Bureaucrats Completely Incapable of Making Reasonable Trade-Offs

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Francis Menton

In economic life, trade-offs are a constant issue for everybody. Maybe you want to buy some better clothes, so you decide to economize on groceries. Or you postpone upgrading the bathroom because the kitchen needs upgrading first. Or you skip a vacation this year in order to buy a new car. Everything you buy means something else you can’t buy, so every buying decision necessarily involves trade-offs. And the same principle applies to use of your time: every hour you spend on one thing you can’t spend on something else. Learn Spanish this year, or train for the marathon — you’ll never find time for both.

Government faces the same necessity for trade-offs, but unfortunately is subject to bad incentives that often render the making of reasonable trade-offs next to impossible. The government is divided into siloed bureaucracies, each of which thinks its own area is the most important. Nowhere is this phenomenon more pronounced than in the environmental bureaucracies, which include not only EPA but also big swaths of places like the Departments of Energy and the Interior. These bureaucracies are staffed by environmental zealots bent on saving the planet, and they find the whole concept of trade-offs abhorrent. How about things like the prosperity of the people, or human convenience, or comfort? Somehow those things don’t count for anything to the environmental functionary.

This phenomenon of inability to make remotely reasonable trade-offs has been on full display in some of the environmental news of the past couple of weeks.

Take as one example the new dishwasher rule, announced on May 5. This one comes from the Department of Energy. It imposes on dishwasher manufacturers what they call “new standards for water and energy efficiency.” In the press release, the main sales pitch to the people is that this is going to save you money — lots of money — along with reducing “carbon emissions” and “saving water.”:

DOE expects the new rule to save consumers nearly $3 billion in utility bill savings over the ensuing 30 years of shipments and reduce carbon dioxide emissions by 12.5 million metric tons—an amount roughly equivalent to the combined annual emissions of 1.6 million homes. DOE also expects the new rule to save 240 billion gallons of water, which is equivalent to the water in 360,000 Olympic-sized pools. 

$3 billion — that’s a lot of money! Actually, not. It’s $3 billion over 30 years, or $100 million per year. There are 123 million households in the U.S., so this is well less than one dollar per year per household. Similarly, the supposed CO2 emissions reductions are less than trivial: 12.5 million metric tons over 30 years is 417,000 metric tons per year. That compares to some 6.34 billion metric tons of emissions for the U.S. in 2021, and 37.12 billion metric tons for the world. So the reduction in CO2 emissions, if actually achieved, would be 0.0066% of U.S. emissions, or 0.0012% of world emissions. But wasn’t U.S. electricity production supposed to be carbon free by 10 years from now? If so most of the supposed emissions reductions from more efficient dishwashers will never happen.

Meanwhile, everyone has noticed that prior Department of Energy energy and water efficiency standards for dishwashers have had the effect of making them run much longer and not get the dishes clean. The new standards, requiring the use of even less water and electricity to wash the dishes, can only make things worse. All to save less than a dollar a year? Almost everybody would gladly pay an extra dollar per year — or maybe even five — for a dishwasher that actually worked. Why can’t we have that option? Because the environmental crazies at the DOE couldn’t care less about making you waste your time pre-washing dishes or waiting for an endless cycle to end before you have the dishes to cook dinner.

On a much grander scale, consider the rule with the title “Multi-Pollutant Emissions Standards for Model Years 2027 and Later Light-Duty and Medium-Duty Vehicles,” also published on May 5. This one comes from EPA. It is the rule that effectively requires the phase-out of gasoline-powered cars by about 2032, in favor of electric vehicles.

The success of gasoline-powered vehicles in the marketplace up to the present has been the result of multitudes of trade-offs made by the consumers for their own benefit. These trade-offs include things like: the initial cost of the new vehicle, the range of the vehicle on a single fueling, how long it takes to re-fuel, how easy and costly it is to repair the vehicle if damaged, how much value the vehicle retains for re-sale, how difficult or dangerous it is to store the vehicle, and many other such factors.

Well, now EPA has decided, on its own authority, that none of those things is as important as the one thing they focus on, which is CO2 emissions from the vehicle while in operation. Note that emissions from the vehicle while in operation is not at all the same thing as lifetime emissions from the vehicle, which include both emissions from the mining and manufacturing to make the vehicle, and also, in the case of EVs, emissions from the sources used to generate the electricity to run the vehicle, which are majority fossil fuels in most cases and will continue to be so for the foreseeable future.

Where in a sane world there are many important trade-offs to be made in deciding what type of vehicle to use, EPA never even gets to that issue. Their sole focus is reducing carbon emissions. If that means that you must spend double for a vehicle, or spend hours per day at a charging station, or risk having your vehicle spontaneously catch fire in the garage and burn down the house, that is not important to them.

What are the chances that an EPA or a Department of Energy could ever by regulation make trade-offs on important issues like these that actually make sense for consumers to advance their welfare? About zero. They’ve got a sole focus, and if that means destroying your lifestyle, they are only too glad to do it.