Chapter 2 - Economics and Environmental Policies

Chapter 2

Economics and Environmental Policy

Cleaning the Tides of
San Diego and Tijuana

• The heavily polluted Tijuana River crosses over from Mexico to the

U.S. and empties into the Pacific Ocean near San Diego, California,
forcing frequent beach closures.

• Pollution sources include U.S.-owned factories as well as Mexican

farms, homes, and sewage treatment plants.

• In 1990 the U.S. and Mexico agreed to build a wastewater treatment

plant, but the wastewater plant can’t keep up with the volume of
wastewater.

Talk About ItWhy is the pollution problem in the Tijuana
River particularly difficult to solve? How does this case
illustrate the connections between the environment, the
economy, and government policy?

Multiple Choice

Water pollution from factories in Tijuana, Mexico, caused beach closures in San Diego, California, that hurt the local economy. Because the pollution did not directly affect the buyers or sellers of factory products, losses due to the pollution are considered ___________ costs.

• external
• production
• local
• internal

What Is Economics?

• The study of how

resources are used and
distributed

• Markets tend to move

toward equilibrium,
where demand for a
product matches supply.

• Cost-benefit analysis is

a decision-making tool
that compares an
activity’s gains and
costs.

Lesson 2.1 Economics

Multiple Choice

____________ is the study of how resources are converted into goods and services and how these goods and services are distributed and used.

• B. Microeconomics
• C. Economics
• A. Supply chain management
• D. Capitalism

Economics and the Environment

• Economies depend on the environment for

goods and services.

•Goods: Sunlight, fresh water, timber, and
fossil fuels

•Services: Nutrient cycling and purification of
air and water

• Economic activity can negatively affect the

environment, which in turn can negatively affect
economies.

Lesson 2.1 Economics

Multiple Choice

The sun's energy, fresh water, trees, rocks, and fossil fuels are all examples of

• natural resources
• renewable resources
• environmental values
• industrial products

Multiple Choice

Services provided by Earth's systems are said to have _________ values—values not usually included in the price of a good or service.

• market
• intrinsic
• indirect
• external

Harmful Economic Assumptions

•These long-held economic assumptions have had
negative impacts on the environment:

•Costs and benefits only affect buyers and
sellers.
•Short-term costs and benefits should be
emphasized.
•Resources are unlimited.
•Economic growth is continual.

Lesson 2.1 Economics

Multiple Choice

A producer will raise the price and supply of a product when the

• price is high.

• demand is low.

• market is in equilibrium.

• demand is high.

Environmental Economics

•Applies the principles of Earth’s systems to
economics

•Argues that economies cannot be sustainable
unless environmental issues are addressed

•Assigns market values to ecosystem services

•Suggests that market failure will occur unless
market values reflect environmental costs and
benefits

Lesson 2.1 Economics

Multiple Choice

The field of ___________ economics applies the principles of Earth's systems, such as a balance of inputs and outputs, to economics.

• capitalist
• societal
• ecological
• non-ecological

Consumer and Corporate

Responses

Lesson 2.1 Economics

•Changing consumer values can drive
corporations to pursue sustainability.

•Ecolabeling is an example of a corporate
response to the call for sustainable goods
and services.

Did You Know?Organic farming is one of the
fastest-growing segments of U.S. agriculture.
Land devoted to growing organic has expanded
by about 15% each year since 2002.

Multiple Choice

A situation in which the free market, operating on its own, does not distribute resources efficiently is called

• inefficient market
• market failure
• market success
• market inefficiency

What Is Environmental Policy?

•A set of general plans and principles for
interactions between humans and the
environment

•Effective environmental policy involves input
from science, ethics, and economics.

•In the U.S., all three branches of government
(legislative, executive, and judicial) are
involved in federal environmental policy.

Lesson 2.2 United States Environmental Policy

Multiple Choice

Which of the following is one of the main goals of environmental policy?

• increase pollution levels
• reduce government intervention
• promote unsustainable practices
• ensure that resources are shared fairly

Multiple Choice

Producing effective environmental policy requires input from

• all of the above
• politics
• history
• technology

State and Local Environmental

Policy

•State and local environmental policies cannot
violate the U.S. Constitution.

•The strength of environmental policy differs
from state to state.

•States that experience environmental disasters
tend to have stronger environmental laws.

Lesson 2.2 United States Environmental Policy

Multiple Choice

What is one of the main reasons a city like Pittsburgh has strong environmental policies?

• It is very wealthy and has vast financial resources.
• All cities have strong environmental policies.
• It has always been aware of environmental issues.
• It has dealt with the impact of messy environmental cleanups.

History of U.S. Environmental

Policy: The First Period

(1780s to late-1800s)

Lesson 2.2 United States Environmental Policy

•Laws enacted during this period dealt
primarily with management of public lands as
the nation expanded west.

•General feeling was that resources and land
were in endless supply.

Early Roots

. ​

• The origins of U.S. environmental law trace back to common law doctrines, including the law of nuisance and the public trust doctrine. These principles recognized the need to protect public health and natural resources.

• In 1916, the National Park Service Organic Act established the National Park Service, emphasizing the preservation of natural landscapes and cultural heritage¹.

The Second Period

(late 1800s to mid-1900s)

•Policies sought to reduce environmental
problems associated with westward
expansion.

•Led to the formation of national forest
system and national park system

Lesson 2.2 United States Environmental Policy

First Statutory Environmental Law

• The Rivers and Harbors Act of 1899 was the earliest federal environmental statute. It aimed to regulate activities affecting navigable waters, but it has largely been superseded by subsequent laws.

• 1947 saw the creation of the Los Angeles Air Pollution Control District, the first air pollution agency in the U.S., addressing urban smog and industrial emissions¹.

Multiple Choice

In the United States, laws enacted from the late-1800s to the mid-1900s reflected the understanding that

• Americans were not affected by pollution or environmental degradation.
• sustainability was not a concern for future generations.
• the West's natural resources were indestructible and did not need protection.
• Americans were living amid dirtier air, dirtier water, and more waste and toxic chemicals.

Multiple Choice

Which period of U.S. environmental policy created the Wilderness Act and the Soil Conservation and Domestic Allotment Act?

• the first period (1780s to late-1800s)

• the second period (late-1800s to mid-1900s)

• the third period (mid- to late-1900s)

• the fourth period

• the third period (mid- to late-1900s)
• the fourth period
• the second period (late-1800s to mid-1900s)
• the first period (1780s to late-1800s)

The Third Period

(mid- to late-1900s)

Lesson 2.2 United States Environmental Policy

•Dense populations led to increasing resource
consumption and pollution.

•Silent Spring and fires on the Cuyahoga River
raised environmental awareness.

•Policy began to reflect the connection between
human and environmental health.

Did You Know?Rachel Carson’s Silent Spring,
published in 1962, awakened the public to the
dangers of industrial chemicals and DDT.

1960s-1980s: Major Environmental Statutes

• During this period, several crucial environmental laws were enacted:

  • Clean Air Act (1970): Focused on air quality standards, emissions control, and reducing pollutants like sulfur dioxide and lead.

  • Clean Water Act (1972): Aimed to restore and maintain the chemical, physical, and biological integrity of water bodies.

  • Endangered Species Act (1973): Designed to protect endangered and threatened species and their habitats.

• Resource Conservation and Recovery Act (1976): Addressed hazardous waste management.

• Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA, 1980): Dealt with hazardous waste sites (Superfund sites) and cleanup.

• Toxic Substances Control Act (1976): Regulated chemicals and their risks.

• Safe Drinking Ensured safe public drinking water supplies.

• National Environmental Policy Act (NEPA, 1969): Required environmental impact assessments for federal projects.

  These statues reflected growing awareness of environmental issues and the need for protective measures.

Multiple Choice

In the United States, during the 1960s and 1970s, what was one of the events that triggered increased awareness of environment problems?

• the creation of the national park system

• the displacement of millions of Native Americans

• a rapid increase in westward expansion

• the publication of Silent Spring by Rachel Carson

Modern U.S. Environmental Policy

• National Environmental Policy Act: Requires government

agencies and contractors to evaluate the environmental impact
of a project; led to the formation of the EPA

• Environmental Protection Agency (EPA): Responsible for

monitoring, enforcing, and researching environmental quality

Lesson 2.2 United States Environmental Policy

Multiple Choice

The Environmental Impact Statement (EIS) process requires government agencies and businesses that contract with them to

• ignore the environmental impact
• evaluate the impact on the environment before proceeding with a project
• conduct projects without any consideration for the environment
• only evaluate the impact after completing the project

Multiple Choice

How did U.S. environmental policy shift in the 1980s?

• A backlash led to efforts to weaken federal environmental laws.
• It was basically the same as in the 1960s and 1970s.

• Most of the important environmental laws were finally passed.

• There was a large push to achieve sustainability quickly.

Multiple Choice

Which statement best describes the current era of environmental policy in the United States?

• Most policy is directed toward weakening federal and state environmental laws.

• The focus has expanded from just cleaning up pollution to achieving sustainability.

• Current policy continues the trends begun in the 1980s.

• Policy has finally solved most serious environmental problems in the U.S.

Multiple Choice

Why are government subsidies often controversial in the United States?

• They increase the prices of many products.

• They are seen as a limit on individual rights and freedoms.

• Subsidies are unable to encourage activities that protect the environment.

• Enormous subsidies are provided for nonrenewable fossil fuels.

• Government subsidies are universally accepted by the public.
• Subsidies always lead to economic growth.
• Subsidies have no impact on market competition.
• Enormous subsidies are provided for nonrenewable fossil fuels.

Multiple Choice

A factory owner has permits to release 10 units of a certain pollutant, but only needs to release 5 units, so the owner sells the permits for the extra 5 units to a factory that releases more pollution than allowed. This is an example of a(n)

• government subsidy.

• cap-and-trade system.

• green tax.

• command-and-control system.

• pollution offset initiative
• emission reduction program
• cap-and-trade system
• government intervention

International Environmental Policy

Lesson 2.3 International Environmental Policy and Approaches

•Environmental issues often involve more than one
nation.
•International organizations promote cooperation
between nations:

•The United Nations
•The European Union
•The World Trade Organization
•The World Bank

•Non-governmental organizations (NGOs) influence
international policies and contribute to research and
funding.

Approaches to Environmental

Policy

•Command-and-control

•Tax breaks and subsidies

•Green taxes

•Cap-and-trade

•Local incentives

Lesson 2.3 International Environmental Policy and Approaches

Did You Know?The cap-and-trade approach
in the U.S. has helped reduce sulfur dioxide
emissions that cause acid rain by 35%.

Multiple Choice

Air pollutants that are emitted in one country may travel on wind currents far across the globe and affect other countries. This is an example of a(n)

• domestic solution
• regional concern
• global warming issue
• transboundary problem

What are Transboundary Pollutants

1. Sulphur Dioxide (SO₂): Emitted from burning fossil fuels, industrial processes, and transportation. It contributes to acid rain and respiratory issues.

2. Nitrogen Oxides (NOₓ): Produced by combustion engines and industrial activities. NOₓ contributes to smog, acid rain, and respiratory problems.

3. Volatile Organic Compounds (VOCs): Released from vehicle exhaust, industrial processes, and natural sources. VOCs contribute to ground-level ozone formation and air quality degradation.

4. Ammonia (NH₃): Commonly from agricultural activities (fertilizers, livestock). It can lead to eutrophication and acidification of ecosystems.

Remember that addressing transboundary pollution requires international cooperation and efforts to mitigate sources both within and outside the national boundaries.🌍🌱

5. Persistent Organic Pollutants (POPs): Includes substances like dioxins, PCBs, and pesticides. POPs can travel long distances and accumulate in ecosystems, affecting human health and wildlife.

6. Heavy Metals (e.g., Cadmium, Lead, Mercury): Released from industrial processes and fossil fuel combustion. These metals can contaminate soil, water, and food chains¹².

Long-range transboundary air pollution includes acidifying gases such as sulphur oxides (SOx) and nitrogen oxides (NOx), ground-level ozone, particulate matter (dust) and environmental pollutants such as heavy metals and persistent organic pollutants (POPs).

​

Examples of Long Range Pollutants

Multiple Choice

Greenpeace, Population Connection, and Conservation International are examples of

• United Nations agencies
• Political parties
• Non-governmental Organizations (NGOs)
• Multinational corporations

Multiple Choice

One of the criticisms of the World Bank is that it

• places too much emphasis on protecting natural resources.

• doesn't always fund projects that are environmentally sustainable.

• does not cooperate enough with the United Nations and the European Union.

• has too much power and can overrule national regulations.

• cooperates well with the United Nations and the European Union.
• doesn't always fund projects that are environmentally sustainable.
• always funds projects that are environmentally sustainable.
• has little power and must abide by national regulations.

Multiple Choice

What is one of the criticisms or weaknesses of the command-and-control approach to environmental policy?

• It is usually a complicated, indirect approach to environmental issues.
• Governments lack the authority to enforce command-and-control policies.
• Companies are not capable of implementing environmental policies effectively.
• The command-and-control approach is always the most cost-effective solution.

The Environmental Policy Process

Lesson 2.3 International Environmental Policy and Approaches

Multiple Choice

What is the correct sequence of steps in the environmental policy process?

• identify the problem, find the cause, propose solutions, get organized, gain access to policymakers, guide the solution to law

• identify the problem, get organized, propose solutions, find the cause, gain access to policymakers, guide the solution to law

• find the cause, identify a problem, propose solutions, gain access to policymakers, get organized, guide the solution to law

• propose solutions, find the cause, identify a problem, get organized, guide the solution to law, gain access to policymakers

• find the cause, propose solutions, identify the problem, get organized, gain access to policymakers, guide the solution to law
• identify the problem, find the cause, propose solutions, get organized, gain access to policymakers, guide the solution to law
• identify the problem, propose solutions, find the cause, get organized, gain access to policymakers, guide the solution to law
• get organized, propose solutions, find the cause, identify the problem, gain access to policymakers, guide the solution to law

Multiple Choice

Which step of the environmental policy process usually requires the use of science?

• pinpointing causes of the problem
• drafting legislation without evidence
• lobbying for funding
• ignoring public opinion

Multiple Choice

Lobbying and making campaign contributions are ways to

• identify environmental problems
• lobby for environmental policies
• gain access to environmental policymakers
• organize environmental campaigns