WSJ Editorial Contradicted Own Paper's Reporting By Claiming EPA Never Considered Costs

Supreme Court Heard Oral Arguments In Case Challenging EPA's Decision Not To Consider Costs Before Deciding To Regulate Toxic Pollutants. National Journal reported:

On Wednesday, justices heard oral arguments in a case challenging whether the EPA was justified in deciding to regulate mercury and other pollutants based solely on the fact that exposure posed a public health threat.

A decision is expected in June.

At issue is the agency's decision not to consider how much the rule would cost for the utility industry to comply with before deciding it would set limits on toxic pollutants. 

[...]

Administration officials say the EPA was justified in considering cost after making the decision to regulate, rather than before. [National Journal, 3/25/15]

WSJ Editorial: EPA Never “Considered Costs” When Setting Mercury And Air Toxics Standards. In a March 25 editorial, the Wall Street Journal claimed that Supreme Court Justice Stephen Breyer “pull[ed] a fast one” during oral arguments by suggesting that the EPA could consider costs “at some point later ... after deciding to regulate” toxic pollutants. The Journal editorial board claimed that Breyer's “invention” would require belief in a “fantasy EPA” that after initially ignoring costs would “all of a sudden become reasonable at step two.” The Journal then further claimed that the EPA acknowledged it “didn't” consider costs:

[Justice Breyer suggested] that the EPA will consider costs at some point later when it enforces the mercury rule. The Clean Air Act allows the [EPA], after deciding to regulate, to divide power plants into different “sub-categories” and apply tailor-made rules to each if they are also “appropriate and necessary.” The EPA could in theory use this discretion to mitigate any inappropriate costs.

The problem is that this invention requires you to believe in a fantasy EPA that, having willfully disregarded the statute at the “appropriate and necessary” listing stage, will all of a sudden become reasonable at step two. The EPA has never taken Justice Breyer's position, and administrative law requires the agency to explain its decision-making. Neither did the Administration nor any friend-of-the-court brief during the Michigan litigation.

Justice Breyer's theory is also self-contradictory on the merits. If the EPA had determined at the outset that costs could be assuaged at some late date, then it would have considered costs--exactly what it asserted it didn't and wasn't required to do. [Wall Street Journal editorial, 3/25/15] (emphasis added)

WSJ News Article: "[The EPA] Said It Took Costs Into Account Later When It Determined Exactly How To Set Emissions Standards." By contrast, a March 25 Wall Street Journal news article reported that the agency did, in fact, explain that costs were considered at the later stage:

[The EPA] said it was appropriate to consider only public health risks--not industry costs--when it decided to regulate coal- and oil-fired generation plants. That decision was the crux of 90 minutes of oral argument.

The court was considering a section of the Clean Air Act that said the EPA “shall” regulate utilities' emissions of the hazardous air pollutants if it found that such regulation “is appropriate and necessary.” The agency said it took costs into account later when it determined exactly how to set emissions standards. [The Wall Street Journal, 3/25/15]

Oral Arguments, Legal Documents Make Clear EPA Did Consider Costs When Setting Standards

U.S. Dept. Of Justice Brief For The Case: EPA Does Not Consider Costs When “Assessing the Dangers,” But Does Later When “Setting Standards.” In its brief on behalf of the EPA in Michigan v. EPA, the U.S. Department of Justice noted: “EPA does not consider costs when assessing the dangers at the first stage, but it does consider costs, in accordance with the relevant provisions, when setting standards at the second stage.” At one point Justice Breyer himself recognized this point during the Supreme Court's oral arguments in the case, stating: "[T]he [Solicitor General's] brief unambiguously required EPA to consider costs at the second stage of the regulatory process. That's what it said." During oral arguments, Justice Sonia Sotomayor similarly noted to U.S. Solicitor General Donald Verrilli: “Basically, you have consistently in your brief, and so has the  other Respondents, basically said at the listing stage we don't consider costs, we consider it later.” [U.S. Supreme Court Oral Arguments, Michigan v. EPA, 3/25/15; Michigan v. EPA, Brief for the Federal Respondents, accessed 3/26/15]

U.S. Solicitor General During Oral Arguments: EPA Did Consider Costs At A Later Stage By Separating Out Standards For Different Types Of Power Plants. During the Supreme Court oral arguments Verrilli directly responded to Breyer's inquiry about addressing costs by noting that EPA placed different sources into “subclasses.” Verrilli stated: “And EPA did that in this case. It broke out power plants that generate power burning natural gas, and it said that's a separate subcategory.” In addition, Paul M. Smith, an attorney representing industry groups that side with the EPA, noted: "[The EPA] categorized oil-fired plants into four categories. They categorized coal-fired plants into various categories. And that was all done through a notice and comment process which led then to different emission standards." Smith then confirmed to Justice Anthony Kennedy that this was “done based on cost.” As Supreme Court Justice Elena Kagan described it, “costs become relevant later in the analysis, and in a variety of ways.” [U.S. Supreme Court Oral Arguments, Michigan v. EPA, 3/25/15]

NYU's Institute For Policy Integrity: Federal Regulatory Review Confirms “EPA Considered Costs And Benefits In A Reasonable Manner.” In an amicus curiae supporting the EPA's position in the case, the New York University School of Law's Institute for Policy Integrity noted:

When a rule's benefits do not justify its costs, [the Office of Information and Regulatory Affairs] OIRA can return a rule to the proposing agency for further review.

[...]

Here, OIRA reviewed EPA's analysis, including the Rule's substantial indirect benefits, and allowed the agency to proceed, indicating that EPA considered costs and benefits in a reasonable manner. [Institute for Public Integrity amicus curiae in Michigan v. EPA, accessed 3/26/15; OIRA regulatory review, Fall 2011]

Business Insider: “The EPA Did Factor In Costs At A Later Stage.” Business Insider reported, “The EPA did factor in costs at a later stage when it wrote standards that are expected to reduce the toxic emissions by 90 percent.” [Business Insider, 3/25/15]

Vox: EPA Says It Considered Costs When Setting Regulations. According to Vox, “the agency considers costs in the later stage, when it's actually setting regulations. And, the EPA says, that's what it did.” [Vox, 3/25/15]

WSJ Editorial Deceptively Compared Full Cost Of Rule To A Fraction Of Its Health Benefits

WSJ Editorial: Reducing Mercury Emissions Will "Produce Merely $500,000 To $6 Million In Direct Public Health Benefits." The Journal editorial alleged: “The EPA's own estimate shows that reducing mercury emissions will produce merely $500,000 to $6 million in direct public health benefits annually. But it will cost the electric industry some $10 billion a year to comply--meaning as much as $20,000 may be needed to produce a single dollar of gains.” [Wall Street Journal editorial, 3/25/15]

WSJ News Article: EPA Found “The Actual Benefits Of The Regulations Would Be At Least $37 Billion.” By contrast, the Wall Street Journal news article noted that Solicitor General Verrilli “referenced EPA findings that the actual benefits of the regulations would be at least $37 billion.” Indeed, in its regulatory impact analysis, the EPA found that the Mercury And Air Toxics Standards would “yield annual monetized benefits (in 2007$) of between $37 to $90 billion,” largely due to “co-benefits from 4,200 to 11,000 fewer [fine particle pollution]-related premature mortalities.” [The Wall Street Journal, 3/25/15; EPA Regulatory Impact Analysis for the Mercury and Air Toxics Standards, December 2011]

EPA: Agency Reduced Costs In Response To Public Input, Allowing Americans To Get $3-9 In Health Benefits For Each Dollar Spent On The Rule. According to an EPA fact sheet on the Mercury and Air Toxics Standards:

After proposal, EPA received more than 900,000 comments. Based on this input and data, the agency has finalized standards that follow the law, maintain vital and significant health benefits and can be implemented for $9.6 billion, about a billion dollars less than the proposed standards. That means that for every dollar spent to reduce pollution, Americans get $3-9 in health benefits in return. [EPA Fact Sheet, accessed 3/26/15]

Even Health Benefits Just From Reduced Mercury Pollution Are Likely Higher Than Figures Cited By WSJ. The figure the Journal editorial cited was based on EPA's estimate of the “economic benefits associated with avoided IQ loss due to reduced [mercury] exposure among recreational freshwater anglers” in the continental United States.   However, while the EPA noted that “ingestion of fish” is the “primary route for human exposures in the U.S.,” it added that limitations on the ability to measure the full economic value of reduced mercury pollution “suggest that the benefits of mercury reductions are understated by our analysis.” [EPA Regulatory Impact Analysis for the Mercury and Air Toxics Standards, December 2011]

WSJ Editorial Baselessly Dismissed Dangers From Mercury Pollution

WSJ Editorial Claimed Mercury Pollution Is Not Worthy Of Concern. In order to smear the EPA's intentions, the Wall Street Journal editorial claimed: “Mercury pollution is already de minimis and well controlled, but the rule isn't really about mercury. It is part of the EPA's larger campaign to drive coal-fired power plants out of business.” [Wall Street Journal editorial, 3/25/15]

WSJ News Article: EPA Said Power Plants Are Single Largest Source Of Mercury, Which Can Be “Particularly Harmful To Children And Unborn Babies.” In contrast to the editorial, the Wall Street Journal news article reported, “The EPA said such plants are the single largest source of U.S. emissions of mercury, a neurotoxin that can be particularly harmful to children and unborn babies. [The Wall Street Journal, 3/25/15]

Greenwire: Scientists Say Each Pound Of Mercury In The Environment Makes 2 Million Pounds Of Fish Unsafe To Eat. According to a Greenwire report:

The sectors subjected to new rules -- coal plants, industrial boilers, cement plants, hazardous waste incinerators, gold mines and chlor-alkali plants -- together produce about 80 of the 100 tons of mercury that American facilities release into the air each year.

That doesn't sound like much, considering the United States produces 6 billion tons of carbon dioxide per year, but mercury is extremely potent. Scientists estimate that 1 pound in the environment is enough to make about 2 million pounds of fish unsafe to eat. [Greenwire,12/8/10]