Standards May Cost Up To $150 Billion and Result in up to 200,000 Job Losses

    WASHINGTON, May 12 /PRNewswire/ -- The Environmental Protection Agency's
(EPA) proposed ozone and particulate matter (PM) standards are not science-
driven, and the linkage of science-to-policy is flawed, according to reports
released today by the Reason Public Policy Institute (RPPI).  The reports
state that the EPA grossly underestimated both the true costs and their
related impacts, with true costs ranging between $90 and $150 billion (in 1990
dollars), as compared with the EPA's estimate of $6.5-$8.5 billion.
    The reports also predict up to 200,000 lost jobs -- with small businesses
bearing the brunt of these losses -- and reductions in American consumers'
personal budgets.
    RPPI released three papers during today's news conference, each of which
point to major shortfalls in the proposed EPA ozone and particulate matter
standards.  The reports evaluate the scientific soundness of the proposed
standards; estimate the standards' costs; review the standards' likely
benefits; and measure the impact the standard could have on jobs and
mortality.
    "The EPA has exaggerated the risks from exposures to permissible ozone and
particulate matter levels and ignored harmful side-effects of proposed
standards, leading to standards that are likely to do more harm than good,"
according to Dr. Kenneth Green, director of environmental studies of the
Reason Public Policy Institute.  "It is ironic that these proposed standards
will likely harm the very populations they are targeted to protect -- children
and the economically-disadvantaged elderly."
    The states hit hardest by job losses would be California, New York,
Florida, Illinois, Ohio, Washington, Pennsylvania, and New Jersey, with losses
in each state of potentially greater than 10,000 on an annual basis.  These
job losses would occur as a result of the great cost to various industries of
complying with the new standards, as well as the secondary impact of increased
costs for goods and services, resulting in reductions in family discretionary
income.
    Assuming that the government could be completely effective in eliminating
national employment impacts, a program consistent with the $90 billion annual
cost estimate would cause lasting average reductions in the real income per
capita of $250 per year, or about 3.5% of American consumers' personal budget,
according to the RPPI.  This would result in widespread impacts throughout all
regions and sectors of the economy.
    The largest job losses in the economy will come from the service and
retail sectors, such as restaurants, non-profit organizations, household
workers, etc., due to the decline in household income.  The EPA standards will
also result in a substantial reduction in clerical, sales, and blue collar
jobs (about 50,000 to 100,000 each year by 2010) and a much smaller increase
in professional, managerial, and construction-related jobs.  Smaller
establishments -- with fewer than 100 employees will be more likely to
experience job losses than larger employers.
    Other major findings or the RPPI's reports showed that:

    * The Clean Air Scientific Advisory Committee (CASAC), an independent
scientific review committee required by the Clean Air Act, raised serious
questions regarding the scientific rigor used in developing the standards, and
proposed no tighter standards.

    * Contrary to EPA's claim that currently permitted levels of pollution are
killing 15,000 people each year and debilitating 250,000 others, RPPI's
reports demonstrate that EPA estimates of the health hazards of currently-
permissible ozone and PM levels are significantly inflated.

    * EPA used legalistic, non scientific thinking, to justify ignoring side-
effects, some from their own research demonstrating the relationship between
ozone levels and protection from capital UV radiation.  Their own research
shows some 2,000 to 11,000 new cases of nonmelanoma skin cancer each year,
from 130 to 26 cases of cutaneous melanoma each year from 25 to 50 new
melanoma-induced fatalities each year, and from 13,000 to 28,000 new cases of
cataracts each year.

    * The economic impact of the proposed standards will decrease real
disposable income by nearly four percent beginning in 2005.

    The RPPI papers are, (1) "Rethinking EPA's proposed ozone and particulate
standards" (2) "Costs and economic impact of EPA's proposed ozone and PM2.5
standards," and (3)"Estimating fatalities induced by the economic costs of
proposed air quality standards for ozone and particulates."
    The Reason Public Policy Institute, a national think tank based in Los
Angeles, provides peer-reviewed research in a variety of policy areas.  RPPI
is a division of the Reason Foundation, a Los Angeles-based national research
and education organization founded in 1978.

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