Retaking Rationality: How Cost-Benefit Analysis Can Better Protect the Environment and Our Health
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That America's natural environment has been degraded and despoiled over the past 25 years is beyond dispute. Nor has there been any shortage of reasons why-short-sighted politicians, a society built on over-consumption, and the dramatic weakening of environmental regulations. In Retaking Rationality, Richard L. Revesz and Michael A. Livermore argue convincingly that one of the least understood-and most important-causes of our failure to protect the environment has been a misguided rejection of reason. The authors show that environmentalists, labor unions, and other progressive groups have declined to participate in the key governmental proceedings concerning the cost-benefit analysis of federal regulations. As a result of this vacuum, industry groups have captured cost-benefit analysis and used it to further their anti-regulatory ends. Beginning in 1981, the federal Office of Management and Budget and the federal courts have used cost-benefit analysis extensively to determine which environmental, health, and safety regulations are approved and which are sent back to the drawing board. The resulting imbalance in political participation has profoundly affected the nation's regulatory and legal landscape. But Revesz and Livermore contend that economic analysis of regulations is necessary and that it needn't conflict with-and can in fact support-a more compassionate approach to environmental policy. Indeed, they show that we cannot give up on rationality if we truly want to protect our natural environment. Retaking Rationality makes clear that by embracing and reforming cost-benefit analysis, and by joining reason and compassion, progressive groups can help enact strong environmental and public health regulation.
Prologue: Reason and Compassion 1Decisions Are Made by Those Who Show UpThe Case for Cost-Benefit Analysis 9The Walls Go Up 21Missed Opportunities 31Winning the Good Fight (Sometimes) 47Eight Fallacies of Cost-Benefit AnalysisAll Unintended Consequences Are Bad 55Wealth Equals Health 67Older People Are Less Valuable 77People Cannot Adapt 85People Always Want to Put Off Bad Things 95We Are Worth More than Our Children 107People Value Only What They Use 119Industry Cannot Adapt 131The Sum of All the Fallacies 145Instituting Regulatory RationalityRegulatory Hurdles 151Shaky Foundation 163Rethinking OIRA 171Balancing the Scales 185Epilogue: Self-Fulfilling Prophecies 191Acknowledgments 195Notes 197Index 237
