11
Aug
2005

Prices and Values: Why Economics Fails as a Sole Foundation of Public Policy

by Ernest Partridge

Immediately upon assuming office in 1981, President Ronald Reagan issued an Executive Order requiring all federal administrative agencies and departments to justify proposed regulations with a cost-benefit analysis. Similarly, on his first day in office, January 20, 2001, George Bush ordered all cabinet officers to withhold implementation of more than fifty federal regulations that had been approved late in the Clinton administration. They were to be kept “on hold” until Bush’s Office of Management and Budget determined that their benefits exceeded their costs. As Amanda Griscom (of grist.com) reported in September 2003: “The frozen rules included more than a dozen significant environmental ones. They called for less arsenic in drinking water, a ban on snowmobiles in national parks, controls for raw sewage overflow, stronger energy-efficiency standards, and protections against commercial logging, mining, and drilling on national lands. Of the environmental regulations that came under scrutiny, only half have since made it past the cost-benefit analysis and into the Federal Register.” Cost-benefit analysis (CBA), an exclusively economic assessment of public policy proposals, is based upon the assumption that the public values that enter into policy decisions can all be quantified in monetary terms. This is a remarkably impoverished concept of “values” to be coming from an administration that proclaims its commitment to “moral values.”....

//www.dissidentvoice.org/Aug05/Partridge0810.htm
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