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Featured stories in this issue...

2005 Was a Very Good Year for the Biotech Food Industry
  Many people around the world resist eating genetically modified
  foods (GMOs), and they still have a choice. But pollen carried on the
  wind is slowly contaminating much of the world's cropland with GMOs.
  One of these days, there won't much left to call "organically grown"
  or non-GMO crops. Then most of us will be eating food grown from seeds
  patented by Monsanto and Dow.
Interview with Greg Leroy, Author of the Great American Jobs Scam
  Today, states, counties, and cities cannibalize their own
  communities in the name of "attracting business," which entails
  competing with one another to waste vast amounts of precious taxpayer
  dollars in the form of corporate subsidies. As The Great American
  Jobs Scam reveals, these subsidies are not just "unfair" but also
  entirely useless. Companies routinely pocket the money -- all $50
  billion of it each year -- without delivering either the promised jobs
  or tax revenues.
The Economic Costs of Environmental Diseases and Disabilities
  "What it comes down is this: The economic costs of environmental
  diseases and disabilities are very significant and they are largely
  preventable. By taking action to reduce or eliminate exposures to
  toxic chemicals, the US could save billions of dollars a year in
  health and related costs and significantly improve public health."
Correction: Serious Error in Rachel's News #835
  Last week, I wrote, "But decade after decade since World War II,
  economic growth rates have been stagnant or declining, not just in the
  U.S. but throughout the "developed" world." I should have written,
  "But decade after decade since 1970, economic growth rates have been
  stagnant or declining, not just in the U.S. but throughout the
  'developed' world."--P.M.

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From: Rachel's Democracy & Health News #836, Jan. 5, 2006
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2005 WAS A VERY GOOD YEAR FOR THE BIOTECH FOOD INDUSTRY

By Peter Montague

Felix Ballarin spent 15 years of his life developing a special
organically-grown variety of red corn. It would bring a high price on
the market because local chicken farmers said the red color lent a
rosy hue to the meat and eggs from their corn-fed chickens. But when
the corn emerged from the ground last year, yellow kernels were mixed
with the red. Government officials later confirmed with DNA tests that
Mr. Ballarin's crop had become contaminated with a genetically
modified (GMO) strain of corn.

Because Mr. Ballarin's crop was genetically contaminated, it no longer
qualified as "organically grown," so it no longer brought a premium
price. Mr. Ballarin's 15-year investment was destroyed overnight by
what is now commonly known as "genetic contamination." This is a new
phenomenon, less then 10 years old -- but destined to be a permanent
part of the brave new world that is being cobbled together as we speak
by a handful of corporations whose goal is global domination of food.

Mr. Ballarin lives in Spain, but the story is the same all over the
world: genetically modified crops are invading fields close by (and
some that are not so close by), contaminating both the organic food
industry and the "conventional" (non-GMO and non-organic) food
industry.

As a result of genetically contamination of non-GMO crops in Europe,
the U.S., Mexico, Australia and South America, the biotech food
industry had an upbeat year in 2005 and things are definitely looking
good for the future. As genetically modified pollen from their crops
blows around, contaminating nearby fields, objections to genetically
modified crops diminish because non-GMO alternatives become harder and
harder to find. A few more years of this and there may not be many
truly non-GMO crops left anywhere. At that point there won't be any
debate about whether to allow GMO-crops to be grown here or there --
no one will have any choice. Most of the crops in the world will be
genetically modified (except perhaps for a few grown in greenhouses on
a tiny scale). At that point, GMO will have contaminated essentially
the entire planet, and the companies that own the patents on the GMO
seeds will be sitting in the catbird seat.

It is now widely acknowledged that GMO crops are a "leaky technology"
-- that it to say, genetically modified pollen is spread naturally on
the wind, by insects, and by humans. No one except perhaps some
officials of the U.S. Department of Agriculture were actually
surprised to learn this. GMO proponents have insisted for a decade
that genetic contamination could never happen (wink, wink) and U.S.
Department of Agriculture officials want along with the gag. And so of
course GMO crops are now spreading everywhere by natural means, just
as you would expect.

It couldn't have turned out better for the GMO crop companies if they
had planned it this way.

Growers of organically-grown and conventional crops are naturally
concerned that genetic contamination is hurting acceptance of their
products. Three California counties have banned GM crops. Anheuser-
Busch Co., the beer giant, has demanded that its home state (Missouri)
keep GMO rice fields 120 miles away from rice it buys to make beer.
The European Union is now trying to establish buffer zones meant to
halt the unwanted spread of GM crops. However, the Wall Street
Journal reported November 8 that, "Such moves to restrict the spread
of GM crops often are ineffective. Last month in Australia, government
experts discovered biotech canola genes in two non-GM varieties
despite a ban covering half the country. 'Regretfully, the GM
companies appear unable to contain their product," said Kim Chance,
agriculture minister for the state of Western Australia, on the
agency's Web site.

For some, this seems to come as a shocking revelation -- genetically
modified pollen released into the natural environment spreads long
distances on the wind. Who would have thought? Actually, almost anyone
could have figured this out. Dust from wind storms in China
contaminates the air in the U.S. Smoke from fires in Indonesia can be
measured in the air half-way around the world. Pollen is measurable in
the deep ice of antarctica. No one should ever have harbored any doubt
that genetically modified pollen would spread everywhere on the Earth
sooner or later. (We are now exactly 10 years into the global
experiment with GMO seeds. The first crops were planted in open fields
in the U.S. in 1995. From this meager beginning, global genetic
contamination is now well along.)

Who benefits from all this? Think of it this way: when most crops on
earth are genetically contaminated, then the seed companies that own
the patented seeds will be in a good position to begin enforcing their
patent rights. They have already taken a test case to court and won.
In 2004, Monsanto (the St. Louis, Mo. chemical giant) won a seven-year
court battle against a 73-year-old Saskatchewan farmer whose canola
fields had been contaminated by Monsanto's genetically modified
plants. The Supreme Court of Canada court ruled that the farmer -- a
fellow named Percy Schmeiser -- no longer owns his crops. Monsanto now
owns his crops because Monsanto's patented genes made their way into
his fields.

Armed with this legal precedent, after genetically modified crops have
drifted far and wide, Monsanto, Dow and the other GMO seed producers
will be in a position to muscle most of the world's farmers. It is for
cases exactly like this that the U.S. has spent 30 years creating the
WTO (world trade organization) -- to settle disputes over
"intellectual property rights" (such as patents) in secret tribunals
held in Geneva, Switzerland behind closed doors without any impartial
observers allowed to attend. Even the results of WTO tribunals are
secret, unless the parties involved choose to reveal them. Let me see
-- a dirt farmer from India versus Monsanto and Dow backed by the U.S.
State Department and the U.S. Treasury (with the shadow of the
Pentagon always in the background). I'm struggling to predict who
might win such a politico-legal dispute conducted by a secret tribunal
in Geneva, Switzerland.

During 2005, it was discovered that GMO crops have not lived up to
their initial promise of huge profits for farmers and huge benefits
for consumers. It was also discovered that the U.S. Department of
Agriculture has not enforced its own strict regulations that were
intended to prevent experimental GMO seeds from accidentally
contaminating nearby fields. GMO crops were supposed to produce
important human health benefits -- and then be developed under super-
strict government control -- but all these promises have turned out to
be just so much eye wash.. GMOs were supposed to reduce reliance on
dangerous pesticides -- but in fact they have had the opposite effect.
Monsanto's first GMO crops were designed to withstand drenching in
Monsanto's most profitable product, the weed killer Round-Up -- so
farmers who buy Monsanto's patented "Round-up ready" seeds apply more,
not less, weed killer.

But so what? Who cares if GMO seeds don't provide any of the benefits
that were promised? Certainly not the seed companies. Perhaps benefits
to the people of the world were never the point. Perhaps the point was
to get those first GMO crops in the ground -- promise them the moon!
-- and then allow nature to take its course and contaminate the rest
of the planet with patented pollen. The intellectual property lawsuits
will come along in good time. Patience, dear reader, patience. Unlike
people, corporations cannot die, so our children or our grandchildren
may find themselves held in thrall by two or three corporations that
have seized legal control of much of the world's food supply by
getting courts (backed by the threat of force, as all courts
ultimately are) to enforce their intellectual property rights.

The Danish government has passed a law intended to slow the pace of
genetic contamination. The Danes will compensate farmers whose fields
have become contaminated, then the Danish government will seek
recompense from the farmer whose field originated the genetic
contamination, assuming the culprit can be pinpointed. This may slow
the spread of genetic contamination, but the law is clearly not
designed to end the problem.

Yes, it has been a good year for the GMO industry. None of the stated
benefits of their products have materialized -- and the U.S.
government regulatory system has been revealed as a sham -- but
enormous benefits to the few GMO corporations are right on track to
begin blossoming. For Monsanto, Dow and Novartis, a decent shot at
gaining control over much of the world's food supply is now blowing on
the wind and there's no turning back. As the Vice-President of plant
genetics for Dow Agrosciences said recently, "There will be come
continuing bumps in the road, but we are starting to see a balance of
very good news and growth. The genie is way out of the bottle."

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From: AlterNet, Jul. 27, 2005
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INTERVIEW WITH GREG LEROY, AUTHOR OF THE GREAT AMERICAN JOBS SCAM

By Lakshmi Chaudhry

We increasingly live in a Wal-Mart America, where the hours are long,
wages low, and benefits non-existent. Where have all the good jobs
gone? The debate over jobs has for the most part been obscured by
partisan rhetoric, corporate spin and media hype. Screaming headlines
about outsourcing jostle those of corporate fraud. But in the end
we're none the wiser about how to create a better future for ourselves
and our children.

Greg LeRoy's new book, " The Great American Jobs Scam: Corporate Tax
Dodging and the Myth of Job Creation offers at least part of the
answer in exposing a system that subsidizes corporate greed at the
expense of the taxpayer. Today, states, counties, and cities
cannibalize their own communities in the name of "attracting
business," which entails competing with one another to waste vast
amounts of precious taxpayer dollars in the form of corporate
subsidies. As LeRoy demonstrates in his book, these subsidies are not
just "unfair" but also entirely useless. Companies routinely pocket
the money -- all $50 billion of it each year -- without delivering
either the promised jobs or tax revenues.

LeRoy spoke to AlterNet from his office in Washington DC.

Lakshmi: So what is the "great American job scam"?

Greg LeRoy: It's an intentionally rigged system that enables companies
to get huge tax breaks and other taxpayer subsidies by promising good
jobs and higher tax revenues -- and then allowing them to fail to
deliver and suffer no meaningful consequences.

LC And this is a system that costs the American tax payers $50 billion
a year?

GL Right, that's the estimated total spending by states and cities.

LC One of the points you make in the book is that it is very hard to
get this data, right? There is no disclosure, with these corporate
deals being negotiated behind closed doors. So the very heart of your
argument -- that corporations don't deliver on the increased tax
revenues, increased jobs, etc that they promise in return for these
tax breaks -- is obscured by this lack of disclosure.

GL People who develop these estimates at the state level are dealing
with broad aggregate numbers. It would tell you nothing about any
specific company, whether it did or did not create jobs, did or did
not generate tax revenue. In most states, we are completely in the
dark.

Having said that, 12 states now have some form of annual company-
specific disclosure. We're very excited because just recently
Illinois, just began reporting data. There are four states now that
disclose some of their data on the web and we think Illinois is the
best.

LC Whose interest does this secrecy serve? It obviously serves the
interest of the corporations, but it's surprising that state
governments have not pushed for more disclosure.

GL It obviously serves lots of peoples' self-interest to hide what's
going on: the companies who get the big tax breaks and don't want
people to look carefully at the outcomes; the politicians who often
frankly know this is bad public policy and don't want to own up to it.
Often the effects of these tax breaks play out over many years. So you
have one governor hand off budget potholes to the next governor and so
on. So there's lots of buck-passing going on. There's lots of self-
interest in these things being hidden.

LC One of the most striking things in your book is this ridiculously
lopsided power relationship between public officials and corporations.
The politicians are almost like members of a harem vying for the
king's attention, or in this case, a company's favor.

A lot of the scams that you describe -- as in extorting these huge
subsidies without delivering any kind of return -- comes from the fact
that different states are competing with each other to land a
corporate deal. Have we always had this war among the states, almost a
kind of mutual and assured destruction?

GL That's really the nub issue. It's the power dynamic both among
states and companies and among suburbs and companies -- because this
harem/king dynamic, as you put it, plays out at the regional level as
well as at the multi-state level.

No, it was not always like this, and I tried to sketch the major kind
of milestones along the way where I think the dams really broke.
There's the birth of a site location consulting industry we got with
Fantus, and its growth in the '50s and '60s is part of the story. The
secretive consulting industry hides in the shadows and specializes in
playing states and cities against each other on behalf of the
companies it represents. By the '70s, we had done this thousands of
times.

Then there's the rise of the whole business climatology industry as
exemplified by the studies -- especially in the '70s and early '80s by
the Grant Thornton Firm for the state manufacturers associations --
which offered this highly politicized interpretation of jobs and tax
data. These studies basically said to the North and to the Midwest:
"You've got to be more like the South. We will judge you based on how
willing you are to give up your tax base and help us suppress wages."

Another big watershed moment was the arrival of the Japanese
transplants -- the auto assembly plants that started arriving early-
and mid-'80s. Despite the fact that the Japanese automakers had to set
up these plants because they were fighting off protectionist
legislation in the U.S. Congress, they still got eight- and nine-
figure subsidy packages by playing states against each other -- and
all with the assistance, frankly, of the American site location
consulting industry.

So I think all those are big watershed moments that kept upping the
ante. So today the average state has 30 different ways it gives away
money in the name of jobs. It does a very bad job of accounting for
outcomes and monitoring cost effectiveness. And the debate in most
state legislatures is not about fixing this problem or reducing
subsidies but over enacting even more handouts.

LC Along the way though there's also been a huge ideological
transformation of American culture, beginning with the Reagan era. And
according to this rightwing, pro-corporate worldview, attracting
business is an unadulterated good. As in anything you do bring a
corporation into your city, district, state, or your country, is an
absolute good. How much has the broader political transformation been
a part of making this kind of corporate extortion easier and more
legitimate?

GL I think you are exactly right. The broader rise of conservatism
goes hand-in-glove with this give-away subsidy problem. Frankly, I've
seen very little scholarship looking at the sort of political economy
of job subsidies. It's a woefully understudied subject. Anecdotally,
I've heard people many times suggest that the way governors allocate
their economic development dollars amounts to political engineering.

They use these dollars to cut ribbons with mayors and county
executives of their own party; use the programs for partisan benefit;
grow new jobs in areas that are more favorable to them politically.
I've never seen that studied systematically -- so there are a couple
of great dissertations waiting for somebody to write here.

LC Right at the outset, in the introduction, you write: "At the core
of this scandal are corrupted definitions of 'competition' that
obscure cause and effect." What do you mean by that?

GL The corporations have transformed the definition of competing for
economic development -- so it's now defined as which state or which
suburb will give away the most money to a company.

But here's the reality: because state and local taxes are such a
small, small cost factor to the average company -- less than 1 percent
for the average company after they deduct them on their federal income
taxes -- these taxes don't determine where companies expand or locate.
If a company were to pay attention to 0.8 percent of its cost
structure and ignore the other 99.2 percent, that company would not be
around very long.

So what's really going on in this rigged system is that companies are
getting paid to do exactly what they would have otherwise done. All
the while that governments are posing as competitors, it's really a
false competition, a rigged competition.

LC Let me clarify that. So what you're saying that a company's
decision on where to locate its operations actually has nothing to do
with these tax subsidies. And therefore, if they decided to set up
shop in Location A, they would have done it anyway, irrespective of
whether they received handouts or not.

GL Exactly right. It's why believe that we need a different form of
competition that doesn't have to do with how much of your tax base
you'll give away. It should be about how good your public systems are
-- public systems that are available to all employers. That is, how
good is your infrastructure? How good is your workforce development
system? How good are your public schools? How good is your quality of
life, your cultural amenities and your open spaces? It's not just
about being "fair." Quite frankly, that's the way a lot of employers,
including the best employers, determine where they want to invest.

So it's a really twisted dance that local officials often have to
dance. In one breath, they're talking about all these giveaways which
allow companies to dodge paying their fair share for these public
goods that I just talked about. On the other hand, they have to brag
about how good their public goods are because they know that's what
really matters to a lot of good employers.

LC And most of these companies are basically being rewarded for doing
what they are supposed to do anyway, which is, do business.

GL Exactly right. And they are getting rewarded in ways that don't
really affect their bottom line -- actually, I'd argue, in ways that
could hurt their bottom line because it's going to undermine the
quality of life, the quality of the skills base, and the quality of
the infrastructure.

LC One of the most interesting connections you make in the book is
between this kind of economic competition and sprawl. So when local
governments give huge incentives to retail stores like Wal-Mart,
they're actually creating unsustainable development.

Yes, absolutely. It's not just the terrible things Wal-Mart does to
wages and competition or the trade deficit. It's about cities being
treated like they are disposable; and open space being treated like
its disposable; and malls being treated like they are disposable.

Because many states allow job subsidies to go to retail companies like
Wal-Mart, etc., we've got suburbs that are cutting each other's
throats. They're robbing each other of shoppers in order to collect
the incremental payment on sales tax. So we have this gross over-
building of retail space in this country, far more than any of our
major trading partners, far more than we had twenty, thirty years ago.
Wal-Mart, as the biggest retail player, is the poster child for that
trend.

It's terrible public policy because it moves lots of economic activity
away from places that need it, that are already developed, and that
have the infrastructure. It's an extremely inefficient and, as you put
it, unsustainable, both ecologically and from a tax point of view. We
can't keep thinning out and expecting the taxpayer to support ever
more miles of roads, ever more miles of sewer and water lines, ever
more under-utilized public schools.

It just doesn't work, and at some point things snap. So you see a
number of big cities -- Detroit is a pretty good example, or
Philadelphia -- struggling with their tax base. These regions are so
gutted that they're really struggling.

LC When it comes to jobs, a lot of the conversation in the media is
centered around outsourcing. You don't focus on that very much at all.
Why is that?

We have one: the case of Sykes Enterprise, the call center company
that is included in Chapter One. That story has not been pieced
together elsewhere, and we think it's one of the breaking news hooks
of the book.

But you're right. We didn't focus a lot on outsourcing. Here's the
reason. It goes back to the disclosure problem. Certainly there are
lists of companies out there that outsource -- some of them are the
biggest IT, engineering and manufacturing companies that we know
about. The Fortune 100 so to speak. But because those companies are so
huge, the quality of disclosure about economic development subsidies
that the companies have gotten is fragmentary. It would be almost as
bad as finding a needle in a haystack to try and knit together the
story of a particular job that used to be in upstate New York and got
a tax break and is now off-shore. Linking those specific stories is
virtually impossible in those cases because of the poor quality of
disclosure of subsidies.

And there are so many things going on with jobs that aren't moving
overseas. We wanted to focus on the fact that taxpayers are
subsidizing fast-food joint and poverty-wage big-box retail jobs and
other kind of low-end, dead-end service sector jobs -- and all this at
a time when some of the best jobs in the country, like manufacturing
jobs, are either being automated out of existence, or going offshore
or being lost because of bad trade policies.

In manufacturing, for instance, we focus on this one particular kind
of tax break called "single sales factor" that a lot of state
manufacturers associations have been touting as kind of a panacea. But
if you look at the track record of the states that have adopted this
huge tax break, they're doing no better than the country as a whole.

The issue affecting manufacturing jobs generally is globalization.
There are a certain number of manufacturing jobs that are very
unlikely to go offshore because they are tied to markets here --
printing things that are time sensitive, business-sector related
things and so on. Other things are very likely to go offshore --
things that are labor intensive, more commoditized, and
technologically less complicated. And we need to grapple with those
realities. We have to save what we can, acknowledge what we can't
save, and try to find good ways to employ people that are affected by
those events. But subsidizing Wal-Mart or fast food joints isn't the
answer to dislocated manufacturing workers.

LC Another interesting thing about the Sykes story is that these call
center jobs that the politicians paid so much to attract weren't even
worth having.

GL Yes, the call center jobs often do not pay very well, and often
suffer lots of erratic ups and downs in terms of layoffs and rehiring.
So it's really testimony to what a company can do when it tries to be
a big fish in a little pond. These call centers had impressive numbers
of jobs. Some of them had five hundred or more people working in them,
and in pretty small labor markets in rural areas where they were
drawing a lot of people. To me, it makes those stories all the more
tragic because the amount of subsidies that the localities gave was,
for them a very huge sum in many cases. And I'm sure it left a bitter
taste in a lot of people's mouths.

LC So what is the solution? You list a series of prescriptions at the
end of the book. But what is the broader philosophy -- paradigm
change, if you will -- that is required here?

GL One theme we come back to a lot -- especially when I train public
officials -- is the idea of your own civic self-esteem or your own
civic self-image. If you internalize the demeaning, degrading
stereotypes that are peddled by the business climatologists and by the
site location consultants -- if you think your community really is
worthless -- then you've set yourself up to give away the store for a
bad deal.

The idea is not to internalize those demeaning stereotypes. To believe
that your community has real assets -- a good school system, a skilled
labor force, valuable business linkages that other companies would
like to link up to. When you've got some fundamentals that have real
value for companies, then you can drive a smarter bargain. Then you
can ask for job quality standards, for better wages and healthcare.
You can put a clause back in the contracts so that if the company
fails to deliver, taxpayers get their money back. And at the state
level you can even demand disclosure -- as we now have in twelve
states -- so that taxpayers can see every deal, every year, to measure
the cost against the benefits.

I like to think that we're close to a tipping point on the disclosure
debate. With twelve states now on line and some of them putting their
information on the web, we think that disclosure of subsidies is going
to become as mainstream as things like the disclosure of toxic
emissions which has been federal law for a very long time as well
under the Toxic Right to Know Law. We think it's approaching that
level of acceptance and legitimacy.

None of the states that have adopted these rules have hurt their
business climate. None of them are losing deals or losing businesses
as a result of putting some sunshine on the process. I think they are
making it easier for local officials to keep the bottom-feeders out of
the public trough, so to speak. And I think they are making it easier
for public officials to save their money for skills and infrastructure
and things that really work.

LC And that actually creates better paying jobs in the future, right?

GL Skills and infrastructure have always been proven winners for
creating good jobs. But now more than ever, it's an acute issue
because of the looming baby boom generation retirements that will
begin en masse -- as early as 2008 -- and because of the decrepit
condition of many parts of the American infrastructure system, which
have suffered because states and cities have had such budget crunches
for so many years.

So either we are going to let our infrastructure fall apart and hurt
everybody's productivity and we're going to ignore the massive loss of
skilled labor resulting when the baby boom hits the exit doors. Or,
we're going to massively redirect our money away from company
giveaways into things that benefit all employers. It's the only way to
cope with this very predictable train wreck.

Lakshmi Chaudhry is the former senior editor of AlterNet.

Copyright 2005 Independent Media Institute

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From: Rachel's Democracy & Health News, Jan. 5, 2006
[Printer-friendly version]

THE ECONOMIC COSTS OF ENVIRONMENTAL DISEASES AND DISABILITIES

By Kate Davies

[DHN introduction. In two other studies, found here and here, Kate
Davies has estimated that enviromment-related diseases in Washington
state cost somewhere betwen $2.8 and $3.5 billion per year. If these
costs were generalized to the entire U.S. population, the total cost
of environment-related diseases would be $132 to $165 billion each
year. However, as this article makes clear, there are large
uncertainties in these estimates. And of course such estimates
completely ignore the psychological and emotional costs of the human
suffering involved for the victims, their families, and their
communities.--DHN Editors]

Introduction

It has been said that economics is the only subject in which two
people can get a Nobel Prize for apparently contradictory research.
Joking aside, economics is quite literally a deadly serious business.
Especially when it comes to the health effects of toxic chemicals.

Environmental health advocates have long claimed that economics, and
more specifically the high costs of implementing environmental
protection measures, have been used to justify the continued use of
many toxic chemicals. They assert that government and industry are
reluctant to protect public health from exposure to toxic chemicals,
if it means implementing measures that would cost too much money and
reduce profitability. For example, lead based paint was banned in some
European countries as early as 1921 because of health concerns, but it
was not outlawed in the US until the 1970s. Similarly, information on
the risks of leaded gasoline was available for many years before
regulatory action was taken. Today, the health risks of asbestos,
mercury and many other toxic chemicals are generally acknowledged by
the scientific community, but these substances continue to be used and
released into the environment.

Environmental health policy decisions focus on the costs of taking
action to protect public health, while often ignoring the costs
associated with inaction. In particular, the continued use of toxic
chemicals has been associated with many chronic diseases and
disabilities, including cancer, birth defects, and learning and
developmental disabilities. These and other chronic diseases now cause
major limitations in daily living for more than one in every ten
Americans and account for more than 70 percent of the $1 trillion
spent each year on health care in the US . Although exposure to toxic
chemicals is only one factor in chronic disease causation,
environmental health policy decisions should take account of both
sides of the metaphorical coin -- both the costs of taking action to
protect public health, and the costs of inaction and continued
exposures to environmental hazards.

The idea that the health costs of environmental hazards should be
considered in policy decisions is not new. About 150 years ago,
Charles Dickens argued that the high cost of typhus in London (440,000
pounds in 1848 alone) should be considered in decisions about whether
to implement new public health measures. He commented: "This cold-
blooded way of putting the really appalling state of the case is,
alas, the only successful mode of appealing.... His heart is only
reached by his pocket." Placing an economic value on people's
suffering may be "cold-blooded", but it is necessary because
environmental health policy decisions are based primarily on an
economic metric. Nevertheless, monetary valuations can never take
account of the psychological and emotional costs of disease to
patients or to their families, friends and communities.

THE ECONOMIC COSTS OF ENVIRONMENTAL DISEASES & DISABILITIES

So what are the economic costs of environmental diseases and
disabilities today? This is a tricky question because it is difficult
to be precise about the proportions of different diseases and
disabilities attributable to environmental exposures, and because of
the challenges of estimating the economic costs of health conditions.

But in the past few years, a growing consensus has emerged on the
fractional amounts or percentages of some common diseases and
disabilities generally linked to exposure to environmental
contaminants. This is a result of increasing knowledge about gene-
environment interactions in disease causation, the determinants of
health, and the health effects of toxic chemicals. At the same time,
health economists have made significant improvements in "cost of
illness" models for most common health conditions. These models now
include direct healthcare costs, such as hospitalization, physician
and nursing services, prescription medications and home care, and
indirect costs, such as lost productivity and costs associated with
special educational and social services.

These advances are paving the way for the development of sophisticated
estimates of the costs of diseases and disabilities attributable to
environmental contaminants. Using cautious assumptions about health
and related costs, the environmentally attributable fractions of a
limited number of health conditions, and disease rates in populations,
researchers are beginning to generate conservative estimates of the
costs of diseases and disabilities attributable to environmental
contaminants.

The studies on the health and related costs of environmental
pollutants fall into three general categories. Early studies focused
on the costs of lead exposure. Key among these are Schwartz's and
Salkever's estimates of the earnings benefits from reduced childhood
exposure to lead. More recently in 2002, Grosse et al. were the first
to estimate the national economic gains resulting from increased
worker productivity associated with reduced lead exposure since the
1970s. Subsequent studies on the costs of lead exposure have gone
beyond looking at productivity and earnings, and have estimated costs
for special education and juvenile justice. Most recently, Trasande
et al. have calculated the costs of mental retardation attributable to
exposure to another heavy metal, methyl mercury.

The second type of study to estimate the health costs of environmental
pollution has focused on the costs of air pollution. An early study
in Pennsylvania estimated the hospitalization costs resulting from air
pollution and a major study conducted by the Ontario Medical
Association used a software model to estimate that air pollution costs
in the Province amounted to more than $1 billion a year in hospital
admissions, emergency room visits, and absenteeism .

The third type of study has focused on multiple disease outcomes,
especially in children. The first major national study considered
childhood asthma, cancer, neurobehavioral disorders, and lead
poisoning, and it estimated that the environmentally attributable
costs of these diseases and disabilities were $55 billion. This
study was followed by similar studies in Massachusetts, Washington,
and Montana.

These studies are important because they provide estimates of economic
costs that have been traditionally externalized from environmental
health policy decisions. Classic examples of costs usually
externalized from decision making include the costs of the raw goods
and services provided "free" by nature, such as: trees for lumber;
fish and agricultural crops for food; oil, coal and hydro-electric
power for energy; and air and water for industrial processing. Then
there are free waste disposal services provided by nature, also
usually externalized from decision making. These costs include water
purification functions provided by wetlands and other aquatic
ecosystems, and the ability of micro-organisms to break down some
environmental pollutants into less harmful substances. The emerging
discipline of ecological economics is beginning to estimate the costs
of these "free" goods and services provided by nature. This is a
useful way of pointing out the need to take account of all costs in
environmental policy decisions. The recent estimates of the health and
related costs of environmental diseases and disabilities add to this
emerging body of knowledge.

COST BENEFIT ANALYSIS

So how can information on the health and related costs of
environmental diseases and disabilities be internalized into
environmental health decision-making? One way is to incorporate it
into cost-benefit analyses. This can be done by seeing these costs as
economic benefits that would accrue if exposures were eliminated or
reduced. Indeed, one recent study has estimated the economic benefits
of public health improvements attributable to air pollution
regulations in the US . Cost-benefit analysis can be most useful to
policy-makers if it includes both types of information -- the costs of
protecting environmental health, and the health and related benefits
of doing so. To be comprehensive cost-benefit analyses should include
all costs and benefits to public health and to industry, not just
some.

A related issue is that the health and related costs of the continued
use of toxic chemicals are borne mostly by individuals, communities
and ultimately by society as a whole, rather than by those who are
responsible for producing, using, disposing of, and releasing toxic
chemicals into the environment. In contrast, the economic benefits of
the continued use of toxic chemicals go mostly to individual
companies. Hence, there is a disparity between who benefits and who
pays. This is a common problem with externalized costs: those who pay
the price are usually different from those who reap the benefits.

THE BOTTOM LINE

Incorporating health costs into environmental health cost benefit
analyses and other policy processes would provide decision makers with
more complete, balanced and accurate information. This would
strengthen decision making processes considerably. Indeed, a recent
study found that environmental health policy makers identified
information on the links between environmental health and the economy
as one of their key needs. Some may argue that we can never know the
exact costs of environmental diseases. This is a valid point, but even
if the recent conservative estimates are inaccurate by a significant
margin, the estimates show that the costs of environmental diseases
and disabilities run into tens of billions of dollars a year in the
US, possibly outweighing the costs of environmental protection.
Moreover, the estimated costs of environmental protection measures are
themselves based on many assumptions that are unlikely to be
completely precise or accurate.

What it comes down is this: The economic costs of environmental
diseases and disabilities are very significant and they are largely
preventable. By taking action to reduce or eliminate exposures to
toxic chemicals, the US could save billions of dollars a year in
health and related costs and significantly improve public health.

Kate Davies MA DPhil
Core Faculty, Environment & Community
Associate Director
Center for Creative Change
Antioch University Seattle

==============

References

Department of Health and Human Services. The Burden of Chronic
Diseases and Their Risk Factors: National and State Perspectives;
2004. Available here. Accessed December 4, 2005.

Johnson E. Charles Dickens: His Tragedy and Triumph Vol. 2 p. 715. NY:
Simon Schuster; 1952.

Schwartz, J , Pitcher H, Levin R, Ostro B, Nichols AL. Costs and
Benefits of Reducing Lead in Gasoline: Final Regulatory Impact
Analysis. EPA-230/05-85/006. Washington, DC:U.S. Environmental
Protection Agency, 1985.

Salkever, DS. Updated estimates of earnings benefits from reduced
exposure of children to environmental lead. Environ Res. 1995;
70(1):1-6.

Grosse SD, Matte TD, Schwartz J, and Jackson R. Economic gains
resulting from the reduction in children's exposure to lead in the
United States. Environ Health Perspect. 2002;110(6):563-569.

Stefanak M, Diorio J and Frisch L. Cost of child lead poisoning to
taxpayers in Mahoning County, Ohio. Public Health Reports.
2005;120:311-315.

Korfmacher KS. Long-term Costs of Lead Poisoning: How Much Can New
York Save by Stopping Lead? University of Rochester, 2003. Available
here. Accessed December 4, 2005.

Trasande L, Landrigan PJ and Schecter C. Public health and economic
consequences of methyl mercury toxicity to the developing brain.
Environ Health Perspect. 2005;113(5):590-596.

Carpenter BH, Chromy JR, Bach WD, LeSourd DA, and Gillette DG. Health
costs of air pollution: a study of hospitalization costs. Am J Pub
Health. 1979; 69(12):1232-1241.

Ontario Medical Association. The illness costs of air pollution in
Ontario: a summary of finding. Available here. Accessed December 4,
2005.

Landrigan P, Schechter C, Lipton J, Fahs M, and Schwartz J.
Environmental pollutants and disease in American children: estimates
of morbidity, mortality, and costs for lead poisoning, asthma, cancer,
and developmental disabilities. Environ Health Perspect.
2002;110(7):721-728.

Massey R, and Ackerman F. Costs of Preventable Childhood Illness: The
Price We Pay for Pollution. Global Development and Environment
Institute, Tufts University; 2003. Available here. Accessed December
4, 2005.

Davies K. Economic Costs of Diseases and Disabilities Attributable to
Environmental Contaminants. Antioch University Seattle, 2005.
Available here. Accessed December 4, 2005.

Davies K. How much do environmental diseases and disabilities costs?
Northwest Public Health WF5-1, 2005. Available here. Accessed
December 4, 2005

Bureau of Business and Economic Research. 2005 Databook Montana Kids
Count. University of Montana. Available here. Accessed December 4,
2005.

Yang T, Matus K, Paltsev S and Reilly, J. Economic Benefits of Air
Pollution Regulation in the USA: An Integrated Approach Report No. 113
MIT Joint Program on the Science and Policy of Global Change, 2005.
Available here. Accessed December 4, 2005.

Morrone M, Tres A, and Aronin R. Creating effective messages about
environmental health. J. Environ. Health. 2005;68:9-14.

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From: Rachel's Democracy & Health News #836, Jan. 5, 2005
[Printer-friendly version]

CORRECTION: SERIOUS ERROR IN RACHEL'S NEWS #835

Last week, in Rachel's #835 I misstated the history of economic growth
in the U.S. since WW II. I wrote, "But decade after decade since
World War II, economic growth rates have been stagnant or declining,
not just in the U.S. but throughout the "developed" world."

I should have written, "But decade after decade since 1970,
economic growth rates have been stagnant or declining, not just in the
U.S. but throughout the 'developed' world."

A corrected version of Rachel's #835 can be found here and a
corrected version of that particular essay can be found here.

The slowdown in economic growth has occured during the past 35 years.
It is particularly obvious when compared to the decade of the 1960s.

My thanks to Mike Hollinshead for pointing out the error.

Anyone who wants data on growth rates of the "developed" economies of
the world during the past 50 years can find it in these five books:

Bernstein, Michael A., and David E. Adler. Understanding
American Economic Decline. Cambridge: Cambridge University
Press, 1994. ISBN 0-521-45679-7.

Bjork, Gordon C. The Way It Worked and Why It Won't; Structural
Change and the Slowdown of U.S. Economic Growth. Westport, Conn.:
Praeger, 1999. ISBN 0-275-96532-5.

Cohen, Richard and Peter A. Wilson. Superpowers in Economic
Decline; U.S. Strategy in the Transcentury Era. N.Y.: Taylor
and Francis, 1990. ISBN 0-8448-1625-6.

Mardick, Jeffrey. The End of Affluence; The Causes and
Consequences of America's Economic Dilemma. N.Y.: Random House,
1995. ISBN 0-679-43623-5.

Shutt, Harry. The Trouble with Capitalism; An Enquiry into the
Causes of Global Economic Failure. London: Zed Books, 1998.
ISBN 1-85649-566-3.

--Peter Montague

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  Rachel's Democracy & Health News (formerly Rachel's Environment &
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  often considered separately or not at all.

  The natural world is deteriorating and human health is declining  
  because those who make the important decisions aren't the ones who
  bear the brunt. Our purpose is to connect the dots between human
  health, the destruction of nature, the decline of community, the
  rise of economic insecurity and inequalities, growing stress among
  workers and families, and the crippling legacies of patriarchy,
  intolerance, and racial injustice that allow us to be divided and
  therefore ruled by the few.  

  In a democracy, there are no more fundamental questions than, "Who
  gets to decide?" And, "How do the few control the many, and what
  might be done about it?"

  As you come across stories that might help people connect the dots,
  please Email them to us at dhn@rachel.org.
  
  Rachel's Democracy & Health News is published as often as
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