May 17, 2017

The Regulated Industry Protection Agency

(Last week was filled with fresh new offenses coming from the White House. But right before the president fired his FBI director -- and then gave away state secrets -- his EPA also dismissed scientists who advised the agency. This is bad news, and it got lost in the shuffle. The EPA has turned its back on its core mission. I posted this on Medium.)

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The Environmental Protection Agency has a clear, one-sentence mandate: “The mission of EPA is to protect human health and the environment.” But EPA Administrator Scott Pruitt and his boss, President Trump, seem to think the EPA should mainly defend business from too much environmental protection. They’re confused and they’re missing a fundamental reality: there is no economy without the environment.

The purpose of the EPA has always been to defend the commons.

The latest attack on the EPA from within came last week. Pruitt dismissed members of a scientific review board to make room for industry representatives.

A spokesperson, according to the New York Times, indicated that Pruitt would “consider replacing the academic scientists with representatives from industries whose pollution the agency is supposed to regulate.” The hen-in-the-henhouse approach would make sense if business were somehow locked out of the process. But does anyone seriously believe that business and industry are underrepresented in government decision-making?

The Cabinet already includes the Small Business Administration and significant representation of business interests within the departments of transportation, agriculture, and energy. And, of course, the Commerce Department itself, which “serves as the voice of U.S. business within the Cabinet.” The private sector has massive, unprecedented influence as well, through thousands of government relations executives, countless lobbying firms, and uber-powerful trade groups like the U.S. Chamber of Commerce and the National Association of Manufacturers.

With that backdrop, the purpose of the EPA has always been to defend the commons -- that is, our air, water, climate, and much more. When President Richard Nixon established the agency, he was clear that he wanted to fill a gap: “Our national government today is not structured to make a coordinated attack on the pollutants which debase the air we breathe, the water we drink, and the land that grows our food. Indeed, the present governmental structure for dealing with environmental pollution often defies effective and concerted action.” He created the agency to organize environmental protection, not focus on economic growth and industry needs.

But besides misunderstanding the mission of the EPA, the Trump administration has fallen prey to a massive misperception. They clearly believe that regulatory protections always come at the cost of business and economic growth. This misplaced narrative has thoroughly infused our public discourse; the word “regulation” rarely appears without the modifiers “burdensome” or “job-killing.”

Of course, many regulations on air and water (and food, products, or workplace conditions) cost some companies money. Complying with regulations can be an ugly and expensive process. They can slow down some kinds of innovation. So, yes, regulations are hardly perfect. So stipulated.

But acting like they are only an impediment to business is a straw man. Regulations are, most of the time, based on a real need to protect us. Safe food and drugs, clean water and air, workplaces that don’t threaten lives, and even a stable climate — these are not nice-to-haves, but prerequisites for a thriving life and economy.

And the value to society (including business) of strong protections is high — protecting air quality alone has been worth many trillions of dollars in avoided health care costs and quality of life. Business does better when its employees and customers thrive. So slashing health, environmental, and societal protections is only “pro-business” in the narrowest of terms, and only in the short-run. Business does not operate in a vacuum, separate from the natural world. Far from it, as the economy depends entirely on the human and natural resources that power it.

Most government departments make these connections explicit. One of the five “strategic goals” of the Commerce Department is called, simply, “environment.” They gather “actionable environmental intelligence” to help business understand environmental change, prepare for it, and even profit by “developing environmental and climate informed business solutions.” At the USDA, “Natural Resources and Environment” is one of seven mission areas. The Pentagon has called climate change a “threat multiplier,” and Trump’s own Secretary of Defense, Jim Mattis, says it’s a national security issue.

Many branches of government, along with many private sector leaders, want to protect the environment and build a clean economy. But the one agency tasked with defending the environment (and human health) explicitly is sprinting away from its duty. Since the economy, our food system, and our security all depend on a strong environment, Pruitt and Trump’s misguided attempt to help a narrow group of business interests will fail miserably. Sadly, we’ll all pay the price.

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Andrew's book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot.

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