How Would Business Function in the Absence of Environmental Regulation?

Here’s an ad for a seminar on sustainability.

Waste. It’s more than an environmental taboo; it’s a total disregard of valuable resources. And that affects everyone’s bottom line. Brand reputations, market share and valuation depend on meeting objectives. How do you achieve optimal energy, environmental, and fiscal practices?

And here’s the issue I have with it: While it’s true that businesses would like to remove all waste from their processes, it’s generally not at all cost-effective to do so. The company I referred to here that had been dumping water with 15 parts of mercury per billion (a hugely toxic level) into the local river would rather not waste anything at all, but the capturing of that mercury cost them millions of times the value of the mercury itself.

I recall that Jerry Taylor of the Cato Institute and I had essentially the same discussion. He slipped into the same piece of bad logic, claiming that businesses regulate themselves, because they have a natural repugnance for waste. It’s true that they’d rather not waste, but that doesn’t mean that it’s cost-effective for them to eliminate all waste.

Trust me, without environmental regulation, we’d live in a world of hurt.