Last week the Trump administration confirmed that environmental regulations are good for the economy. This may sound like “fake news,” but the numbers are unambiguous: According to Trump’s Office of Management and Budget, every dollar spent on environmental compliance generates six dollars in economic benefits.
Every year the White House Office of Management and Budget (OMB) releases a report on the “Benefits and Costs of Federal Regulations.” And every year these reports show that the economic benefits of regulations outweigh the costs, by large margins. Last year we looked at the 2015 report OMB report, which covered the 2004-2014 time period. According to that report, the benefits of EPA regulations were roughly ten times higher than the costs.
The latest OMB report is officially the draft 2017 report, and it covers regulations issued in 2006-2016. The benefits continue to outweigh the costs, in this case by a ratio of roughly 6:1, over that ten-year period. And this is true every single year: The OMB report only provides year-by-year costs and benefits for all regulations (including environmental and other regulations), but overall, and for any given year, every dollar in compliance costs generates between $3 and $20 in economic benefits.
To look at this another way, the OMB report shows that over the 2006-2016 time period, environmental regulations have created a net economic benefit of over $300 billion per year.
The upshot should be clear – environmental regulations are good for the economy. And it’s not just the cost-benefit math that shows this. As we and others have noted elsewhere, there is no truth to the claim that environmental regulations “kill” jobs. In fact, they are more likely to lead to job growth.
Trump and EPA Administrator Scott Pruitt like to complain about job-killing regulations, but they are just blowing smoke, according to the Trump administration itself. They also boast about regulatory rollbacks, which is tantamount to boasting about how effective they are at hurting our economy and putting our children’s health at risk. Trump’s regulatory rollbacks are profoundly misguided, and by any measure bad for the country. He should listen to his bean-counters. Protecting the environment is a win-win; good for our kids, and good for our pocketbooks. We should be doing more, not less.