Lein, and E. L. David, Wisconsin Department of Natural Resources, Madison, WI; and Donna M. Downing, USEPA,
“ENVIRONMENTAL INNOVATION AND REGULATION: SIFTING REALITY FROM RHETORIC”, Jan 1,
http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0408A-1.doc/$File/EE-0408A-1.doc)
We did find instances in which the environmental regulatory regime does appear to hinder innovation,
either by making it more difficult to innovate or by failing to provide strong incentives for innovation.
We summarize these regulatory hurdles and our policy recommendations below. We then note the various barriers to innovation that the theoretical
literature considers important, but that appear in practice not to importantly hinder innovation. Finally, we review motivations to innovate that are generated
or augmented by current environmental policies and attempt to underline areas in which existing policies and practices might be strengthened.
Regulatory hurdles are of two types; they discourage innovation or fail to encourage innovation. The regulatory hurdles that could discourage innovative
approaches, and therefore merit immediate attention include the following:
Permits that limit production or production inputs, in addition to pollution, can blunt firms’
incentives to consider creative ways to reduce emissions per unit of product. EPA requires such production
limits, in response to a court order; so short of challenging the court decision, state and federal agencies can not directly address this
problem. Nevertheless, agencies should make certain that firms understand that their production cap is based on their releases and that it
may be recalculated if the firm demonstrates that it has reduced its releases. Expedited permit review for such changes may lessen this
hurdle to innovation.
Performance standards that apply to the content of the input material, rather than to
environmental releases from production activities, can hinder innovation. While it doesn’t appear that this
application of performance standards has deterred much innovative activity, it remains possible. Either such standards themselves should be revisited, or an
expedited variance process should be developed for innovative approaches that run into conflict with these standards.
Gonzaga Debate Institute 2008 24
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Liability Laws Good – Innovation


Strict liability laws encourage innovation because of high litigation costs

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Being held legally responsible for health or environmental damages is a potent incentive for sources to
reduce or avoid pollution, since if found liable they can face extraordinarily large and unpredictable
damage claims. The Clean Water Act, for example, requires the cleanup of oil and petroleum products
spilled into the nation’s waters, while the Superfund Act and the Oil Pollution Act impose liability for
environmental damages caused by the release of hazardous substances and oil, respectively. Since 1990,
awards and settlements for damages to natural resources under these and related state statutes total
more than $700 million, with a number of cases that involve large sums still in varying stages of litigation.
Liabilities associated with the cost of cleanup at Superfund sites total billions of dollars.
With potential costs of this magnitude, sources have a powerful incentive to minimize their legal
exposure. Consequently, expensive technologies that control pollution or aggressive environmental
management systems can seem very reasonable to sources. While liability has prodded sources to take
significant actions to reduce pollution, such as managing hazardous wastes on site, it is sometimes difficult to
quantify the environmental results of those actions or to establish a causal link between concerns over
liability and reductions in pollution.
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Liability Laws Bad – Filing Deadlines


Liability laws fail – the filing deadline is too fast

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Polluters respond to federal and state pollution liability statutes by taking precautionary actions that
reduce the severity and frequency of spills. Alberini and Austin found this effect with respect to the
imposition of strict liability laws by states.19 The petroleum industry created the Marine Spill Response
Corporation, an emergency spill response effort, following the Exxon Valdez spill and the 1990 Oil Pollution
Act.20 Common law, such as nuisance, trespass, and negligence, can be used to address harm to individuals
and to private property that is caused by pollution. The effectiveness of these approaches in dealing with
pollution is an open question. In selected applications, liability can be a strong deterrent, but a number of
considerations limit the effectiveness of this approach as a general solution to pollution-related problems.
One factor that restricts its widespread use is the time limit for filing claims, otherwise known as the
"statute of limitations." In most jurisdictions, a case must be filed within two or three years of
discovering a harm. In a few jurisdictions, a case must be filed within a two- or three-year period of
when the harm occurred. This distinction is very important for individuals who develop cancer and
other diseases of long latency possibly as a result of exposure to toxic substances, since observable
effects may arise many years or even decades following the exposure.
Gonzaga Debate Institute 2008 26
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Liability Laws Bad – Burden of Proof


High burden of proof prevents companies from liability

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
A second limiting factor is the burden of proof required by law. The burden of proof required for a
judgment against the defendant is usually the standard of “more likely than not,” which usually is
interpreted as having a probability greater than 50%. Epidemiological studies may suggest that exposure
to a particular toxic substance is but one of many factors that could have caused a disease. Satisfying
the more-likely-than-not standard can be difficult. Even if a substance is implicated, it may be difficult
to determine which polluter is responsible for the harm. For example, doctors may determine that an auto
mechanic’s lung cancer likely was caused by inhaling dust from brake linings, but assigning responsibility to
a particular manufacturer may be impossible. A few jurisdictions allow the assignment of proportional
responsibility for both the harm-causing substance and for the determination of who is responsible.
Gonzaga Debate Institute 2008 27
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Liability Laws Bad – Cost


High transaction costs prevent defendants from bringing claims forward

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
A final limiting factor for liability systems are the transaction costs of pursuing a claim. These costs
include the legal costs of obtaining evidence, reaching agreement among plaintiffs on how to pursue a
case, presenting the case, and following up if the case is appealed. Liability works best when there is one
party on each side of the case and an easily demonstrated harm. When the harm is large in magnitude,
liability systems may perform reasonably well when transaction costs are small in proportion to the
amounts awarded and if there are few defendants and clear causation, even if the number of plaintiffs
is large.
Gonzaga Debate Institute 2008 28
Scholars Regulations/Free Market Toolbox

Disclosure Good – Accountability


Public disclosure of environmental performance spurs greater demand for accountability,
provide a business incentive

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf
The collection and public availability of information on environmental performance has proven to be a
strong incentive for sources to reduce their emissions of pollution. The incentive derives from a number
of factors. For example, when companies collect emissions information, they learn about the nature and
magnitude of their emissions. When such information is made easily accessible to the public, workers
and local communities have a much better idea of the environmental risks they face, so they are more
prone to support or demand actions to reduce emissions. When a source’s emissions are shown to
decline over time, the source often reaps the benefits of better relationships with its employees and with
the local community. Finally, in some cases a proven, long-term record of environmental stewardship
makes a company’s products more desirable to consumers.
The disclosure of environmental performance information is much more common today than a decade ago. Although some information is disclosed
voluntarily, other information must be released to the public as required by statute. The two best-known laws mandating the public disclosure of
environmental information are the Toxics Release Inventory provisions of the federal Community Right-to-Know Act and California’s Proposition 65. Other
forms of information reporting include environmental impact assessments, product labeling, environmental performance awards, Securities and Exchange
Commission (SEC) environmental reporting requirements, and disclosure requirements for lead paint and radon when homes are sold.
Information disclosure has been a powerful tool for reducing pollution. Over the past decade,
the Toxics Release Inventory, for example, shows that sources have substantially reduced the amount of
substances listed in the inventory that they release into the environment. Because the TRI requires only
the reporting of information, actions taken by sources to reduce pollution are voluntary and in all
likelihood relatively low cost.

Disclosure decreases pollution more than command and control, California laws prove

Doul et al 96 (John, Department of Pharmacology, Toxicology and Therapeutics, Kansas University Medical Center, Bernard Goldstein,
Director, Environmental and Occupational Health Sciences Institute and Chairman, Joshua Lederberg, President Emeritus, Rockefeller
University Sheila McGuire, President, Iowa Health Research Institute David Rall, Former Director, National Institute of Environmental Health
Sciences Virginia V. Weldon, Senior Vice President for Public Policy, “Commission on Risk Assessment and Risk Management”, June 13,
http://www.riskworld.com/nreports/1996/risk_rpt/html/nr6aa001.htm#TC1)
The Toxic Release Inventory and California Proposition 65 have proved effective pollution prevention
incentives by requiring the disclosure of information about chemical releases to the environment and
labeling of chemicals in products, respectively. Those right-to-know laws rely on the public's attitudes
toward toxicants to encourage industry to reduce or eliminate their use or release. In the case of Proposition
65, the requirement to warn people about exposures to chemicals known to cause cancer, birth defects, or other reproductive harm has
been an incentive to businesses to eliminate such chemicals or reduce exposures and associated risks below the bright lines for cancer
and reproductive risks. Rather than relying on command and control, Proposition 65 uses disclosure of
information and labeling requirements as risk-management tools. Proposition 65 places the burden of
proof of safety on manufacturers rather than on government agencies, requiring businesses to present
a risk-based analysis to avoid having to label their products and substances as cancer-causing or
reproductive toxicants. David Roe of the Environmental Defense Fund informed the Commission that Proposition 65, once
enacted and implemented, has had widespread support from environmental and business communities and has had few legal challenges.
A key element was the decision by the state agency, accepted by environmentalists and business, to put the bright line for cancer risk at
10-5, rather than 10-4 or 10-6, as proposed by contending parties. He estimated that under this system, the state of California completed
the necessary regulatory work for 282 chemicals at a cost of about one-tenth of what EPA was spending on risk assessment during the
same years.
Gonzaga Debate Institute 2008 29
Scholars Regulations/Free Market Toolbox

Disclosure Good – Accountability


Environmental accounting key to worker safety, efficiency, environment

Doul et al 96 (John, Department of Pharmacology, Toxicology and Therapeutics, Kansas University Medical Center, Bernard Goldstein,
Director, Environmental and Occupational Health Sciences Institute and Chairman, Joshua Lederberg, President Emeritus, Rockefeller
University Sheila McGuire, President, Iowa Health Research Institute David Rall, Former Director, National Institute of Environmental Health
Sciences Virginia V. Weldon, Senior Vice President for Public Policy, “Commission on Risk Assessment and Risk Management”, June 13,
http://www.riskworld.com/nreports/1996/risk_rpt/html/nr6aa001.htm#TC1)
In traditional accounting of revenue, expenses, and net income of businesses, energy costs are lumped in overhead, and
effects on and uses of resources--such as air, rivers, soils, and other environmental components--are neglected altogether.
The challenge is to incorporate all costs involved in design, production, use, disposal, and reuse so as to arrive at a life-
cycle analysis of a product or process. Assigning values to various environmental assets used and to real or potential
environmental effects that have varied probabilities is problematic, however. Those assigned values may well drive the
results of the analysis. Nevertheless, the process of environmental accounting can link environmental costs
with activities and products and provide information that results in win-win opportunities to increase
operational efficiency, improve worker safety, enhance product quality, and meet environmental
protection goals. Bankers and investment advisers have been slow to encourage up-front investments
in those cost-saving initiatives. The President's Council on Sustainable Development (1996)
recommended that national business associations provide technical assistance to companies interested
in identifying environmental management costs and innovative ways to increase profits by reducing
energy and materials use while better protecting public health and the environment.
Gonzaga Debate Institute 2008 30
Scholars Regulations/Free Market Toolbox

Waste Disposal Tax Bad


Waste disposal taxes fail – too many variables for proper enforcement

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Although “[s]tates’ experience suggests that taxes may provide an alternative to the standardbased policies
now used for most hazardous waste regulation,” Sigman found, the design and implementation of such
taxes pose several potential problems, including the determination of tax levels. To maximize the
efficiency of these taxes, they should reflect the social cost of hazardous waste generation. This cost,
however, depends on the type of waste, the method of disposal, the geographic location, and various
other factors that are difficult to assess and incorporate into tax structures. If, on the other hand, taxes
are too high, they could encourage illegal dumping, of which even a small amount could cause enough
environmental damage to offset the increased efficiency achieved by taxes. “In the presence of illegal
dumping,” the study states, “a deposit/refund program may be substantially less costly than a waste-
end tax.”
Because current federal regulations impose high costs on generators of hazardous waste, there may
already exist sufficient incentives to reduce the generation of hazardous waste. If existing regulatory
incentives are sufficient, taxes could raise the costs of waste disposal to a level that is higher than what
is socially desirable.
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***Regulations Bad – Regs Death


Gonzaga Debate Institute 2008 32
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Regulations Bad – Economy


A regulatory approach destroys liberty and causes economic collapse

McIntosh 96 (David, former Indiana congressman, “Making Regulatory Reform a Reality”, 1/31,
http://www.heritage.org/Research/GovernmentReform/HL559.cfm)
This leads me to the key area -- the environment -- where I think we need to more effectively articulate our
position. Republicans must lay out their vision of environmental protection. We should start by explaining
that in the 1960s, 1970s, and 1980s, as we turned towards the goal of protecting the environment in this
country, we did what the Soviet Union did. It used a command-and-control approach, made
tremendous strides forward, changed from a peasant economy into a manufacturing economy, but at
great cost in individual liberty. And what we now see is that if we continue down that route of a
command-and-control approach we run the risk of going the way of the Soviet Union, where the
structure collapses in on itself. So if we want to have a truly good record of protecting the environment,
we need to follow the same principles we follow in the economic world, where you use free markets, you
use property rights as the foundation of your policies. I think we can prove empirically that this will deliver a
better result on the environment.

Regulations cause economic centralization, destroying small business

Shaw and Stroup 0 (“Do Environmental Regulations Increase Economic Efficiency?”, Spring,
http://www.cato.org/pubs/regulation/regv23n1/shaw.pdf)
Large companies have always been tempted to seek tougher regulations as a means of raising the costs
of their smaller competitors more than their own. But today, they can wrap themselves in the cloak of
respectability by promoting regulation as a way of forcing beneficial change. One result can be to draw the
most entrepreneurial companies into the process of negotiating for regulations that give their companies
special advantages. Bruce Yandle reported in Regulation (Vol. 22, no. 3) that some oil and natural gas
companies have already figured out how to benefit from the proposed Kyoto Treaty negotiations—at
other companies’ expense. He also noted that logging regulations to protect the northern spotted owl,
which drastically reduced timber logging in public forests, raised timber prices, helping companies like
Weyerhaeuser that log primarily on their own land. (This fact helps explain why Weyerhaeuser’s
chairman enthusiastically supported the regulations.) Regulation can be a competitive tool regardless of its
environmental merits.
Gonzaga Debate Institute 2008 33
Scholars Regulations/Free Market Toolbox

Regulations Bad – Economy/Resource Tradeoffs

Regulations increase pressure on the economy, preventing resources from being spent on
more important issues

Antonelli 96 (Angela, Dept. of Housing & Urban Development chief financial officer, “Making Regulatory Reform a Reality”, 1/31,
http://www.heritage.org/Research/GovernmentReform/HL559.cfm)
The American people have not stopped wanting regulatory reform, but we need to help them understand that
the goals of reformers are not different -- we want cleaner air and cleaner water -- but we can do it with less
money and less government intervention. Today, the federal bureaucracy supports elaborate programs
aimed at reducing tiny risks at huge costs to the taxpayer, while more serious dangers go neglected. At
the same time, this huge misallocation of resources means these resources are not available for other
purposes -- for example, the local community that must spend millions of dollars to eliminate one
chemical from its water supply that poses a negligible or non-existent risk to the public cannot spend
this money to put police on the streets or build a school. Helping people put daily risks in perspective is
one of the challenges we face in making regulatory reform a reality. As Dr. Graham points out, today people
are suffering from what can be called a "syndrome of paranoia and neglect" about the potential
dangers to their health, safety, and the environment. Risk regulation is responsible for the bulk of the
nation's $600 billion in annual regulatory costs, particularly those rules affecting the environment. Dr.
Graham's work with Dr. Tammy Tengs recently has shown us that a reallocation of resources to more cost-
effective programs could save an additional 60,000 lives per year at no increased cost to taxpayers or
industry. 60,000 lives! And we can also save $31 billion.

Regulations impair the economy and health system

McIntosh 96 (David, former Indiana congressman, “Making Regulatory Reform a Reality”, 1/31,
http://www.heritage.org/Research/GovernmentReform/HL559.cfm)
I think we must return to the basic principles that have been successful for us. We need to explain regulatory
reform in terms of what it does for the average American. Reform will help us create more jobs; it will help
us get more products; it will lead to a healthier health system; it will help small businesses be more
productive and be able to be competitive. I think we need to search out examples of how the current
regulatory system works against us. I talk with people back home in Indiana about working in a foundry. I
put myself through college, and I point out that that foundry is now closed down because they could not
afford all costs of compliance of the Clean Air Act Amendments. Two hundred people are out of a job,
and their families are affected. It has had a terrible effect on the community. I talk about some of the
people I have met in hearings, for example, when we looked at FDA's review process. We heard from a
wonderful little 8-year-old girl who is a hydrocephalic child, and she is alive because of a miracle of
science. They have a shunt that drains the fluid from the back of her head; it's made out of silicone,
and the manufacturers are saying they're no longer going to make that shunt because FDA has still not
said that silicone is safe for use in the human body.
Gonzaga Debate Institute 2008 34
Scholars Regulations/Free Market Toolbox

Regulations Bad – Competitiveness

Regulations force increased industry spending without improving products, halting medical
and industrial advances to destroy competitiveness

Miller 93 (Dane, Biomet Inc. CEO, 12/8, http://www.heritage.org/Research/Regulation/HL482.cfm)


By Dane Miller The Congress of the United States has focused a great deal of its attention on the Food and
Drug Administration (FDA) for the past five years. During this period, congressional oversight committees
have meddled with the agency's operations to such an extent that the FDA is cur- rently incapable of
giving approval to the release of new medical devices into the marketplace. These devices at my
company, Biomet, include such things as hip and knee replacements, bone screws, and bone healing
products. In fact, the FDA has become such an impediment to the intro- duction of new devices in the
United States that most new or improved devices are available to the rest of the world more than a year
in advance of the U.S. I am in a position to see the dangerous, albeit often hidden, medical consequences of
this. I have worked in the field of orthopedic research and product development for nearly twenty-five years,
the last sixteen of which I have served as President and CEO of Biomet, Inc., after co- founding the company
in 1978. During this time period I have seen America's manufacturers increasingly distracted by the
regulatory process as a result of inaccurate tabloid reporting and political sensationalism. This has
forced the U.S. Food and Drug Administration and other regula- tory organizations to divert from good,
sound regulatory practice to a crisis response based on these pressures. As a result, today's manufacturers
of medical devices have been forced to spend more money and effort on regulatory approval and
compliance with little or no improvement in the safety and efficacy of our products. Having the
Opposite Effect. Legislation to improve the situation has not been effective. In 1990, the Safe Medical
Devices Act (SMDA) was passed into law. Industry supported the SMDA because it was intended to get
devices into the marketplace in a timely manner. SMDA places more emphasis on postmarket monitoring of
devices and less emphasis on premarket re- quirements. Unfortunately, SMDA has had the opposite effect.
SMDA significantly increased FDA's workload but gave no extra resources to handle that increase. Congress
merely pressured the agency to step up enforcement activities, and FDA resources were directed
toward compli- ance activities at the expense of new device approvals. At the beginning of 1993, Congress
pressured the FDA into making organizational changes to improve its efficiency and reduce the backlog of product submissions. The
FDA recently re- leased the results of an internal survey given to the staff of the Center for Devices and Radiological Health asking
whether those organizational changes have improved their efficiency and effectiveness. The Office of Device Evaluation, which is
responsible for premarket reviews, had the highest negative response rate at 80 percent. Only 8 percent thought there had been im-
provement. In our experience, congressional interference into the activities of the FDA has had a negative impact on the agency, on the
medical device industry, and consequently on the patient. Medical device research and development is increasingly
moving overseas to avoid the ever-increasing regulatory burdens in the United States. And the
manufacture of devices sold in the international marketplace is moving overseas to avoid the delays
associated with FDA export clearances. In summary, the way in which the FDA carries out the tasks assigned to it by Congress is di-
rectly related to the interference and pressure placed on the agency by the Congress. During the past three years, Congress has
devastated the FDA, and the industry it regulates, by using the agency as a media and publicity ploy. For example, the public
congressional hearings on the "Silicone Breast Implant Crisis" is one example of a grossly exaggerated and oversensational- ized issue
driven by political gamesmanship. With the FDA's Office of Device Evaluation's premarket review activities in a state of virtual
gridlock, new and improved devices are not being made available to physicians and their patients. U.S. companies are discouraged from
operating in the U.S. marketplace, but are inclined to supply the international market with medical devices made by foreign subsidiaries.
Let me give you a few specific examples of the frustrations we as an industry face as we deal with the FDA on a daily basis. My first
example concerns the FDA's approval for marketing of a specific hip implant developed at Biomet for patients who needed replacement
of a failed total hip. The FDA has taken more than a year (now typical) to respond to a 5 1 0(k) premarket noti- fication for a modular
calcar hip stem. A 5 1 0(k) premarket notification is supposed to be a simplified approval process in products which are similar in design
and function to others currently being produced and sold and with a proven clinical track record. The device is a hip prosthesis used for
revision surgery; in other words, it is an implant designed for use in a patient whose previously implanted total hip had not functioned
properly and required re- placement. The hip stem is part of the Mallory/Head Modular Hip System previously cleared for general
marketing by the FDA. The 5 1 0(k) was submitted on October 30, 1992, and the FDA's first reply was received November 18, 1993. In
their response, the FDA gave us 30 days to complete a fatigue test of 5 stems to 10 million cycles and submit the results. Not only is this
an unreasonably short response time in light of the FDA taking more than a year to respond to the original filing, but it is impossible to
complete this amount of testing, analyze the data, and prepare a report in such a short time period. If it takes us longer than 30 days to
provide the FDA with additional information, the FDA may consider the 5 10(k) notification to be with- drawn. Once a submission is
considered withdrawn, the entire 5 1 0(k) must be resubmitted as if it were a new submission. The FDA will then give the submission a
fresh date of re- ceipt, and place it at the end of the backlog queue. Our request for an extension of response time is still awaiting action
with the FDA and the status of this request is unknown at pre- sent.
Gonzaga Debate Institute 2008 35
Scholars Regulations/Free Market Toolbox

Regulations Bad – Poverty

Environmental regulations disproportionately hurt the poor

Parry 2 (Ian W H, Resources for the Future Fellow, “Are All Market-Based Environmental Regulations Equal?”,
http://www.issues.org/19.1/p_parry.htm)
Policymakers might also be concerned about the effects of environmental policies on different income
groups. Unfortunately, environmental and distributional objectives often appear to be in conflict. A
number of studies suggest that the burden on households from environmental regulation imposed on
power plants, refineries, and vehicle manufacturers is moderately regressive. The increase in prices as
producers pass on the costs of regulations tends to hurt lower-income groups disproportionately,
because they spend more of their income on polluting products than better-off households do.
Gonzaga Debate Institute 2008 36
Scholars Regulations/Free Market Toolbox

Regulations Bad – AT: Innovation

Regulations cause a net decrease in profits – their arguments are flawed

Shaw and Stroup 0 (“Do Environmental Regulations Increase Economic Efficiency?”, Spring,
http://www.cato.org/pubs/regulation/regv23n1/shaw.pdf)
Most environmental economists dismiss the notion that innovation depends on regulation. You could
almost hear Karen Palmer, Wallace E. Oates, and Paul R. Portney sputtering with indignation as they
responded in the Journal of Economic Perspectives. They called the Porter-van der Linde article
“somewhat astonishing” because it defended environmental regulation without recognizing the
necessity of weighing costs and benefits. “The traditional approach,” they explained, “consists of
comparing the beneficial effects of regulation with the costs that must be borne to secure these benefits.”
They disparaged the Porter- van der Linde claim that there are “lots of $10 bills lying around waiting
to be picked up.” They graphed an abstract model showing that environmental regulation cannot, as a
general rule, lead to higher profits. They explained that examples cited by Porter and van der Linde
were special cases under narrow circumstances. In addition, they reported that they had communicated
with officials of firms, including some mentioned by Porter and van der Linde. Each official “said quite
emphatically that, on the whole, environmental regulation amounted to a significant net cost to his
company.” The economists cited a Bureau of Economic Analysis study showing that industry spent $102
billion in 1992 on pollution con- trol, of which $17 billion (less than 2 percent) was offset by innovation.
And they pointed out that whatever the successes, concentration on environmental innovation meant
“other opportunities forgone” for these companies.

Shock effect proves their argument wrong

Shaw and Stroup 0 (“Do Environmental Regulations Increase Economic Efficiency?”, Spring,
http://www.cato.org/pubs/regulation/regv23n1/shaw.pdf)
We agree with these economists. The theory that regulations will wake up sleepy executives, forcing
them to become more efficient, is illogical in a competitive economy. The claim, however, resembles a
predecessor idea, the “shock effect.” Taught in labor economics texts, the theo ry of the shock effect held
that unions, by raising wages, would shock management into efficiency gains. The higher wages would
stimulate productivity so that higher wage costs would not be passed on to buyers. As Neil Chamberlain put
it in his 1958 text, Labor, “It is amazing the way firms find theycan cut costs when they are driven to it by the
spur of rising wages!” With this spur, he said, it is “possible to pay the added wage costs, retain the old scale
of prices, and make as much profit as before” (p. 289). But, of course, it is not true in general. Studies in
the United States and the United Kingdom indicate that unionized firms have higher wages but lower
profits and lower employment. Unionized firms and sectors have grown less rapidly than have
nonunionized ones, further discrediting the shock-effect theory.

Regs aren’t key – economic competition solves innovation

Shaw and Stroup 0 (“Do Environmental Regulations Increase Economic Efficiency?”, Spring,
http://www.cato.org/pubs/regulation/regv23n1/shaw.pdf)
Business executives never accepted the shock theory of union wages in a big way, and the theory died a
natural death. It is easy for economists to assume that this new variant, the Porter–van der Linde message,
has been discredited and is on its way to a similar demise. After all, how many stodgy firms are there in
need of artificial stimulus to competitive behavior? In a global economy, with increased foreign trade,
wider markets in nearly every industry, and thriving merger-and-acquisition activity, surviving firms
are lean, mean, and innovative without regulation.
Gonzaga Debate Institute 2008 37
Scholars Regulations/Free Market Toolbox

***Regulations Good – AT: Regs Death


Gonzaga Debate Institute 2008 38
Scholars Regulations/Free Market Toolbox

Regs Good – General Econ

Environment regulations are key to the economy

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 4, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
Effective environmental regulation is integral to successful markets, an essential ingredient of a vibrant,
modern economy. Unregulated markets would be chaotic, unfair and unlikely to deliver what people
want – safe, reliable products and a clean environment in which to live and work. The opposite is
sometimes assumed - that environmental regulation represents sand in the cogs of the economy,
resulting only in burdens on business, inefficiency and lower competitiveness. Businesses often focus on the
time spent and cost of dealing with regulators and tend to underestimate the benefits of regulation to
business and wider society. Oppressive environmental regulation can be damaging, but a modern
approach can help to deliver the environmental improvements people want in a way that fits with
a competitive economy. Good, modern regulation is likely to incorporate a mix of policy tools, including
market-based measures such as emissions trading, a risk-based approach, and effective engagement and
dialogue with business and other stakeholders. Some countries, including Germany, Italy and Sweden,
point to the advantages of having a coherent environmental code bringing together, summarising
and harmonising all relevant environmental legislation, including on nature conservation. Such a code can
enhance the clarity of law for the public and for businesses and simplify enforcement by the competent
authorities. Society benefits from less pollution and waste and improved quality of life. Businesses can also
be better off with clear standards that are enforced effectively, rather than uncertainty and unfair
competition from those who ignore the rules. Good environmental regulation helps reduce costs for
industry and business Business can benefit directly because regulation in areas such as energy
efficiency and waste reduction can deliver cost savings and help companies develop more attractive
products. These reduced costs add up to substantial benefits across the whole economy. Research in
the UK 2 suggests that: – waste minimisation could yield almost 4.4bn euros saving in manufacturers’
annual operating costs, equal to 7% of profits in 2000 - 60% of the savings come from the costs of materials that do not end
up in the final product, – industry could save 2.7bn euros through energy efficiency, – typical payback periods for waste investments are
no more than 12 months. – the agriculture sector could save some 1.3bn euros through improved environmental management
Individual companies also show that such gains need not be short-lived. The healthcare company
Baxter International reckons it is saving more than 50m euros a year from measures such as packaging
and waste reduction which have been introduced since 1996. The technology company 3M began its pollution prevention
programme in 1975 and is still profiting from it, having saved over 740m euros since then.

Environmental regulations are key to business success

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 6-7, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
Recent research found a close link between environmental governance – embracing policies, processes
and performance – and financial performance. Such a link was found in 51 of 60 recent studies reviewed
by researchers, covering performance of individual companies, whole sectors and pension funds 12. For
example, the difference in financial performance between the best and worst environmental performers
in the oil and gas sector was nearly 12% over three years . Similarly the UK Financial Times Share
Exchange (FTSE) prices of the best electric utilities beat the worst companies by 39% over three years.
Another recent study, by the Climate Group, found that 5 international companies (DuPont, Alcan, British
Telecom, IBM and Norske Canada) had achieved reductions of over 60% in their greenhouse gas
emissions since 1990. The resulting savings of over 6bn euros resulted from improved energy efficiency
(process, product, buildings), fuel switching and reduced waste 13. The banking and insurance sectors,
which provide strategic business advice and insure all businesses, look more favourably on those with a
good environmental record and low environmental risks, providing better access to capital and lower
insurance premiums than for businesses with a poorer record. A recent Danish study confirmed that
financial institutions pay attention to environmental risk management in their evaluations of companies
Gonzaga Debate Institute 2008 39
Scholars Regulations/Free Market Toolbox

Regs Good – Innovation

Environmental regulations spur innovation that creates new environmental markets

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 5, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
Higher environmental standards and regulation help create markets for environmental goods and
services. The world market for environmental goods and services is estimated to be worth 425bn euros
and is likely to grow to 565bn euros by 2010. This figure is comparable with those for the aerospace and
pharmaceutical industries. In the UK, the environmental goods and services industry already consists of over
17,000 companies with an estimated annual turnover of 33bn euros. The International Institute for Industrial
Environmental Economics in Lund reported continuous growth in the number of Sweden’s environment-
related jobs 5 It is forecast that in the years ahead, more and more people will devote at least some of
their working hours to environment-related tasks. Michael Porter of Harvard University was instrumental
in showing that countries with high environmental standards often have market-leading firms and
record better economic performance than those with lower standards This is because high standards
can stimulate innovation both in firms selling environmental solutions and in those having to comply.
English Nature has provided a useful summary of international research in this area undertaken since Porter’s
initial challenge

Regulations are key to innovation that increases profits and competitiveness

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 6, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
Some industries depend for commercial success on high environmental standards, most obviously those
providing clean technology and waste management. Danish leadership in wind turbine technology is an
example of a country gaining competitive advantage by pursuing environmental leadership and innovation.
The way businesses respond to regulation is more important, especially in the environmental context where
regulation is often designed specifically to change behaviour. Michael Porter has recognised this dynamism,
writing: “The data clearly show that the costs of addressing environmental regulations can be minimised,
if not eliminated, through innovation that delivers other benefits.” 8 Some argue that if companies risk
profitability by failing to innovate then an unregulated market will pass judgement. However Porter
and Van der Linde have argued that this makes unrealistic assumptions and that a regulatory push is
needed to overcome business inertia, to alert and educate companies about resource efficiencies and
the potential for technological improvement and to protect the environment in the interim. It is clear,
for example, that companies innovate in response to tighter waste regulation, to change products and
processes so that they generate less waste. They save money and possibly find an opportunity to charge
a premium price for an improved product. Similarly, companies have responded to the climate change
levy by investing in energy efficiency, again cutting costs. A World Wildlife Fund report on the effect of
proposed EU chemicals regulations on innovation found that the regulations were likely to promote
innovation by encouraging the replacement of risky and less sustainable chemicals with safer
alternatives. Indeed, this innovation can allow an industry to be more competitive internationally
because the resultant products are in greater demand
Gonzaga Debate Institute 2008 40
Scholars Regulations/Free Market Toolbox

Regs Good – Innovation

Regulations are good for the economy – increase profits and innovation while providing
business opportunities

Shaw and Stroup 0 (“Do Environmental Regulations Increase Economic Efficiency?”, Spring,
http://www.cato.org/pubs/regulation/regv23n1/shaw.pdf)
A different idea is gaining ground in business boardrooms, however. Saving the environment is a “business
opportunity,” says Tachi Kiuchi of Mitsubishi Electric. According to the Aspen Institute (in a report
developed with help from businesses— from Anheuser-Busch to Wey-erhaeuser), “By learning to ‘value the
environment,’ companies and financial institutions are uncovering another competitive edge.” Yes,
regulation can be a good business opportunity for some, even with the higher costs it imposes. For
example, producers who are the first companies to discover better ways to reduce pollution can profit
by keeping costs down. In addition, they may profit by selling new technologies to other producers. (As
we will note later, some companies also profit by obtaining monopoly power through regulation.) So far, so
good. But some business strategists make another leap: they argue that regulation leads to cost-reducing
innovation, directly increasing profits. Lower costs and lower pollution can result. Under these
conditions, who would argue against tighter regulation?

Regulations spur cost-saving innovations

Shaw and Stroup 0 (“Do Environmental Regulations Increase Economic Efficiency?”, Spring,
http://www.cato.org/pubs/regulation/regv23n1/shaw.pdf)
Although there are variants, the idea that regulation spurs innovation that raises profits stems largely from the
work of Michael Porter and Claas van der Linde. They have presented their views in such places as the
Harvard Business Journal, Scientific American, and the Journal of Economic Perspectives. Indeed, an
exchange with economists in the latter journal seems to be the one serious debate over the issue— and it is
not clear that the economists won. Since their competing essays appeared in 1995, economists have moved
on, assuming they were victors. Or, so it would appear. Meanwhile business strategists have held confer-
ences, written books, and persuaded journalists (in case they needed persuasion) that more environmental
regulation is nearly always a good thing. In the 1995 article, Porter and van der Linde argued that
“properly designed environmental standards can trigger innovation that may partially or more than
fully offset the costs of complying with them.” They offered several examples of such offsets. • Ciba-
Geigy responded to environmental standards by making process changes that saved $740,000 per year.
• 3M saved $120,000 in capital investment and $15,000 annually by replacing solvents with water-based
solutions.•The Robbins Company saved nearly $300,000 in capital costs and more than $115,000 per
year by moving to a closed-loop system in its jewelry-plating business. These examples are undoubtedly
true. The companies mentioned are making money from pollution control or material reduction. It
should not surprise us. The profit motive has long led to increasingly efficient use of material resources.
Every 1 percent reduction in the aluminum needed to make a beverage can saves beverage can manufacturers
$20 milliona year. Similarly,air pollutiondeclined for decades long before the passage of the Clean Air
Act because engineers strove to improve the efficiency of burn- ing fuel. The profit motive has been a steady
contributor to cleaner industry. Porter and van der Linde’s claim, however, is that environmental regulation
is necessary, for the most part, to spur the innovation that will add to profits. They argue that because of
poor information and management incentives in many companies today, there are “$10 bills” lying
around that have not been picked up—innovations just waiting to be made. And regulation is the way
to make executives start looking for them.
Gonzaga Debate Institute 2008 41
Scholars Regulations/Free Market Toolbox

Regs Good – AT: Hurts Econ

The costs of regulation is inevitable – government regulations just make their impact more
equitable and improve efficiency

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 7, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
There are several reasons why regulation tends to be mistakenly seen as anti-competitive, not least that
the costs in terms of time spent dealing with regulators is much more visible than the benefits, such as
fair competition and less pollution. But it seems likely that businesses over-estimate compliance time. A
recent report for the UK Government (the Hampton Report 22) estimated that a firm with 19 employees
would spend less than 2 1/2 hours per person per month complying with all government-related
regulation and paperwork (not just that related to the environment). The bulk of this would involve
labour and financial regulation (the OECD estimate that 46% of the time needed to comply relates to
taxation and 35% to employment regulations 23). However, it is also recognised that proportionately larger
businesses have less administration of regulation per person that small businesses. More fundamentally,
estimates of the impact of regulation often ignore two important issues: – the element of self-regulation
which would take place in the absence of formal requirements – the ways in which businesses adapt.
Self-regulation is common in many areas because it is in companies’ interests to behave responsibly,
and because they are under pressure from society to avoid anti- social behaviour such as dumping waste.
Voluntary action is not always sufficient to achieve widespread responsibility, and regulation can be
more efficient because it provides certainty and equity. Indeed, voluntary action only works if there is the
understanding that regulation will be introduced if the desired outcomes are not achieved. It is unlikely that
the costs of regulation would disappear if the regulations were removed.
Gonzaga Debate Institute 2008 42
Scholars Regulations/Free Market Toolbox

Regs Good – AT: Job Loss

Regulations improves employment and business

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 7, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
Evidence tends to indicate that the net impact on employment of environmental regulation is either
neutral or slightly positive. The most visible beneficiary is the environmental goods and service sector,
which by 2001 already employed over 2 million full time equivalent jobs in the EU15 24. The
Confederation of British Industry (CBI), which is very alert to competitiveness issues, has acknowledged
that “economic growth can be consistent with a better environment” 25 and has found that there is “no
strong evidence that environmental regulation destroys jobs and businesses” 26. High standards are
also important in sectors such as tourism and leisure, which rely on an attractive physical environment
to win customers. In England, economic activities connected with the management of the natural
environment support an estimated 2.68 million full time jobs 27. In Wales an estimated 1 in 6 of the
workforce depends on the environment for employment, whilst in Scotland nearly as many people are
employed in natural heritage related activity as are employed in biotechnology, call centres and electronics
combined.
Gonzaga Debate Institute 2008 43
Scholars Regulations/Free Market Toolbox

Regs Good – AT: Competitiveness

Regulations don’t hurt competitiveness

Network of Heads of European Environmental Protection Agencies 5 (“The Contribution of Good


Environmental Regulation to Economic Competitiveness”, Nov., p. 7, http://www.eea.europa.eu/about-
us/documents/prague_statement/prague_statement-en.pdf)
Several economic studies have exposed the myth that regulation leads to competitive disadvantage. On
the contrary, good regulation can have a positive impact through stimulating dynamic responses,
innovation and better practices. The World Bank has observed that “Contrary to common perceptions,
higher environmental standards in industrial countries have not tended to lower their international
competitiveness” 15 The World Resources Institute says “There is no evidence that industries affected
by regulatory costs do poorly in international markets” 16 A DG Enterprise study found that air
pollution legislation in Europe has had very little effect on competitiveness of industry, particularly
when compared to other international regions 17. In fact industry competitiveness was more associated with
product quality and range, raw material quality, location of the plant relative to the market and transport
costs. Other studies have however pointed out that macro-economic studies can hide substantial variations
and complexities at sectoral level
Gonzaga Debate Institute 2008 44
Scholars Regulations/Free Market Toolbox

Regs Good – AT: Poverty

Regulations don’t exacerbate poverty – they assume the worst-case scenarios

Parry 2 (Ian W H, Resources for the Future Fellow, “Are All Market-Based Environmental Regulations Equal?”,
http://www.issues.org/19.1/p_parry.htm)
But distributional concerns should not be an excuse for avoiding action on serious environmental
problems. Pollution control measures should be evaluated mainly by weighing their environmental
benefits against their economic costs for society as a whole. Distributional objectives are much better
addressed by altering the income tax system or providing a safety net through the benefit system. It still
makes sense, however, to avoid environmental policies that increase income inequality. That is a major
drawback of grandfathered emissions permits. When the government gives away rights to pollute for free,
companies acquire an asset with market value. This enhances their net worth. The increase in company equity
values in turn leads to more profits for shareholders, either directly through higher dividends and capital
gains or indirectly though their holdings in retirement accounts. Stock ownership is highly skewed toward the
rich; the top income quintile owns about 60 percent of stocks, whereas the bottom income quintile owns less
than 2 percent. Using annually allocated grandfathered permits to meet the original U.S. carbon pledge under
Kyoto could transfer more than $50 billion each year in pretax income or larger retirement assets to the top
income quintile. Thus, higher-income groups can benefit greatly from grandfathered permits, with their
windfall gains easily outweighing their income losses from higher product prices. Poor households, by
contrast, are worse off. According to a study by the Congressional Budget Office, grandfathered permits to
reduce U.S. carbon emissions by 15 percent would cut the annual real spending power of the lowest-income
quintile by around $500 per household, while increasing that for the top income quintile by around $1,500
per household. Auctioned emissions permits and emissions taxes do not create windfall gains to
shareholders. Instead, the government obtains revenue that can be returned to households in a
distributionally neutral manner, such as proportional reductions in all marginal income tax rates, or in
ways that disproportionately benefit the poor, such as increasing personal allowances
Gonzaga Debate Institute 2008 45
Scholars Regulations/Free Market Toolbox

C&C Good-Solves Pollution


Command and control solves pollution
Hart`7 (Stuart L. Hart is one of the world's top authorities on the implications of sustainable development and environmentalism
for business strategy, Capitalism at the Crossroads: Aligning Business, Earth, and Humanity, November 2, 2007,
http://www.whartonsp.com/articles/article.asp?p=775679)
There can be no question that command-and-control regulation was of enormous importance; it
required, perhaps for the first time, that business address directly its negative societal impacts. Since the
time of the industrial revolution, enterprises had relied upon the extraction of cheap raw materials,
exploitation of factory labor, and production of mass quantities of waste and pollution (think of those
"dark, satanic mills"). Indeed, pollution was assumed to be part of the industrialization process. When
economists conceived the concept of externalities, in other words, it seemed virtually impossible that
firms could behave in any other manner. For the better part of 200 years, industrial firms engaged in what
might be described as "take, make, waste" as an organizing paradigm.2 Command-and-control regulation
seemed a necessary and appropriate counter to the prevailing industrial mindset.
.
Gonzaga Debate Institute 2008 46
Scholars Regulations/Free Market Toolbox

C&C Good-AT: Inefficient


Command and Control not inherently inefficient, the solvency must be determined on an
individual basis
Cole and Grossman 98 (Daniel H and Perter Z, Professor Indiana University School of Law and Clarence Efroymson
Chair and Assc. Prof. of Economics, Sept., http://papers.ssrn.com/sol3/papers.cfm?abstract_id=135749)
Contrary to the conventional wisdom among economists and legal scholars, command-and-control
(CAC) environmental regulations are not inherently inefficient or invariably less efficient than
alternative "economic" instruments (EI). In fact, CAC regimes can be and have been efficient
(producing net social benefits), even more efficient in some cases that alternative EI regimes.
Standard economic accounts of CAC are insensitive to the historical, technological, and institutional contexts
that can influence (and sometimes determine) the efficiency of alternative regulatory regimes. A regime that
is nominally or relatively efficient in one set of circumstances may be nominally or relatively inefficient
in another. In some cases, given the marginal costs of pollution control, technological constraints, and
existing institutions, CAC can be the most efficient means of achieving a society's environmental
protection goals. This paper reviews the empirical literature on environmental regulation and finds that
CAC is not inherently inefficient or invariably less efficient that EI. In addition, the paper elaborates a
model through five stylized cases, which demonstrate how alternative approaches to environmental
regulation are more or less efficient depending on institutional and technological factors that affect
overall regulatory costs. Finally, the model is empirically supported by a detailed history of the U.S. Clean
Air Act's regulatory regime. Viewed as an evolutionary process, occurring within an institutional and
technological framework, it was (nominally and relatively) efficient for Congress to rely, in the early years of
federal air pollution control, on CAC regulations, and then in more recent years to begin experimenting with
efficiency-enhancing EI.
Gonzaga Debate Institute 2008 47
Scholars Regulations/Free Market Toolbox

***Tax Credits Good


Gonzaga Debate Institute 2008 48
Scholars Regulations/Free Market Toolbox

Tax Credits Good – Key to Alternative Energy


( ) Tax credits are the best incentive for alternative energy. This will encourage
experimentation in this field with a security blanket for the cost of failure.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Preferential tax treatment is often provided to risky industries. n163 According to proponents' rationale,
without a subsidy, the tax system may discourage investment in activities that involve both high risk
and the possibility of substantial losses. n164 In certain circumstances, "lower income tax rates for the
more risky industries may be consistent with an optimum allocation of productive resources." n165
Moreover, investors in high-risk activities require higher investment returns, and taxes can make that
harder to achieve. n166 Because of the social benefits of inexpensive petroleum, ignoring other costs such
as pollution, the government has provided tax incentives that reduce or eliminate the effect of taxation
on the oil and gas industry. n167

( ) Alternative energy resources have not developed because of the absence of tax credits.
The current subsidies are not immediately deductible and do not encourage investment in
other types of energy.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola
University Chicago School of Law, Journal, 38 Loy. U. Chi. L.J. 43, Lexis)
The federal government's huge investment in the petroleum industry, through both tax and other government
subsidies, influenced how [*65] quickly and dramatically the United States developed into a fossil fuel-
driven society. Investment spurred development and consumption, resulting in exhaustion of the
resource more quickly than might otherwise have occurred. In addition, other energy resources have
not developed because of the inability to compete with the heavily subsidized petroleum fuel industry.
This section discusses the impact and effectiveness of energy-based tax incentives for the petroleum industry
over a fairly long time period, and it considers ways to use similar incentives to stimulate alternative fuels.
For over ninety years, the combination of percentage depletion and the deduction for intangible drilling
costs, along with more recently enacted tax incentives, has significantly lowered the effective tax rate for,
and attracted substantial resources to, companies in the oil and gas industry. Deductions for the costs
of exploration and production in the petroleum industry are superaccelerated as compared to other
types of capital investments because amounts in excess of original cost are deducted and most other
costs associated with the investment are not only recoverable, but immediately deductible. n141 These
generous tax incentives were designed to defer tax liability and to encourage oil and gas prospecting and
drilling along with the development of U.S. petroleum reserves. n142 Since their inception, however, the
combination of percentage depletion and intangible drilling costs deductions has resulted in little or no
income tax for much of the petroleum industry. n143 A mere nine years after Congress enacted percentage
depletion in 1925, critics begin to characterize these deductions as tax "loopholes." n144 In 1937 President
Franklin Roosevelt declared that percentage depletion was "perhaps the most glaring loophole in our present
revenue law." n145
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Tax Credits Good – Expansion Key to Alternative Energy


( ) Tax subsidies for alternative fuels are too small. The lack of action has failed to reduce
fossil fuels.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
The most significant alternative fuel tax provision, the credit or deduction for alcohol fuels, which constitutes over
ninety-four percent of alternative tax incentives directed at reducing gasoline use, n193 grants a subsidy to
fossil fuels mixed with an alternative fuel, typically alcohol or ethanol. n194 Although the incentive ostensibly
encourages more efficient fossil fuel consumption, alternative fuel use has not resulted in lower fossil fuel
consumption or reduced our dependence on cars. n195 In fact, both consumption and car use have increased
despite these provisions. Since 1978, when Congress enacted most of the alternative fuel provisions, the United
States has invested between $ 30 and $ 33 billion in alternatives through tax subsidies. During this same period,
despite decreases in oil and gas incentives, the United States invested approximately $ 106 billion in fossil fuels -
three times what it spent on alternative fuels. n196 This kind of differential, not surprisingly, undercuts the
likelihood of achieving successful results for alternative fuel technologies. To date, the tax subsidies for
alternative fuels are too small, and they fail to target the real problem: fossil fuel dependence.
Alternative fuels have the potential to reduce petroleum consumption, reduce greenhouse gas emissions, and
produce significant energy savings. Therefore, under a long-term strategy, moving to alternative fuels represents an intermediate step in the right
direction. Unfortunately, several recent studies indicate that even with increasing purchases of alternative fuel vehicles by federal agencies, state governments, and
private consumers, "alternative fuel use in the transportation sector remains very small." n197
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Tax Credits Good – Solve Oil Dependence


( ) Petroleum companies have been granted tax relief 6.5 times higher than the maximum
rate applicable to general businesses. This system can be reversed and will have
astronomical effects.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
An early Treasury Department study indicated that percentage depletion reduced the taxable gross income of the
petroleum industry as a whole by approximately 25.3%, even taking into account the 50% net income limitation
in place prior to 1990. n146 The study also revealed that percentage depletion exceeded cost depletion by
approximately 95.7% [*66] of the total depletion allowable. n147 Other studies show that intangible drilling costs account for
seventy-five to ninety percent of the costs of drilling. n148 A nationwide survey taken between 1948 and 1955 indicated that IDCs averaged slightly less than seventy
percent of total gross income from production. n149 Therefore, the IDC deduction alone appears to have had the effect of reducing the marginal tax rate by more than
half. Another tax return study using samples from leading corporations in selected industries for the period between 1938 and 1961 indicated that oil and gas
producers earned higher rates of return than integrated petroleum companies, manufacturing companies, mining companies, and all other industry, with a rate of return
for oil and gas producers ranging from three to twenty-two percentage points higher. n150 After 1969, when Congress reduced the percentage depletion rate to twenty-
the combination of the percentage depletion and IDC deductions reduced the total
two percent, one report estimated that
tax liability for petroleum and oil producers by approximately forty-six percent, 6.5 times higher than the
maximum rate applicable to the general business credit available at the time. n151 Throughout the 1980s and
1990s, tax rates for oil and gas producers continued to be lower than rates for other industries. n152

( ) Tax credits have a direct effect on consumption – the tax relief granted to petroleum
companies prove.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
[*67] The increased profitability and reduced marginal tax rates of the petroleum industry reduced
production costs, increased investments in petroleum exploration, accelerated oil and gas extraction, and
caused rapid depletion of energy resources. n153 Specifically, "relatively low oil prices encouraged petroleum
consumption (as opposed to conservation) and inhibited the development of alternatives to fossil fuels, such as
unconventional fuels and renewable forms of energy." n154 One early study analyzing resource allocation from 1959 to 1971 concluded
that federal tax policies significantly affected investment in crude petroleum reserves. n155 The same study also indicated that the percentage depletion allowance was
not cost-effective in increasing reserves when compared to the alternative policy of having the government purchase additional oil reserves directly. n156 The
effect of these tax benefits can be directly related to increased consumption. Several recent reports have quantified the tax
benefits to the petroleum industry as reflected through lower gasoline prices to consumers. n157 These estimates conclude that tax subsidies reduce the
price of gasoline by 1.5 to 7 cents per gallon. n158 Lower prices translate into additional consumption, rather
than conservation, of gasoline by consumers. Because energy policy is made in a political setting, it rarely comports with principles of
economic or public finance theory, and "more often than not, energy tax policy may compound existing distortions, rather than correct them." n159 In 1920, oil and
gas production comprised sixteen percent of total U.S. energy production. By 1970, the nation's peak production year, petroleum [*68] production constituted
seventy-one percent of total U.S. energy production. n160 Policy makers have justified the differential tax treatment of the petroleum industry on several grounds: (1)
to adjust for the high risk associated with the oil and gas industry and encourage investors to provide the significant up-front capital needed to develop this valuable
commodity; (2) to encourage conservation of the oil and gas reserves and prevent waste of our limited oil reserves; and (3) to maintain our productive capacity in oil
reserves for national defense purposes. n161 While other reasons for preferential tax treatment are also advanced, these three reasons are the most commonly used to
justify percentage depletion and the IDC deductions. n162
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Tax Credits Good – Laundry List


( ) Tax incentives are cheap and will result in massive energy conservation – this will
increase the likelihood of investment into alternative energy.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Unfortunately, Congress only extended the provision for two years in the 2005 legislation. n211
Since the Reagan era, all of the energy tax legislation enacted by Congress has continued to provide tax relief
for the oil and gas industry, with only modest incentives for conservation and alternative fuels. n212 For
example, in the most recent 2005 Energy Tax Act legislation, fossil fuel subsidies accounted for more than two-
thirds of the total tax expenditures provisions for energy. n213 The various tax incentives available for
conservation and renewable technologies represent a small fraction when compared with the country's
enormous investment in fossil fuels and its infrastructure.Yet the potential for improved energy efficiency in the
United States is immense. n214 One report states that with existing cost-effective energy efficiency
improvements, electricity demand could be reduced by eleven to twenty-three percent below projected levels
for 2010, and possibly up to thirty-five percent by 2020. n215 In fact, data on energy [*77] efficiency and
conservation activities from 1973 through 1991 revealed an eighteen percent reduction in energy use from
previous projections, saving about $ 150 billion annually in total domestic energy expenditures. n216 In terms
of environmental quality, one study estimated that by implementing a number of recently proposed conservation
programs, annual carbon emissions would be reduced by about 3.5% and nontransportation energy consumption
would be reduced by about 6%. n217 Energy efficiency policies, which address the demand side of the energy
equation, are an inexpensive means to address the environmental and national security problems associated with
fossil fuel use. The energy savings alone typically cover the cost associated with the policy change.Tax incentives
can help increase the market for new energy efficient products by reducing their cost and lowering the risk of
production for manufacturers. n218 As a result of tax incentives, the public benefits from lower energy use,
environmental quality improvements, and enhanced energy security. n219 One study estimated that tax
incentives for new energy efficient homes, energy efficient upgrades to existing homes, and energy efficient
upgrades to new and existing commercial buildings could save eleven quadrillion Btus of energy through 2025,
ultimately saving consumers over $ 88 billion during the same period. n220
On the positive side, the government's cost to implement the tax incentives included in the 2005 Energy Tax
Incentive Act is far less than it will realize from the energy efficiency improvements, not including the cost
savings from environmental quality improvements. n221 Moreover, tax deductions and credit for energy
conservation could significantly increase the likelihood that individuals and businesses will invest in
alternative fuel technologies. n222 To the extent that policy [*78] makers are able to identify incentives that
encourage environmentally sound behavior and result in both environmental and monetary savings, Congress
must be more proactive in adopting such incentives.

( ) Tax credits are necessary – multiple reasons.


Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
The federal government has used tax incentives to effect social, economic, and political goals since the inception of
the income tax. The use of such targeted tax incentives violates principles of tax neutrality when they deviate from
the generally accepted structure of an income tax. n13 In essence, such tax incentives implement government
policy [*47] apart from any revenue-raising impact, which is the purported function of the tax system. The
advent of the tax expenditure budget in the 1970s forced policy makers to quantify these "tax subsidies," thereby
increasing their transparency. n14
Since the early stages of the fossil fuel industry's development, the federal government has implemented tax
incentives to promote the industry. Federal incentives targeting the energy industry have been justified on
several grounds: (1) to encourage oil and gas production and exploration during the initial stages of
development; (2) to compensate for the value differential of an activity between the private sector and the
public sector; n15 and (3) to overcome the risks and hazards associated with producing oil and gas. n16
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Tax Credits Good – Laundry List


( ) Tax credits have multiple benefits – none of them are being seen in the squo because the
government over allocates them to fossil fuel producers.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Since the 1970s, policy makers have employed energy taxes and subsidies to help alleviate a host of problems:
declines in production, increases in demand, oil embargoes, oil price and supply shocks, wide petroleum price
variations and price spikes, rising oil import dependence, and increased evidence of the seriousness of
environmental problems associated with fossil fuels. n55 The Energy Tax Act of 1978 was Congress's first
attempt to encourage energy conservation and development of alternative fuels through tax provisions. n56
Although the government's new environmental legislation and its regulations on pollutants enacted during the 1970s
were groundbreaking, these "environmentally friendly" tax incentives are inconsequential when compared with the
federal investment targeted at fossil fuel exploitation. The overwhelming majority of energy tax incentives
continue to support businesses that extract, produce, and transport nonrenewable resources. Although federal
support is slowly increasing, industries involved in developing renewable energy do not receive the government
assistance and commitment that the fossil fuel industries have enjoyed.
Gonzaga Debate Institute 2008 53
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Tax Credits Good – Laundry List


( ) Tax incentives can be very effective in expanding the alternative energy market –
petroleum industry proves.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Despite rhetoric claiming a commitment to the development and implementation of alternative and renewable
energy and to overcoming our devastating oil habit, the numbers tell the truth: to date, Americans have only
dabbled in alternatives. Tax incentives enacted to encourage alternative fuels are too small and do little to
change the infrastructure that supports nonrenewable fuels. Put simply, the incentives are insignificant and fail
to address the real problem - dependence on fossil fuels. On the other hand, the same tax incentives that
subsidized fossil fuels fifty years ago still do so today. This combination of provisions, by and large, has been
ineffective in solving any of the problems associated with fossil fuel dependence. Though Congress has limited
fossil fuel subsidies somewhat over the years and enacted a few "environmentally friendly" tax subsidies since the
1970s, policy makers, hampered by politics, are slow in formulating a long-range plan for dealing with fossil fuel
dependence through tax policy or elsewhere. Policy makers must focus on identifying features of the various tax
incentives that correlate positively with their goals: stimulating alternative fuel technology, promoting
investment in and public acceptance of renewable energy sources, conserving energy, and increasing
efficiency of traditional energy technologies. Carefully crafted tax incentives are a vital tool that can assist
policy makers in moving the nation toward a sustainable energy future. The effectiveness of energy tax
incentives used to develop the petroleum industry reveals a number of important lessons that should be considered
when formulating incentives to develop alternative energy sources. n223 Promoting the commercialization of
advanced technologies and assisting their establishment in the marketplace can be facilitated through tax
incentives. n224 Policy makers should prioritize developing those technologies that will have the most
significant impact in reducing energy use and greenhouse gas emissions. To be most effective, incentives
should be substantial enough to overcome barriers to market entry and target technologies where the
primary obstacle to development is the initial cost. Governments also need to be flexible in [*79] terms of who
receives incentives and must allow adequate time before eliminating them. Finally, tax incentives need to be
incorporated into a comprehensive mix of policy instruments, operating in harmony with other initiatives.
The Energy Tax Incentives Act of 2005 has both succeeded and disappointed based on these criteria. First, the vast
majority of its tax incentives will expire at the end of 2008. n225 To be most effective, the incentives should be left
in place for at least a ten-year period. n226 Because these new incentives will expire within a short time,
individuals and businesses that might have utilized the credits may not even know they are available before
the credits are phased out. Even taxpayers interested in investing in new technologies subject to the incentives
may have difficulty finding those technologies in the market. Additionally, some of the most cost-efficient and
energy-efficient tax credit proposals were not enacted. For example, a ten-percent credit for Combined Heat and Power Systems, which
has an estimated benefit-to-cost ratio of 3:1, was not enacted. n227 On the other hand, the $ 2 billion the government is spending on energy efficiency tax incentives
will save 2.5 quadrillion Btu, or about two percent of projected energy use in 2020, will reduce energy bills by more than $ 20 billion, and will reduce carbon dioxide
by about fifteen million metric tons, n228 making it apparent that energy-saving tax measures can produce significant cost savings and contribute to environmental
improvements.
Gonzaga Debate Institute 2008 54
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Tax Credits Good – Tax Revenue


( ) Governments prefer tax credits because they maximize tax revenues and can self-
sustain further environmental projects.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
Svendsen argues that state governments prefer green taxes because of the ability to maximize tax revenues. n85
Nordic green taxes in the 1990s taught policymakers that it can be difficult to net substantial revenues through
green taxation. Governments should consider the ability for even relatively small amounts of revenue to self-
sustain further environmental projects. In other words, revenue from green taxes can be recycled back into
projects that further environmental protection. The political success of trading permit schemes should not be
overlooked. The environmental success of trading schemes in the United States has encouraged several other
governments to choose permit trading over green taxation. For many governments, green taxation is an uphill
battle against the powerful forces of industry, a battle potentially not worth fighting. n86

( ) Tax credits can generate government revenue and increase the economy. This would
help accelerate efforts on the environmental front.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
Green taxes may be used to punish polluters. The general principle of increasing taxes on "bads" (e.g.
polluting, smoking) and decreasing taxes on "goods" (e.g. labor) n93 was first adopted by the OECD in [*428]
1972. n94 Environmental agencies across the globe use this underlying principle as a reason for implementing green
taxes. n95 Countries including Sweden, Norway, Finland, Denmark, and the Netherlands have attempted to
shift the tax burden of labor and capital to the use of environmental resources through the implementation of
green taxes. n96 Green taxes are also often designed to change behavior. Taxes must be set high enough to "make it attractive for customers to use more
environmentally benign products and practices." n97 For example, in 1989 the U.S. Congress introduced a federal tax on Ozone Depleting Chemicals. Initially the tax
on chlorofluorocarbons (CFCs) was $ 1.37 per pound, approximately twice the then-current product price. n98 By 1995, the federal tax was $ 3.10 per pound. n99 The
Federal Government simultaneously introduced the Clean Air Act, which put a cap on most CFCs with a phase-out in 2000. Nevertheless, many analysts believe that
the tax, not the cap, is responsible for U.S. ozone gas reduction. n100 Similarly, policymakers can use green taxes to channel good behavior and influence the choice
governments may want to discourage the use of exhaustible natural resources and
of resources used. For example,
provide more attractive alternatives through the use of the tax system. n101 Governments may also use green
taxes to generate revenue. Governments may choose to use the resulting revenue to pay for damages created
from past pollution or for measures to reduce future pollution. For example, of the thirty-two billion pounds
generated by U.K. environmental taxes in 2001, fourteen percent purportedly was allocated to environmental
projects. n102 Tax shifting describes the economic theory that by combining a significant pollution tax with a
major restructuring of the national tax system, government can make the overall economy more efficient.
[*429] This theory often arises in conjunction with raising revenue. In the early 1990s, many scholars suggested
that governments could eradicate unemployment by implementing high environmental taxes. The debate was most
vigorous in European countries with strong environmental political parties and high unemployment. n103
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Tax Credits Good – Income Adjustments


( ) Tax credits good – they can be income adjusted and class-effective.
Mann 2k (Roberta, Associate Professor of Law, Widener University School of Law, Arizona State Law Journal, Lexis)
The home mortgage interest deduction serves primarily to subsidize the shelter of middle to upper income Americans who are willing to purchase residences. As
shown above, the home mortgage interest deduction has a strongly regressive effect. n277 At the other end of the spectrum, a series of direct spending programs
provide shelter for lower income Americans. n278 In [*1394] 1972, Henry Aaron noted that the United States has no housing strategy. n279 Henry Aaron evaluated
six groups of Federal housing policies: (1) housing subsidy through the Internal Revenue Code; (2) federal mortgage insurance and loan guarantees; (3) federally
sponsored financing instruments; (4) "public housing[;]" (5) "special assistance through mortgage markets[;] and" (6) "aid to residents of rural areas." n280 He
reserved his harshest criticism for the Internal Revenue Code, stating that "with respect to any conceivable policy objective, the pattern of tax benefits seems to be
capricious and without rationale." n281 As a more equitable alternative to the existing policies, Henry Aaron proposed a "Housing Assistance Plan," which would
provide "rent" certificates to renters and homeowners making monthly mortgage payments. n282 The payments would be tied to actual housing outlays. n283 More
recently, Professor Peter Dreier has proposed eliminating the home mortgage interest deduction and replacing it with a refundable homeowner tax credit. n284 The
tax credit would be organized along the lines of the earned income tax credit for low wage earners, and would be
administered by the Internal Revenue Service. n285 Peter Salsich notes that the housing benefits of such a tax credit could be
expanded to include renters by allowing a credit against taxes for a percentage of housing costs, not just
mortgage interest and property tax payment. n286 The shelter credit, as outlined below, would encourage home
ownership for all Americans, while discouraging sprawl. Tax credits, unlike itemized deductions, benefit the relatively low
income taxpayers who take the standard deduction as well as the relatively higher income taxpayers who
itemize deductions. The proposed shelter credit would have two components, a base amount and a location efficiency premium ("LEP"). The base amount of
the credit would be designed to encourage purchase of a median-priced home, in contrast to the home mortgage interest deduction, which provides an increasing
Limiting the benefit of the credit to the more modest median home ensures that
benefit for increasingly expensive homes.
wealthier taxpayers do not get the lion's share of the credit. Limiting [*1395] the benefit of the credit to the
more modest median home also eliminates an incentive to sprawl development--the government would no longer subsidize the
purchase of larger homes on larger lots. The base amount of the credit would be determined by multiplying the median national home price by the annualized long-
term tax exempt interest rate, and then multiplying that product by the lowest marginal tax rate. n287 The base amount of the credit will thus approximate the amount
of tax benefit that would be derived from interest payments on the average home under current law, if the taxpayer did not have to itemize to get those benefits. If
structured as a refundable tax credit, the Federal shelter credit would not only reduce or eliminate federal income tax liability, but would also pay cash to homeowners
if the Federal shelter credit exceeded the tax they owed. n288 The amount of the credit would be capped at the actual housing cost paid by the taxpayer, n289 and
LEP component of the shelter
could be phased out at higher income levels in a similar manner to the phase out of itemized deductions. n290 The
credit would reduce sprawl by increasing the amount of the shelter credit for homes located close to public
transportation. The LEP would be based on calculations similar to those done by John Holtzclaw in his analyses of location efficiency. n291 Because the
[*1396] LEP reflects the additional value represented by the accessibility of the home to public transportation, it would create an incentive for home buyers to
purchase transit accessible homes, which are generally located close to the urban core. n292 Encouraging home buyers to seek homes close to available transportation
will reduce sprawl development, which is characterized by low density and automobile dependence. n293
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Tax Credits Good – Cost Competition


( ) Renewable energy is not cost-competitive – tax credits are key to stimulate R & D.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Studies evaluating the effectiveness of tax incentives in stimulating the alternative fuel technology industry
confirm that such incentives, or equivalent measures, are necessary to the industry's development. Entering
into the current energy industry with its deeply entrenched fossil fuel infrastructure presents potential
investors in alternative and renewable fuels with difficult barriers. Without federal tax incentives, which
make prices competitive with conventional fuels, no markets would exist for alternative energy sources like
alcohol fuels, and the result is no capital. n9 Alternative energy sources have the potential to reduce
petroleum consumption, reduce greenhouse gas emissions, and produce significant energy savings. To date,
however, their limited use has not had a significant impact on the environment. Even with increasing purchases of
alternative fuel vehicles by federal agencies, state governments, and private consumers, "alternative fuel use
in the transportation sector remains very small." n10 Nor have alternative energy sources been effective in
increasing the supply of oil reserves or reducing dependence on foreign imports. As long as fossil fuels remain
relatively inexpensive, alternative energy industries will not be competitive. The United States must eliminate
fossil fuel subsidies and invest in renewable energy before any real gains will be realized.
Gonzaga Debate Institute 2008 57
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Tax Credits Good – Commercialization


( ) Tax credits will provide the government flexibility and stimulate the commercialization
of advanced technologies. This will overcome barriers to entry into the market.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Tax incentives, if properly structured, can play a valuable role in moving the United States toward a
sustainable energy future. A detailed analysis of the effectiveness of energy tax incentives reveals a number of
guiding principles that should be used in formulating tax incentives to promote alternative energy sources. For
example, tax incentives should stimulate the commercialization of advanced technologies. Such incentives
must be substantial enough in the initial stages of the subsidy to overcome barriers to entry into the market.
Concomitantly, tax incentives should target technologies where the initial equipment cost to either the supplier or the
consumer presents the major barrier. n11 Governments also must remain flexible in terms of [*46] which
industry players receive incentives and should allow adequate time before phasing out such incentives. Finally,
tax incentives must form part of a mix of policy initiatives and work in complementary fashion with other
strategies.
Gonzaga Debate Institute 2008 58
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Tax Credits Good – Innovation


( ) Tax credits allow entities to have insurance for failed projects. This massively increases
innovations and interests in research for alt. energy.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
As American dependence on fossil fuel-based technologies, such as cars and electricity, increased, so too did
Congress's use of tax incentives to encourage exploration and development in the oil and gas industry. Arguing
that the United States must do all it can to encourage the search for more oil, including more tax incentives, one 1958 government article, written by an official at the
Pure Oil Company in Chicago, stated, "A large part of the credit for the high standard of living in the United States may be attributed to a healthy oil industry. It not
only provides employment to millions of people directly, but it is one of the largest customers of ... other industries which employ additional millions merely to keep
the oil industry supplied." n17 By the early 1970s,
the federal government realized that the domestic supply of oil was fixed
and relatively determined while the nation's increasing demand for oil showed no signs of slowing. The
justification for continued fossil fuel tax incentives had changed from support for a [*48] fledgling industry to price support for American fuel demands. n18 The
For almost 100 years, two
next two sections discuss those tax incentives used to promote the energy industry, their justifications, and their effectiveness.
very important tax incentives have been available for businesses that explore for and produce oil and gas: (1)
the percentage depletion allowance and (2) the deduction for intangible drilling costs. Similar to depreciation of a tangible
asset, the depletion allowance provides for cost recovery of an owner's mineral investment. n19 Such cost recovery recognizes the wasting nature of the mineral
deposit as it is extracted from the ground. Typically, the purchase price of the property, discovery costs, and development costs are included in the capital costs of the
mineral investment. Two methods of depletion are allowable: cost depletion and percentage depletion. A taxpayer using cost depletion recovers the actual costs of his
or her mineral investment over the deposit's producing life based on the amount of the mineral extracted each year. n20 Cumulatively, cost depletion deductions
cannot exceed the original capital investment.
Congress adopted percentage depletion n21 to encourage exploration and
production activities. Under percentage depletion, taxpayers are permitted to deduct a fixed percentage of the gross
value of annual production. n22 Percentage depletion is computed without regard to the taxpayer's actual investment
in the property. As a result, cumulative percentage depletion deductions can exceed the original investment
costs. If the value of the mineral deposit exceeds the original cost of the investment, percentage depletion
affords the investor a bigger tax deduction, and thus a [*49] significantly reduced tax rate based on
successful production. n23 Moreover, taxpayers taking percentage depletion deductions may also take additional deductions from gross income of nearly
all of the actual exploration and development costs. In addition to percentage depletion, taxpayers may immediately deduct their intangible drilling and development
costs (IDCs). n24 IDCs typically include labor, fuel, hauling, power, materials, supplies, tool rentals, drilling equipment repairs, and other items incident to and
necessary for drilling and equipping productive wells. n25 Unlike similar costs in other businesses, these costs do not have to be capitalized.
In addition, the
costs associated with a nonproductive well or "dry hole" (which make up about eighty percent of all wells
drilled) are also deductible when incurred and can offset other sources of income. n26 If the taxpayer chooses to
capitalize these costs, they can be recovered through depletion or depreciation deductions. n27 The percentage
depletion allowance and the intangible drilling cost deduction account for the most significant federal investment in
the fossil fuel industry.
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Tax Credits Good – Better Than Command & Control


( ) Tax credits are better than command and control – three reasons.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University
of Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
Economic incentives (EIs), on the other hand, have become increasingly popular around the globe. The
Environmental Protection Agency (EPA) has adopted a broad definition of EIs as "any instrument that provides
continuous inducements, financial or otherwise, to encourage responsible parties to reduce their release of
pollutants or make their products less polluting." n69 As such, EIs include tradable [*423] permit schemes and
green taxes. EIs have a number of advantages over traditional CAC regulation in controlling GHG
emissions. n70 First, EIs encourage polluters to "reduce pollution below permitted amounts when it is
relatively inexpensive to do so." n71 Second, EIs promote technological innovation. Polluters will be willing
to spend resources on alternative energy sources, for example, when economically efficient. n72 Third, EIs
are better suited to cover a wide range of polluters, large and small, because EIs do not demand the amount
of enforcement required by CAC regulation. n73

( ) More ev.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
In his book, Public Choice and Environmental Regulation, Gert Ting-gaard Svendsen of the Aarhus School of
Business in Denmark discusses the general attitude of private industry, state government, heavily regulated industry,
and environmental groups toward the options for emissions regulation. n81 Svendsen reports that private industry
generally supports permit markets. n82 Permit trading schemes are more flexible than CAC regulation, which
does "not readily adapt to changing economic conditions, and therefore, does not embrace new technological
solutions." n83 Green taxes are rigid and may be arbitrarily set, while permit markets allow the market to set
prices. Moreover, private industry particularly supports grandfathering schemes that effectively make it
more difficult for future competitors to enter the industry. n84
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Tax Credits Good – AT: Economically Infeasible


( ) Tax credits are the most economically prosperous – studies and effects prove.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
While green taxation can provide government with a revenue source, the amount of revenue will be a function
of the level of tax and administrative costs. n339 The days of the golden double dividend appear to be gone.
Economic models suggesting governments could eradicate unemployment with sufficient green taxes did not
stand up in the real world. n340 That said, existing green tax regimes suggest it is entirely possible to
simultaneously reduce other "bad" taxes. n341 Also, governments may choose to recycle some tax revenue back into
environmental projects. n342 Such systems reflect sound policy choices because, in essence, the environment
receives a double dividend. Naturally, government must spend sufficient resources in determining the
appropriate level of tax and where to appropriate any resulting revenue. In some cases, administrative [*458]
costs can be greater than the tax assessed and thus provide a negative source of revenue, a result to be avoided.
Since permit trading schemes allow polluters to purchase extra allowances, some polluters will continue doing
business as usual. As such, environmentalists criticize some trading schemes for creating "hotspots" (areas in which
GHG emissions remain strong). n343 For instance, environmental groups have called for stringent mercury
regulation in the United States and have argued that mercury is too great a health hazard to be an appropriate
candidate for market-based regulation, which can result in uneven enforcement and protect some populations more
than others. n344 Taxation on GHGs is also market-based and simply provides a price incentive for firms to
decrease GHG emission and can, theoretically, result in hotspots. n345 Recent studies suggest permit trading
schemes are more likely culprits. Grandfathered permit schemes are especially likely to create this negative
public health effect because entrenched industry is favored and thus may be allocated enough permits to
cover its prior emissions levels. These established industries are also quite likely to reside in the same
geographical area for reasons having to do with available resources or the history of development. Further
scientific discovery will answer whether carbon dioxide and other greenhouse gases lead to such hotspots.
Carbon taxation may also make more sense in economic terms than the alternative permit trading system. There is
enormous uncertainty regarding the costs and benefits of carbon abatement and, therefore, "it can make a big
difference whether you regulate by quantity (that is, caps) or with price (that is, with taxes)." n346 Economists
argue that the per-unit benefits of carbon abatement change little relative to the amount of the overall carbon dioxide
in the Earth's atmosphere. n347 Conversely, the per-unit costs to factories and utilities change a lot. n348 Therefore,
economists reason the tax is preferable to a trading system because the tax, theoretically, can be set at a rate
that can never greatly exceed the benefits. n349 (Extensive research would be required to achieve the correct tax
rate.) The trading system, on the other hand, [*459] depends on a volatile market with much less certainty. n350 In
other words, "a reasonable carbon tax would never impose unreasonable costs on the reduction of carbon emissions,
but a quantity target could" n351 and "preserving the cap at all costs is simply not worth it." n352
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***Tax Credits Bad


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Tax Credits Bad – Not Cost Competitive


( ) Tax credits have been implemented on a large scale in 2005 – studies prove they are not
cost effective and have no impact on energy production.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)

Congress passed the Energy Tax Incentives Act in August 2005. As the most significant energy legislation in
many years, the Act contains tax incentives for both the fossil fuel industry and its infrastructure, as well as
the alternative and renewable fuel industries. n41 Tax breaks for domestic fossil fuels constituted well over
half of the government expenditure mandated by the legislation over a ten-year period. n42 As part of this Act,
Congress added to the nonconventional fuels credit a production credit for qualified facilities producing coke or
coke gas. The $ 3.00 credit is available for up to 4,000 barrels of oil equivalent. The credit for these fuels extends
until January 1, 2010. In addition, this credit is now part of the general business credit, thus making carry back
and carry forward of unused credits available. n43 [*52] The Act also included several other incentives to
stimulate oil and gas production. First, the new law increases the number of oil and gas producers that will be
able to claim percentage depletion by qualifying as independent producers or royalty owners. Percentage depletion
may only be used by independent producers or royalty owners who are not "refiners." Under the old law, to avoid being classified as a "refiner," a producer could not
engage in refining operations in which production exceeded 50,000 barrels on any day during the taxable year. The law now allows producers to refine up to 75,000
barrels based on average daily production and still qualify for percentage depletion. n44 In addition, the Act made certain natural gas distribution lines and electricity
transmission property depreciable over fifteen years rather than thirty years, and natural gas gathering lines depreciable over seven years rather than fifteen years. n45
Congress
Geological and geophysical costs are now amortizable over a two-year period rather than capitalized as part of the cost of the oil and gas property. n46
also provided a temporary option to claim qualified oil refinery property as an expense. A taxpayer may also
expense fifty percent of qualified refinery property used in the refining of liquid fuels for property if the
property has a binding construction contract prior to January 1, 2008; is placed in service before January 1, 2012;
and meets increased capacity requirements. n47 Ordinarily, petroleum refining assets are recovered over a ten-year
period. Congress also included two new credits for investment in certain clean coal technologies. A twenty
percent investment tax credit is provided for property associated with gasification of coal, including any coal
handling and gas separation equipment. Additionally, a fifteen percent tax credit is now available for other
advanced coal-based projects, and a twenty percent credit is available for certain certified gasification
projects as well. n48 The Act also provides significant additional government investment into the existing
nonrenewable energy infrastructure. Though several of [*53] these provisions are designed to encourage more
efficient use of fossil fuels, a number of these incentives target exploration and development of petroleum. However,
most of the available studies suggest that these tax incentives are not cost effective and have little or no impact
on energy production. n49 One recent study evaluating many of the Act's tax incentives found that the
estimated federal revenue loss from enacting the incentives would not be offset by revenues generated from
increased oil and gas supplies stimulated by those tax incentives. n50
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Tax Credits Bad – No decrease in conservation


( ) Tax credits have not resulted in conservation nor an increase in security of foreign
imports – empirics prove this method fails.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Early empirical studies of the impact of oil and gas tax incentives on resource allocation consistently
concluded that these special provisions allowed the petroleum industry to maintain a higher level of private
investment than it would have absent these policies. n4 However, early cost-benefit analyses of these tax incentives were inconclusive. The
earliest studies focused on the petroleum industry's rate of return on investment as compared to other industries. They reveal that tax incentives substantially increased
the petroleum industry's rate of return, but they provide little information regarding the correlation between such incentives and the level of investment in oil and gas.
n5 A later study by the United States Treasury Department concluded that the annual cost of the percentage depletion deduction, $ 1 billion per year for the fossil fuel
Moreover, these incentives have not
industries, n6 far exceeded the annual additions to oil and gas reserves ($ 150 million) during the 1960s. n7
resulted in conservation of the oil and gas reserve, nor have they decreased U.S. security concerns associated
with foreign imports, two of the chief justifications advanced for such incentives. The General Accounting Office
stated that "developing alternative fuels, increasing fuel efficiency in transportation, and continuing
development of the Strategic Petroleum Reserve" would likely increase U.S. energy security more than
additional oil and gas tax incentives. n8 Despite this spotty data, the United States continues its questionable
practice of investing billions of [*45] dollars to facilitate exploration and production of fossil fuels. At a minimum,
the government's investment in the fossil fuel industries must be reconceived as a transitional tool to be
combined with increased investment in new energy sources.
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Tax Credits Bad – Not meeting current goals


( ) Tax credits will not be as good as anticipated – they are not even meeting current goals.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
In one recent example, Congress enacted a nonconventional fuels tax credit to encourage production of fossil
fuel from marginal sources. n174 A recent study indicated that the primary impact of this credit would be
increased gas production from qualified sources. n175 Though gas production is expected to increase due to the
credit, the study concluded [*70] that the impact on petroleum production and petroleum imports would be
negligible. n176 The credit will likely have little or no impact on reducing our dependence on fossil fuels or
foreign imports because total energy consumption continues to rise at a pace that far exceeds any energy
production increases.
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Tax Credits Bad – Hard to manage


( ) Tax credits are not a good incentive – they are hard to manage and the figures exclude
too many externalities.
Hymel 6 (Mona, Professor of Law, James E. Rogers College of Law, University of Arizona, Loyola University Chicago School of Law, Journal, 38 Loy. U.
Chi. L.J. 43, Lexis)
Additionally, neither percentage depletion nor the IDC deduction has succeeded in their purported goal of
encouraging conservation of the oil and gas reserve. n181 Petroleum is a nonrenewable wasting asset; thus, its
conservation depends on the rate of use of known mineral reserves and the rate of discovering new reserves.
Lowering the costs of consuming petroleum through tax incentives has made it easier to consume,
encouraging waste rather than promoting conservation. n182 These incentives have also failed with respect to
their other justification, improved national security. This justification rests on the argument that domestic production of petroleum increases national
security by reducing importation of foreign petroleum, which leaves the United States vulnerable to foreign governments. Domestic production contributes to the
creation and maintenance of a domestic reserve in times of energy shortages and produces reserves sufficient to allow a large volume of petroleum to be diverted for
military use and war [*71] production without creating a civilian energy crisis. n183 However, because domestic oil consumption continues to outstrip production,
conservation of petroleum reserves and decreased dependence on oil imports remains impossible. The GAO concluded that "developing alternatives, increasing fuel
efficiency in transportation, and continuing the development of the Strategic Petroleum Reserve" would likely increase U.S. energy security more than additional oil
and gas tax incentives. n184 Alternative and renewable fuels have the potential to increase petroleum conservation and alleviate national security concerns, but
because of their limited use to date, they have done little to increase the supply of oil reserves or to reduce dependence on foreign imports. n185 Since the inception of
the United States has spent between $ 370 and $ 391 billion in tax
the percentage depletion allowance and the IDC deduction,
subsidies for fossil fuels, n186 an average expenditure of approximately $ 4.5 billion every year for the last eighty-seven years. n187 Moreover, these
amounts represent the tax expenditure figure only, and do not include subsidies that directly and indirectly benefit the oil and gas industry or other externalities that are
more difficult to measure. Taxpayers also support government subsidies for transportation [*72] infrastructure, energy security costs, research and development
subsidies, and Strategic Petroleum Reserve maintenance costs. n188 Furthermore, these
figures do not take into account externalities that
flow from fossil fuel use, such as localized pollution, agricultural crop losses and loss of visibility, planetwide
environmental costs such as global warming, water pollution costs such as oil spills, noise pollution, the
environmental impact of sprawl, and travel delays and subsidized parking, all of which cost Americans both
money and quality of life. n189
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Tax Credits Bad – Hot Spots


( ) Credits are bad – they just create hyper-concentrated hot spots that ruin the
environment.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
Moreover, the Sierra Club opposes emissions trading schemes because of resulting "hotspots." n91 In essence,
because most emissions trading schemes do not put a CAC-type limit on the amount of pollution allowed from
a particular source (i.e. polluters can purchase an unlimited number of permits), areas around these remaining
high polluters become hotspots. The Sierra Club opposes the EPA's proposed mercury trading scheme under the
Clean Air Act because "dirty plants could continue to emit high levels of mercury beyond 2018 and create
mercury 'hotspots' by simply purchasing mercury pollution credits from cleaner plants." n92
Traditional CAC regulation is source specific, requiring each polluter to reduce GHG emissions. Green taxation and
emissions trading schemes, on the other hand, provide economic incentives for polluters to reduce emissions but do
not demand that each polluter reduce emissions. Instead, these Els focus on total reduction of emissions and as such
allow industry greater flexibility in compliance.
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Tax Credits Bad – Zero Sum (Enviro and Econ)


( ) The environment and the economy are a zero-sum game with tax credits – any effective
tax credit will raise serious problems with cost-competitiveness and hurt revenue.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)

Big industry is sometimes a big problem for policymakers devoted to environmental taxes. Energy industry
groups argue that environmental taxes hinder global competitiveness. n129 The effectiveness of this claim is
perhaps most evident in the public statements by leaders of the United States and Australia in rejecting the
Kyoto Protocol. n130 A survey of recent literature reveals that scholars are working to counter this fear and have
suggested at least five techniques to reduce the effects from environmental taxes on competitiveness. n131
First, a country may introduce a relatively low rate of environmental tax. n132 A tax that is too low, however,
will not only fail to affect competitiveness, but will also fail to have substantial beneficial environmental
effects. In the words of the OECD, a tax that is too low will simply be a "revenue raising device" not an
environmental tax. n133 Indeed, the EPA proposes that green taxes tend to be set too low to have a significant
impact on the environment, with few exceptions. n134 Second, scholars suggest that countries may "exempt
those industries or products that are exposed to international competition from the tax." n135 Many
countries have used this technique, but this method "raises serious problems related to cost-effectiveness and
the achievement of the environmental objective in question." n136 Third, countries may subsidize parts of industry subject to
competitive disadvantages. n137 Fourth, countries can make domestic taxes dependent on whether foreign producers competing in the same market as domestic
producers are subject to similar taxes. n138 Finally, countries can offset the adverse effects of environmental taxes through a mechanism called a "border [*433] tax
adjustment." n139 For example, by applying the tax to final products rather than to raw materials, a country has greater freedom to adjust the tax as the product either
enters or leaves the country. n140
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Tax Credits Bad – Econ Infeasible (Permits better)


( ) Tax credits are economically infeasible – permits would be better.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
Permit trading can oftentimes be politically achievable when industry interests have stalled green taxation. In some cases, the implementation of an environmental tax
will involve enormous increases in costs to industrial polluters. n313 Therefore, these polluters will expend large sums of money lobbying politicians to reject the tax
and put in its place a trading scheme. Politicians
must also answer to their constituents. Taxes can be extremely hard to sell
to voters, especially outside of Northern Europe. Indeed, most policymakers have accepted that economic
models promising to rid countries of unemployment and the like through the application of a green tax simply
could not work in the real world. n314 Even in Northern Europe, taxes could not be set high enough to
achieve such lofty goals. n315 In the case of the European Union, its own structure inhibits the implementation of a
common carbon tax because it requires unanimity for fiscal measures. n316 Countries such as the United Kingdom
have stood firm against a common carbon tax. n317 In contrast, a permit [*455] market is not fiscal in nature and
may thus be passed by majority rule. n318 Whereas the idea of permit markets may be more politically
attainable than green taxes, getting these markets off the ground can be a political struggle. n319 It is often
difficult to gain agreement on the distribution of the initial assignment. For example, the EPA has yet to get political
and industry agreement to implement the CAMR and CAIR trading programs. n320Permit trading is also more
economically feasible for industry than green taxation. Even the most devout environmentalists must
acknowledge the potential for economic damage as a result of ill-conceived green taxes. n321 Trading schemes
provide greater flexibility for industry than green taxes and the market, rather than a government agency, is
better able to determine the cost of cleaning up GHGs under emissions trading schemes. n322 Conceptually,
trading schemes should be more economically efficient than green taxes. Governments, like industry, are also
concerned about maintaining industrial competitiveness in the world market, and thus, may favor trading
schemes. n323 For instance, the United States and Australia unapologetically withdrew their support for the Kyoto
Protocol citing their concern that binding emissions cuts would hinder competitiveness. n324 Many politicians fear
green taxes will similarly impede industry and hamper their own political ambitions. n325 In contrast, permit
trading schemes are more flexible and allow industry a greater opportunity to mitigate loss. n326 Less cost to
national industry means it can maintain its position on the global market.
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Tax Credits Bad – AT: Raises revenue


( ) Tax credits exacerbate the inefficiencies of the existing tax system. It will not have a
positive effect on the economy.
Harper 7 (Christina, Morgan Lewis’s Business and Finance Practice, LL.M. Commercial Law from the University of Cambridge, J.D. from the University of
Southern California Law School, 30 B.C. Int'l & Comp. L. Rev. 411, Boston College International and Comparative Law Review Lexis)
Currently, most policymakers believe that the second dividend is unrealistic. n117 The green tax, like any other tax,
exacerbates the inefficiencies of the existing tax system. n118 Much of the early double dividend literature
previously ignored this negative "tax interaction effect," n119 [*431] focusing only on the good aspects of
carbon taxes--the reduction of carbon emissions and the ability to raise revenue that could be used to reduce
existing taxes and their inefficiencies ("revenue recycling effect"). n120 However, most economists now agree that
"the tax interaction effect does exist and may actually be as large as--or even larger than--the revenue
recycling effect, so the double dividend argument has pretty much been ruled out." n121 For this reason, the first
dividend--the promise of a cleaner environment--must be the driving force behind green taxes. While this may be a harder sale, the onset of the Kyoto Protocol has
made countries more amenable to the possibilities of carbon and energy taxes. Although taxes may not be set high enough to eradicate unemployment, revenues from
green taxes can be recycled back to at least partially offset "bad" taxes. n122 Moreover, some of the revenues raised by green taxes may be recycled into
some
environmental projects and research. Such a program, in essence, creates a green double dividend and makes good policy sense.In an extreme example,
Belgian green taxes are so low it costs the government more to collect them. n123 This fact alone does not necessarily make the
tax inefficient. The persistence of such taxes signals that the Belgian Government has determined that the social
benefits outweigh the administrative costs.
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***Free Market Bad – Misc


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Incentives Bad – Environmental Justice


Economic incentives fail on environmental justice issues – there’s no market incentive to care about other people

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
However, just as economic incentives have advantages, they also have limitations. One of the most
significant disadvantages is that they are often inappropriate for dealing with environmental issues that
revolve around equity concerns. Many types of environmental standards are designed to protect
individuals around the site of a polluting facility; in some cases the specific purpose is to protect
individuals exposed to the highest pollutant concentrations. In general, people are not willing to accept
higher risks to their health because it is “more economical” to reduce risks to others. There are many
such environmental and health standards, including toxicity standards for air, waste management standards,
and cleanup standards. For example, risks cannot be traded between Superfund sites. To do so would
mean that some people would live near an unsafe site.
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Rewards Fail – Cheating


Carbon trading proves, rewards only encourage cheating,

Bell 2 (Ruth Greenspan, Director of International Institutional Development and Environmental Assistance at Resources for the Future,
http://www.emissierechten.nl/climate_change__monitoring_inter.htm)
What does this mean for protecting the world from global warming? The dazzle of trading, and its
undeniable benefits, should not blind policymakers to the need for fashioning a reality-based system
with real greenhouse gas reductions. They must be sure that the rewards from trading do not tempt
traders to manipulate the system for their own enrichment. This requires countries in the developing world and
countries in transition to develop institutions that can control emissions and expose cheating before, during, and after trades are made.
The role of the developed world must be to face this challenge the old fashioned way--by providing assistance and working patiently to
develop laws, monitoring systems, and property rights, as well as respect for those requirements.
The governments running the system, through the Conference of the Parties, must build confidence through an institutional structure that
is capable of managing these very difficult problems. The bottom line is integrity must be developed and insured. Emissions trading
clearly can save society money. But international planners must put safeguards into place now, not later, to keep the mission of traders
on track with the goal of reducing greenhouse gas emissions. If international policymakers wait to act until a scandal
erupts, it will be too late. The United States, with 200 years of experience in financial regulation, has
just acknowledged the urgent need to step up enforcement through the Securities and Exchange
Commission. Who will be the international SEC of greenhouse gas credit trading?
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Refund Bad – Cost


Refund systems for pollutants fail – the system’s too expensive

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Deposit-refund systems appear to be most appropriate for discrete, solid commodities such as beverage
containers, batteries, and car bodies that would cause environmental harm through their improper disposal.
Government-mandated deposit systems for less discrete substances, like air and water pollutants, have
not been attempted. One factor that limits the widespread use of deposit-refund systems is their high
transaction cost. Collecting and refunding deposits on the sale of individual products such as beverage
containers tends to be expensive, and additional costs are involved in collecting and returning used
products for disposal.
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Subsidies Fail – Burden, Environment


Subsidies make the government pay for the polluters cost, don’t solve the environment

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Subsidies for environmental management are sometimes criticized because the government entity
providing the subsidy and the taxpayer, ultimately is helping to bear the costs that should be the
responsibility of the polluter. Other environmentally related subsidies, such as federal support for
timber harvesting in the national forests, are also criticized because they in fact have proven harmful
to the environment. Nonetheless, subsidies have become a fairly common tool to manage the environment
at every level of government.
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Subsidies Unpopular
Subsidies politically unpopular

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Subsidies often are politically popular. In contrast to taxes, they transfer funds to specific targets within
the private sector where incentives for conservation, recycling or pollution control currently are
lacking. Consequently, subsidies may be most useful in situations in which targeted assistance is
essential and other policy approaches would be politically unacceptable or ineffective.
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Incentives Bad – AT: Their Evidence


( ) Their offense for incentives isn’t reflective of the way they’re actually implemented – in
the real world, incentives are counterproductive for environmental protection
Stephen M. Johnson, Associate Professor of Law, Walter F. George School of Law, Mercer University, Winter
1999, Washington & Lee Law Review, 56 Wash & Lee L. Rev. 111
Supporters of these market-based approaches cite dozens of studies which suggest that market-based
approaches can reduce pollution control costs n36 and which provide equivalent or better environmental
protection than command and control regulation. n37 Despite the rosy predictions, market-based reforms
have not been implemented in the manner advocated by economists, participation in market-based
reforms has been marginal, and the reforms are not generating the substantial cost savings that
economists predicted. n38 Nevertheless, even if market-based approaches delivered all of the benefits
that economists predict, governments should proceed down the economic path with caution because
market-based approaches could exacerbate existing problems of environmental injustice.
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***Free Market Good


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Voluntary Best – Motives


Voluntary measures best; command-and-control forces businesses to use outdated methods
Marzulla 98 (Roger, former head of the U.S. Justice Department's Land and Natural Resources Division,
Environment & Climate News, Sept 1, http://www.heartland.org/Article.cfm?artId=13827)
Cohen: Do you consider voluntary self-audits a good idea?
Marzulla: Self-audit and voluntary compliance are the only way to keep the environment healthy. If the
bureaucrats at EPA are right--and everybody in America really wants to contaminate our water and
air--no federal program is going to stop it. But Americans are a law-abiding people who, moreover,
don't want polluted air or water.
EPA enforcers, like the holdover KGB hard-liners in Moscow, are completely out of step with what is
going on in the country. Ironically, by insisting on punctilious compliance with mind-numbingly
complicated regulations under threat of fine or imprisonment, they force people to forego
environmental protection measures that are better than the ones drafted 15 or 20 years ago in
Washington. You wouldn't use a 20-year-old manual to operate your new car or computer--so why use
outmoded rules that have little to do with modern processes and technologies?

Incentives best – harness natural motives for public health, environment, economy

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Economic incentives have a singular advantage over traditional forms of regulation: they harness the force
of the marketplace to reduce environmental and health risks. While this feature does not make economic
incentives applicable to every source of pollution, market forces often can operate where traditional
regulations would be ineffective. Sources of pollution include point sources such as discharge pipes and
stacks; area sources such as factories and storage areas; and non-point sources such as streets, farms, and
forests. In a traditional regulatory system, owners of many of these sources have an incentive to comply
i.e., avoidance of enforcement actionsbut releasing pollution has no economic cost to the owner.
Consequently, owners of these sources of pollution (hereafter referred to as “sources”) normally have no
incentive to do more than the regulations require, whether it is a limit on emissions or on the use of a
specific technology. With market incentives, sources of pollution can see an economic value in reducing
pollution because doing so saves them money. Consequently, the difference between a traditional
regulatory system and economic incentives can lead to several public health, environmental, and
economic benefits.

Voluntary programs spur innovation, solve nation-wide

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Voluntary programs have also become a major environmental management tool at EPA over the past
decade. The Agency now manages dozens of such programs, many of which have led to measurable
reductions in pollutant emissions. In some cases EPA’s voluntary programs have given U.S. companies
an incentive to develop less polluting products, like computers and household appliances, the sale of
which reduces pollution in every part of the country.
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Voluntary best – pilot programs


Voluntary programs offer a litany of benefits, key to pilot programs

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
An important new trend in environmental management is the use of voluntary programs to accomplish the
goals of environmental protection. This trend involves implementing methods to cut waste, conserve
materials, and improve efficiency— outcomes that increase the value added by business, improve
competitiveness, and reduce pollution. Voluntary programs are an important addition to the more
marketbased incentive measures discussed elsewhere in this report. While the market-based programs offer
financial and other closely related incentives to encourage firms and individuals to reduce pollution,
voluntary programs offer less tangible rewards such as public recognition and access to information on
ways to reduce pollution at low or no cost. Governments promote voluntary initiatives for a variety of
reasons, including the pilot testing of new approaches and the absence of legislative authority to
establish mandatory programs. As such, many voluntary programs offer unique approaches to
environmental management.
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Voluntary Best – Empirics


Energy Star proves voluntary programs solve

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Working with equipment manufacturers, the U.S. Department of Energy (DOE) and EPA are using Energy
Star labels to promote highly energy-efficient products. Collaborations formed with DOE are also
facilitating the development of initial markets for advanced technologies, for example, by encouraging large-
volume purchases. These purchases help reduce manufacturing costs through economies of scale in
initial production. More than 1,200 manufacturers now offer Energy Star products in over 30
commercial and residential product categories such as air conditioners, heating systems, and exit
lights. These products are featured in over 4,000 retail stores. In 1999 alone, consumers purchased
more than 100 million EPA-labeled Energy Star products, saving over 25 billion kWh of energy.
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Voluntary Best – Industry Bonds


Voluntary measures strengthen industry bonds, constructive dialogue

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Voluntary agreements appear to contribute to constructive dialogue among groups that normally act as
adversaries. Voluntary agreements also provide for more opportunity for stakeholder participation
than the status quo does. With improvements in administrative, monitoring, and participatory procedures,
voluntary agreements could become an important element of the U.S. strategy for improving the cost
effectiveness of environmental management. Unilateral, industry-led voluntary agreements can suffer from what is termed
the "free rider" problem. Such agreements provide benefits in the form of publicity and goodwill for all members. Members of an
industry association may join a voluntary agreement, yet take minimal actions to comply. Members can also choose not to
join the voluntary agreement, but they can still benefit from the actions of those who have joined.
Understandably, an association would be reluctant to eject members, since it depends on dues from them to survive. Thus, free-riding
may be a significant problem from the point of view of truly motivating participants to join unilateral agreements. This problem was
evident in the STEP program of the American Petroleum Institute (API). In this case, several API members joined STEP, yet they failed
to follow through with all of its provisions.
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Incentives Best – Business and Labor


Voluntary programs provide a litany of benefits to business and labor

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
There are a number of reasons why voluntary reductions in pollution are proving more and more popular
with sources, and they are related to the incentives associated with information disclosure. When sources
voluntarily reduce pollution and their employees, neighboring communities, and customers learn
about it, sources gain several benefits. Voluntary actions taken by sources often reduce employees’
exposure to harmful pollutants, thus lessening sources’ liability and improving their relationship with
labor. Sources enjoy better relations with neighboring communities, and a reputation for good
environmental stewardship may attract more customers for their products. In some cases, sources also
save money by taking these actions. Moreover, sources that join voluntary partnership programs can
be eligible for various kinds of technical assistance from sponsoring government agencies. For example,
they can receive free information on the cost and availability of energy-efficient technologies.
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Incentives Best – Laundry List


Incentives better that command and control – multiple warrants

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
The Report also concludes that economic incentives for environmental pollution control:
• Provide a unique contribution to environmental management--In many cases incentives generate benefits
beyond what is possible with traditional regulations; sometimes they are applied where traditional
regulations might not be possible. They are particularly useful for small and geographically dispersed
sources. They can also provide impetus for technological change.
• Provide cost savings relative to traditional regulatory approaches–Demonstrated theoretically, based on
at least 40 studies. One study estimates potential savings of widespread use of economic incentives could
reach $45 billion annually. On a practical level, acid rain trading savings are at least $700 million
annually.
• Have wide applicability to specific environmental problems–Although a wide variety of incentives are
available, any particular one may be effective in managing only a fairly narrow range of problems. The report
suggests which incentives are most useful for what problems. Economic incentives are expected to be
particularly useful in controlling pollution not subject to regulation For instance, citizens can be
encouraged to reduce curbside solid waste by recycling, composting and other means if there is a disposal
charge based on the volume of solid waste.

Incentives better than regulations – multiple warrants

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Clearly, economic incentives have several advantages that make them attractive environmental management
tools. When properly designed and used in appropriate circumstances, they can achieve environmental
results beyond those of traditional regulations, they can achieve those results at lower costs, they often
can do a better job of controlling large numbers of small sources, and they provide a valuable spur to
technological innovation.

Incentives better than regulations – multiple warrants

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
In some instances it is difficult to quantify the reductions in pollutants or the improvements in human health
and environmental quality that result from the use of specific economic incentives. However, there is little
doubt that such incentives are providing a new and unique element to environmental management in
the United States. In many cases, incentives are generating health and environmental benefits beyond
what is possible with traditional regulations, and sometimes they can be applied in situations where
regulations might not be possible at all. It is difficult to imagine, for example, the public supporting a
regulatory system that mandated reductions in household waste, but household wastes are declining
significantly in communities that charge for waste collection based on the amount generated.

Incentives better – innovation, cost, tech

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf
Market-based or incentive approaches, by contrast, provide rewards for reducing pollution (and,
conversely, assign penalties for releasing pollution). The rewards may or may not be financial. In contrast to
the traditional regulatory approach, an incentive based regulatory strategy gives sources great flexibility
in selecting both the type and magnitude of their response and gives them incentives to develop new
and cheaper strategies and technologies to control pollution.
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Incentives Best – Results


Incentives allow a greater reduction in pollution than regulations

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
First, economic incentives in some circumstances can be structured to achieve larger reductions in
pollution than would result from traditional regulations. For example, a program that allows trading of
pollution reduction obligations among sources may be able to require greater reductions in pollution
than a similar program that does not use trading. Pollution charges or voluntary pollution prevention
programs could encourage sources to reduce emissions below permitted amounts.
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Incentives Best – Cost


Low compliance costs drive markets to reduce achieve better results

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Second, economic incentives often can control pollution at lower costs than can traditional regulations.
By setting standardized emissions, product, or technology requirements, traditional regulations do not
usually take into consideration the different costs of compliance faced by different sources. But in an
incentive system, the marginal costs of controlling pollution play an essential role. When emission
allowances or credits can be bought and sold by the sources, the sources that have relatively low costs
of pollution control will reduce more pollution than sources that have relatively high costs of pollution
control. Thus, when economic incentives are used, goals of reducing pollution whether applied over
a facility, an industry, or the nation as a whole will be achieved at the lowest cost as determined by
market forces. One study done for the EPA (Anderson. 1999) estimated that the potential savings from
widespread use of economic incentives at the federal, state, and local level could be almost one-fourth of
the approximately $200 billion per year currently spent on environment pollution control in the United
States.

Incentives more cost-effective than regulations

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf
Economists have long understood that economic incentives have the potential to reduce pollution at a cost
below that imposed by traditional regulations. The national experience of using economic incentives over
the past decade reinforces this point of view. In some cases, it is difficult to quantify the costs imposed by a
particular incentive. In other cases, the hoped-for cost reductions do not materialize to the extent expected.
However, in general, it is clear that economic incentives do provide the opportunity to achieve any
given level of pollution control with substantial cost savings.
Evidence supporting the lower costs of economic incentives is both theoretical (derived from models)
and empirical (based on the results of operating programs). At least 40 studies based on computer
modeling of different scenarios for controlling pollution show that economic incentives should be more
cost-effective than traditional regulations. One study (ICF, 1989) estimated that allowance trading in
EPA’s acid rain program could result in savings to affected utilities of $700 to $800 million per year
over the long term. The actual cost savings now are believed to be at least twice this amount. Other areas also
offer potentially large savings. For example, effluent trading has the potential to save sources as much as
$7.5 billion annually. Even if the cost savings from using market incentives are less than predicted as a
result of regulatory, institutional, transactional, or legal restraints, or some combination of these factors, the
actual savings undoubtedly are still significant.

Incentives that allow for trading are cost-effective

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Economic analysis indicates that incentive mechanisms can often increase the cost effectiveness of
pollution control relative to traditional regulatory approaches. Several reasons exist for this conclusion.
First, some incentive-based mechanisms explicitly allow the trading of pollution allowances or pollution
reduction credits. By trading credits or allowances, sources with high incremental costs of pollution
control can have their obligations satisfied by sources with low incremental costs of pollution control.
Other incentive-based mechanisms levy a charge or tax on each unit of pollution. Under such an approach
sources would control pollution only to the point at which the incremental cost of control equaled the
charge or tax. In an ideal world that did not have transaction costs and competitive markets, both permit/credit trading and pollution
fee, charge and tax approaches should result in the same marginal cost of controlling pollution at each source. In such an idealized world
of economic incentives, control costs should be lower than (or, at most, the same as) the costs associated with a traditional regulatory
approach.
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Incentives Best – Small Sources


Incentives control multiple small sources better, regulations can’t regulate all the sources of
a problem

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Third, the use of economic incentives, in contrast to that of traditional regulations, can control the
pollution that is caused by a multitude of small and dispersed sources. A traditional regulatory system,
which relies on reporting, inspections, and fines for noncompliance, becomes very cumbersome and
expensive to administer when applied to thousands, or even millions, of sources. For many serious
environmental concerns today, such as surface water quality and global warming, the sources of the
problem can indeed number in the millions. two good examples of how economic incentives can more
effectively manage the quantity of pollution that is released from large numbers of small and dispersed
sources.
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Incentives Best – Innovation


Economic incentives let the marketplace choose the most cost-effective tech, stimulate
innovation

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic
Incentives for Protecting the Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-
01.pdf/$File/EE-0216B-01.pdf)
Fourth, economic incentives can stimulate technological improvements and innovations in pollution
control in situations where traditional regulatory mechanisms may not. In some cases, traditional regulatory
mechanisms can stimulate technological change. For example, challenging numerical performance standards have prompted the
development of cleaner technologies (e.g., catalytic converters). Also, when regulations require the use of the best available control
technology (BACT), manufacturers of pollution control equipment have an incentive to improve the performance of the products they
offer for sale. But traditional regulations that specify the approved pollution control technologies
discourage sources from developing better pollution control technologies. Not only is there uncertainty
that an improved pollution control technology would be approved, but greater pollution control
normally is costly. What source would want to engage in greater control of pollution than is required by
existing regulations? Economic incentives, on the other hand, attach a value to controlling pollution. In
some cases the value is an explicit monetary amount, while in other cases the financial impact is indirect.
Therefore, sources have an incentive to develop technologies that are more effective or less costly,
particularly when pollution reduction obligations can be traded among sources like any other
commodity in the marketplace.

Voluntary incentive programs spur innovation, global competitiveness

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf
Many economic incentives give an impetus to technological change and innovative pollution control because
sources can generate profits by finding better, cheaper ways of reducing emissions. EPA’s voluntary
programs are a particularly good example of economic incentives acting as an incubator for
technological improvements. When businesses take initiative on their own or work collaboratively with
government to find ways to reduce pollution, instead of merely reacting to government regulations, they
tend to apply the same inventiveness and cost-cutting skills used in other parts of the business. In this
sense, voluntary programs, as well as other kinds of economic incentives, unleash the qualities of
American entrepreneurs that make U.S. businesses such strong competitors in the marketplace and
encourage these sources to use those skills to protect the environment.

Market-based incentives stimulate technological change, innovation

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf
Market-based instruments should have significant advantages over traditional regulatory mechanisms
in terms of stimulating technical change and innovation in pollution control. The reason is that each and
every unit of pollution is costly to the source. In contrast, under a traditional regulatory approach, once
a source has satisfied the emission limits, all pollution within those limits has no cost. Why spend
valuable resources instituting further controls when there is no offsetting cost savings? In fact, there
generally is no incentive for a facility to reduce pollution much below permitted amounts because such
an action would invite regulators to reduce the facility's permit limits. In many parts of the nation,
pollution control agencies are constantly struggling to find ways of meeting ambient environmental quality
goals. Facilities that demonstrate the possibility of making emission reductions below permitted
amounts offer an easy target for obtaining some of the necessary emission reductions. These same
innovative firms may be the catalysts for developing regulations that require other firms in the same
industry to reduce their emissions to the amount shown to be feasible.
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Refund Good – Small Sources


Deposit refunds effective at pollution reduction, they can target small sources

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
The contributions to environmental management made by economic incentives are as varied as the incentives
themselves. Deposit-refund systems are helping change the environmental behavior of individual
consumers in ways that traditional regulations could not. Deposit-refund systems and taxes on
products and outputs are reducing the pollution caused by a multitude of small and geographically
dispersed sources that typically are difficult to control through traditional regulations.
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Subsidies Good – Environment


Subsides effective to protect health and the environment

Doul et al 96 (John, Department of Pharmacology, Toxicology and Therapeutics, Kansas University Medical Center, Bernard Goldstein,
Director, Environmental and Occupational Health Sciences Institute and Chairman, Joshua Lederberg, President Emeritus, Rockefeller
University Sheila McGuire, President, Iowa Health Research Institute David Rall, Former Director, National Institute of Environmental Health
Sciences Virginia V. Weldon, Senior Vice President for Public Policy, “Commission on Risk Assessment and Risk Management”, June 13,
http://www.riskworld.com/nreports/1996/risk_rpt/html/nr6aa001.htm#TC1)
Taxes and Subsidies. Tax and subsidy programs that encourage and discourage economic activity can be
powerful motivators, either encouraging or discouraging use of natural resources and production or
reduction of pollution. For example, agricultural land-retirement programs have prevented excessive soil
erosion and damage to waterbodies and wildlife habitat, and promoting agricultural production through
implicit and explicit subsidies for inputs, such as pesticide and water use, can contribute to environmental
damage. Elimination or amelioration of negative-tax and subsidy programs can have a positive impact
on the protection of human health and the environment, as can carefully targeted increases in subsidies
for the provision of some environmental benefits. Government purchasing practices can also encourage
the development of markets for products that are environmentally more sound. Care is needed to avoid
excessive acquisition costs for products with small markets and to avoid buying products with one attractive
attribute but other unfavorable characteristics.
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AT: Regs Bad – Innovation


Study proves, regulations DO NOT prevent business innovation
Scott et al 98(V. J. Lein, and E. L. David, Wisconsin Department of Natural Resources, Madison, WI; and Donna M. Downing, USEPA,
“ENVIRONMENTAL INNOVATION AND REGULATION: SIFTING REALITY FROM RHETORIC”, Jan 1,
http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0408A-1.doc/$File/EE-0408A-1.doc)
The principal purpose of this study was to determine the extent to which the current regulatory system
does, in fact, create barriers to environmental innovation. Our research asked how environmental
regulations actually affect manufacturing firms' decisions to innovate in their control or prevention of
environmental releases. In addition, we sought to better understand the full range of hurdles to innovation that manufacturers face, so that we
might put in context the relative importance of regulatory-induced innovation barriers.
We focused on how firms experience regulatory hurdles to innovation, the nature and extent of perceived hurdles, and the relative importance of hurdles in
preventing innovation. In both structured interviews and with survey tools, we
looked for instances where manufacturing firms
had wanted to do something innovative but were prevented or hindered from doing so by the
environmental regulatory regime. We analyzed firms' experiences to provide direction to policymakers for how they might
remove or lower the regulatory hurdles to innovation.
In stark contrast to the impression of EPA administrators, and the literature more generally, we found
no instances where firms perceived that the environmental regulatory process erected outright barriers
to innovation. No interviewed firm could identify a specific instance in which they sought to use an
innovative approach for controlling or preventing pollution but were prevented from doing so by
environmental regulations, how those regulations were implemented, or how they were enforced.

Environmental regulations spur product design innovation


Scott et al 98(V. J. Lein, and E. L. David, Wisconsin Department of Natural Resources, Madison, WI; and Donna M. Downing, USEPA,
“ENVIRONMENTAL INNOVATION AND REGULATION: SIFTING REALITY FROM RHETORIC”, Jan 1,
http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0408A-1.doc/$File/EE-0408A-1.doc)
The study’s working definition of “innovation” excluded innovation directed towards reducing a products' in-use emissions. We were
interested in releases during the product manufacturing, not releases caused by the products' use. Of course, environmental
regulations do affect innovations in product design. For example, regulations might cause a small-
engine manufacturer to re-engineer its engines to reduce emissions from when consumers use the
engine. Regulations could also cause paint manufacturers to change paint constituents to reduce
emissions when other manufacturers use their paint. Such innovation was not the focus of our study.
However, in the latter example, we were interested in how regulations might prompt secondary manufacturers to use innovative paints in
the manufacture of their products or to work with paint suppliers to develop these paints. We examined how regulations affected
innovation by manufacturers in the manufacturing process, not innovations in the products they manufactured.

<< >> doesn’t hurt innovation


Scott et al 98(V. J. Lein, and E. L. David, Wisconsin Department of Natural Resources, Madison, WI; and Donna M. Downing, USEPA,
“ENVIRONMENTAL INNOVATION AND REGULATION: SIFTING REALITY FROM RHETORIC”, Jan 1,
http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0408A-1.doc/$File/EE-0408A-1.doc)
There are various barriers to innovation that the theoretical literature considers important, but that
appear in practice not to importantly hinder innovation. These theorized regulatory hurdles appear to
have limited or no practical effect on innovation. Findings include the following:
Regulations do not specify the technologies firms must use. Rather, both in the regulations and
in firms' experiences, requirements specify the level of environmental performance to be achieved.
Firms do not appear unable to distinguish agency requirements from agency suggestions. No
interviewed firm felt that their permit writer had a preferred approach to compliance.
Fear of noncompliance penalties is not a factor in deterring innovation. However, firms dislike
being treated like “bad actors” if attempts to innovate run into difficulty, as happened to one interviewed
firm. Firms were largely unaware of available variances that would prevent compliance problems by
allowing them more time to get their innovative approach up and running. Agencies should consider ways of better
publicizing the existence of variances for innovative endeavors. Agencies should also consider addressing issues of enforcement style in training programs
or review for enforcement staff.
Information is available for small firms. It does not appear that small firms have significantly less access to
information about innovative approaches than large firms. However, environmental managers at smaller firms are more
likely to have multiple responsibilities and so are less likely to have time to avail themselves of the information. Unless small firms feel that the potential
benefits of tracking emerging requirements and researching alternative approaches is worth the investment in time, providing more information and
seminars is unlikely to have the desired result.
Permitting delays occur, but do not appear to favor conventional over innovative approaches
to pollution prevention and control.
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AT: Regs Bad – Innovation


Multiple regulations increase innovation

Scott et al 98(V. J. Lein, and E. L. David, Wisconsin Department of Natural Resources, Madison, WI; and Donna M. Downing, USEPA,
“ENVIRONMENTAL INNOVATION AND REGULATION: SIFTING REALITY FROM RHETORIC”, Jan 1,
http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0408A-1.doc/$File/EE-0408A-1.doc)
Even while the environmental regulatory system erects some hurdles to environmental innovation, it also provides important incentives
for firms to innovate. Policymakers concerned about innovation should use care when considering proposals that would dilute these
regulatory incentives. Firms must comply with environmental requirements. Frequently, they pay attention to the actual and potential
costs associated with releases and their control. The following regulatory motivations, found to be especially
effective at motivating innovative approaches to pollution control, should be enhanced or strengthened
where possible.
Environmental requirements that limit firms' releases. One example, product bans, motivates
considerable innovative activity. Stringent regulations that require firms to reduce or watch their releases
also motivates innovative behavior.
Future standards anticipated to be more stringent. Firms innovate to stay ahead of the
regulations.
Liability for process wastes. The potential for uncertain liability prompts firms to innovate to
eliminate their use of hazardous substances altogether.
Reduction in regulatory burden when releases fall below a threshold. Thresholds can motivate
innovation if the regulatory burden is substantially lessened for firms that reduce their releases below
the threshold, i.e., the firm is subject to less burdensome recordkeeping or reporting requirements or is
no longer subject to a regulation.
Public release of firms' pollutant information. The Toxic Release Inventory status appears to
provide a powerful motivation to innovate.
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AT: Incentives Bad – Non-Unique/Solve Advs. of C & C


( ) Incentives in general are inevitable, triggering their link, and they access every benefit
of command and control at lower costs
Stephen M. Johnson, Associate Professor of Law, Walter F. George School of Law, Mercer University, Winter
1999, Washington & Lee Law Review, 56 Wash & Lee L. Rev. 111
In light of those criticisms and limitations, the federal government and state governments are increasingly
implementing market-based approaches to address environmental problems. n10 The Clinton
Administration has suggested that "[m]arket incentives should be used to achieve environmental goals,
whenever appropriate," n11 and a recent report by the Environmental Law Institute estimates that
governments are using over one hundred different economic incentive mechanisms to address
environmental problems in the United States. n12
Instead of mandating uniform pollution reductions on a national basis, market- based approaches use
economic incentives to encourage polluters to reduce their pollution in the most cost-effective manner.
n13 Theoretically, market-based approaches can achieve the same level of pollution reduction as
command and control regulation at a lower cost. n14 In addition, proponents claim that market- based
approaches can eliminate the information-gathering burden of command and control regulation on the
government.
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***Emissions Trading
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Emissions Trading Fails – cheaters


Emissions trading fails to decrease warming

Bell 2 (Ruth Greenspan, Director of International Institutional Development and Environmental Assistance at Resources for the Future,
http://www.emissierechten.nl/climate_change__monitoring_inter.htm)
Advocates of international emissions trading would be wise to reflect on recent U.S. accounting and
trading scandals. The Kyoto Protocol establishes an international greenhouse gas trading system. Emissions
trading clearly can save society money, but international planners must put safeguards into place to keep
the mission of traders on track with the goal of reducing greenhouse gas emissions. If international
policymakers wait until a scandal erupts, it will be too late. Who will be the international Securities
and Exchange Commission of emissions trading? Ruth Greenspan Bell directs Resources for the Future's program for
International Institutional Development and Environmental Assistance, helping institutions in societies without strong legal systems to
become more effective in implementing natural resource management and environmental protection policies and laws. Her current
projects include efforts involving public participation in environmental decision making in the Danube region and in Thailand. Before
joining RFF, Bell spent almost 17 years in management positions in the Office of General Counsel at the Environmental Protection
Agency.
Sham trades reported by Reliant Resources, Dynergy, Enron, and CMS Energy to pump up trading
revenue and volume in California, the out-and-out balance sheet fraud committed by WorldCom, and
the most recent revelations about seemingly reputable bankers who intentionally structured
transactions to allow Enron to hide $125 million in debt, seem, at first glance, to have only a remote
connection to global climate change policy.
But advocates of international emissions trading would be wise to reflect on these scandals.The cornerstone of the approach
to climate change management taken by the administration of former U.S. President Bill Clinton is a complex international
greenhouse gas trading system. The administration of President George W. Bush has pulled out of the Kyoto Protocol process, but it has
not slammed the door shut on an emissions trading scheme in the future. Emissions trading allows firms and countries
that can control pollution more cheaply to accumulate credits for their efforts. They may then sell these credits
to others for whom the cost of pollution reduction is greater. Variations of this technique were written into the Kyoto Protocol's "clean
development mechanism." The Pew Center for Climate Change calls emissions trading the "policy of choice," and the theory has been
endorsed by many economists, including several Nobel laureates, and now even by many environmental advocacy groups. The
purpose of trading is to harness market forces in the reduction of greenhouse gases. The main
opposition has come from proponents of the view that emissions trading would allow the developed
world, and in particular the United States, to escape responsibility for its energy-intensive lifestyle by
funding reductions in other parts of the world.
Gonzaga Debate Institute 2008 95
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Emissions Trading Fails – Cheaters


Despite checks, US emissions trading abuse is rampant

Bell 2 (Ruth Greenspan, Director of International Institutional Development and Environmental Assistance at Resources for the Future,
http://www.emissierechten.nl/climate_change__monitoring_inter.htm)
But in the past six or so months, a number of warning bells have sounded for those who care to listen.
Examples of trading abuses have cropped up in the United States, meaning within the context of a well-
developed legal and oversight system and a free press--an important issue that will be discussed further
below. The basic message of each of these incidents is that even in a mature, capitalist democracy, the
invisible hand needs plenty of highly visible oversight and management. Without strong institutions to
police the participants in the market, markets can be captured and distorted. The losers from the
frauds reported in today's press have been investors and consumers. In the future, if greenhouse gas
trading is not backed up by effective institutions, the environment will be the loser.
The first of these incidents involved New Jersey's emissions trading system. PSEG Fossil LLC, the
biggest player in that state's system, apparently had not installed necessary pollution controls or
obtained proper permits. The U.S. Justice Department discovered this and brought an enforcement action, which was resolved
in the form of a consent decree. PSEG, without admitting any wrongdoing, agreed to stop selling its credits to other firms and to stay out
of the trading system. When PSEG was forced to withdraw, its sheer size and status as one of the largest "suppliers" of credits in New
Jersey brought that state's system close to collapse.
In addition, according to the Aug. 5, 2002, issue of the Electricity Daily, the South Coast Air Quality Management District (SCAQMD)
in California and the regional office of the U.S. Environmental Protection Agency are looking into charges that a
Pasadena broker cheated several firms who paid for emissions credits that were never delivered. The
SCAQMD manages emissions trading for the Los Angeles region. A similar example from the United Kingdom was reported in the April
12, 2002, edition of the Electricity Daily, in an account of a government-sponsored auction in which participating companies bid by
offering greenhouse gas reductions. An independent review by Environmental Data Services noted strong
grounds to suspect that at least half of the claimed emissions reductions were not real, and blamed the
inaccuracies on shortcomings in the Department of Environment, Food, and Rural Affairs regulatory controls and "poorly thought
through rules."
The New Jersey and U.K. situations attracted little public notice. But more recent events have attracted a great deal more attention. This
past spring, several energy trading companies admitted to having made sham electricity trades. In
addition to the well-known activities of Enron, Duke Energy Corp. reported that it had included about
$1.1 billion of energy trades that had no economic benefit in financial statements over a three-year period, and
the chief executive of CMS Energy was forced to resign when it was disclosed that the company had inflated revenue by 28 percent over
two years. A former Reliant executive was quoted as saying, "The same circuit got traded back and forth. The idea
was to book more transactions and get a market going."
All of the above failures and near failures, including the Enron and WorldCom debacles, took place in
countries where law and law enforcement are relatively well developed. The news media paid close attention and
so, therefore, did the public and government officials. The nongovernmental organizations are vigilant and know how to bring lawsuits
or how to complain to Congress.

Cheating inevitable in the carbon trading system, emissions hard to regulate


Bell 2 (Ruth Greenspan, Director of International Institutional Development and Environmental Assistance at Resources for the Future,
http://www.emissierechten.nl/climate_change__monitoring_inter.htm)
Emissions trading systems must be tested against the difficult conditions found in the real world, where
there will always be people who cut corners or outright cheat. If it was not clear before these recent
events, it certainly is now: some countries and some people will not follow the rules. And the rules are
particularly hard to enforce when what is being traded is a highly intangible commodity, as are carbon
emissions. The difficulty of the proposed global emissions trading system is that it rests on a foundation
of carbon reductions in each country. The actual in-country reductions can be achieved any number of ways, using
traditional command-and-control or market-based environmental instruments, but they must be continuous, that is, there must be a
reliable continuing stream of carbon reductions over time. It is these reductions that are sold or traded. In addition, if the Kyoto regime
holds up, the reductions will be calculated after a baseline is established; the greenhouse gas emission reduction for which a credit can
be obtained must be incremental to each country's baseline, defined as that would occur in the absence of the certified project activity.
In other words, the commodities being traded are difficult to identify, to keep track of, and to count. The
European Union has recognized this fact by attaching an explanatory note to its proposed directive on greenhouse gas emissions trading
that allows the EU to enter into separate agreements with non-EU countries for trading, but emphasizes that such agreements will
depend on whether there are adequate monitoring, reporting, and verification programs in place so that the carbon allowances would be
demonstrably related to actual emissions reductions.
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Emissions Trading Fails – Verification


Cap and trade fails – high verification costs

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
At the same time, trading programs may have several drawbacks, including the potential for high
transaction costs and inactive markets, especially in credit or open-market systems. High costs can be
attributed to the need to verify each reduction before authorizing the credit. Clearly, trading programs
should not be applied to all environmental problems. The long-term effects of The U. S. Experience with
Economic Incentives for Protecting the Environment trading programs on technical innovation vary from
program to program. Some have spurred considerable innovation, such as the acid rain program,
while others have not due to high transaction costs.

Weak domestic environmental enforcement makes verification unworkable

Bell 2 (Ruth Greenspan, Director of International Institutional Development and Environmental Assistance at Resources for the Future,
http://www.emissierechten.nl/climate_change__monitoring_inter.htm)
But verification can be notoriously difficult and rests on domestic systems of environmental
enforcement. Participants in these transactions in the West know they can rely on a viable legal system or
some analogous set of institutions to ensure the integrity of trades and to act in a timely manner to protect
wronged parties.
But many places where the "cheapest" carbon reductions are to be found do not have reliable rule of
law traditions or the resources and policies that would discourage cheating. For example, a power
plant can change its fuel entirely, or use cleaner coal, or install control technology. Verification of each
of these approaches is quite different. It is relatively easy to determine whether the plant is fired by coal or
natural gas, but harder to know, on a continuous basis, whether the coal used is cleaner or the control
technology has been turned on and continuously maintained.
The EU may have the best of intentions, but its actual ability to monitor what is going on in Russia, Ukraine,
Bulgaria, and Romania, to choose four examples, will be quite limited. Verification and oversight procedures
in the developing world and the countries of the former Soviet bloc, where reside many of the big potential
sellers in this market, have been notoriously ineffective. In many cases, these are countries that have
adequate laws on the books, but they have done a very poor job of controlling their domestic pollution.
We could not be sure how much pollution each of their plants would send in to the atmosphere when
they do not have the expensive monitoring equipment that is required in the United States.
The court systems may move too slowly, giving life to the adage, "justice deferred is justice denied." Or the
judiciary lacks independence, and sometimes judges get their pay checks and social benefits from the same
body that owns polluting industry.
In addition, rampant, or even institutionalized, corruption may mean that public officials who oversee
such programs will make policy decisions on the basis of personal connections or illegal payments
rather than whether the trade involves true reductions in greenhouse gas emissions. Independent
nongovernmental organizations, where they exist, do not have the tools available to their counterparts in the
United States. Indeed, many of these countries cannot produce accurate figures on basic data such as
population and economic production, let alone the highly esoteric information for greenhouse gas emissions.
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Emissions Trading Fails – International verification


International verification problems for emissions trading doom success

Bell 2 (Ruth Greenspan, Director of International Institutional Development and Environmental Assistance at Resources for the Future,
http://www.emissierechten.nl/climate_change__monitoring_inter.htm)
Critically, verification must be in the countries of origin of the emissions. There are no international
institutions to police trades across borders and keep them honest, although some level of oversight is planned
through the Conference of the Parties and an executive board supervising the clean development mechanism.
Nevertheless, we know through examples--such as the difficulty of policing arms reduction and nuclear
proliferation treaties--how hard verification can be and how many resources they can absorb.
Climate change verification should be even harder, and the incentives to do it fewer. This is because
reducing greenhouse gas emissions can require supervision of potentially thousands of domestic
reduction projects in each country. Historically, governments have typically given far less weight and attention to supervising
international environmental treaties than they do to agreements that involve arms and world trade. And the sanctions available, even
when governments are alert to violations, are limited in number and often severe. Negative trade
measures, unilateral sanctions, membership sanctions, and other economic and political measures are
rarely or reluctantly used because of their political consequences.
What if we set up a worldwide system and later find fraudulent record keeping or industries that sell phony reductions? Who will enforce the rules? What
body would prosecute false accounting schemes and assure the basic integrity of the regime? There are at least two possible outcomes. The best solution
would be if countries with currently weak enforcement and compliance regimes could be inspired to make improvements so they can share in the
considerable benefits that global trading might bring them. The other possibility is the temptation toward cheating.
Either way, trading itself will not solve the problem of greenhouse gas emissions in the absence of
substantial domestic commitment to making real emissions reductions.
Proponents are quick to point out the undeniable successes of the sulfur dioxide emissions trading
scheme, but they are less likely to mention its reliance on the many unique safeguards built into the
U.S. program. No less an authority than The Economist magazine has published a spate of articles trumpeting market-based instruments as the
salvation of the environment (in the same issues that report the details of the WorldCom scandal).
But their exhibit No. 1, emissions trading, alone is not a solution to resolving works relatively well, these same solutions are far less likely to succeed
where institutions are much weaker.’
Gonzaga Debate Institute 2008 98
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AT: Trading/New Markets Good


Trading systems fail to meet cost expectations—models don’t take into account restrictions

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
Examining the performance of trading systems in particular, one finds that existing applications fail to
achieve anywhere near their theoretical potential cost savings.24 Trades have been fewer and cost
savings smaller, according to this analysis, than indicated by economic modeling. A number of
explanations have been offered for why the predicted savings are not realized.25 Regulatory and legal
requirements of the actual programs may limit the trading opportunities to a greater extent than
portrayed in the models, especially where the incentive programs operate in conjunction with
traditional regulatory programs. Various models have not fully reflected all the aspects of real
regulatory programs, including the transaction costs, restrictive trading rules, monitoring and
reporting requirements, and the administrative burden placed on both emission sources and
regulatory agencies.
In addition to the limitations imposed by the regulatory structure, potential participants in trading systems
may be reluctant to trade emissions credits or allowances, preferring instead the greater certainty of
installing pollution control equipment at their facilities. Moreover, pollution credits have a limited life
whereas engineering controls, in principle, last for the life of a facility. In most trading systems, the vast
majority of trades that take place occur within firms, not between firms. Furthermore, markets for permits
that are available for sale tend to be thin, and it may be difficult to locate potential sellers.26

Multiple state policies prevent effective trading

Anderson 1 (Robert C, Resource Consulting Associate, EPA, “The United States Experience with Economic Incentives for Protecting the
Environment”, http://yosemite.epa.gov/ee/epa/eermfile.nsf/vwAN/EE-0216B-01.pdf/$File/EE-0216B-01.pdf)
ERC emission trading has not lived up to expectations; trades have been fewer and offset prices lower
than many had expected. Several factors seem to have limited the appeal of the emissions trading policy. In
order to assure that air quality did not deteriorate, state environmental administrators often required
expensive air quality modeling prior to accepting proposed trades between geographically separated
parties. Deposits to emission banks typically were “taxed” by the air quality management authority to
meet state SIP requirements or to generate a surplus that the area could offer to attract new firms.
Offset ratios greater than unity further depressed the value of ERCs. In many areas, it appears that
ERCs had an economic value less than the transaction costs of completing a sale to another party.
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***Capital Flight DA
Gonzaga Debate Institute 2008 100
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Capital Flight DA 1NC (1/2)


A. US capital investment up

Chapman 8 (John, The American [http://www.american.com/archive/2008/june-06-08/america2019s-economic-


outlook-a-symposium] America’s Economic Outlook: A Symposium/ June 27, 2008)
When considering the U.S. economy, one is reminded of Dickens’s A Tale of Two Cities: it is the best of
times, and the worst of times. On the one hand, in spite of several concurrent challenges, America’s
consumers and its entrepreneurial class have proven themselves remarkably resilient. Bolstered by
record levels of non-farm productivity and a huge increase (more than 15 percent) in exports, the economy is
on track to grow by 1.5 percent this year. Additionally, real corporate profits should grow slightly in
2008, and $150 billion to $200 billion in new private equity and venture capital investment suggest an
enduring confidence in future growth. Fueled by an expansionary monetary policy, which has driven
interest rates to artificial lows, and accommodative fiscal policies (including a $168 billion “stimulus”
package), the United States may well avoid a “recession” in the technical sense of the word—that is, it may
avoid two consecutive quarters of negative growth.

B. Environmental policies force businesses to “pollution haves” in foreign countries.

Krissoff et al 96 (Barry, May, U.S. Department of Agriculture. Agricultural Economic Report No. 738.,
http://www.ers.usda.gov/publications/aer738/Aer738.pdf)
National environmental policies may exert longrun effects on international investment flows and firm
location. Just as labor-intensive industries may concentrate where labor is abundant (everything else equal)
polluting industries may concentrate in countries with less stringent environmental policies (everything
else equal). One concern is that developing countries, in particular, may use their lower environmental
standards to attract foreign investment and stimulate economic growth.9 Another is that countries that
are moving toward stricter environmental regulations will encourage industrial and capital flight
toward countries offering “pollution havens.” Little evidence supports the pollution-haven hypothesis,
particularly concerning the importance of differing environmental standards for foreign direct investment in
the food and agriculture sectors. Pearson’s survey (1987) finds little evidence of industrial flight to
developing countries as a result of differing environmental standards. In another study, Pearson (1976)
estimates that developing countries may have increased their export revenues by 2.1-4.6 percent by lowering
their environmental standards. Duerkson and Leonard (1980) conclude that there is no evidence of
widespread relocation of U.S. industries to pollution havens. However, Molina (1994), investigating
pollution abatement costs and U.S.-Mexico trade in food-related products, finds some evidence to
support the pollution-haven hypothesis. He finds that in U.S. industries that incur higher water and
solid waste abatement costs relative to Mexico, the United States is more likely to import from that
industry and, consequently, firms are more likely to migrate.
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Capital Flight DA 1NC (2/2)


C. Multinational corporations destroy the environment

Shah 2 (Anup, May, Society of Environmental Consultants and Auditors


http://www.globalissues.org/TradeRelated/Corporations/Environm
ent.asp#Corporateinterestsandactionscanharmtheenvironment
One sharp example of environmental problems caused by multinational corporations, is the drive to
extract oil from Nigeria. As the previous link, from this site’s section on Africa shows, corporations have
even backed the military to harass, even kill, local people who continue to protest at the environmental
and other problems the activities of the various oil companies have caused. Some local groups have
become extreme themselves, kidnapping foreigners for example. The interests of the various big polluters,
such as the auto, mining, oil and chemical corporations influenced the Kyoto Global Climate Change
Conference outcome. And with biotechnology and genetically engineered food production, companies are
accused of following a profit motive even as they promote the technology as a means to address world
hunger. Environmental concerns also feature quite strongly on this issue. With increased consumerism, there
has been a rise in the number of environmental groups campaigning on various issues such as
environmentally friendly products. To varying extents then, environmental concerns are issues that
sometimes make the mainstream news. However, a cover story, of Down To Earth magazine from Delhi-
based Centre for Science and Environment as an example, warns that the latest craze in green and ethical
consumerism may just be another way for corporations to exploit people and make money by
misrepresenting the facts. As another example of this, EarthDay Resources’ annual Don’t Be Fooled
Awards highlight some of what they call the corporate “greenwashing” that goes on through advertising and
lobbying campaigns. There are countless examples where corporate involvement in various issues could
contribute to environmental problems as a result. Corporations are major entities in the world and
thus have an enormous impact (negative and positive) on all our lives. And concerns of overly corporate-
led globalization contributing to environmental problems are increasing, as reported and documented by
countless environmental and social justice groups around the world.
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Capital Flight – Uniqueness: Investment UP


US capital investment levels are steady

Selko 8 (Adrienne, managing editor of corporate publications at a large regional financial institution
[http://www.industryweek.com/ReadArticle.aspx?ArticleID=16860] U.S. Manufacturing to Remain Flat over Next
3-6 Months Says Industry Group/ July 17, 2008)
Two indexes remained flat at positive levels of activity. The U.S. investment index, which queried
executives on their expectations regarding capital investment in 2008 compared to 2007, held steady at
62%. The research and development (R&D) index remained at 72%.

US capital investment up

Chapman 8 (John, The American [http://www.american.com/archive/2008/june-06-08/america2019s-economic-


outlook-a-symposium] America’s Economic Outlook: A Symposium/ June 27, 2008)
When considering the U.S. economy, one is reminded of Dickens’s A Tale of Two Cities: it is the best of
times, and the worst of times. On the one hand, in spite of several concurrent challenges, America’s
consumers and its entrepreneurial class have proven themselves remarkably resilient. Bolstered by
record levels of non-farm productivity and a huge increase (more than 15 percent) in exports, the economy is
on track to grow by 1.5 percent this year. Additionally, real corporate profits should grow slightly in
2008, and $150 billion to $200 billion in new private equity and venture capital investment suggest an
enduring confidence in future growth. Fueled by an expansionary monetary policy, which has driven
interest rates to artificial lows, and accommodative fiscal policies (including a $168 billion “stimulus”
package), the United States may well avoid a “recession” in the technical sense of the word—that is, it may
avoid two consecutive quarters of negative growth.

Capital investment expected to increase

Daily Dash 8 ([http://www.wwj.com/Hiring-Likely-to-Remain-Soft/2451389] Hiring Likely to Remain Soft This


Year, But Signs Point to Better Times In 2009/ July 14, 2008)
Likewise, the Federal Reserve and other economists say they think the fragile national economy will
strengthen later this year and into next year – even as the nation's unemployment rate, a lagging indicator
of business health, rises. Earlier this month, for example, Fed Chairman Ben Bernanke told an international
monetary conference that the Fed's recent interest rate reductions along with the government's $168 billion
stimulus package should bring about "somewhat better economic conditions" in the second half of this
year. According to a national survey released last week by the Business Roundtable, most chief executives
expect sales and capital investment to remain at current levels or even improve over the next six
months.
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Capital Flight – Link: Environmental Regulation


Environmental policies cause capital flight.

Granados 6 (Francisco J, Social Forces. University of North Carolina Press, Dec.,


http://socialissues.wiseto.com/Articles/156364106/?page=1)
Environmental policies are often resisted on the grounds that they will cost jobs and slow economic
growth. Economic globalization heightens such fears because firms can easily move investment and
production to other countries should local environmental regulations become too onerous (Cobb and
Daly 1989; Hansen-Kuhn 1993; Korten 1993; Thrupp 1994). Countries that choose to enact strong
environmental protections may experience flight of firms and investment, damaging the economy. Yet,
empirical studies on the economic impact of environmentalism have proven equivocal.

Environmental regulations reduce capital investment.

Granados 6 (Francisco J, Social Forces. University of North Carolina Press, Dec.,


http://socialissues.wiseto.com/Articles/156364106/?page=1)
Opponents of environmental regulations often argue that constraints on firms and economic activity
reduce economic growth. (1) Basic economic theory holds that capital investment is a primary source of
economic growth (Barro and Sala-i-Martin 1995). Environmental regulations can decrease the efficiency
of invested capital and discourage investment altogether. (2) For example, air pollution laws that
require expensive pollution abatement equipment necessitate greater capital investment to achieve a
given level of economic output, reducing the incentive to invest. Laws prohibiting or taxing the
utilization of available resources have a similar effect. For example, environmental regulations prevent
the development of productive land (wetlands, forests), the use of certain fuels (e.g., high-sulfur coal),
the emission of particular chemicals, and so on. This directly halts economically productive activities or
lowers profitability by requiring the use of more expensive fuels and production methods. (3)
The costs of environmental regulation can be quite large. By one estimate, the implementation of the Kyoto
Protocol limiting CO2 emissions may reduce economic output by $100 billion (in 1990 U.S. dollars)
annually for Western Europe, and on the order of $50 billion for Japan alone (Li 2000:164). Depending on
the circumstances, Kyoto may cost the typical nation between 0.5 percent and 1 percent of total GDP (Li
2000:168).
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Capital Flight – Impact: World Econ


Capital flight quickly destroys world economic growth

Eurodad 8 (European Network of Debt and Development, May,


http://www.eurodad.org/uploadedFiles/Whats_New/Reports/Capital_flight_report.pdf)
In the aftermath of the Asian financial crises ten years ago the international community recognised the
importance of financial stability. Today new troubles infect the global financial system, leaving governments
and financial analysts uncertain how to react. The media is full of the credit crunch, write-downs by private
banks and dramatic price rises. There is discussion of how these incidents are spilling over across the
economy in the U.S.A., Europe and elsewhere, with people losing their homes and jobs and struggling to
provide meals for their families. Very little attention is given to the specific impacts in the world’s poorest
countries. Yet global financial stability – like climate change – is a key global challenge and one that the
current financial and regulatory system is ill-equipped to handle. The sub-prime crisis that started in the
U.S. and spread through contagion has shown that market-based solutions and conventional crisis
management are completely insufficient. Central bankers and finance ministers have tried injecting
liquidity, lowering interest rates, and even nationalising a bank. Yet regulators and central banks are largely
playing catch up. In France a single trader caused a €5 billion loss to Société Générale by evading in-house
systems. In Germany the scandal of hidden deposits in Liechtenstein exposed the tip of the tax havens
scandal iceberg. The crisis is not just due to individual misbehaviour. There are deep flaws in the
international financial system. Finance has become an end in itself: to make money out of money in the
shortest possible time. This speculation leads to instability and widens the gap between rich and poor.
Recurrent crises are inevitable. We are very far from achieving what the world’s governments signed up to
at the Monterrey Financing for Development conference in 2002. There they pledged to encourage “the
orderly development of capital markets aimed at addressing development financing needs and foster
productive investments”. They agreed, correctly, that this “requires a sound system of financial
intermediation, transparent regulatory frameworks and effective supervisory mechanisms”. Finally they said
they would introduce measures “that mitigate the impact of excessive volatility of short-term capital
flows” and to strengthen “prudential regulations and supervision of all financial institutions, including
highly leveraged institutions”. The financial system is not only unstable, it is also unjust, resources are
flowing from poorer to richer. Experts estimate that every year $500 - $800 billion leave Southern countries
due to criminal activities, tax evasion, and corruption. This makes South-North financial flows several times
higher than the average $90 billion annual aid flows, the $240 billion foreign direct investment to the South
and the couple of hundreds of billions of dollars of remittances transferred from migrants.1
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***AT: Capital Flight DA


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Non-Unique: Capital Flight Up


Treasury bonds are causing an increase in capital flight

Colby 8 (Robert, Senior Analyst [http://www.forexhound.com/article.cfm?articleID=104612] Daily Market


Update by R. W. Colby, Tradingeducation.com, LLC/ July 7, 2008)
U.S. Treasury Bond September futures contract moved up to a new 4-month high. The theme seems to
be capital flight to safety, and away from stocks. That appears to be the path of least resistance.
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Turn – Capital Flight Good – Investment


Capital flight doesn’t hurt employment

Mokhiber 98 [Russell [http://multinationalmonitor.org/hyper/issues/1995/01/mm0195_04.html]


PRIVATIZATION AND HEALTH/ August 19, 1998)
Environmental regulation has often been blamed for contributing to a shift in the U.S. economy from
manufacturing jobs to service employment. Industry critics have argued that environmental protection
measures have led to plant shut-downs, encouraged the flight of U.S. manufacturing capital overseas and
reduced domestic investment by hampering productivity growth. But the report found the employment
effects of shutdowns, capital flight, and productivity losses from environmental protection have been small
or non-existent. At the same time, the report found that money spent to protect the environment has in
fact created jobs. In 1993, some 4 million people were employed directly or indirectly in the
“environmental protection industry.” Because much of the environmental spending is either labor
intensive (recycling and sewage construction) or uses domestically produced capital goods (air-pollution
control equipment), most studies indicate that environmental spending boosts aggregate employment.
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Turn – Capital Flight Good – Environment


Capital flight helps impoverished countries and environment.

Muradian 2 (Roldan, UNIVERSITAT AUTÒNOMA DE BARCELONA NEPAD AND THE ENVIRONMENT: ENVISAGING THE
ECOLOGICAL CONSEQUENCES OF OUTWARD-ORIENTED DEVELOPMENT IN AFRICA
http://www.worldsummit2002.org/texts/RoldanMuradian.pdf)

On the other hand, foreign direct investment (FDI) is also supposed to encourage both economic growth
and environmental quality improvement. Transnational corporations (TNCs) should play an important
role in the economic performance of developing economies by enhancing competition, injecting capital,
providing technological advances, and promoting modern management practices. TNCs may help
developing countries leapfrog stages in development, enabling them to shift from an economy oriented
toward primary products to a service economy. This would release pressure on natural resources and
improve the environmental performance of the economy. Even if foreign investments are directed to
the primary sector, many analysts assume that environmental performance will improve because TNCs
are more efficient and technologically advanced than outdated national enterprises (Zank, 1995).
According to some authors, multinational firms are the single most important vehicle for the transfer of
environmental information and technology to the developing world, and the initiatives they are taking in
many cases exceed the requirements of the host country governments (Hadlock, 1994). Natural resources
have no value unless they are discovered, extracted, processed, transported, and distributed to
customers. The predominant idea is that TNCs may give value to these resources that would otherwise
remain unused due to lack of capital, managerial skills, and technology in poor countries (Wilkins,
1998).
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No Link – Environmental Regulation


Industries won’t leave US for environmental regulations

Goodstein 2 (Eban, Professor of Economics at Lewis and Clark College in Portland Oregon
[http://www.progressiveregulation.org/perspectives/enviro_regs_jobs.cfm] The Trade-off Myth: Fact and Fiction
About the Employment Effects of Environmental Policy/ May 2002)
This is one case in which the conventional wisdom is dead wrong. Economists who have studied the issue
agree that the three propositions above are false. At the economy-wide level, in reality, there has simply
been no trade-off between jobs and the environment. In fact, regulation-induced plant closings and
layoffs are very rare. And, despite what one hears in the media, few firms are fleeing industrial
countries like the U.S. to take advantage of lax environmental regulations in poor countries. Let’s look
more closely at these three facts. First, there is no economy-wide tradeoff. This reality is demonstrated by
looking at U.S. economic performance in recent years. From 1990 to 2000, U.S. firms, consumers, and
governments boosted their spending on environmental protection from round $138 to $219 billion -- from 2.1
percent to 2.8 percent of GDP. These expenditures financed the installation of pollution control equipment in
factories, catalytic converters in cars, laboratory testing of new pesticides, the construction of municipal
sewage plants, and the disposal of household garbage, to name just a few items. Over the same period of
time that environmental spending grew so dramatically, the U.S. economy added a whopping 16
million new jobs. At a nationwide level, unemployment rates ultimately depend on the health of the
macroeconomy, which has not been impaired by environmental regulation. Second, it is a mistake to
confuse costs of environmental protection with net job losses from environmental protection. Environmental
costs translate into environmental spending, which also provides jobs. The great majority of studies
which have examined this issue find that jobs created in the environmental and related sectors balance jobs
lost as a result of higher regulatory costs.

Environmental regulations won’t cause capital flight

Goodstein 2 (Eban, Professor of Economics at Lewis and Clark College in Portland Oregon
[http://www.progressiveregulation.org/perspectives/enviro_regs_jobs.cfm] The Trade-off Myth: Fact and Fiction
About the Employment Effects of Environmental Policy/ May 2002)
Over the last 35 years we have been at this same decision point-- facing a new set of major
environmental regulations—several times. And each time that a new regulation is put in place, we have
been able to gather more evidence that refutes such claims. In spite of apocalyptic predictions from
industry-sponsored models about the consequences of the SO2 control program, for example, not even
a whiff of economic slowdown emerged from this highly successful clean-up program. The accumulated
experience to date shows unambiguously that the job impacts from environmental regulation have been small
and gradual and that job gains have balanced losses. Environmental protection has never induced or
deepened a recession, lead to widespread plant shutdowns, nor has it promoted significant capital
flight to poor countries.
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***EPA Administration DA
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EPA Administration DA (1/2)


A. Uniqueness: The EPA implements environmental law in the status quo.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
Federal environmental law has no single, uniform statutory base. Over the last four decades, Congress
has enacted numerous
pieces of legislation focusing upon a range of particular types of environmental problems. For example, the
CAA was concerned with the nation's air quality while the CWA focused upon the eradication of pollution in the nation's waters. 28 As a
result, federal environmental law has been established in a media-specific or problem-specific fashion and, as a consequence, is a
composite of a large number of statutes. These environmental laws usually direct EPA to set substantive and
procedural requirements necessary for the achievement of identified environmental policy goals
underlying each statute. 29 For instance, in order to [*182] meet the National Ambient Air Quality Standards (NAAQS) set
under the CAA, EPA and the states must establish source-specific emission standards that limit the amount of air pollution that can be
emitted. 30 Agency requirements, such as these emission rules, often impose economic costs, require
operational changes and/or delay activities falling under EPA's statutory jurisdiction. 31 As a result, these
environmental standards may not be enthusiastically embraced by those subject to them. Not surprisingly, those falling under the EPA
regulatory umbrella may find many practical reasons not to comply or not to fully comply with these rules.

B. The plan’s increase in EPA’s administrative efforts trades off with judicial efforts to
address environmental problems.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
However, those regulated by EPA rules do not immediately come into compliance with the them. Environmental
regulations
are not self-enforcing and frequently, when they ask regulated entities to assume new economic costs or
to change their methods of operation, they are resisted. 7 As part of federal environmental policy, EPA
has also developed both coercive and cooperative tactics to achieve compliance with its many rules. 8
Using the threat of punishment to encourage voluntary compliance, EPA has adopted an enforcement
program that threatens noncompliant behavior with a variety of judicial and administrative sanctions,
believed necessary to achieve the environmental goals of federal law. 9 Environmental law authorizes a range of
enforcement techniques that can impose both civil remedies--injunctive and financial--and criminal penalties. 10 However, both of these
enforcement methods require a federal enforcement lawsuit. 11 Federal environmental statutes provide an alternative enforcement route
to resource-intensive and time-consuming judicial intervention: EPA's issuance of administrative injunctive and penalty orders. 12
Increasingly, EPA has selected this in-house approach by taking civil enforcement actions within the agency's own administrative law
structure to punish environmental violators. 13
[*178] During the last decade, these administrative enforcement cases have become so numerous that they far outnumber court-ordered
actions and result in the payment of millions of dollars in civil penalties and in the imposition of injunctive compliance orders. 14 This
practice is so pervasive that one recent assessment has estimated that approximately ninety percent of EPA's
enforcement actions are administrative, not judicial, in nature. 15 For example, in fiscal year 2006, EPA data
reported that the agency initiated 4647 administrative complaints while issuing 1438 compliance orders and imposing 4624 final
administrative penalty orders for approximately $ 42 million in fines. 16 To put these [*179] numbers into a comparative perspective,
during this same year, EPA reported that the total number of judicial enforcement cases concluded in federal court totaled only 173 and
that $ 82 million were collected in civil penalties. 17 A private estimate places the number of civil enforcement law suits filed by the
Department of Justice (DOJ) in fiscal year 2006 to be only fifteen cases. 18 The overall trends in EPA enforcement
demonstrate consistent reductions in the number of judicial civil case referrals and case conclusions, as
well as criminal sentences and fines. 19 While at the same time, the available data shows that EPA
administrative [*180] penalties have become the only increasing form of enforcement undertaken
over the last decade. 20 This striking rise in in-house environmental enforcement has occurred just
when more visible judicial enforcement has diminished.
Administrative enforcement has not only become the more frequently selected alternative to judicial
enforcement, but it has also given rise to the development of an administrative analogue to the federal
judicial system--an administrative judicial system. 21 This system conducts adjudicatory proceedings governed by its
own Agency rules of practice, largely within the confines of EPA, in an insulated administrative format with significantly less public
involvement or awareness. 22 Despite the increasing importance of EPA's internal enforcement regime, the
workings of this administrative enforcement process have operated as a stealth system, largely
escaping the view of the public. Over the years, it has also avoided scholarly examination both in terms
of its methods and its results. 23 Significantly, there has been no concerted [*181] attempt to analyze reported case decisions
that have been generated by these administrative enforcement methods. The augmented use of EPA's administrative civil penalty
technique of enforcing environmental rules is the focus of this Article.
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EPA Administration DA (2/2)


C. Impact: The administrative mechanism of the EPA hurts the environment more than it
helps turning the case.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
In conclusion, the increased use of the administrative penalty mechanism is not a clear-cut improvement in the attainment of
environmental-quality objectives. In fact, this shift could actually represent a movement towards under enforcement and result in
damage to the deterrent effect of all environmental enforcement. An unjustified and unwise over reliance on informal
and less-costly methods of enforcing environmental law could have a deleterious effect on the
willingness of regulated parties to meet their environmental obligations. If this actually does occur, the
stealth system of administrative enforcement will have harmed environmental policy more than it has
helped--certainly an unfortunate result.
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Uniqueness: Environmental groups going to courts


Environmental groups are using courts now: Whale case proves.

Greenhouse June 24 (2008, New York Times, Linda, http://www.nytimes.com/2008/06/24/washington/24scotus.html)


The Supreme Court on Monday stepped into a long-running environmental dispute over the impact on
whales and other marine mammals of Navy training exercises off Southern California.
The court, warned by the Bush administration that a set of conditions placed on the exercises by the federal appeals court in San
Francisco “jeopardizes the Navy’s ability to train sailors and marines for wartime deployment during a time of ongoing hostilities,”
agreed to hear the Navy’s appeal during its next term.

Environmental groups have been taking cases to the Supreme Court: Whale case.

Anderson June 24 (2008, Mark H, Wall Street Journal,


http://online.wsj.com/article/SB121426356830998271.html?mod=googlenews_wsj)
The U.S. Supreme Court agreed to hear the Navy's request to overturn restrictions on its ability to
train with sonar off the California coast because of concerns about harm to whales and dolphins.
The Ninth U.S. Circuit Court of Appeals, based in San Francisco, in March upheld most of a court ruling that bans high-powered sonar
near the California coast and puts other limits on Navy training exercises.
Several environmental groups sued the Navy to block its sonar use in the Pacific Ocean near southern
California. The area is home to nine threatened or endangered species of whales, dolphins, sea lions and seals.

Supreme Court is hearing environmental cases: Whale case.

Environmental News Service June 23 (2008, http://www.ens-newswire.com/ens/jun2008/2008-06-23-04.asp)


The U.S. Supreme Court today accepted a request by the U.S. Navy that the court review a series of
lower court rulings that restrict the Navy's use of loud sonar blasts in submarine detection training
exercises off the coast of Southern California.
The Navy, in its official environmental assessment of the exercises, acknowledges sonar use now underway in Southern California
waters will disturb or injure an estimated 170,000 marine mammals, including causing permanent injury to more than 450 whales and
temporary hearing impairment in at least 8,000 whales.
The underlying lawsuit was brought by a coalition of conservation organizations led by the Natural
Resources Defense Council, NRDC. The other groups are the International Fund for Animal Welfare,
the League for Coastal Protection, Cetacean Society International, and Ocean Futures Society and its
president and founder Jean-Michel Cousteau.
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AT: We Don’t Use the EPA


Congress relies on EPA for administration.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
This four-tier array of enforcement methods represents a mix of techniques sharing the common goal of ensuring compliance with the
myriad environmental rules and regulations, as well as the larger programmatic objectives underlying each environmental statute. 53
While citizen suits continue to be filed, the vast majority of environmental enforcement activity is
initiated by the government, rather than by citizens or environmental organizations. 54 Frequently,
media attention is fixed upon enforcement results from significant court judgments or settlements
[*187] imposing substantial monetary penalties and far-reaching injunctive relief. 55 With this big
case emphasis in the popular media and in the minds of many commentators, it is easy to lose sight of
the fact that a significant amount of environmental enforcement occurs within EPA itself by way of
administrative or agency penalty practice. 56 It is not difficult to comprehend the reasons for this shift
towards administrative enforcement: (1) reduced agency resources than are required by judicial
methods; (2) EPA independence in enforcement without required coordination with the DOJ; and (3)
decisionmaking by EPA's ALJs, who are familiar with the law, regulations, and technical aspects of
environmental conflicts. 57 Relying upon these administrative authorities, EPA annually obtains both monetary penalties and
injunctive relief in many individual cases that are decided within its own administrative judicial system staffed by EPA ALJs and by
EPA's Environmental Appeals Board (EAB or Board). 58 As the statistical data below will indicate, this kind of [*188] administrative
enforcement is becoming increasingly common as more cases are disposed of in this low visibility, administrative fashion. The wisdom
of this enhanced reliance on civil enforcement via administrative means remains an open question.

Congressional laws allow the EPA to use administrative mechanisms for the environment.

ExpectMore.gov January 29 (2008, http://www.whitehouse.gov/omb/expectmore/detail/10000220.2004.html)


Explanation: The purpose of EPA's Civil Enforcement Program (i.e., compliance assistance, compliance
incentives, compliance monitoring, and civil and administrative enforcement actions) is to protect
human health and the environment by ensuring that regulated entities achieve full compliance with the
nation's environmental laws; and by assisting and overseeing our state, tribal, and local partners in
achieving maximum compliance with federal and state environmental laws. All major environmental
laws provide the Agency enforcement and oversight authority, as well as authority to achieve compliance through
other means (e.g., compliance assistance). The program purpose is embodied in the Agency's strategic plan, and the mission statements
of the Office of Enforcement and Compliance Assurance (OECA) and its subsidiary offices.
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AT: EPA Not Administrative


90% of EPA actions are administrative.

Miller ‘5 (Jeffrey G, Professor of Law at Pace University, 29 Harv. Envtl. L. Rev. 1, “Theme and Variations in Statutory Preclusions
Against Successive Environmental Enforcement Actions by EPA and Citizens”)

States have similar arsenals of enforcement remedies in their statutes. In practice, however, EPA and
states conduct most
enforcement by issuing administrative orders. Approximately ninety percent of EPA enforcement
actions and ninety-five percent of state actions are administrative. 30

EPA uses administrative regulations to deter potential polluters.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
As with any regulatory scheme, EPA must find ways to have its regulations followed so that the environmentally protective goals of the
regulations and statutes will be realized. But how will compliance be achieved? What approach will be taken? This effort to insure
regulatory compliance is generally known as enforcement. 32 Two main theories of enforcement have
been advocated: a deterrence-based approach and a negotiated, cooperative approach. 33 Over time, and
with the differing political philosophies of successive governing administrations, the relative emphasis between these two approaches
can shift. Despite this observation, EPA's enforcement system has consistently stressed deterrence-based
enforcement methods using formal sanctions imposed through adversarial processes as a sign of
programmatic success. 34 The central idea underlying this view is that polluters will act in an economically rational fashion and
will seek to avoid the certain--and [*183] high--penalty costs of their environmentally noncompliant conduct. 35 This risk avoidance
will influence behavior and encourage compliance. 36 In this way of thinking, EPA consistently must act to quickly identify regulatory
violations and punish these transgressions in a predictable and economically onerous way. Even if EPA wishes to employ its
enforcement powers in a more conciliatory or cooperative way, it must maintain the possibility of using
more punitive tactics as an incentive to securing cooperation. 37 This conclusion is especially true when public health
and environmental quality interests are at stake. In the most environmentally threatening situations, the deterrence theory also requires
that EPA have the authority to punish particularly egregious behavior with noneconomic criminal law penalties. 38
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Administrative/Judicial Tradeoff Links


Administrative enforcement deters action from entities like the courts.

Glicksman and Earnhart 7 (Robert: Distinguished Professor of Law at the University of Kansas and Dietrich: Professor of
Economics at the University of Kansas, “The Comparative Effectiveness of Government Interventions on Environmental Performance in the
Chemical Industry”, 26 Stan. Envtl. L.J. 317)
Despite the central role of enforcement in the implementation of environmental legislation, relatively
little is known about why regulated entities either do or do not comply with their regulatory
obligations. In particular, "until recently, there have been surprisingly few empirical studies of environmental enforcement," in part
because comprehensive data on compliance and enforcement have been difficult to obtain. 7 The EPA
and state environmental agencies typically proceed on the assumption that rigorous enforcement will
deter noncompliance by regulated entities. 8 Other participants in the environmental enforcement
process, including the courts, seem to agree. 9 Some environmental law scholars, however, have interpreted the available
evidence to suggest "that economic sanctions do not play a major role in encouraging compliance" with environmental regulations. 10
Even assuming that government enforcement efforts can potentially induce regulated firms to improve their performance, relatively little
is known about what kinds of enforcement actions are more effective at deterring noncompliance than others. 11

Data proves that administrative enforcement trades off with judicial enforcement.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
After reviewing the EPA administrative enforcement data for the five-and-a-half-year study period, a number of conclusions can be
made. First, administrative enforcement within EPA is definitely increasing, even if recent EPA data is
discounted for being somewhat over-inclusive. This appears to be the result of twin trends: a reduction
in EPA and DOJ judicial civil enforcement and an increase in the use of administrative measures. If this
de-emphasis of more formal judicial enforcement continues, EPA will employ these administrative tactics to seek both injunctive relief
and civil penalties from violators of environmental regulations in the future. Serious questions remain whether this increased reliance on
administrative enforcement measures sufficiently advances the environmental policy goals of the underlying statutes. A more complete
analysis of this greater emphasis on the administrative process is warranted to determine if environmental policy goals are being
adequately served.

EPA administrative enforcement cases are kept away from the courts.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
Fifth, with a limited number of cases reviewed by the EAB, ALJ decisions, in reality, represent the final
step in the EPA enforcement process. This conclusion means that a larger number of environmental
enforcement disputes are being resolved by EPA's ALJs without external review by courts. 172 The
only review of these decisions is potentially undertaken by the EAB. However, the small number of
EAB appeals granted suggests that few cases are seriously reconsidered. All in all, this adjudicatory process vests
considerable discretion and authority upon EPA's ALJs and in regional officials to determine how environmental noncompliant behavior
will be sanctioned.
While there may be certain efficiencies and other benefits from such an administrative enforcement
system, there is no assurance that the right cases are being kept inside the Agency, rather than being
enforced in a more public way outside of EPA in court. Perhaps this kind of case selection represents a proper exercise
of prosecutorial discretion. However, this increased emphasis on administrative enforcement potentially diverts more serious cases away
from the judicial forum. Perhaps these right cases will be resolved in the wrong venue. The expansion of this form of internal Agency
enforcement, while simultaneously contracting the amount of external enforcement, holds the potential for inadequately sanctioning
more serious environmental wrongs. While deciding which matters are worthy of referral to the DOJ for civil enforcement would be
essentially a matter of discretionary judgment, the rapidly shrinking number of judicially enforced environmental cases calls this
selection process into serious question.
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2NC Link: Consent Agreements


Administrative enforcement results in consent agreements for environmental complaints,
which eliminates judicial enforcement.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
Second, the data collected indicates that administrative enforcement can result in cost savings for the
Agency by encouraging Consent Agreements as the principal method of resolving a large number of
environmental complaints. While the EPA regional offices expend time and effort to secure these settlements, it would seem that
more of both would be needed to expand judicial and administrative enforcement proceedings from their present levels. As the
research shows, a relatively small portion of the administrative complaints actually result in contested
cases. Put into perspective, for the five-plus years of the study period, there were less than 200 reported ALJ case decisions under the
five major environmental statutes. This suggests that EPA conducted adjudicatory hearings in approximately thirty-five contested cases
each year, with hundreds more resolved by CAFO settlement agreements. 170 If this trend continues, negotiated
settlements conducted at the regional level will become the rule in environmental violation cases, with
[*214] administrative penalty proceedings being an occasional event and judicial enforcement serving
as the rare exception.
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2NC Link: Penalty Reductions


Administrative mechanisms result in high penalty reductions increasing incentive for
challenges to enter the EPA instead of the courts.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
Fourth, the administrative enforcement process not only results in low visibility and negotiated
settlements but has also produced an adjudication format that results in a high number of penalty
reductions. The number of downward penalty adjustments greatly exceeds the number of upward
adjustments. This fact suggests that ALJs frequently perceive EPA's initial proposed penalty to be too high, rather than too low. It is
not altogether clear why EPA enforcement officials would repeatedly err on the high side. One possible
answer is that they expect the ALJs to reduce the penalty, so they set their bargaining and litigation starting point high. Perhaps the ALJs
systematically discount the EPA claims as being excessive from past experience in prior cases. [*215] Whatever the strategic
reason might be for setting the initial penalty amounts, as the system has evolved, it rewards initial
penalty challenges with a forty-two percent chance of downward adjustment. This adjustment would
compensate penalty challenges with a relatively high probability of financial reductions.
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AT: EPA Rules Good


Regardless of what rules the EPA has, it doesn’t follow them.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
Third, the review of the reported CAFOs and administrative case decisions reveals a surprising lack of
adherence to EPA's own rules of practice in administrative penalty hearings. This defiant behavior is not
reflected by the parties charged with environmental offenses or EPA enforcement officials, but rather by the RJOs and ALJs who draft
the CAFOs and write the case decisions. These are the decisionmakers who have been charged with the responsibility of implementing
EPA's administrative enforcement system. In particular, the absence of specific civil penalty calculations in the
final penalty decisions undercuts the objectivity of the system as a whole. The Part 22 rules specifically require
this explanation in all decisions to enhance the transparency and accountability of these decisionmakers. In an agency adjudicatory
system where individual decisions rarely reach the public or the environmental community, it would seem especially important to
comply with EPA's own disclosure regulations as a means of reinforcing the legitimacy of this important and increasingly utilized
penalty process. Unfortunately, this does not seem to be the case and one is left to wonder just how the particular civil penalties were
calculated. The absence of coherent explanations certainly does not build confidence in the administrative
enforcement system that is so isolated from public view. 171
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Impact Extension: Turns Case


EPA enforcement turns case because it does not have the serious threat of court
enforcement.

Rosenberg ‘8 (Ronald H, “Doing More or Doing Less for the Environment: Shedding Light on EPA’s Stealth Method of Environmental
Enforcement”, 35 B.C. Envtl. Aff. L. Rev. 175)
Sixth, the sustained increase in EPA administrative enforcement emphasizing negotiated settlements
and relatively low civil penalties may provide the regulated community with the idea that
environmental enforcement does not present a serious threat of court enforcement, and so may not
deter noncompliant conduct. If those subject to environmental [*216] rules believe that regulatory
compliance is something that can be negotiated away for a low-level sanction in a nonthreatening
context, what will become of the deterrent effect of enforcement? Conventional wisdom suggests that
serious and costly EPA enforcement is unlikely and that environmental charges can be dealt with through publicly
invisible negotiation.
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***AT: EPA Administration DA


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2AC: EPA DA (1/2)


1. Non-Unique: EPA is fighting with Congress: No reason Congress would use the EPA.

Lieberman July 11 (2008, Ben, The Heritage Foundation, http://www.heritage.org/Research/EnergyandEnvironment/wm1987.cfm)


Today, the Environmental Protection Agency (EPA) issued an Advance Notice of Proposed Rulemaking
(ANPR) detailing potentially devastating regulation of the economy in the name of fighting global
warming. But several weeks ago, the Senate considered and wisely rejected global warming legislation that, as with EPA's proposal,
would have done far more economic harm than environmental good. Apparently, the EPA bureaucracy is trying to
circumvent Congress and regulate carbon dioxide and other greenhouse gas emissions under the Clean
Air Act. Fortunately, while allowing the ANPR to be released for comment, the Bush Administration expressed in clear terms its
objections to it. EPA Administrator Steve Johnson noted that the Clean Air Act was originally intended to regulate regional pollutants
that caused health problems and is not the way to reduce greenhouse gases.
The regulatory roadmap laid out in the ANPR would result in a vast expansion of the EPA's power,
giving the organization unprecedented regulatory oversight into all sectors of the economy, including
restaurants, hospitals, apartments, schools, shipping, trucks, and farming. There is now a 120-day comment
period for interested parties to explain why this proposal needs to be stopped.

2. Non-Unique: EPA won’t get that regulatory power because the Bush administration is
blocking efforts to regulate.

Madia July 7 (2008, Matt, RegWatch, http://ombwatch.org/article/blogs/entry/5166/24)


The White House Office of Information and Regulatory Affairs (OIRA) has rejected an Environmental
Protection Agency proposed rule that would encourage the recycling of pesticide containers. EPA has been
mulling the proposal for at least a few years.
The rule would establish a national recycling program that would help ensure pesticide containers are rinsed out and properly disposed
of. According to EPA, "The proposed regulation is intended to protect human health and the environment by promoting recycling of
pesticide containers to reduce the risk of unreasonable adverse effects to public health and the environment that may be associated with
certain nonrefillable pesticide containers and the associated residues."
But the White House has rejected the EPA proposal. In a July 3 letter to EPA Deputy Administrator Marcus Peacock,
OIRA Administrator Susan Dudley takes exception to the proposal. Dudley says the rule would be too costly and criticizes
the agency for not examining other regulatory alternatives.

3. Link Turn: The courts don’t help the environment: Clean Air Interstate Rule proves.

New York Times July 16 (2008, http://www.nytimes.com/2008/07/16/opinion/16wed3.html)


Nobody could ever seriously accuse the Bush administration of being too aggressive when it comes to enforcing the nation’s
environmental laws. But it was partly on those grounds that a federal court last week struck down the Clean Air
Interstate Rule, a regulation aimed at reducing soot and smog and one of the few creative initiatives to
emerge from the Environmental Protection Agency in the last seven years. The decision was an
unexpected triumph for a handful of utilities, including Duke Energy, which complained that the
agency had overstepped its authority. It was also an enormous setback for the nation’s air quality and the health of all
Americans

4. Link Turn: Current EPA regulations protect the environment.

EPA No Date Given (Compliance and Enforcement, http://www.epa.gov/ebtpages/complianceenforcement.html)


Complying with environmental regulations is important in protecting public health and the
environment. EPA is responsible for enforcing and assuring compliance with environmental
regulations and may delegate this responsibility to state and tribal governments. EPA's enforcement efforts focus on
assisting businesses and communities with compliance training and guidance. The Agency also partners with
foreign governments, international organizations and other federal agencies to help building enforcement and compliance capabilities in
other countries, and to fulfill U.S. commitments under international agreements.
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2AC: EPA DA (2/2)


5. No internal link: EPA works with businesses on regulations: No reason to resist.

EPA June 9 (2008, http://www.epa.gov/lawsregs/brochure/index.html)


EPA encourages and facilitates such voluntary efforts to protect the environment, but sometimes we also must write mandatory
requirements called regulations. While Congress passes the laws that govern the United States, Congress has also authorized EPA and
other government agencies to create and enforce regulations in order to put those laws into effect. EPA regulations cover a
range of environmental and public health protection issues, from setting standards for clean water to
specifying cleanup levels for toxic waste sites to controlling air pollution from industry and other
sources.
We invite stakeholders to share in the development of EPA regulations. We want our rules to be
practical and fair for the American people. This online brochure provides an in-depth overview of how EPA writes
regulations, and how your voice can influence the policies that shape our environmental future.
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Extension: Congress-EPA conflict


EPA and Congress are fighting over lowering greenhouse gas emissions.

Reuters July 11 (2008, http://www.reuters.com/article/environmentNews/idUSN1149339120080711)


The head of the U.S. Environmental Protection Agency said federal clean air laws are the "wrong tool"
to regulate greenhouse gas emissions and that Congress should enact laws to tackle climate change.
The EPA has been under pressure to take steps to regulate greenhouse gases since a landmark 2007 Supreme
Court decision that it must reconsider its refusal to regulate carbon dioxide emissions from new cars and trucks.
"The Clean Air Act is ill suited and the wrong tool, therefore I believe this should be the responsibility
of Congress," EPA administrator Stephen Johnson told reporters in a teleconference.

More evidence.

Reuters July 11 (2008, http://www.guardian.co.uk/business/feedarticle/7646135)


The top U.S. environmental regulator on Friday declined to make rules to regulate planet-warming
emissions under existing pollution laws despite a Supreme Court decision that has pressured his agency to act.
Environmental Protection Agency Administrator Stephen Johnson said Congress should make rules to
regulate emissions of carbon dioxide and other gases blamed for global warming
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Extension: Bush administration-EPA conflict


The EPA has worked against regulation due to White House direction.

LA Times July 12 (2008, Janet Wilson,


http://www.boston.com/news/nation/washington/articles/2008/07/12/epa_chief_sidesteps_supreme_court_ruling/)
Responding to a US Supreme Court order, the Environmental Protection Agency said yesterday that the
Clean Air Act was "the wrong tool for addressing greenhouse gases" because it would be too costly for
the American public and that instead Congress should move forward with passing legislation to tackle the issue.
The high court had ordered the EPA more than a year ago to determine whether greenhouse gases were a danger to the public.
If so, the justices said, under the Clean Air Act the agency is required to develop regulations to reduce the risk.
Instead, Stephen Johnson, EPA administrator, signed what he said was an unprecedented 1,000-page
document yesterday that included letters from numerous White House environmental and economic
agencies detailing how such regulations could have a negative impact on major sectors of the economy.

The Bush administration is preventing regulation on climate change.

Charleston Post and Courier July 18 (2008, http://www.charleston.net/news/2008/jul/18/face_up_global_warming47922/)


By week's end, though, environmentalists were assailing the Bush administration anew over its refusal
to act on the findings of Environmental Protection Agency scientists who concluded that climate
change presents "grave risks" to human health due to its impact on supplies of food, water and energy.
That EPA analysis was conducted in response to a 2007 Supreme Court ruling requiring it to regulate greenhouse gases unless it could
provide a "scientific" basis for not doing so.
Yet EPA Administrator Stephen Johnson rejected his own agency's report, instead declaring a four-
month "public comment" period before deciding the next step. By the time that delay ends, a new
president-elect will have been chosen.
The Bush administration's apparent intention to play out the clock on climate change is hardly
surprising. In a related recent development, a former senior EPA official charged that Vice President Dick Cheney's office altered
testimony from the Centers for Disease Control early this year to downplay climate change's ill effects on public health.
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Extension: Courts hurt the environment


Supreme Court not helping environmental groups: Border fence proves.

Environmental News Service June 23 (2008, http://www.ens-newswire.com/ens/jun2008/2008-06-23-092.asp)


The U.S. Supreme Court today decided not to hear a plea by two environmental groups to limit the
Bush administration's power to waive laws in order to construct a fence along the U.S.-Mexican
border.
In April, Homeland Security Secretary Michael Chertoff announced that he was waiving 36 federal
laws, including the Endangered Species Act, the Migratory Bird Treaty Act, the National Wildlife
Refuge System Administration Act, and the National Environmental Policy Act, in order to speed up
construction of over 300 miles of border wall.

Even Massachusetts vs. EPA didn’t work: The Bush administration is rejecting action.

ContraCostaTimes July 15 (2008, http://www.contracostatimes.com/opinion/ci_9893757)


PRESIDENT BUSH'S STALL tactics on global warming have finally worked. By turning down
recommendations from top experts and rejecting regulation of greenhouse gases blamed for global
warming, Bush has officially passed the hot potato on to the next administration. Bravo, Mr. President.
The Bush administration dismissed a 588-page federal notice, saying it would cripple the economy.
However, the evidence comes from an Environmental Protection Agency that is suddenly mastering the art of flip-flopping, even when
the future of our society could be hanging in the balance.
In the notice released, the EPA said it made no finding on whether global warming threatens people's health or welfare; that was a
reverse of an earlier conclusion and came at the insistence of the White House.
Three weeks earlier, the EPA suggested that the 1970 Clean Air Act can be workable and effective for addressing global climate change.
But the White House not only rejected that claim, the EPA later changed its stance again and said that law is "ill-suited" for dealing with
global warming. EPA Administrator Stephen Jackson said "It is really at the feet of Congress."
The Supreme Court ruled last year that the government had the authority under the Clean Air Act to
regulate greenhouse gases as a pollutant, but Bush has steadfastly opposed such a notion.
Gonzaga Debate Institute 2008 127
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Extension: EPA helps the environment


The EPA helps the environment: It promotes environmental management systems.

EPA 5 (January 12,


http://yosemite.epa.gov/opa/admpress.nsf/a76c9c7d7c5403f8852572a000658eee/50f77e260c79da2785256f870065068f!OpenDocument)
Environmental management systems (EMS) are a well established tool to help local governments
prevent pollution, operate more efficiently and improve environmental performance within their
communities. Since 1997, EPA has helped local entities establish EMS that include effective
environmental policies and measurable goals for reducing impacts on the environment. Mayor Douglas
Palmer of Trenton, N.J., who co-chairs the National Conference of Mayor Urban Watershed Council said,
"Introducing EMS as a tool reduces costs and improves government efficiency in addition to preserving
environmental quality, making it a ‘must do’ for mayors and their staff and programs."
The agency has been working with local governments and others to help understand the benefits of an
EMS and assist those that choose to put one in place. EPA in cooperation with the Global Environment
and Technology Foundation has worked with more than 30 local governments around the country to
reduce operating costs, improve their compliance and significantly reduce environmental impacts in
the community. In the first year of implementing an EMS, the city of San Diego's Solid Waste Division was
able to reduce air emissions from heavy equipment more than $800,000.
EPA is also leading a program to work with non-profit organizations, called EMS Local Resource
Centers, to help increase the number of local governments that adopt EMS. These centers provide a range of
services to local governments including education, training, workshops and guidance. There are 11 local resource centers around the
country, including four new centers recently designated by EPA. These newly designated centers are located at the University of
Missouri-Rolla, Kansas State University, the University of Colorado, and EcoVenture in Oakland, Calif. Each of these local
resource centers is playing an important national leadership role by helping local governments operate
in a more environmentally and economically sound manner and provides more efficient services for
taxpayers in their communities. Information about EMS and the new centers is available at: http://www.peercenter.net .

EPA helps the environment: New website.

EPA 7 (May 2, Dave Ryan,


http://yosemite.epa.gov/opa/admpress.nsf/066afa186adc1114852572a00065593c/0fe60b8b9050fed7852572cf005f5262!OpenDocument)
The new EPA Web site on stewardship programs, launched today, can help business, government and
private citizens make intelligent choices on sustainable environmental benefits. Simple everyday decisions by
organizations and individuals on such issues as recycling, reuse or choice of fuel support pollution prevention and environmental
stewardship.
The Web site will enable users to find EPA partnership programs, such as the Energy Star energy saving program, which best align with
their needs and interests. Businesses can search for EPA programs based on their industrial category,
environmental issue of interest, and geographic area. One specific Web site, for example, shows businesses how they
can help employees reduce the environmental impacts of commuting.
The Web site also provides information links individuals can use to protect the environment in different settings, such as home, work,
school and shopping. One Web site shows citizens how they can use pesticides safely.
This tool is the latest in a series of steps EPA has taken to support environmental stewardship. In 2005,
EPA Administrator Stephen L. Johnson endorsed a framework for EPA that recognizes environmental
stewardship as the next phase in an ongoing evolution of environmental policy – from pollution control
to pollution prevention and sustainability.
EPA is now promoting environmental stewardship in a variety of ways. For example, the agency has challenged
individuals to become more energy efficient at home through the "Change a Light, Change the World" campaign, and challenged
Fortune 500 companies to double their purchases of green power. Examples at the local level include EPA offering communities
technical assistance in applying smart growth principles, as well as providing funding to retrofit older diesel school buses with pollution
control equipment. At colleges and universities, EPA is sponsoring research to help students develop and design innovative solutions to
sustainability challenges in agriculture, water and energy use. EPA's commitment to environmental stewardship is also evident at the
agency's facilities: In 2006, EPA's new Potomac Yard office in Arlington, Va., earned a gold rating under the internationally recognized
green building standard known as LEED (Leadership in Energy and Environmental Design).
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Extension: EPA regulations not resisted


EPA regulations provide flexibility for businesses.

EPA June 9 (2008, “Providing Flexibility”, http://www.epa.gov/lawsregs/brochure/flexibility.html)


Companies sometimes argue that, by mandating specific solutions, EPA regulations stifle innovation that could lead to better
environmental results. By pursuing innovative approaches and insisting on strong accountability for results,
we are finding ways to build more flexibility into regulations.
One way we do so is by using performance-based approaches that emphasize the end result we want to
achieve. For example, an air quality regulation directed heavy-duty diesel trucks and buses to cut sulfur emissions by 95 percent. The
regulation did not specify how refiners and engine manufacturers must achieve this goal, but it did give them significant time to decide
for themselves.
In other instances, EPA has offered companies extra time to comply with a new requirement if those
companies were willing to invest in more advanced technologies than required. The goal of this
approach is to achieve better protection for the environment and more flexibility in making
environmental investment decisions.
EPA works with states, businesses, and other organizations with environmental interests to test
approaches that can lead to more flexible regulations. The objective is to find more efficient and effective ways of
achieving environmental goals and to then apply those approaches on a scale that produces the greatest possible benefits.

EPA is completely accountable to the public.

EPA June 9 (2008, “Providing Flexibility”, http://www.epa.gov/lawsregs/brochure/flexibility.html)


Many individuals outside the government are affected by and interested in environmental regulations.
These stakeholders often provide valuable comments on EPA's proposed regulations. Stakeholder
comment can illuminate issues that EPA has not yet considered, allowing us to benefit from the
knowledge and experience of the concerned public and leading to better regulations.
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Non-Unique: Courts not helping the environment


The courts are not helping the environment: Clean Air Interstate Rule proves.

New York Times July 16 (2008, http://www.nytimes.com/2008/07/16/opinion/16wed3.html)


Nobody could ever seriously accuse the Bush administration of being too aggressive when it comes to enforcing the nation’s
environmental laws. But it was partly on those grounds that a federal court last week struck down the Clean Air
Interstate Rule, a regulation aimed at reducing soot and smog and one of the few creative initiatives to
emerge from the Environmental Protection Agency in the last seven years.
The decision was an unexpected triumph for a handful of utilities, including Duke Energy, which
complained that the agency had overstepped its authority. It was also an enormous setback for the nation’s air quality
and the health of all Americans

Supreme Court not helping environmental groups: Border fence proves.

Environmental News Service June 23 (2008, http://www.ens-newswire.com/ens/jun2008/2008-06-23-092.asp)


The U.S. Supreme Court today decided not to hear a plea by two environmental groups to limit the
Bush administration's power to waive laws in order to construct a fence along the U.S.-Mexican
border.
In April, Homeland Security Secretary Michael Chertoff announced that he was waiving 36 federal
laws, including the Endangered Species Act, the Migratory Bird Treaty Act, the National Wildlife
Refuge System Administration Act, and the National Environmental Policy Act, in order to speed up
construction of over 300 miles of border wall.

Even Massachusetts vs. EPA didn’t work: The Bush administration is rejecting action.

ContraCostaTimes July 15 (2008, http://www.contracostatimes.com/opinion/ci_9893757)


PRESIDENT BUSH'S STALL tactics on global warming have finally worked. By turning down
recommendations from top experts and rejecting regulation of greenhouse gases blamed for global
warming, Bush has officially passed the hot potato on to the next administration. Bravo, Mr. President.
The Bush administration dismissed a 588-page federal notice, saying it would cripple the economy.
However, the evidence comes from an Environmental Protection Agency that is suddenly mastering the art of flip-flopping, even when
the future of our society could be hanging in the balance.
In the notice released, the EPA said it made no finding on whether global warming threatens people's health or welfare; that was a
reverse of an earlier conclusion and came at the insistence of the White House.
Three weeks earlier, the EPA suggested that the 1970 Clean Air Act can be workable and effective for addressing global climate change.
But the White House not only rejected that claim, the EPA later changed its stance again and said that law is "ill-suited" for dealing with
global warming. EPA Administrator Stephen Jackson said "It is really at the feet of Congress."
The Supreme Court ruled last year that the government had the authority under the Clean Air Act to
regulate greenhouse gases as a pollutant, but Bush has steadfastly opposed such a notion.
Gonzaga Debate Institute 2008 130
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***DOE Good/Bad
Gonzaga Debate Institute 2008 131
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DOE Good – Quarterly Checks


( ) The DOE makes communication and management a top priority – quarterly report cards check inefficiencies.
DOE 8 (Department of Energy, Steps to Success, http://www.doe.gov/pma/stepstosuccess.htm)
DOE’s success has resulted from strong top level leadership, ownership by career officials, broad
communication and participation at all levels of the agency, including the field. The Secretary and Deputy
Secretary have made management improvement a high priority and consistently used the President's
Management Agenda (PMA) to implement needed reforms. The Management Council, which is chaired by the
Deputy Secretary and consists of DOE’s top political and career officials, was established to oversee PMA
implementation. The Council meets monthly to discuss guidance from the President’s Management Council,
review progress in implementing PMA initiatives and establish expectations for future action. The Secretary
designated the Associate Deputy Secretary to lead day-to-day management of the PMA and provide consistent attention to PMA issues. To institutionalize DOE’s
management reforms, a kitchen cabinet of career senior executives was established by the Associate Deputy Secretary to strengthen ownership of PMA principles in
the career ranks. Senior career executives were designated to lead each of the five PMA initiatives. These initiative “owners” report directly to the Associate Deputy
Secretary on PMA matters. PMA office coordinators were designated to help implement PMA initiatives in their component. PMA coordinators were also identified
The Deputy Secretary
at DOE’s national laboratories to ensure that major facilities contractors align their management practices around PMA principles.
issues a quarterly “report card” that uses stoplight scores to assess each component’s performance in
implementing the five PMA initiatives. Components with yellow or red scores must prepare remediation
plans, which are monitored by Associate Deputy Secretary.
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DOE Good – Regulations


( ) DOE is good with regulations – recent health provisions prove.
DOE 6 (Department of Energy, February, http://www.doe.gov/news/3147.htm)
Energy Secretary Samuel W. Bodman today announced regulations aimed at improving worker safety across the
Department of Energy complex. This rule establishes a uniform set of standards that will require department-
wide compliance and monetary fines for contractors who fail to apply these regulations.“This announcement
marks a major step forward in protecting the health and safety of our workers and contractors,” said
Secretary Bodman. “Most importantly, this rule strengthens our hand in both identifying and fixing safety
issues before an accident occurs.” While DOE nuclear workers are protected under the Price-Anderson Act, which
allows the Department to take enforcement actions against contractors who violate nuclear safety rules, there is no
uniform standard or enforcement mechanism that addresses the health and safety of non-nuclear workers.
“In the past, health and safety regulations varied from site-to-site and contractor-to-contractor, creating
uneven standards of protection,” said Assistant Secretary of Energy for Environment, Safety and Health, John S.
Shaw. “While DOE’s record is strong, this rule provides incentive for our contractors to constantly continue to
improve safety practices.”
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DOE Bad – Management


( ) DOE has many problems with management and coordination on many existing projects.
ASCE 5 (American Society of Civil Engineers, Project Management Factors Affecting Department of Energy Project Success,
http://books.google.com/books?id=xZte3iKpuV8C&dq=Department+of+Energy+success&source=gbs_summary_s&cad=0)
An independent research team (IRT) was assembled to perform the study in collaboration with the CERF staff. This
team collected data on the projects, familiarized themselves with what happened on each project, discussed
the projects with DOE Headquarters personnel, and visited the sites to discuss the projects with project
teams. The data from the 16 projects were discussed by the IRT team during a meeting in Washington, and the
common factors contributing to project success, or deficiencies, were ascertained. These factors were then
grouped into categories and prioritized. Finally, lessons learned were listed and recommendations formulated
for presentation to the DOE. The key categories and results are: Organization and personnel. A critical
success factor is the assembling and coordinated focus of a co-located Integrated Project Team (IPT)
consisting of all key participants who are needed to perform the project as well as those who will use the
deliverable when it has been completed. Both procurement and operations/facility user personnel should be
on the team. A critical success factor is employment of an effective DOE Project Director with the right skils,
including an undertstanding of the difference between assuming a leadership role and directing actual project
execution. The most successful Contractor Project Managers have both technical and leadership skills.
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DOE Bad – Cost control


( ) DOE does not use all of the tools available to them. This hinders their ability to
coordinate successful cost control.
ASCE 5 (American Society of Civil Engineers, Project Management Factors Affecting Department of Energy Project Success,
http://books.google.com/books?id=xZte3iKpuV8C&dq=Department+of+Energy+success&source=gbs_summary_s&cad=0)
The projects that performed robust front-end planning had the fewest problems during project execution. The risk
assessment and management skills of the project team are critical determinants of eventual project success.
Some of the projects reviewed showed an excessive reliance on the use of Earned Value Management Systems
(EVMS) to monitor projects and were not using other tools at their disposal such as critical path schedule
methods. Also, EVMS data problems and frequent rebaselining masked the true state of some of the projects.
Best practices in schedule and cost control are the use of integrated, critical path project schedules and
trending of potential changes. Regular, periodic project reviews by internal and external parties are often an
effective means of keeping projects on track. However, these reviews need to be coordinated and limited to those
necessary to track the project.

( ) DOE procurement approaches are not tailored to specific needs – this limits their
effectiveness and success.
ASCE 5 (American Society of Civil Engineers, Project Management Factors Affecting Department of Energy Project Success,
http://books.google.com/books?id=xZte3iKpuV8C&dq=Department+of+Energy+success&source=gbs_summary_s&cad=0)
An acquisition strategy should be developed during the conceptual design phase of the project and integrated with
the risk management program. Procurement approaches should be tailored to project needs. Performance metrics
and incentives should be used to tie contractor performance to desired business results.
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DOE Bad – Risk Assessment


( ) DOE fails – poor risk assessment policies prove.
ASCE 5 (American Society of Civil Engineers, Project Management Factors Affecting Department of Energy Project Success,
http://books.google.com/books?id=xZte3iKpuV8C&dq=Department+of+Energy+success&source=gbs_summary_s&cad=0)
Reviews by technical peers from other sites can play a key role in the success of complex, first-of-a-kind DOE
projects. Unpredictability of funding disrupts projects, lengthens schedules, and increases costs. Develop a
core group of highly qualified Federal Project Directors along with a defined career path to retain these individuals.
Create opportunities for interactions and the sharing of lessons learned sharing among DOE Project Directors.
Provide guidance on the required membership on an IPT and ensure that an IPT is appropriately identified early in
the project. Take steps to strengthen risk assessment and risk management practices, an make the discussion
of risk assessment and mitigation plans a part of all project reviews. Work to make Earned Value Management
Systems (EVMS) meaningful management tools by improving the awareness of IPTs that EVMS are more than
reporting mechanisms. Appropriately control the rebaselining of projects. Ensure that an integrated project schedule
which includes all participants’ work efforts is developed for projects. Encourage robust front-end planning.
Establish a baseline at the 30-40% design point for large projects (over 50M) that have reached Critical Decision-1.
If they are not ready to satisfy all of the requirements of Critical Decision-2 at that point then a shortened list
of requirements should be developed so that they can have a formal baseline for some portion of the work
approved. Ensure that an acquisition strategy is developed at the beginning of the project. See that procurement
staff play an integral role in the development of the acquisition strategy and become key members of the integrated
project team. Require peer reviews for first-of-a-kind and technically complex projects at Critical Decision 1.
Fully fund the smaller line-item projects and provide phased funding for the larger ones. The phased funding
should be linked to the Critical Decision points. See that multi-partner teams develop Memorandums of Agreement
early in the project and incorporate them in the relevant contracts. Develop guidelines for tailoring the requirements
of the 413.3 Order and Manual to address the special conditions facing smaller and other unique programs. Examine
the value of the PARS program reporting system to senior managers responsible for monitoring program efforts.

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