Monday, January 23, 2017

Environmental regulations and jobs

This Atlantic article sums up some recent research on the relationship between environmental regulations and jobs. Although they soft-pedal it, their summary concludes that job losses are indeed associated with environmental regulations, though they also note that such claims are often inflated.

However, we must also consider some countervailing factors. First, it's often true that one person's loss is another's gain. Over the last 5-10 years, the coal industry has done a major faceplant as the fracking industry has increased operations. That means fewer jobs in West Virginia but more jobs in Pennsylvania, for example, and not everyone who lives in West Virginia is able to retool their skill set and easily move several hundred miles away to take one of the new jobs. So, there are winners and losers from this market change. Who do you think will make more noise: the losers or the winners? 

It's important to note that this change didn't happen as a result of regulations: as technology improved, it just got cheaper to frack than to mine, so the change happened sort of organically. Regulations can have similar effects, though, for example if they require coal to meet certain emissions standards.

Lastly, and most importantly, the other winners from environmental regulations- who often don't even realize they're winning, and therefore are even less likely to speak out- are the people living downwind. When comparatively clean-burning natural gas is used to generate energy instead of coal, less CO2 is emitted and less particulate matter as well, meaning that people living near and far will be healthier. Unfortunately, in most cases politicians don't benefit from these health improvements, so that makes them less valuable to policymakers.

In other words, it's not as simple as they'd have you believe!

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