Cost-Benefit Analysis Lesson Plan Slide #5 Pros: Yes.

An alternative would be to state costs in dollar terms but benefits in lives and other values. Then, costs take on a role rather like one hand clapping: there is nothing offered in opposition to them, so its hard what to make of the benefits. Cons: Lives / environmental benefits cannot be measured in dollars. Slide #6 -Major issue: extrapolation from animals to humans. There are few human studies for many existing chemicals, and ethical considerations preclude experimentation on human beings. In many cases, toxicological tests on laboratory animals are the only source of relevant data. This empirical information must then be extrapolated to actual environmental settings, which may be very different from those under which the data were collected. For instance, animal tests are ordinarily conducted at high doses and over a short period by comparison with the levels to which human beings typically experience long-term exposure to environmental toxins. Limits: (1) Hazard identification: There are few chemicals on which the human data are definitive. The question is often whether the chemical causes cancer in animals. Chemicals may have other effects other than cancer (e.g., asbestosis; neurological effects in children from lowlevel lead exposure). Timing of exposure is also important (e.g. fetal exposure to hormonedisrupting chemicals). (2) Dose-response assessment: A dose-response assessment usually requires extrapolations from high to low dose and from animals to humans. Slide #7 Q: What is ToSCA? A: A market access, front-end control law, TSCA addresses the production, importation, use, and disposal of specific chemicals including polychlorinated biphenyls (PCBs), asbestos, radon and lead-based paint. Slide #8 Corrosion Proof Fittings v. EPA, 5th Circuit 1991 Facts: In 1989, after ten years of study, EPA issued a final rule prohibiting the future manufacture, importation, processing, and distribution of asbestos in almost all products. The results of the EPA rulemaking were challenged. Issues: Appropriateness of discounting the perceived benefits of the EPAs rule Appropriateness of using unquantified benefits to justify calculations as to which the benefits seem far outweighed by costs. (EPA only quantified the lives saved over the next 13 years and counted any additional lives saved as unquantified benefits.) Conclusion: Rulemaking found wanting. EPA basically didnt give any weight to the cost side of the equation, and just allowed any cost to justify the benefits it found. EPA needs to be more disciplined in its balancing; there need to be some boundaries to allow a fair comparison of costs with benefits. Reasoning: Discounting benefits: Various commentators dispute whether it is ever appropriate to discount benefits when they are measured in human lives. But it would skew the results

to discount only costs without according similar treatment to the benefits side of the equation. Unquantified benefits: Calculations that include unquantified benefits not only lesson the value of the EPAs cost analysis, but also make any meaningful judicial review impossible. Unquantified benefits can at times be used to tip the balance in close cases, but cannot be used to effect a wholesale shift.