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OpenMarket: Energy and Environment

  • A Voluntary Approach to Helping the Honeybee

    April 8, 2015 3:12 PM

    Today, the Competitive Enterprise Institute published my paper on the honeybee health issue and pesticide use. We have had several media outlets ask, why is CEI focused on the honeybee issue now? If you read this blog, you know that I have been writing about pesticides and their impact on public health and well-being for at least a decade and a half.

    CEI selects issues based on our goals to promote freedom and prosperity, using the market to advance public health and well-being. I focus on chemicals, which I believe are under appreciated and misunderstood market-generated technologies that advance human well-being.  My work on pesticides has focused on allowing strategic uses to control disease carrying vermin such as mosquitos and ticks as well as the benefits and importance of crop protection chemicals for producing a stable food supply. 

    But I have another agenda when it comes to honeybees. As long as I have owned a piece of land, I’ve poured my heart and soul into my wildlife garden. While other people complain and look for regulations and government intrusions, I’d rather be part of the solution. And when it comes to public policy, we won’t help pollinators unless we use science and reason rather than alarmism-driven, anti-technology agendas.

    That said, there are things that private parties can do to help honeybees, and other wildlife, without asking big brother to ban valuable technologies. Consider what I’ve done to my yard.

    When I first moved in, the grass grew up to the house, and I barely saw a bird or butterfly. With lots of digging and effort, my yard is now a destination for myriad butterflies, bumblebees, and bugs I can’t even name. It’s also a favorite destination for all kinds of birds, from hummingbirds to finches and mockingbirds to crows and mourning doves. I even periodically see a crazy beautiful moth called the clearwing hummingbird moth. This amazing little creature really does look like a hummingbird! The feeders in the backyard attract a wide array of birds as well.

    So, for those people who want to help the honeybee, consider growing some plants that will benefit them, whether it’s in your yard or simply in flower box. Habitat is critically important for these creatures. Here are some plants that do well in my Virginia garden. Why not try them in yours?

  • California Drought 2.0, or Is it 3.0?

    April 6, 2015 6:46 AM

    California’s water woes are back in the headlines after Gov. Jerry Brown commanded a 25 percent cut in consumption last week after extended drought.

    Pricing matters and we’ve not done the greatest job liberalizing infrastructure and matching resouces to market signals. California’s just the most extreme modern example, now pitting neighbor against neighbor. Pools in the desert are scorned, as are the lush desert golf courses, and thirsty agricultural interests.

    But water doesn’t cost much. It needs to cost what its worth, and part of the job of markets is to determine prices. But markets are not what water utilities are.

    After congressional testimony on western states water policy a year and a half ago, California’s water crisis resurfaced again. I wrote a column in Forbes then noting that California, western and national water resources and environmental amenities should be better integrated into the property-rights, wealth-creating sector. That’s an evolution derailed here as well as in other sectors such as in electromagnetic spectrum, electricity and transportation grids.

    Recommendations were these:

    First, better pricing of existing supplies can make shortages vanish. (I talked about the water/diamonds paradox; you can Google it.)

    Second, improving water infrastructure can reduce the leaks that now deplete some 17 percent of the annual supply, as noted in a Competitive Enterprise Institute report by Bonner Cohen.

    Third, better transport and infrastructure, including pipelines and canals, better reservoir storage, trucking, and crude oil carriers can secure supply and lessen artificial drought more cheaply than expensive politically pushed alternatives like desalination.

    Fourth, improved trades between cities, farmers and private conservation campaigns can be essential to pricing and value.

    All these can supplement direct sourcing alternatives including drilling, gray and wastewater treatment and reclamation; stormwater harvesting and surface storage and, OK, you got me: even desalination where it’s economically rational.

    The path taken politically is usually restrictions on usage rather than pricing and liberalization, so there’ll be plenty headlines to come. 

  • TSCA Reform Debate Is Not about Public Safety

    April 1, 2015 1:59 PM

    At recent hearings on the the Frank R. Lautenberg Chemical Safety for the 21st Century Act (S. 697), senators, environmental activists, and local government officials claimed that the Toxic Substances Control Act (TSCA) law is not sufficient protect public health. As I have argued before, that’s certainly not the case.

    There may be an economic reason to reform this law—to preempt a growing patchwork of nonsensical state-level consumer product regulations—but there’s no legitimate “safety” reason for reform.

    Still, activists and some members of Congress at the hearing complained that TSCA’s risk standard has prevented the EPA from banning “a known human carcinogen,” i.e., asbestos. Cosponsor of S. 697 Senator Tom Udall (D-N.M.) exclaimed at the hearing, “I think we all agree: TSCA is fatally flawed. It has failed to ban even asbestos.”

    Activists and members of Congress point out that EPA failed to address asbestos in part because TSCA requires EPA to pick the “least burdensome” regulation to achieve its goals. 

    But how can that be a bad thing? Shouldn’t we want to achieve our goals at the lowest costs? It doesn’t say EPA should pick a regulation that is less safe; rather, it says that EPA should simply pick a less expensive means to meet the safety goal.

    That requirement is part of TSCA’s robust risk standard that holds regulators accountable and prevents them from passing rules that do more harm than good. Under TSCA, EPA may regulate when the agency finds that a chemical may pose an “unreasonable risk of injury to health or the environment.” This standard requires weighing the risks of the chemical against the risks of the regulatory action.

    People who use the asbestos case to push TSCA reform are either grossly misinformed about the case or they are simply being disingenuous. It is true that the rule was thrown out by a federal court in part because EPA did not bother to find the “least burdensome” approach to meet its goals. In addition, the court pointed out that the rule might have produced more deaths than theoretical lives saved. Accordingly, this is not a TSCA failure, it’s a life-saving success!

  • President Obama's UN Climate Plan Ignores American People and Congress

    March 31, 2015 3:38 PM

    Myron Ebell of the Competitive Enterprise Institute responded to the Obama Administration’s submission of its intended nationally-determined contribution (INDC) to the United Nations:

    “President Obama has pursued his domestic climate agenda without trying to build support for it with the American people or in Congress, and today’s INDC submission is no different. The President thinks he can make an international commitment to reduce greenhouse emissions by up to 28 percent of 2005 levels, and thereby limit economic growth, without consulting Congress. The administration is making this commitment to the forthcoming Paris Accord under the UN Framework Convention on Climate Change without any authorization from Congress and without broad public support. Governments in other countries should be aware that the President’s plan is dead on arrival in Congress.   

    “The U.S.’s INDC goes far beyond the commitments undertaken by the Clinton Administration under the Kyoto Protocol in 1997. But the Senate did not ratify the Kyoto Protocol, and the Congress refused to enact cap-and-trade legislation or any other significant climate legislation. Nor has Congress given any indication that it will support major elements in the plan submitted to the UN. The largest single component of the plan is the EPA’s proposed Clean Air Act regulations to reduce emissions from power plants. These rules are being challenged in federal court by at least 13 states and are opposed by a majority in both the House and Senate.”

     

  • Arsenic in Wine: Dangerous or Beneficial?

    March 26, 2015 2:23 PM

    Dan Nosowitz in Modern Farmer offers some insights on the recent class action lawsuit filed against California winemakers. The plaintiffs found that some inexpensive wines contained arsenic at levels exceeding the federal drinking water standard for this substance. Nosowitz rightly points out that the standard is for water, not wine and “people don’t, or shouldn’t, drink as much wine as water.”   

    Well, let’s not go that far… kidding of course! Moderation is surely a good idea when it comes to alcohol consumption. Yet even if you drank as much wine as you do water, there’s still no reason to be alarmed about arsenic. The levels in wine are still too low to have any significant adverse impacts, and ironically, such small amounts might even have health benefits. 

    Arsenic is an element that naturally occurs in the earth’s crust, so traces of arsenic inevitably appear in food and water. Certainly, high levels of arsenic are not healthy and concentrated exposures can be immediately deadly. But the trace levels found in water and food are rarely an issue. Problems have emerged primarily in developing nations like Bangladesh where poor people drink from untreated water sources with arsenic levels that range in the hundreds of parts per billion (ppb), and sometimes more than 1,000 ppb.

    It’s worth noting that the levels allegedly found in wine are reportedly just five times greater (or 500 percent higher as noted in the press) than the federal drinking water standard of 10 ppb. So, some number of samples—we don’t know how many—tested by the plaintiffs in this case had some level of arsenic near the 50 ppb level. But did you know that until 2006, that was the allowable level in drinking water in the United States and it had been for decades?

    The U.S. Environmental Protection Agency (EPA) changed the standard to 10 ppb in 2001 with full compliance not required until 2006. The 10 ppb standard for arsenic in drinking water is excessively overcautious. When EPA proposed it, it was very controversial because the cost to small drinking water systems was substantial and the benefits highly questionable. EPA’s Science Advisory Board highlighted lots of problems with EPA’s science and maintained that the change could actually undermine public health. The SAB explained that the costs might cause some small communities to disconnect their water systems, forcing people to use untreated well water, but EPA finalized the rule anyway. 

    If you look at the history, you can see that EPA did not change the standard for safety reasons; they did it for political ones. You may remember, environmental activists attacked the Bush administration for taking time to reconsider changing the standard, which the Clinton administration rushed out during the final hours of the Clinton presidency. Green groups made it sound like the Bush administration was adding arsenic to the water supply. And this bad press made a rational and scientific debate impossible.

  • Yes, and Water Can Run Uphill!

    March 20, 2015 10:05 AM

    A recent Washington Post story by Joby Warrick says much about the credulity of the media. The story extols the great gains in wind power, noting that it “could provide more than a third of the country’s electricity by 2050 while yielding a net savings in energy costs paid by consumers.”

    Warrick, like many in the media, viewed this prediction by the Department of Energy as clear evidence of the gains by non-fossil fuel sources. Indeed, he quoted without comment the Department’s statement that there would a “net savings in energy costs paid by consumers” and later that this shift “would result in a net price increase of about 1 percent for consumers” even though “an overall savings of 2 percent.” The “savings” would include the imputed values of CO2 and other pollutant reductions. Consumers are going to pay more, but “society” will benefit—a story we’ve heard before. 

    But, although the article suggests that dramatic cost reductions in the wind power area have made this source more economically attractive, the report also “warned that consistent government policies were critical to avoiding boom and bust cycles,” and that “Congress must keep the wind-friendly tax policies in place.” So, an efficient technology option has to be subsidized to survive in the marketplace?  Does the media ever read its own stories?

    Of course, wind power can be attractive to some if it is heavily enough subsidized. But an energy alternative that’s been around since the Middle Ages and which the Department of Energy claims to be cost-competitive cannot survive without continued government subsidies? The media seems to like any energy source that requires government support.

  • Data Torturing at the CPSC

    March 19, 2015 1:57 PM

    James Mills of the National Institute of Child Health and Human Development lamented in an article in the New England Journal of Medicine back in 1993: “‘If you torture your data long enough, they will tell you whatever you want to hear’ has become a popular observation in our office. In plain English, this means that study data, if manipulated in enough different ways can prove whatever the investigator wants to prove.”

    Government regulators will resort to such data torture to justify an activist regulatory agendas if they can’t do it with good data and sound science. One approach includes selective use of data—excluding years or datasets that might change the conclusions of a risk assessment. The Consumer Product Safety Commission’s recent Chronic Hazard Advisory Panel (CHAP) report on the chemical class known as phthalates offers one new example of excluding inconvenient data.

    In short, the CHAP report is being used to justify a proposed rule that would essentially ban the use of certain chemicals for toys that children might mouth or chew. These chemicals make plastics soft and pliable, suited for such things as a plastic version of a “rubber duckie.” For background on this issue, see my other blog posts here and here

    In addition, in the absence of any compelling body of data that any individual phthalate is the cause of human health effects, the panel relied on the possibility that the cumulative effects of phthalates as a class pose risks. Accordingly, they needed data on human exposure from all sources.

    The panel developed a “cumulative risk assessment” that they maintained justified regulations. But pharmacologist Christopher J. Borgert, Ph.D., observes in a review of the CHAP report that the panel’s cumulative risk assessment: “failed to recognize obvious inconsistencies with human experience and clinical evidence”; “overstates the accuracy of its cumulative risk methods and conclusions”; and “appears to have grossly overestimated chemical potencies.” In other words, the panel failed to properly apply the available data and research.

    To make matters worse, they used old and irrelevant data for their human exposure assessments even though more accurate and recent data was available. Former and current CPSC commissioners have noted that had the panel used the most recent data, their risk assessment would have produced the opposite result. This issue raises the prospect that the panel members were intentionally “selective” in their use of data because they desired to generate a particular conclusion, as appears to be the case with their selection of studies that they also reviewed. 

  • CPSC's Scientific Shenanigans on Phthalates

    March 18, 2015 2:00 PM

    Many “stakeholders” have complained about the process through which the Consumer Product Safety Commission (CPSC) developed its proposed rule related to a class of chemicals called phthalates—and rightly so. In particular, the agency’s failure to allow public comment and open peer review of its Chronic Hazard Advisory Panel report (CHAP report) underscore the fact that bureaucrats want to avoid scrutiny that might hold them accountable for rash and unscientific decisions. 

    Designed to make plastics soft and pliable, these chemicals have many valuable uses for making a wide range of products from blood bags, to rain boots and swimming pool liners as well as children’s toys, which are the subject of this regulation. Safely used for decades, activists and regulators are poised to essentially throw away these valuable technologies based largely on junk science. 

    While this rule only affects toys that children might place in their mouths or chew, it sets a terrible precedent. I already detailed how this rule might harm consumers in a blog post last week. Now let’s look at the so-called “science” behind it.

    The justification for the proposed regulations are found within the CHAP report, which is a review and risk assessment that the agency released in July 2014. A key problem stems from the fact that the CHAP report relies on a selective review of limited studies that offer scant evidence that individual phthalates or cumulative exposure pose any significant risk to humans at current exposure levels. 

    Most of the CHAP-report-identified “evidence” that these chemicals pose health risks comes from lab tests that over-dose rodents to trigger health effects. Such tests are not particularly relevant to humans that better metabolize the substance and who are exposed to traces that are multitudes lower.

    The human research highlighted in the CHAP report is not particularly compelling either. Many of these human studies are noted to be “small,” which limits their value for drawing any conclusions. And many of them report associations between potential health effects in babies whose mothers’ phthalate exposure levels were measured in single “spot” urine samples during pregnancy. Given that humans metabolize phthalates relatively quickly, one time spot measurements may be misleading about actual exposures, raising important questions about the utility of such studies.

  • CPSC Proposal on Phthalates Likely to Do More Harm than Good

    March 13, 2015 8:58 AM

    On Monday, the Consumer Product Safety Commission will close the comment period for a proposed rule related to chemicals used to make soft and pliable plastics. While they claim to do this in the name of children’s health, it’s not clear that the rule will do more good than harm.

    The process and the “scientific” review that brings us to this proposed rule has been controversial, to say the least. I detail some of those issues in comments that I will submit on Monday and will post some of that here on Monday as well.

    Unfortunately, not enough attention has focused on the fact that the agency-commissioned study—referred to as the Chronic Hazard Advisory Panel (CHAP) report—failed to fully consider the potential implications of substitute products that will replace those they ban. 

    Before initiating a rulemaking that may remove chemical technologies from the marketplace that have been safely used for decades, CPSC should consider whether replacement products pose greater risks. The CHAP allegedly addresses replacement products by reviewing data on the potential environmental health effects of other chemical substitutes. But the CHAP did not address whether or not the substitutes that might actually win a place in the market would affect product performance in ways that help or harm public health and safety.  

    The rule should ensure net safety, considering all factors. It is incumbent that regulators don’t inadvertently increase risks with short-sighted decisions. Based on the CHAP, we lack reasonable assurance that regulatory action will increase net safety and, in fact, such actions might accidentally introduce new hazards and even greater public health and safety risks.

  • There Are No “Neutral Taxes” in Politics

    February 25, 2015 10:24 AM

    Those favoring larger government are finding it harder to finance them by raising taxes. Proponents have sought to reduce opposition by claiming that they’re not really raising taxes at all—their taxes will be “neutral.” Sure, we’ll take $50 billion or so in taxes from the economy, but we’ll then put it back again in the form of tax reductions or rebates. From a macro-economic perspective, they argue, there will be no impact at all! Why bother, you might ask? 

    The prime candidate advanced by those seeking to better plan our economy is the carbon tax. We’ll tax carbon and use the revenues to offset its impact. People will use less energy but retain the same income. We’ll change prices without changing income—a highly targeted incentive package! To tax energy users is feasible, although complicated—simply tax all energy materials. But farmers have traditionally escaped gas and diesel taxes for on-farm use—will this exemption be repealed? 

    In many regions, people use natural gas, oil, and electricity (which in turn uses coal, natural gas, and some hydro and nuclear). The prices of some of these energy types is market driven, while others are regulated. The income impact on specific consumers is not easily ascertained nor is the appropriate rebate. The result is that the micro-impact of energy taxes is never neutral. Individuals in areas dependent on coal or oil will lose; individuals in areas where climate or policy has shifted to solar or other renewable energy will gain relatively. And this critique fails to note another problem: the tendency of politicians to use new tax revenues to gain support for the measure.  Since different groups have different priorities, the result is often to “spend” the new tax revenues many times over. Rebates, being complicated and having no strong political champion, are likely to receive low priority.

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