Over the last 40 years — roughly since the first Earth Day was held in 1970 — Americans have become more environmentally conscious than ever before. Environmentalism is arguably the most successful philosophical movement in modern times. But like other ideas that have seized the popular culture, environmentalism has a downside. America may be a safer, healthier place today than at any time in the past, but it is also a place where building oil refineries and aluminum smelters has become nearly impossible due to regulatory barriers. That’s why Exxon has just completed one of the largest refineries in the world in China, but no new refineries have gone up in the U.S. since Earth Day became an annual event.
The same year that the first Earth Day was celebrated, two respected political scientists named Ben Wattenberg and Richard Scammon wrote a bestselling analysis of voter behavior arguing (among other things) that environmentalism was largely a preoccupation of people with secure jobs and incomes. In other words, if you’re affluent then you worry about effluents, but if you’re struggling then your day is filled with more urgent concerns. The implication of that finding for today is that since America has been getting poorer compared with the rest of the world for much of the past decade, the public may be ready to start rethinking its reflexive support for any policy labeled as environmentally friendly. A good place to start might be the Environmental Protection Agency’s (EPA) recent decision to establish more demanding standards for cleaning up a rocket fuel ingredient called perchlorate.
Perchlorate isn’t an especially dangerous or exotic toxin. It is a salt derived from a chlorine compound similar to that used in swimming pools that occurs naturally all over the Earth, and the Phoenix Lander also found it on Mars. But in sufficient concentrations it can inhibit the absorption of iodine by the thyroid gland, leading to developmental problems in children. So some care is required in its handling. The question is how much care. A 2005 study by the National Academy of Sciences found that exposure to low levels of perchlorate — amounts of less than 250 parts per billion in ingested fluids — had no measurable effect on the health of children, infants or pregnant women. EPA the same year set a reference dose of about one-tenth that amount as the threshold level for safe drinking water. No subsequent scientific studies have found that exposure at the EPA threshold level or lower is likely to have injurious effects even in the most sensitive populations.
Such findings matter a lot to the handful of surviving companies that make rockets and rocket motors in the United States, because during the Cold War many of them allowed perchlorate to seep into ground water near their sites. Perchlorate is still used in large quantities as an oxidizer in rocket motors — each solid rocket motor on the Space Shuttle contains 350 tons of ammonium perchlorate — but since the industry has cleaned up its act, the main concern it has is with how demanding Washington and the states will be in directing the remediation of past transgressions. Despite a finding by its own inspector general that “further reducing the perchlorate exposure below the [current reference dose] does not effectively lower risk,” EPA looks likely to move in that direction. The agency argues that the effects of exposure are cumulative, and drinking water isn’t the only potential source of perchlorate.
Maybe EPA is right, and maybe it isn’t. But the economic problem its approach creates is that at some point the cost of remediation might grow so burdensome that U.S. rocket motor companies will become unprofitable and uncompetitive. Once that occurs, rocket motor production could shift to places like China where environmental rules are more “flexible.” That’s what happened in the production of rare earths vital to the manufacture of advanced weapons: a combination of low overseas prices and domestic environmental rules drove U.S. producers out of the market, so China now enjoys a global monopoly. The good news for industry is that the federal government is willing to pick up most of the costs for purifying ground water. The bad news is that reimbursement only occurs when the costs are included in overhead rates on government contracts. Obviously, the higher overhead rates don’t improve the chances of winning more contracts.
One major company has seen overhead rates leap by 50 percent as a result of the add-on. That same company has already reduced perchlorate concentrations in the ground water near its main cleanup site to four parts per billion, at significant cost to profits. If the federal government thinks that’s still not good enough, then the least it can do is pay companies directly for the cost of making ground water pure, rather than condemning them to including excessive overhead charges in every contract they bid. After all, the reason the problem exists at all is because the government bought thousands of rockets during the Cold War without much thought as to environmental impacts, and then much later decided that it needed to be a more thoughtful steward of the environment.
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