Cost Benefit Analysis Flashcards
What are the problems with cost-benefit analysis in rulemaking?
1) Costs are usually overstated because as technology improves, costs will go down. So overtime, costs will decrease, leading to an overstatement.
2) Benefits are understated because it is almost impossible to put a price on many intangibles.
In American Textile v. Donovan, OSHA did not do a Cost-benefit analysis. The main purpose of the statute was for the protection of the employees. Should OSHA should have done a CBA?
No. OSHAs goal was to regulate the health and safety of employees. So, a cost-benefit analysis cannot be done. OSHA should only consider the employees safety, not the costs of the employees safety.
In Whitman v. American Trucking, the statute stated: “What is requisite to protect public health and with an adequate margin of safety.” Should the Agency consider cost benefit analysis?
Based on this language, the EPA should not consider costs to the businesses. The can only set a standard for what is required to protect the public’s health and within a margin of safety.
In Energy v. Riverkeeper, the Agency was given discretion to set the standard that would “best protect public health.” Can they consider Cost Benefit Analysis in setting the standard?
Court held the term “best” could have two different meanings:
1) Procedures that are the most advantageous with considering the costs of the procedures.
2) Produces a good outcome and fulfills the goal, but costs less.
The court determined that the agency has the discretion to decide which form of best is intended.
What is an Environmental Impact Statement and when is it required?
These statements are required when promulgating rules:
a) Court has stated that as long as it is done then they are alright with it.
b) The agency does not need to state every possible environmental concern.
c) Agencies do not need to follow the impact statement. Their main purpose is just to ensure the agency is aware of the environmental effects.
