Innovator and Pariah: The United States and Clean Air Legislation

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Introduction

The United States has drawn criticism from environmental groups and other leading nations for its failure to address climate change. Yet the United States has a history of effective legislation on air quality. Following World War II, Congress passed a number of acts designed to improve air quality, culminating in the Clean Air Act of 1970. The laws have substantially improved air quality in the United States, and market-based pollution control models may provide a framework for tackling carbon emissions, which contribute to global warming.

What major anti-air pollution laws have been passed in the U.S.?

1970 Clean Air Act

The 1970 Clean Air Act is the backbone of U.S. air-pollutant control policy. Passed in 1970 during the Nixon administration, the Clean Air Act gave teeth to previous pollution control acts by authorizing the newly created Environmental Protection Agency to set National Ambient Air Quality Standards, identify harmful pollutants, and limit their levels in the air. The agency identifies six ‘criteria’ pollutants: carbon monoxide, nitrogen dioxide, ozone, sulfur dioxide, particulate matter, and lead. States are required to develop state implementation plans (SIPs) to administer pollution controls tailored to industrial and mobile sources specific to each area. The act also called for the phasing out of leaded gasoline by the 1980s, which was, according to the watchdog group Environmental Defense, “one of the single most important and successful environmental health initiatives of the last century.” The act gave citizens the right to take legal action against those who violate emissions standards or against the EPA for failing to enforce its own rules.

A 1977 amendment included the New Source Review, which requires new industrial facilities and power plants to meet EPA emissions requirements. Older facilities were not required to meet new Clean Air Act standards. If they were upgraded, however, they would be required to install pollution-control measures to meet requirements.

The effect has been “broadly and hugely positive,” says Judi Greenwald of the Pew Center on Global Climate Change. A 1997 EPA self-assessment saw massive reductions in the criteria pollutants and a nearly 100 percent reduction in lead emissions between 1970 and 1990. The EPA estimates the net economic benefit from reduced medical care costs, improvements in visibility, and reduced damage to agriculture is $22.2 trillion.

1990 Clean Air Act

The 1990 Clean Air Act amendments addressed urban air pollution, toxic air emissions, and acid rain. To combat urban smog, the amendments called on the EPA to tighten pollution standards on cars and trucks and mandated the use of cleaner, “reformulated” gasoline. The act also mandated the use of “Maximum Achievable Control Technology” to reduce emission of additional substances harmful to human health but not covered by the 1970 act. An April 2007 Supreme Court decision may expand the Clean Air Act’s purview, as the court ruled in a 5-4 decision that the EPA has the authority to regulate heat-trapping gases in automobile emissions.

To combat acid rain, the law limits the production of sulfur dioxide by power plants in a cap-and-trade system. Limits are set, and each source is allocated pollution allowances, which polluters can buy or sell according to their own economic needs. They can receive bonus allowances for achieving lower levels. Alan Krupnick, director of Resources for the Future, an environmental analysis think tank, says that the sulfur dioxide allowance trading program has “led the way to a revolution in thinking (PDF) about the use of market-based instruments for pollution control.” A similar cap-and-trade program for nitrogen oxide—a pollutant that contributes to smog—functions in the Northeast and Mid-Atlantic states.

A 2005 National Acid Precipitation Assessment Program Report (PDF) found that the 1990 amendments significantly decreased emissions that cause acid rain, a result the EPA credits (PDF) to the cap-and-trade program. Overall, benefits of the 1990 amendments exceeded implementation costs by a factor of four, with a maximum estimate of $1.4 trillion, according to an EPA assessment. The act also mandated a phase-out of substances that damage the ozone layer, to comply with the stipulations of the Montreal Protocol.

What is the Montreal Protocol?

The 1985 discovery of a hole in the ozone layer brought ozone depletion to the top of global environmental priorities. Following the 1985 Vienna Convention for the Protection of the Ozone Layer, the Montreal Protocol was signed in 1987 by over one-hundred fifty nations, including the United States. The treaty, which went into effect in 1989, was an agreement to limit the production and consumption of ozone-depleting substances, such as chlorofluorocarbons (CFCs), which are used in refrigeration, and halons, which are used as fire-extinguishing agents.

Sebastian Oberthür, a climate policy expert at the Institute for International and European Environmental Policy, says the protocol “is generally considered to be one of the most successful cases of international cooperation on environmental issues,” citing an 85 percent decrease in global production of ozone depleting substances by 1998. “Around mid-century,” says a report (PDF) from the Earth System Research Laboratory, which is connected to the U.S. Department of Commerce, “the effective abundance of ozone-depleting gases should fall to values that were present before the Antarctic ‘ozone hole’ began to form in the early 1980s.” Assuming continued compliance with the Montreal Protocol, the laboratory predicts substantial recovery of the ozone layer by the middle of the 21^st century.

In addition to its effect on the ozone problem, the protocol also set the standard for international solutions to environmental problems, and became the basis for the subsequent Kyoto Protocol to combat climate change.

What are the criticisms of U.S. anti-pollution policies?

Although there is consensus on the overall effectiveness of pollution reduction policy, some criticize the EPA’s methods of self-evaluation. A paper published by the libertarian CATO Institute argues that estimates for what pollutant levels would be in an unregulated environment were likely overestimated and that the monetized health benefits were inflated. “No student of public policy,” say the authors, “will be surprised to find that an agency, when asked, will produce an exaggerated estimate of the net benefits of its efforts.”

Krupnick, of Resources for the Future, says that the EPA’s practice of evaluating the act at a “highly-aggregate, economy-wide level” may not yield useful data on the effectiveness of individual regulations. He also points out that since certain pollutants can travel hundreds of miles, placing responsibility on individual states through SIPs is not a logical way to enforce standards.

Still, Krupnick gives the Clean Air Act a generally positive rating. He says market-based controls are an especially cost-effective and politically palatable strategy for pollution reduction: “Witness the enthusiasm in some quarters outside of those inhabited by economists, for carbon dioxide trading, tradable CAFE credits and the like. The success of Title IV [the allowance program] has made this popularity and even ‘faith’ possible.”

Recently, environmental groups have accused the Bush administration for failing to continue the legacy the Clean Air Act and enforce its rules. Robert F. Kennedy Jr., chief prosecuting attorney for the Hudson Riverkeeper and president of Waterkeeper Alliance, accuses the administration of a systematic effort to undermine U.S. environmental law. The EPA says that the administration’s ‘Clear Skies’ initiative is an improvement to the anti-pollution law, halving sulfur dioxide, nitrogen oxide, and mercury emissions over the next ten years. But environmentalist groups say that the measure would allow more pollutants (PDF) than under existing law.

Can market-based solutions help ease global warming emissions?

Yes, though there are complications. “Carbon is a bigger problem,” says Greenwald, of the Pew Center. “There are more sources, more countries with diverse kinds of sources. With sulfur dioxide, you had a set of relatively similar sources trading and acting together.

Danny Cullenward, of the Program for Energy and Sustainable Development at Stanford University, says market strategies for the Montreal Protocol were successful because ozone depletion is caused by a relatively small group of chemicals—primarily CFCs used worldwide in refrigeration applications. Companies were able to develop alternatives fairly easily, and the incremental cost of reducing them was low. “There are lots of ways to get refrigeration done,” says Cullenward, “but pretty much every way we have of producing energy is carbon intensive.”

Yet the ubiquity of carbon may make it a better candidate for a cap-and-trade. “I don’t know if there’s a family of pollutants more amenable to cap-and-trade solutions,” says Manik Roy of the Pew Center on Global Climate Change. “Reducing it here is as good as reducing it in Beijing or anywhere.” Also, a large number of carbon producers means a larger market. “When you have lots of sources that face different costs, it’s what economists call greater gains from trade. Different sources have different costs,” says Greenwald.

How do U.S. clean air regulations compare to those in other countries?

Europe has a similar federal structure to that of the United States for enforcing clean air standards, with member states using their own strategies to meet standards set by 1996 Air Quality Framework Directive, an effort to harmonize anti-pollution standards throughout the EU. A report (PDF) from the National Environment Research Institute at the University of Aarhus in Denmark provides a comparison of the two systems.

“For three decades, the United States was the world’s environmental trendsetter,” writes Clifford Rechtschaffen of the Center for Progressive Reform, a non-profit environmental research institute. Indeed, the Clean Air Act and others provided a conceptual framework for the rest of the world. “The 1972 UN Conference on the Human Environment in Stockholm marked the beginning of a large global effort to build environmental regimes in countries around the world,” writes Ruth Greenspan Bell of Resources for the Future. “Many countries patterned their requirements on the apparent growing success of the National Environmental Policy Act, which introduced environmental impact assessment in the United States.”

But Rechtschaffen goes on to criticize the United States’ lack of engagement on new environmental challenges. “The EU,” he says, “is tackling its most pressing environmental problems with a focus and creativity Americans can only envy.” The Christian Science Monitor reports that the United States has lost ground in the lucrative market of developing pollution reduction technology. And while the United States is reluctant to sign the Kyoto Protocol, the EU recently agreed to cut greenhouse gas emissions by 20 percent and assure that one-fifth of its energy comes from renewable sources. Though the Bush administration boasts a strong record on the environment, including reduction of greenhouse gases, some say the efforts pale in comparison to Europe.