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Environmental Policy and the Cost of Capital
A monograph published September 1990 by the ACCF Center for Policy Research.
Introduction
There is no question that sound and effective environmental regulation
is necessary and beneficial. Few would debate the need for a clean, safe
environment that enhances the quality of life. But some have suggested
that, in the zeal to repair past environmental destruction and put in
place safeguards for the future, the cost of new environmental legislation
has not been sufficiently scrutinized.
Given lagging U.S. economic growth and productivity, such analysis seems
well warranted. Are we improving our environmental health at the expense
of our economic health? Will new burdens of compliance faced by U.S. business,
along with the associated costs, negatively affect our economic well-being?
What about the competitive position of the United States in the world
marketplace? Do our stringent environmental standards throw yet another
hurdle in the path of U.S. business, already struggling to keep up with
some of our more aggressive competitors? How do our environmental standards
compare with those of our industrialized countries? How will the Clean
Air Act amendments affect the cost of capital for U.S. business?
To address these and other critical questions related to U.S. environmental
policy, the American Council for Capital Formation Center for Policy Research
sponsored a day-long symposium on June 11, 1990, entitled "Environmental
Policy and the Cost of Capital." This was the second in a series
of programs designed to explore "Tax and Environmental Policies &
U.S. Capital Costs," a two-year special project that the ACCF Center
for Policy Research launched in 1990. A symposium on "Business Taxes,
Capital Costs, and Competitiveness, and Growth," will take place
on November 8. Continuing its focus on "Tax and Environmental Policies
& U.S. Capital Costs," the Center will sponsor four symposiums
in 1991.
We extend our deep thanks to the panelists and participants at the symposium
on "Environmental Policy and the Cost of Capital," who contributed
to an important public policy dialogue that will doubtlessly be with us
for years to come as the nation strives to reach a consensus on the value
of a clean environment. We offer special thanks as well to the groups
that are so generously supporting the project on "Tax and Environmental
Policies & U.S. Capital Costs"; American Business Conference;
American Petroleum Institute; BankAmerica Foundation; Chemical Manufacturers
Association; Clean Air Working Group; Exxon Company, USA; General Electric
Company; The Henley League, Ltd.; Manufacturers' Alliance for Productivity
and Innovation; National Venture Capital Association; Shell Oil Company;
Thermo Electron Corporation; and Weyerhaeuser Company.
Charls E. Walker, Chairman
Mark Bloomfield, President
Margo Thorning, Director of Research
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