Has the Clean Water Act Reduced Urban River Pollution? A Natural Experiment

Republicans often question whether environmental regulation offers significant social benefits.   A recent fire at a New York City sewage treatment plant offers a nasty natural experiment.   The fire knocked out some of these treatment plants and the local rivers are now filled with poop.   As reported by the New York Times,  the Clean Water Act has significantly contributed to the “greening” of NYC as it provided the $ to pay for the sewage treatment plants.    

 An interesting urban public finance issue arises here. If the Clean Water Act had not provided funds for constructing high quality sewage treatment plants, would NYC have used its own local tax revenue to finance these investments?  Given that such investments raise local quality of life (and hence local real estate prices) should they be financed using federal $?    Is North Dakota subsidizing Don Trump and Derek Jeter’s exciting lifestyle?

Here is a good CBO report providing some historical details about federal involvement in local water issues.

Author: Matthew E. Kahn

Professor of Economics at UCLA.

16 thoughts on “Has the Clean Water Act Reduced Urban River Pollution? A Natural Experiment”

  1. A reasonable question, if every watershed had its own government. But NYC gets polluted on by towns upriver, and pollutes New Jersey. There’s plenty of external benefit in sewage treatment to justify some subsidy. And anytime North Dakota wants to pay the actual cost of postal service, telecoms, rail, and air, I’ll be all ears about the sufferings of its poor, exploited taxpayers. Due to the Senate, the entire American government is rigged to take money from cities and dump it in rural areas.

  2. “Is North Dakota subsidizing Don Trump and Derek Jeter’s exciting lifestyle?”

    Answer: As MK pointed out above, not hardly. But this misses a bigger point. The question is not “who subsidizes who”, it should be about the overall quality of life for all and capturing externalities, but then I feel we should expropriate the wealth of rich people, so what do I know.

  3. “..the entire American government is rigged to take money from cities and dump it in rural areas.”

    Agree. What would you expect from a system where NDakota has a US Senator for every 320,000 people and California two for 37,000,000?

  4. This sort of “I’m paying for his lifestyle” commentary (I mean in general, not at the RBC) seems so odd to me. Even forgetting MK’s comment on the subject. There are a fair few things that we are, as a country, all on the hook for: preservation of our resources, education and the military to name a few. We all benefit from the fact that cities aren’t the cesspools they were back at the turn of the last century. We also all depend on an interconnected economy with something like half the population residing in cities. Telling NYC to get stuffed isn’t in the cards. Also, there are a great many people in NYC who are not rich and/or famous who we should be considering besides Trump and Jeter. And finally, of all the things I can think of investing another moment on worrying about, this is pretty near the bottom.

  5. And then there is Wisconsin, under Republican rule…

    From Ruth Conniff in The Progressive (7/5/2011):

    “In the last two weeks of the [legislative] session…it managed to pass [a bill stating]:

    “‘the government may only require a property owner to replace or rehabilitate a failing residential private sewage system if…the discharge of sewage reaches a property owned by a different person.'”

    Heedless of the animals and physical processes that might shift the sewage off-site, or the lovely aromas to be generated, or public health risks of run-off and airborne viral and bacterial and protozoan particles, or the watershed, or the groundwater, or much of anything other than to declare that if you wish to have a sewage-filled yard, that is your lawful privilege, no matter what anyone has to say about it.

    Could the neighbors and those downstream invoke federal standards to remediate this? Why is sewage-freedom something anyone, Republican or otherwise, would choose to support?

    Why would anyone want to return us to the time of having to live amongst sewage?

  6. Interesting post, but the “is-North-Dakota-subsidizing-New-York-City” question clouds the waters (so to speak).

    Take, for example, the state of Maine—home of the principal author of the Clean Water Act, Sen. Edmund Muskie. Before the Clean Water Act, every major river in Maine was horribly polluted. The Androscoggin was one of the 10 most polluted rivers in the country. The Kennebec changed color depending on what color paper the mills were producing.

    Yes, the Senate is rigged to subsidize rural areas. But the Clean Water Act is one example of the kind of law and tax policy that’s best done at the federal, and not at the state or local level. Same rules for everyone across the country. Same benefits for everyone too.

    See. Sometimes politics really can be “win-win”.

  7. “Is North Dakota subsidizing Don Trump and Derek Jeter’s exciting lifestyle?”

    Piling on here – first, ND is being subsidized; please note the *direction* of the money flows, Matthew. Second, even if ND were in some Bizarro World subsidizing NYC’s sewage treatment plants, how would that affect Trump and Jeter, any more than any other person?

  8. And an additional piling on – again, even if ND were in some Bizarro World subsidizing NYC’s sewage treatment plants, why would one not phrase it as ‘wealthy ranchers subsidizing poor NYC residents’?

  9. I, for one, am happy we have a law that makes is unlikely that I could toss a match in a river and have it go up in flames.

  10. Kathleen – Because we are Americans, and we hate ourselves. Correction: Because *some* Americans hate America and hate Americans.

    A lot of American idiosyncrasies can be explained by self-hatred and self-spite rooted in puritanism.

  11. I don’t know the history of NYC’s water treatment plants. But if there’s any parallel to our experience here in Atlanta, my guess is they didn’t sprout up because folks thought it would be awesome to have clean water in their rivers no matter what the cost. Sadly, most people don’t appreciate the Good until the Bad is removed. My guess is that folks complained about water quality up until they saw the price tag for fixing it themselves. Now it’s possible a Trump and/or Jeter could have stepped up and helped finance a deal but I don’t even want to contemplate what the outcome of that would look like. So Clean Water Act funding helped make possible a project that the locals were unable to do on their own. And OK, “unable” in the sense that it was a burden they were unwilling to shoulder all on their own. Absent specific data, I can’t say whether that was reasonable or not.

    Water is a shared resource. Atlanta didn’t get its act together on its own. Downstream cities and activists sued the EPA which kicked our butt to do the right thing. Even then we dragged our feet until the courts stepped in.

  12. If it were only New York, you’d have a point. Ultimately, though, nearly every municipality gets its turn. And given the daunting cost of sewage system upgrades (my own fair city’s in-the-works overhaul to comply with California standards costs roughly $2,000 per resident in capital costs — just to keep flushing the toilet) on localities, there’s a strong argument for federal assistance. Many areas cannot afford or in practice find raising rates enough politically impossible. What else are the feds going to do? Shut down their water plants? Fine them out the wazoo? A little carrot works wonders.

  13. Commenters are missing the larger picture, as usual.

    If we didn’t have public sewage treatment, there would be that many more opportunities for capitalists to profitably adapt!

  14. Good thing federal money doesn’t come from the citizen of all the states, and that no rivers cross state boundaries, much less serve as state boundaries.

  15. “I, for one, am happy we have a law that makes is unlikely that I could toss a match in a river and have it go up in flames.”

    Of course we have (multiple) such rivers in Montana right now, thanks to the sort of thinking Matthew praises…
    I’m sure we can sort it all out and come to a reasonable and efficient settlement by striking Coasian bargains between every pair of the millions of people somehow involved in this.

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