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THE WALL STREET JOURNAL MONDAY. JANUARY 23. 1995 An Environment for Reform By CFseR V. Corroa In the next few months. the Republican majority in Congress will pass versions of what some environmentalists have dubbed " * "unholy trinity": risk assessment and at-benefit tests for all environmental rules, prohibitions on unfunded federal mandates, and compensation for the "tak- ing" of private property by land-use regu- lation. However, the grass-roots coalition behind these reforms-business owners, state and local government officials, and landowners-should not declare victory. Clearly, the trinity of reforms will help rationalize environmental regulations and reduce their economic burden (SI30 billion annually, according to the Environmental Protection Agency). But the command- and-control regulatory structures of many environmental laws, will remain intact. With several major environmental laws up for reauthorization-chief among them the Safe Drinking Water Act. the Superfund hazardous waste cleanup law. the Endan- gered Species Act and the Clean Water Act-Itepublicans have an opportunity to I nvent environmentalism and replace it •.h a new paradigm. for environmental protection, one that stresses market in- centives. sound science, and "regulatory federalism." Guiding Principles In reauthorizing these major environ- mental laws. Republicans should follow these guiding principles: . First, market incentives and private conservation efforts should take prece- dence over gtrvetitment' solutions. Free- market environmentalism works: For ex- ample, in England and Scotland, private ownership of the rivers and waterways has successfully prevented overfishing and controlled water pollution for 800 years. The owners simply charge others for the right to fish in their section of the river. Consequently, the owners have an eco- nomic incentive to maintain the fish population and keep the waterway clean. By contrast, two- plus decades of gov- ernment manage- ment has wiped out AGElVDA r the fish population in George's Bank, a once bountiful area in the Atlantic Ocean off the coast of New England. Not long ago. George's Bank was dosed for fishing. Two, sound science enhances environ- mental protection. Without sound science to guide regulatory decisions, scarce pub- lic and private resources are wasted on re- ducing often insignificant health and eco- logical risks. That's why the GOP's pro- posal requiring the EPA to analyze and compare its hot-button risks to risks people face in their everyday lives is vital. For examDle. the infinitesimal risk of developing lung cancer from secona-hand smoke 11.19 re attve nsk, accoratne to t e EPA) is actuallv lower than the risk of de- velopmg cancer of the eso hagus from eat- ing beef reeulanv (1.a or eart~'isease from eating one cookie a day (1.49). If risks Were out in oersoecttve, Amencans suo- port for costly.re atory schemes such as the oronosed public. smokine ban woui~ probably diminish. Three, state and local governments are 'roat'cf)

:ont'd] better able to solve local environmental problems. For example, under the Super- fund. the states have cleaned up approxi- mately 20 times more contaminated sites than the federal government. Here's a reform strategy for applying these principles to each reauthorization bill: • Safe Drinking Water Act. Under cur- rent law, the EPA requires local drinking- water programs to regulate 25 additional contaminants every three years. regard- less of whether they pose real health risks. These mandates cost 51.4 billion annually and often result in ridiculous regulation. For example, Columbus. Ohio. must moni- tor a pesticide that is only used to grow pineapples. The compromise bill that almost passed the last Congress solved many of these problems: It required risk and cost-benefit ~ Republicans must ag- gressively counterattack with an agenda that achieves the same or better environmental protection without costing jobs or lim- iting individual f reedoms. tests for most new contaminanu, it pro- vided flexibility for localities in monitor- ing contaminants, and it created a S1.3 bil- lion revolving loan fund for localities. To strengthen the bill. Republicans should seek additional risk and cost-benefit tests for non-carcinogenic contaminants (e.g.. those that may pose the risk of birth de- fects), and a comparative- analysis of ft, nking-water risks to other health risks. a long term goal, authority for safe drinking water should be returned entirely to the localities. . • Superfund. Although the Superfund's authorization expired on Sept. 30,1994, its tax authority does not expire until the end of this year, thus extending the funding for this costly failure. Superfund has cleaned up fewer than 209~ of the more than 1200 hazardous waste sites at a cost of SZS mil- lion per site. Because of Superfund's un- fair strict, retroactive, joint and several li- ability scheme, most of the cleanup costs go for legal and administrative costs. Millions have been spent to clean up sites that pose absolutely no environmen- tal or health risks. According to a survey of the EPA's own data, only 100 of Super fund cites pose current. u-tual health risks; the other 90~7~ pose hypothetical risks dependent upon future behavior and land-use changes. For example, the EPA routinely assumes that future site uses will include dirt-eating children who will live there for 70 years. Indeed. of the S14 billion spent on Superfund cleanups, almost half was spent to comply with rules similar to this one. -4- The Superfund reform bills in the last Congress fell woefully short of fixing the program's fundamental problems. Repub- licans should simply abolish Superfund outright and replace it with a revolving state loan fund, as proposed by analyst Kent Jeffreys. -. Financed in part by a portion of Super- fund's current taxes, this fund would pro- vide loans to states and localities for local hazardous waste cleanups. The fund and the taxes should be phased out over a rea- sonable period; allowing time for the cleanup of the 10% of Superfund sites that pose actual risks. Expensive cleanups should be replaced by land use and deed restrictions along with the sr?ection of the most cost-effective containment mea- sures. Allowing the local community to de- cide how to spend funds to clean up Super- fund sites would produce better results. •Endangered Species Act and Clean Wa- terAct. The most contentious aspects of the Endangered Species Act's and the Clean Water Act's wetlands regulation-the tak- ing of private property because of land-use restrictions-will be. in large part, solved if Republicans enact a tough property rights bill. But again, Republicans should not stop there: they should replace these failed government approaches with more effective, market-based solutions. Under the Endangered Specie~ Act, for instance, only 19 of 1,354 listed species have been de-listed-seven because of ex- tinction. A 1990 General Accounting Office report found that more than 80°70 of the act's listed species were actually declin- ing. Clearly, the act has not worked. Republicans should impose a morato- rium on new listings, pending a thorough review of the data and scientific methods used by the government to find out whether a species is truly endangered. The Endangered Species Act should be re- formed in ways that make•it easier for pri- vate landowners and conservation groups to protect, breed and care for imperiled species. According to a Competitive Enter- prise Institute report, private conservation efforts=not government regulations- have been responsible for the resurgence of many threatened species, such as the American• bison. . The wetlands program should be re- formed in ways that focus its efforts on ecologically high-value wetlands (only about 119~ of all privately owned wetlands ) instead of on puddles of water on some farmer's land. Further. landowners should be given the unrestricted use of their land, as long as they create new wetlands to re- place the ones they use. Private conserva- tion ought to be encouraged: While the fed- eral government- owns only 4.7 million acres of wetlands, about 11.000 private duck clubs have managed to protect five million to seven million acres of wetlands from destruction, according to the Na- tional Center for Policy Analysis. JAN231995 Nation of Love Canals A recent CNN/USA Today poll found that Republicans hold.the edge over De- mocrats as the party best able to make progress on every major domestic policy issue except one-the environment. To be sure, the Democrats will exploit this ad- vantage by charging that the GOP's com- mon-sense regulatory reforms will some- how lead to a nation of Love Canals and the extinction of the bald eagle. That's why Republicans must aggressively coun- terattack with a market-based. limited- government environmental agenda that achieves the same or better environmental protection without costing jobs or limiting individual freedoms. Mr. Cbnda, former erecutice director of the Aleris de Tocquerflle Institution, is now legislative director for Sen. Spencer Abra- ham fR.. Mich).