An Environmental Report Card on the 104th Congress

Policy Backgrounders | Energy and Natural Resources

No. 141
Tuesday, January 14, 1997
by H. Sterling Burnett

Major Laws Passed

Summary of Bills and Grades

Grade: B-/C+

Freedom to Farm Act.

Since the Depression, federal intervention has skewed agricultural markets. Farm policy has alternately - sometimes simultaneously - provided federal price supports, subsidized irrigation and wetlands reclamation projects, issued rules that limited acreage and types of crops, and paid farmers either not to plant or to restore lands to "natural" conditions. Some argue that these policies have kept food prices low and the family farm viable. Yet, because of price supports, Americans have paid higher prices than the rest of the world for some foods. When farm policies have kept consumer food prices artificially low, taxpayers have made up the difference. Considering both taxes and artificial prices, it appears that consumers have been made worse off.1

"Agricultural runoff is the primary pollutant of the nation's rivers, streams and lakes."

Need for Change. In addition, more than 50 years of farm policy has yielded a bumper crop of environmental ills:2

  • Crop subsidies and federal water projects have encouraged the conversion of valuable wetlands to marginal croplands.
  • Federal policies have encouraged the overuse of pesticides and fertilizers; agricultural runoff is now the primary pollutant of the nation's rivers, streams and lakes.
  • Wild rivers have been dammed to make arid lands available for farming.
  • Wildlife has suffered, and soil erosion has increased.

Positive Changes. Widely touted as the most radical change in federal agriculture policy in the last 60 years, the Freedom to Farm Act temporarily caps federal crop price support payments and ends federal authority to hold land out of production. If this were all the act did, it would indeed represent a major break with past federal agricultural policy. Unfortunately, the Freedom to Farm Act continues a large (and in some ways growing) federal presence in agriculture.

Negative Change: New Bureaucracies. The farm bill creates several new bureaucracies, including the National Natural Resources Conservation Foundation, a new food safety panel in the Department of Agriculture and new boards to promote and protect domestic popcorn and kiwis. These additional programs might surprise people who thought the 104th Congress would begin to end big government.

"Congress missed its opportunity to simultaneously preserve the Everglades and save the taxpayers money"

Negative Change: Florida Land Grab. Given its stated objective to reduce the federal government's presence in agriculture, the new farm bill's most perverse component is its authorization of $300 million to acquire about 100,000 acres of the Florida Everglades. Wetlands conversion, water use and pesticide and fertilizer runoff from sugar production degrade the Everglades. The simplest way to protect that fragile ecosystem would be to eliminate the sugar subsidy that allows inefficient sugar producers to operate there. Congress missed its opportunity to simultaneously preserve the Everglades and save the taxpayers money.

Missed Opportunity: The Vampire Effect. In typical Washington fashion, Congress and the administration took credit for major reform while leaving hard choices to the future. Under the new bill, farmers currently planting subsidized corps will receive fixed but declining payments over the next seven years. However, the old farm policies - including subsidy payments and land set-asides - will reemerge at the end of seven years unless Congress acts again.

Missed Opportunity: Limited Choice. Sponsors of the act touted the benefits of increased choice, yet farmers currently receiving subsidies have little or no incentive to switch to nonsubsidized crops with higher market prices. Instead of planting whatever crop is likely to yield the highest profit, a farmer now growing subsidized crops probably will switch to another subsidized crop - essentially another grain, cotton or rice.

Missed Opportunity: Same Old-Same Old. Many things do not change under the new farm bill. Americans will continue to pay higher prices than the rest of the world for sugar, peanuts, soybeans and most dairy items and to subsidize their production by more than $2 billion a year. Many acres of undeveloped wetlands lie on agricultural lands. Proposed reforms would have compensated farmers and ranchers when laws restricting the development of their wetlands reduced the value of their land. However, these reforms were not included in the final bill, so farmers and ranchers will continue to bear a disproportionate financial burden to preserve wetlands.

Grade: C-

Food Safety Act.

"One cup of coffee contains more carcinogens than all the pesticide residues an average person eats in a year."

This bill represents a substantial change in federal food safety and pesticide policy. By bipartisan agreement, the 104th Congress did what Congresses for the last 20 years have not: they killed the Delaney Clause. That clause prohibited even minute, harmless amounts of chemicals in processed foods if the chemicals caused cancer when laboratory animals ingested them in massive amounts. This was the rule even though natural carcinogens are found in fruits and vegetables, and even though one cup of coffee contains more carcinogens than the amount of potentially carcinogenic pesticide residues an average person eats in a year. The Delaney standard was enormously expensive and unsupported by sound science, but for years environmentalists had thwarted attempts to change it.3

Positive Changes. The new law replaces Delaney with a uniform standard. Chemicals used in raw or processed foods must pose a "reasonable certainty" of no harm. The new law also allows states to petition the Environmental Protection Agency (EPA) for permission to enact their own pesticide standards. And it allows the EPA to relax federal standards when using a particular pesticide would help maintain a constant food supply or when food grown with the pesticide would pose a lesser risk to consumers than the same food grown without. Farmers, industry officials and public health advocates have applauded the changes.

However, balanced against these positive changes are the following undesirable ones:

  • The act adds a new layer of reporting requirements, increasing costs and regulatory paperwork for businesses and consumers.
  • Rather than clarifying and limiting EPA power, the law increases it.
  • Based on controversial scientific evidence, the law adds regulations concerning a new class of potential health problems.

Negative Change: Increased Bureaucracy. The law requires the EPA to collect, publish and distribute to large retail grocers information about various pesticide residues and chemical additives. Grocers must display the information or face penalties. Collecting and reporting the data will cost millions, and the costs not passed on to consumers will come from the paychecks of workers. In addition, the provision will divert scarce resources from other EPA programs but will do little if anything to protect human health, since the only chemicals involved have all been approved by the EPA or FDA.

Negative Change: Increased EPA Power. The law allows the EPA to define "reasonable," "certainty" and "no harm." None of these EPA definitions require peer review or judicial review. Congress apparently expects the EPA to interpret the "reasonable certainty" standard as no more than a one-in-a-million lifetime chance that a residue will cause cancer. This standard, which the EPA routinely applies to other environmental risks, is controversial from both scientific and policy standpoints.4 Other agencies with health and safety responsibilities apply a lower standard and save more lives at less cost.

"The new standard almost certainly will raise the costs of compliance to businesses and thus the costs of products to consumers."

The EPA may apply an even more stringent standard. The new law requires the agency to take into account children's special sensitivity to chemicals and to "err on the side of child safety." So the future standard could be 10 times more stringent. Children may be more sensitive to pesticide residues than adults, so a margin of safety may be justified. This is unclear. What is clear is that the new standard almost certainly will raise the costs of compliance to businesses and thus the costs of products to consumers.

Negative Omission: No Cost-Benefit Considerations. The bill does not allow the EPA to consider economic costs in writing new standards, although such costs may reduce the law's health benefits. For example, if enhanced child safety standards raise the price or reduce the availability of certain vegetables so poor children get less of them, other health hazards such as the increased cancer risks may far outweigh increased pesticide risks. The National Research Council, research arm of the National Academy of Sciences, has expressed this fear.5 In an exhaustive study, NRC scientists found that the risk of cancer from pesticide residue was far lower than that posed by natural carcinogens in food and minuscule compared to that posed by a high fat, low fiber diet. As vegetable prices rise, the poor - who spend a higher proportion of their incomes on food - are most likely to eat more foods high in fat and cholesterol. The NRC report shows that as vegetable intake decreases and fat intake increases, the risk of cancer soars.

Negative Change: Encouraging Unsound Science. Finally, the law gives the EPA new responsibilities to study, screen and test pesticides for "endocrine disrupters." According to some scientists, a multitude of industrial chemicals may mimic, block, disrupt or enhance hormone activities, resulting in myriad human and animal ills, including birth defects, mental retardation, breast cancer and lower sperm counts. The EPA is directed to consider whether or not each pesticide exhibits hormone mimicking/disrupting characteristics when establishing, modifying or revoking a pesticide tolerance level. Testing tens of thousands of pesticides and other chemicals described as "environmental contaminants" will involve an enormous commitment of manpower and material resources by the EPA or manufacturers.6

The push for this legislation can be traced to a book, Our Stolen Future: Are We Threatening Our Fertility, Intelligence and Survival?7 Scientists roundly condemned the book for its selective use of data and unsubstantiated conclusions.8 According to these scientists, many of the studies the book's authors cite are problematic, either because their methodology was flawed or because their conclusions were controverted by other studies.

Overall Assessment. Lawmakers were under great pressure to vote for the Food Safety Act because failure to replace the Delaney Clause would have forced the EPA to ban 80 widely used pesticides by the end of 1996. Many legislators felt that the benefits of repealing Delaney outweighed the costs of the other provisions. Time will tell whether they were correct.

Grade: B

Safe Drinking-Water Act.

Some analysts have argued that since safe drinking water is almost exclusively a local issue, the federal government should not be involved. While this argument is correct, national consensus on the importance of safe drinking water is so great that federal intervention seems a fact of life. With this in mind, the SDWA is a step in the right direction.

"This bipartisan bill loosens the regulatory straitjacket on 185,000 regulated water systems."

Positive Changes. This bipartisan bill passed 392 to 30 in the House and unanimously in the Senate. It loosens the regulatory straitjacket that has hampered the 185,000 regulated water systems across the U.S., dispensing with the requirement that the EPA promulgate standards for 25 additional contaminants every three years. This rule has forced the EPA to seek out and regulate chemicals as contaminants to meet a numerical target. Recognizing the severe financial strains facing smaller water systems, the law allows states to exempt from federal regulations water systems serving fewer than 3,300 people and to exempt with EPA approval systems serving between 3,300 and 10,000 people.

In addition, the law sets up a $1 billion-a-year state revolving-loan fund (SRF) from which states can draw repayable money to improve drinking-water infrastructure. Reducing the one-size-fits-all portions of previous SDWAs, the law allows states and localities to focus on the most urgent health needs in their communities. For instance, it permits states to transfer up to 33 percent of their SRF from drinking water to activities related to the Clean Water Act or vice versa.
Flexibility in fund allocation and standard setting allows states and localities to devote resources to the most pressing local health concerns. Repayment requirements give them an incentive to undertake drinking-water solutions in a timely and cost-effective manner.

Negative Changes. The bill is not uniformly good. Endocrine disrupter provisions similar to those in the food safety bill were added at the last minute. The SDWA also includes a controversial, costly provision that the EPA enact certification requirements for drinking-water operators and withhold up to 20 percent of a state's SRF if it doesn't adopt such regulations within a certain time. This mandate is at odds with the recent trend to move power out of Washington and back to the states. The standards for drinking-water operators are primarily a local concern and there is no evidence that states have been lax in their duty to keep drinking-water safe. Finally, the new law requires the Food and Drug Administration to monitor and regulate bottled water for chemicals the EPA considers to be tap water contaminants. These standards must be at least as stringent as current EPA tap water standards.

Overall Assessment. In spite of these provisions, the bill represents real progress towards returning power and authority over drinking-water problems to the affected states and localities.

Grade: B

Regulatory Exemptions for Small Business.

One regulatory reform law9 allows small businesses, local governments and other small entities to sue a regulatory agency for wrongly assessing the economic impact of new regulations. Small businesses have driven economic growth and increased employment for the last decade,10 but they often are the hardest hit by new regulations. Further, over the last 20 years local governments increasingly were forced to divert resources from public safety, education and infrastructure in order to comply with federal regulations.

Other Needed Changes. The new law does not go far enough. Large businesses also are burdened by ineffective regulations and should be at least as free to challenge agency (in)actions in court. The disparate treatment is certainly unfair and arguably unconstitutional. It represents an ugly tendency to impose - or shift - regulatory costs to those who can afford them. Regulatory costs should be proportionate to the potential risks created by particular activities.

Grade: B

Congressional Regulatory Oversight.

A second reform11 allows Congress to review all new rules before agencies implement them and to veto those that are seriously flawed. Under this reform, Congress has 60 days to examine rules with an economic impact of more than $100 million before they become law. Congress also may rescind a rule up to 13 months after it has been published in the Federal Register. Any rule Congress vetoes ceases to be law from that very moment. In addition, the act broadens the definition of a rule to include agency guidelines and policy statements and may allow Congress to overrule some executive orders.

"Proposed bills would require Congress to review and affirm by vote all new regulations."

This reform increases accountability in two ways. First, regulatory agencies no longer can interpret congressional intent in ways that increase their budgets and staff and expand their power without improving human health or environmental conditions. Second, Congress cannot pass the buck for bad regulations. If costly and ineffective regulations become law, the voters can hold legislators accountable.

Other Needed Changes. As several legislators have argued, this law does not go far enough. Proposed bills would require Congress to review and affirm by vote all new regulations, including those written to carry out past legislation. Since $99 million, $75 million or even $50 million is no small drain on the nation's economy, Congress has no reason to treat such rules differently. Further, absent this revision administrative agencies may find creative ways to break one regulation into several, each under the $100 million limit but with great cumulative impact. Finally, without this revision members of Congress can evade blame for costly new regulations by claiming, for example, that they lacked the time both to examine and vote on the rules generated by laws already passed and to write and debate new legislation.

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