March 18, 2016 by Evan Isaacson

Trading, Manure, and the Free Market

Recently, I have been noticing a number of connections between the environmental policies or issues that I’ve been studying and modern economic doctrine. I’m not sure if the number or strength of these connections are enough to claim that we’re seeing a rise in “laissez faire environmentalism” in the Chesapeake Bay region, but the implications are interesting to consider nevertheless.

Nutrient trading is the best example. There is little question that the notion of pollution trading stems directly from economic principles, ultimately leading to a sulfur dioxide trading program to control acid rain during the George H.W. Bush years. I don’t have to work very hard to draw those parallels. And while pollution trading in the context of water is less pervasive or understood than it is in the context of air, more than a few papers have catalogued the dozens of current or extant local and regional water pollution trading programs.

The epicenter of water pollution trading is here in the Chesapeake Bay. The concept is so well engrained that, at least in one context (offsetting new pollution loads), the idea of buying and selling nutrient pollution credits was built right into the Chesapeake …

March 17, 2016 by Evan Isaacson

Maryland’s high court ruled last week in favor of the Maryland Department of the Environment (MDE) in a challenge by several advocacy groups against five municipal stormwater (“MS4”) permits issued by MDE. While reading the lengthy opinion on my computer, I felt at times like a raving sports fan yelling at the TV in frustration. My frustration was borne not of the court’s specific arguments, or even of concerns over any far-reaching legal implications of the decision. Rather, to understand why this decision has generated such frustration, it is important to understand the timing and context of this decision.

Generally speaking, court decisions merely upholding existing programs and the status quo, such as in the present case, rarely generate outrage. Moreover, I acknowledge that reasonable minds certainly can differ in interpreting complicated legal matters, as each of the seven reasonable minds on Maryland’s Court …

March 15, 2016 by Matthew Freeman

Later today, not one but two CPR Member Scholars will testify today before the House Judiciary Committee’s Subcommittee on Regulatory Reform, Commercial and Antitrust Law.

Emily Hammond and Richard J. Pierce both offer some perspective on the limits and scope of judicial deference to federal regulatory agencies. Pierce sketches out the long history of jurisprudence on the subject, noting that,

Until late in the Nineteenth century, courts could not and did not review the vast majority of agency actions. The Supreme Court held that courts lacked the power to review exercises of executive branch discretion. A court could review an action taken by the executive branch (or a refusal to act) only in the rare case in which a statute compelled an agency to act in a particular manner. In that situation, the court was simply requiring the agency to take a non-discretionary ministerial action.  

He …

March 15, 2016 by James Goodwin

Over the weekend, the White House Office of Management and Budget (OMB) released the final draft of its annual report on the costs and benefits of federal regulation, which purports to provide a reasonably complete picture of the total impact that federal regulations have on the U.S. economy. This year’s final report finds that federal regulations generated total benefits in the range of $216 billion to $812 billion (in 2001 dollars; in 2010 dollars, the range recalculates to $261 billion to $981 billion) while imposing total costs in the range $57 billion to $85 billion (in 2001 dollars; in 2010 dollars, the range recalculates to $68 billion to $103 billion). According to the report, then, federal regulations make society better off, and significantly so, producing total net benefits in the range of $131 billion to $755 billion (in 2001 dollars; in 2010 dollars, the net …

March 14, 2016 by Sidney Shapiro

I was recently a panelist at a Senate workshop on regulatory capture sponsored by the Administrative Conference of the United States (ACUS). In an earlier post about this event, I wrote about the potential of enhanced transparency to reduce regulatory capture, which I discussed at the workshop. Conservative commentators at the workshop argued that agencies are captured by public interest groups as well as by regulated entities. They contended that Congress should thus pass the REINs Act to reduce capture from both types of regulatory stakeholders. Of course, their fears of public interest capture are greatly overblown, as the potential for these groups to capture agencies is far more hypothetical than real. But the real problem is that the REINS Act, if it became law, would increase regulatory capture, not decrease it.  

My earlier post explained that the imposition of budget cuts by Congress on regulatory agencies …

March 11, 2016 by Sidney Shapiro

The subject of regulatory capture was back on Capital Hill last week as the result of a briefing sponsored by Administrative Conference of the United States (ACUS). In 2010, I testified concerning regulatory capture in a Senate hearing chaired by Senator Sheldon Whitehouse (D-RI), but in the midst of the broad-scale conservative assault on regulation, the issue hasn’t gotten nearly the attention it deserves. That’s unfortunate for a simple reason. As Rena Steinzor and I establish in our book, many aspects of the regulatory system are downright dysfunctional, and we identified regulatory capture as a significant source of this dysfunction.

Regulatory capture is a complex issue and determining how best to reduce the amount of capture is challenging, as a helpful book on the subject edited by Dan Carpenter and David Moss establishes. Nevertheless, there are some steps that Congress or the President can take …

March 10, 2016 by Daniel Farber

Many thought that the BP Oil Spill would lead to new environmental legislation, as happened after past environmental disasters. That didn’t happen. But something else did happen: BP paid $24 billion in civil and criminal penalties. In an era where any effort at government regulation is immediately denounced as a dire threat to liberty, there was nary a peep out of Republican politicians about these massive penalties. Nor do I hear Trump, Cruz, or Rubio defending Volkswagen from penalties. The moral is that the public is much more united behind punishment for corporate wrongdoers than it is about new regulation.

This makes sense if you think about the arguments that are made against regulation. Opponents of regulation have successfully spun their position as protecting consumers from higher prices and workers from lost jobs. Corporate shareholders, and corporations as entities, don’t get such a respectful hearing …

March 9, 2016 by Mary Jane Angelo

Recently I had the opportunity to spend an entire day at the University of Florida Department of Entomology — the same department where I obtained my M.S. more than 30 years ago. I gave a talk on the law and ecology of pesticides and pest management and met with graduate students and faculty. It was fascinating to hear about the innovative research being conducted related to ecologically based pest management and sustainable agriculture. The discussions that day provided concrete illustrations of some of the challenges of developing sound pesticide regulation that I have highlighted in my recent scholarship, particularly my recently published book chapter.

First, it reminded me how it important it is for lawyers and scientists to share their perspectives and engage in the interdisciplinary work that is necessary to solve today’s complex environmental issues. Second, it reminded me of the challenges of incorporating new …

March 7, 2016 by Dave Owen

Since Justice Scalia’s passing, the blogosphere has been abuzz with speculation about how the changed composition of the Court will affect environmental law. This post adds a little more to that speculation. My focus is not the Clean Power Plan litigation, which has (justifiably) gathered much of the attention, but instead the litigation over the joint EPA-Army Corps Clean Water Rule. And my prediction is a bit different from most predictions about the Clean Power Plan. Here, I predict, that changes in court composition probably won’t matter much.

Before I explain the reasons for that prediction, a little context may be helpful. The Clean Water Rule (also sometimes referred to as the Waters of the United States Rule (or just WOTUS)) determines the geographic scope of federal jurisdiction under the Clean Water Act. The Army Corps and EPA jointly released the rule last summer. Its …

March 3, 2016 by Daniel Farber

Chief Justice Roberts turned down a request this morning to stay EPA’s mercury rule. Until the past month, this would have been completely un-noteworthy, because such a stay would have been unprecedented. But the Court’s startling recent stay of the EPA Clean Power Plan suggested that the door might have been wide open.  Fortunately, that doesn’t seem to be true.

In some ways, a stay in this case would be even more shocking than the earlier one. Only the states, not industry, were seeking the stay. Some industry members even argued that a stay would just disrupt their planning. Moreover, as the government pointed out, the states were seeking review of a very narrow issue: whether the D.C. Circuit should have vacated the rule pending a remand to the agency. Since the agency plans to act within the next six weeks, this issue …

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