I'm a law student researching Entergy v. Riverkeeper where the Supreme Court said EPA can use cost-benefit analysis when determining the best technology available standard for cooling water intake systems.Well, there are two issues here:
J. Breyer's concurring opinion posits that it's irrational in a world of stressed resources to force a power plant to spend a million dollars to save one more fish. Wouldn't it be more environmentally beneficial to apply those funds to some other environmental problem (e.g., river restoration, emissions filtering)?
I'd like to explore different institutional options for moving funds to the most environmentally beneficial use.
Your blog is pretty much the extent of my economics education. I'm trying to teach myself. Do you have any resource suggestions that might help me get up to speed? And of course, I'd love to hear your opinion on the case.
- What should Entergy do to reduce harm at its plant, locally. Let's say that costs $10,000/fish life saved in situ.
- Can Entergy spend the same amount of money elsewhere, to get more bang for the buck, say $500/fish life saved in Brazil.*
If Riverkeeper wants to mitigate the harm to the local community, it will direct the money to option 1.
If Riverkeeper wants to do the world a favor, it will direct that money to option 2, but that option does nothing to redress the harm to the local community. (It also gets into the famous moral "dilemma" -- if you could save ten lives by killing one person, what would you do?)
So, we can see a dichotomy between efficiency and equity. If I had to make a judgment, I'd say go for option 1, because morals can trump efficiency.
Of course, I am not a lawyer, and I am only one opinion.
What do you aguanauts think?
* Let's assume that the marginal value of the fish is the same in both places. Big assumption, but I don't want to get into debates over species, ecosystem and extinction values.**
** Read this [pdf] for more on that (via LP): "The fishing-industrial complex -- an alliance of corporate fishing fleets, lobbyists, parliamentary representatives, and fisheries economists... secured political influence and... nearly $30 billion in subsidies each year -- about one-third of the value of the global catch -- that keep fisheries going, even when they have overexploited their resource base."
Oh, and read A Life Cycle Assessment of Global Salmon Farming Systems (Norway MUCH better than the UK)