Environmental Pollution
Daily Environment Repost

The economics of environmental pollution

‘Pollution pays’ is the driving economic principle behind much of the environmental pollution we experience today. Superfund sites provide a prime example of how this works. They showcase a process that provides a way to maximize profits at the expense of the general public, so that future taxpayers cover the cost for damages done.

During the last two decades, cleaning up superfund sites cost the American taxpayer over 21 billion dollars. The economics of how we got to this point are quite simple. If you are manufacturing a widget that sells for $100, and it cost you $50 to produce it, then you have a handsome profit of $50 per item. However, if producing that object creates toxic waste byproducts that require disposal, your profits suffer.

If your business chooses to neutralize and dispose of those wastes in an environmentally responsible way, then the cost will be $40 per widget. Option two is to buy a large plot of land beside your factory and bury the waste below the ground. This option costs $10 per widget, so you choose the second option to maximize your profits. 

The $40 per widget cost to responsibly dispose of the toxic materials has not gone away; you have simply deferred it. When site cleanup occurs, the taxpayer picks up that cost. For many years Congress has declined to fund the needed cleanup of Superfund sites adequately. So the price is paid in another way by the 53 million people who live within three miles of a Superfund site as they fight higher incidents of health issues, including cancer and birth defects.

The economics of environmental pollution rely on cost deferral-and-transfer to maximize present-day profits. However, the transfer of these costs is usually to future taxpayers.

Seabed mining

Along the waterfront of Kingston Harbor in Jamaica, are several office buildings that house the International Seabed Authority (ISA). Here, in these buildings, the 168 country delegates who compose the ISA meet periodically to determine how the mining of ocean bottoms in international waters around the globe will proceed. So, this group determines who gets permits to mine and the environmental standards that govern mining operations. 

Early indications are that waste disposal will be an area where cost deferral-and-transfer is an operative principle. The argument is that the complete treatment of waste materials is too expensive, and thus will render the operations unprofitable. This statement is probably true. But, shouldn’t the response be to wait until demand raises commodity prices to the point where mining and proper disposal of waste becomes profitable. 

The prize is big for the first companies who successfully mine the seafloor. Also, the prize is even bigger if they can defer real waste disposal costs to future generations. 

(More on seabed mining tomorrow)


Seabed mining: Technological marvel or environmental folly? (Source ArcheanWeb) – https://archeanweb.com/2020/01/03/seabed-mining-technological-marvel-or-environmental-folly/ Also:

Seafloor ecosystems fare poorly in simulated deep-sea mining (Source: ArcheanWeb) – https://archeanweb.com/2020/05/05/seafloor-ecosystems-fare-poorly-in-simulated-deep-sea-mining/ Also:


History’s Largest Mining Operation Is About to Begin (Wil S. Hylton – The Atlantic) – https://www.theatlantic.com/magazine/archive/2020/01/20000-feet-under-the-sea/603040/ Also:

Taxpayer dollars fund most oversight and cleanup costs at Superfund sites – https://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&ved=2ahUKEwi62tr02tPmAhVRpZ4KHTXoCIsQFjAAegQIBhAB&url=https%3A%2F%2Fwww.washingtonpost.com%2Fnational%2Ftaxpayer-dollars-fund-most-oversight-and-cleanup-costs-at-superfund-sites%2F2017%2F09%2F20%2Faedcd426-8209-11e7-902a-2a9f2d808496_story.html&usg=AOvVaw11Ssb4MFN98fjmGvg-nxFz Also:

Feature Photo: Heavy night industrial pollution.jpg – Photograph by  Gavin Schaefer – This file is licensed under the Creative Commons Attribution-Share Alike 3.0 Unported license. – https://creativecommons.org/licenses/by-sa/3.0/deed.en

William House
William is an earth scientist and writer with an interest in providing the science "backstory" for breaking environmental, earth science, and climate change news.