Explaining Regulatory Policy Divergence
Explaining Regulatory Policy Divergence
Abstract and Keywords
This chapter explores several alternative explanations for the divergence in transatlantic risk regulation, and discusses the policy shifts that have taken place on both sides of the Atlantic since around 1990. The United States and the fifteen member states of the EU are affluent democracies with sophisticated public bureaucracies, substantial scientific capacities, and strong civic cultures. Their regulatory officials have access to much of the same scientific expertise and there is extensive communication among policy makers, scientists, business managers, nongovernment organizations, and citizens. The chapter shows how divergent risk regulations between the United States and the EU add to the costs of transatlantic commerce and also raise the costs of international trade as some countries adopt European standards and others adopt American ones.
A Policy Puzzle
The extent to which transatlantic regulatory policy divergence has increased during the last two decades presents a puzzle. When compared to the rest of the world, Europe and the United States have much in common. The United States and the fifteen member states of the EU (as of 2003) are affluent democracies with sophisticated public bureaucracies, substantial scientific capacities, and strong civic cultures. Their regulatory officials have access to much of the same scientific expertise and there is extensive communication among policy makers, scientists, business managers, nongovernment organizations (NGOs), and citizens. Thanks to the spread of global media, many Americans and Europeans are well informed of policy developments on the other side of the Atlantic.
Moreover, their economies have become increasingly interdependent. “The transatlantic trade and investment relationship has become a super highway.”1 Bilateral trade in goods between the EU and the United States totaled $563 billion in 2007; each is the other’s second most important trading partner. European investments in the United States total $1.5 trillion, and American firms have investments of approximately $1.7 trillion in the EU.2
The result is a staggering degree of interdependence between the two economies, not least because the fabled US and European multinationals are now so thoroughly intertwined by mergers and cross-fertilization. Something close to a quarter of all US-EU “trade” simply consists of transactions within firms with investments on the other side of the Atlantic.3
Divergent risk regulations between the United States and the EU add to the costs of transatlantic commerce and also raise the costs of international trade as some countries adopt European standards and others, American ones. Improving regulatory cooperation and coordination has (p.23) accordingly become an important objective of global firms and government officials on both sides of the Atlantic.4 Why, then, has transatlantic regulatory polarization increased in so many important policy areas?
Alternative Explanations for Regulatory Policy Divergence
There are a number of alternative explanations for why many American and European risk regulations have diverged since 1990, which I want to critically review before presenting my own explanatory framework in more detail.
Differences in Actual Risks
The most obvious explanation for the differences in the stringency of a wide range of European and American regulations is that they represent a response to differences in the actual risks their citizenry faces. However, cross-national differences in environmental quality cannot account for recent differences in the scope and stringency of risk regulations across the Atlantic. According to a careful and detailed quantitative analysis of changes in national environmental performance among seventeen industrial democracies between 1970 and 1995, all but two of the twelve EU member states included in this study had higher total performance scores for overall environmental quality than the United States.5 A narrower study that measured the percentage changes in national SO2 emissions between 1985 and 1995 reported that these emissions declined less in the United States than in all but two member states of the EU.6 A global environmental index published in 2002 found that environmental quality in the member states of the EU and the United States was roughly comparable: environmental quality in the (p.24) United States ranked poorer than in four member states, better than in five, and similar to seven.7
If we accept the data presented in the first two studies, then the United States should have recently enacted more stringent environmental regulations than the EU, as its environmental quality was poorer. If we accept the data presented in the third study, namely, that each had comparable levels of environmental quality, then the stringency of more recently adopted American and European environmental regulations should have been roughly similar. But neither of these outcomes occurred.
Still, it is possible that many of the specific differences in American and European risk regulations might be due to variations in the actual risks their citizens faced. For example, mad-cow disease posed significantly greater risks for Europeans than for Americans; one would therefore have expected European regulations for animal feed and testing linked to BSE to be more stringent and extensive than those of the United States, which they were.
But more commonly there has been little or no relationship between the magnitude of actual harms or risks faced by citizens in either Europe or the United States and the response of policy makers to them. For example, during the early 1960s, substantially more Germans and British than Americans were harmed by the drug thalidomide, which had not even been approved for sale in the United States. But the United States responded by enacting far more stringent regulations for the approval of new medicines than both Germany and Britain.
For the vast majority of American and European regulatory policies described in this study, it is difficult to discern any apparent differences in the actual risks faced (or not faced) by Europeans and Americans. Lead in petrol/gasoline posed no more or fewer health risks to Americans than to Europeans, yet this fuel additive was phased out much more rapidly in the United States than in Europe. Many American food safety regulations adopted during the 1960s and 1970s were more risk-averse than many European ones, yet the health risks of consuming the substances banned in the United States were the same as for Europeans. The risks to Europeans of ozone-depleting chemicals were not substantially different than those faced by Americans, yet the United States acted much more rapidly to restrict them.
Likewise, the risks to the health and safety of Europeans from beef or milk hormones, antibiotics in animal feed, hazardous substances from e-waste deposited in landfills, phthalates in children’s products (p.25) and cosmetics, chemicals in general, and the consumption and production of genetically modified (GM) foods have been no different than those Americans faced. Nor can it be plausibly argued that Europeans face more risks from global climate change than do Americans. In each of these cases, what was different was not the actual risks themselves, but rather the public’s perception of them, which in turn helped shape differences in the extent and intensity of political demands to address them.
A second explanation for this divergence has to do with historical differences in the expansion of regulatory authority across the Atlantic. Because many national European regulations were weaker than American ones during the 1970s and 1980s, by around 1990 the EU arguably had to do more to “catch up.” This does explain those policy areas in which European regulations have become both more stringent and more similar to those in the United States, such as for lead in gasoline/petrol, automotive emissions, and ozone depletion.
However, this explanation cannot account for the fact that many European regulatory policies adopted since around 1990 are more stringent than those earlier adopted by the United States. Chemical regulations are an important example. The 1976 Toxic Substances Control Act (TSCA) imposed more stringent and comprehensive safety and environmental regulations than did the EU’s Sixth Amendment. Accordingly, the EU might have been expected to “catch up” to the United States by adopting new chemical regulations roughly similar to the TSCA. But the provisions of REACH went significantly beyond those of the American regulatory statute; indeed, they made EU chemical regulations the most precautionary and comprehensive in the world. Nor can a “catch up” theory explain why the EU has enacted more stringent regulations for beef and milk hormones, antibiotics in animal feed, chemicals in cosmetics, GM food, and global climate change.
Since the EU only acquired the authority to harmonize a broad range of environmental and consumer regulations after the mid-1980s, and the American federal government began expanding its consumer regulations around 1960 and its environmental regulations around 1970, one would certainly have expected the EU to have issued more regulations or directives than the American federal government since 1990, which it has. But this does not explain why many of the standards that the EU enacted were more stringent and comprehensive than those of the United States.
A third set of explanations focuses on variations in rates of economic performance and relative living standards. Public support for more stringent risk regulations arguably is affected by economic conditions: accordingly, higher growth rates are likely to increase the rate at which new environmental regulations are enacted—both by exacerbating many environmental problems and making policy makers more willing to impose additional costs on firms—while slower growth rates are likely to make both the public and policy makers more sensitive to the costs of additional regulations. Regulatory stringency is also affected by differences in per capita income: richer nations are more likely to enact more stringent and extensive regulations than less affluent ones.
In the United States, real GDP growth averaged 5 percent between 1965 and 1969, and after a slight downturn in 1970, grew by roughly 5 percent between 1971 and 1973. Concomitantly, the late 1960s and early 1970s witnessed an historic expansion of federal environmental regulation: Congress enacted eight important regulatory statutes between 1969 and 1973. However, the ambitious automobile emission standards of the 1970 Clean Air Act Amendments were subsequently modified in response to the stagflation of the mid-1970s and fewer new regulations were adopted during the economic downturn of the early 1980s. Similarly, the relatively strong growth rates that resumed around 1984—GDP growth averaged 4.3 percent between 1984 and 1989—contributed to the second major expansion of American environmental regulation which took place around 1990.
But while variations in economic performance are associated with many of the changes in American environmental policy between 1969 and 1990, they cannot satisfactorily account for policy developments between 1990 and 2007. After a slowdown in the early 1990s, a long sustained economic expansion began in 1992, with growth rates averaging 3.8 percent over a period of nine years; American incomes grew by 14 percent between 1993 and 2000. The American economy also continued to perform relatively strongly through 2007, with growth rates averaging 3.2 percent from 1993. Yet beginning in the early 1990s, there was a marked decline in the enactment of more stringent risk regulations in the United States.
Moreover, between 2000 and 2007, a period when many of the more stringent risk regulations described in this book were adopted in Europe, annual GDP growth in the United States averaged 2.6 percent as compared to 2.2 percent in the EU-15. If economic growth rates were a critical determinant of national regulatory policies, then since 1990 the United States should have continued to adopt more stringent regulations than the EU, at least prior to the economic downturn that began in 2008. In addition, during the first decade of the twenty-first century, GDP per (p.27) capita was roughly 40 percent higher in the United States than in the EU-15. Finally, if citizens in more affluent societies are more likely to share “postmodern” values, then both the United States and Europe should have steadily increased the scope and stringency of their risk regulation.8 But the United States did not do so.
The Role of Economic Interests
Another explanation for the differences in European and American regulatory policies has to do with the dynamics of global business competition. More specifically, the EU’s more stringent risk policies enacted since around 1990 may reflect, or at least may be consistent with, the competitive interests of European firms. The fact that many European regulations have been criticized as non-tariff trade barriers by the United States and three have been the subject of formal World Trade Organization (WTO) dispute proceedings brought by the United States (and other countries) makes this explanation a plausible one.
But it is important to distinguish between regulatory policies that disadvantaged American producers and those that advantaged European firms. In fact, the first of these disputes, the EU’s beef hormone ban, did not reduce beef imports into Europe; rather, it shifted their sources to countries whose farmers made less extensive use of hormones. Moreover, the hormone ban was also strongly opposed by several European countries who were important beef producers. The banned hormones themselves were produced by both European and American firms, all of whom strongly opposed and were adversely affected by the EU’s decision to ban their use.
In the case of the second of these disputes, over genetically modified organisms (GMOs), while European imports from the United States of corn/maize and soy measurably declined as a result of EU regulations, they have not declined overall. Europe, which produces virtually no soy, continues to rely on imports of this product, since it is a critical source of animal feed and is used in many processed foods. But its sources of supply have shifted from the United States to countries that produce non-GM soy varieties. The same is true of corn, which is used for both human consumption and animal feed. Very little is grown in Europe, which means that the EU must continue to import it—but it is now more likely to do so from countries whose farmers use GM crops approved by the EU.
Nor does opposition to GMOs in the EU reflect either the political preferences or economic interests of most European farmers. Were it not for consumer preferences and activist pressures, many European farmers (p.28) would have planted GM crops. Moreover, European restrictions on the import of GM varieties for animal feed have raised production costs for European farmers. Revealingly, the European country that was initially the strongest proponent of the introduction of GM crops was France, Europe’s largest agricultural producer and traditionally the country most strongly identified with European agricultural protectionism.9 French policy toward GMOs did change radically, but this was because of pressure from environmentalists, consumers, and activists, some of whom were politically militant small farmers, and not because of any shift in the preferences of the country’s large agricultural producers or its seed firms. Significantly, France’s initial regulations were more favorable to the sale rather than to the cultivation of GM products, the opposite of the policy pattern one would expect if its policy objectives were protectionist.
What about the interests of agricultural biotechnology firms? While several important agricultural biotechnology companies such as Syngenta and Novartis are based in Europe, the global firms most acutely disadvantaged by EU restrictions on GM varieties are based in the United States, most notably Monsanto, the world’s most important agricultural biotechnology company. The fact that the United States already had a highly developed agricultural biotechnology industry when GMOs were first being introduced certainly contributed to the American decision to adopt relatively permissive regulations for the introduction of GM varieties. But the fact that Europe initially had fewer and smaller agricultural biotechnology firms does not explain why the EU chose to adopt regulations that significantly impeded the growth of this sector.
Certainly, no European-based biotechnology firm has supported or benefited from the EU’s increasingly stringent regulatory controls. Had the EU adopted regulations in 1990 promoting the use of agricultural biotechnology similar to those adopted by the United States in 1986—as the European Commission had strongly advocated—Europe would doubtless now have a much more flourishing agricultural biotechnology industry.
What about global climate change? Clearly, economic interests did play an important role in shaping business preferences as well as policy outcomes on both sides of the Atlantic. An important reason why the EU was a strong supporter of the Kyoto Protocol and the United States refused to ratify it was because of the fact that its percentage reduction requirements were structured in ways that disadvantaged American-based firms and advantaged their European-based competitors. But the (p.29) EU maintained and even strengthened its commitments to reduce GHG emissions even after the United States decided not to ratify the Protocol. While European firms have been more willing to accept regulations for greenhouse gases than have most American ones, this is not because they were economically advantaged by them.
It is certainly true that once the EU has adopted more stringent domestic production or product standards, it then becomes in the interests of European firms to also have them applied to imported products; this is the underlying source of many American complaints about EU regulations that serve as non-tariff barriers to trade. But this begs an important question: why were these regulations adopted in the first place?
For most of the more stringent EU risk regulations described in this study, there were no important differences in the preferences of European and American firms. Both American and European firms have lobbied against many of the risk regulations adopted by the EU, and many of the trade associations that opposed or attempted to weaken them were composed of both European-and American-based firms. For example, both European and American chemical firms actively challenged the European Commission’s proposal to significantly strengthen European chemical regulation, electronics producers from both sides of the Atlantic opposed the EU’s ban on hazardous substances in electronic products as well as its mandatory electronics recycling requirements. Both European and American firms opposed and were disadvantaged by the EU’s bans on phthalates in children’s toys and cosmetics, beef and milk hormones, and antibiotics in animal feed. Many European firms and business associations have been just as critical of the adoption and application of the precautionary principle as their counterparts in the United States.
While there are certainly examples of what an editorial in the Wall Street Journal has described as “the EU’s regulatory assault on U.S. companies,” most European regulations apply equally to all firms doing business in Europe, though it may be more or less difficult for some firms to comply with particular regulations.10 This is not to suggest that protectionist motivations have played no role in European risk regulation, or to deny that some regulations have disproportionately favored European producers, only that economic interests have not been central to its increased scope and stringency.11 The politics of protective regulation in (p.30) Europe have been no different from that of the United States: firms have typically opposed more stringent consumer and environmental regulations. The only difference is that, after 1990, producers became more successful in preventing their adoption in the United States than in Europe. In short, the strengthening of European risk regulations since around 1990 cannot be satisfactorily explained by either the political preferences or the economic interests of European-based firms—any more than the previous strengthening of American consumer and environmental regulations reflected the political preferences or economic interests of most American businesses.12
Attitudes toward the Role of Government
Another plausible explanation emphasizes the critical importance of transatlantic differences in the role of the state and the legitimacy of government regulation. Thus, Europeans are said to “have a stronger tradition and are more accepting of government intervention in the market than Americans,”13 while the latter are “more ideologically averse to regulation.”14 According to Ludwig Kramer, an official of the European Commission (EC) with responsibilities for environmental governance: “Traditionally, Europe has had a stronger commitment to social and more recently to environmental concerns than has the U.S. … There is … a sort of consensus in Europe that public intervention must also ensure a decent state of the environment, and that environmental protection cannot be left to market forces.”15
As numerous scholars have noted, patterns of business-government relations in the United States and Europe have long diverged. Historically, European governments have been far more interventionist and controlled a much wider scope of business activity than in the United States. The recent expansion of European consumer and environmental regulation is consistent with this broad historical trend. But a variable cannot be explained by a constant. Europe’s statist traditions and America’s long-standing hostility to “big government” and belief in “free (p.31) enterprise” cannot explain why, for three decades, the United States consistently enacted more extensive and costly consumer and environmental regulations than did most European countries as well as the EU.
The Role of Political Systems
Yet another explanation for the changes in European and American approaches to risk regulation emphasizes the importance of transatlantic differences in political systems. David Bodansky writes:
The recent tradition of divided government between the President and Congress in the US has produced a least-common dominator effect. Which branch is the most conservative tends to prevail … In contrast the political economy in Europe of coalition governments has produced exactly the opposite effect—what could be called a greenest denominator rather than a least-common denominator. Green parties care more about the environment and demand Green positions as a condition of supporting the government.16
The critical role of party systems as an explanation for differences in patterns of environmental regulation between Europe and the United States is also emphasized by Christopher Green-Pedersen and Michelle Wolf, who argue that “the institutionalization of attention to environmental issues is stronger in the European party system than in the U.S., which with its multiple venue system is more likely to resist institutionalization.”17 They further claim that “the institutionalization of attention to environmental issues is stronger in the European party systems than in the U.S. due to the fact that if an issue becomes attached to a European political party, it is more likely to become strongly institutionalized.”18
The electoral system of proportional representation, which has periodically made possible the participation of Green parties in a number of European governments, including Germany, France, Denmark, Italy, Finland, and Belgium, as well as in the European Parliament, has clearly played an important role in strengthening many national and European consumer and environmental risk regulations. However, the Democratic Party in the United States previously played as important a role in advancing a “green” political agenda as has any Green Party in Europe. Moreover, the national electoral systems in both Europe and the United States have not changed, yet their policy outcomes have (elections to the European Parliament are based on the electoral system of each member state).
(p.32) Nor has divided government in the United States historically been an obstacle to the adoption of more stringent regulations.19 The two most important periods of American environmental regulatory expansion, namely the late 1960s and early 1970s, and the late 1980s through 1990, took place under Republican Presidents Richard Nixon and George H. W. Bush and a Democratic-controlled Congress. The American constitutional system has arguably made it more difficult for treaties signed by American presidents to be ratified, since the American legislature is more independent of the executive than in Europe’s parliamentary systems.20 But prior to around 1990, international environmental agreements signed by American presidents were routinely ratified by the American Senate. Moreover, the authority to ratify international agreements is also fragmented in the EU: treaties signed by the European Commission must be approved by the Council of Ministers, and more recently, also by the European Parliament.
The Role of Cultural Values
Another alternative explanation emphasizes the role of deeply rooted cultural values. According to this thesis, “Europeans demonstrate their considerable concern about environmental issues in their behavior as voters, consumers, corporate managers, and policy makers,” while “people in the U.S. are more individualistic, more concerned about their life-styles than about the environment.”21 Likewise, it has been argued that “Europeans express more concrete concerns about environmental impact on future generations,” most notably in the case of global climate change, and therefore are “more likely to invoke caution regarding unforeseen risks.”22 It has also been suggested that the reason the EU has adopted the precautionary principle and the United States has not done so is because “Europeans are more risk averse and suspicious of technology than Americans and therefore more willing to take action even when the scientific evidence is uncertain.”23
But the United States previously adopted many regulations that highly constrained the “life styles” of “individualistic” Americans, by limiting, (p.33) for example, the drugs they can take, the land they can develop, the products they can use, and the kinds of cars they can purchase. The United States was among the first countries to ban the use of aerosol spray cans because they produced emissions that harmed the ozone layer, which certainly affected American lifestyles. Americans have been no less concerned about protecting environmental quality for future generations. The Endangered Species Act of 1973 represented a precautionary approach to protect species that were threatened as well as possibly endangered in order to preserve them for future generations.
Nor is there any evidence of a deeply rooted or long-standing European mistrust of technology. The applications of biotechnology to pharmaceuticals and stem cell research are strongly supported in Europe; the latter has been far less controversial than in the United States. Moreover, the debate in Europe and America over the funding of supersonic commercial aviation transport during the early 1970s demonstrates precisely the opposite pattern of public concern: in this case, it was Americans rather than the French and British who were “more suspicious” of the possible negative environmental impacts of a new commercial technology.
The recent adoption of many highly precautionary regulations by the EU does not reflect a distinctively or deeply rooted European approach to managing new or uncertain risks. In fact, for roughly three decades, no nation more consistently employed a more precautionary approach to consumer and environmental risk regulation than the United States. “In the U.S. many laws and regulations [enacted or implemented between 1959 and 1978] require that action be taken to anticipate, prevent, or reduce risk where there is scientific uncertainty or a lack of clear evidence of risk.”24
As studies of risk regulation by scholars such as Aaron Wildavsky, Mary Douglas, and Sheila Jasanoff persuasively argue, “risk cultures” and public attitudes toward nature, technology, and particular risks do play an important role in shaping the public’s risk perceptions.25 Cass Sunstein further suggests that cross-national cultural variables can function as “predispositions,” making some risks more salient than others.26 (p.34) Some of these predispositions have clearly affected both public perceptions and public policies. For example, Americans have historically been more concerned than Europeans about the risks of cancer, while Europeans have consistently displayed strong preferences for “natural” food production. The former helps explain the relative stringency of American regulations regarding carcinogens in the food supply, while the latter may help explain why Europeans have been more opposed to the introduction of agricultural biotechnology than Americans or have been more willing to accept the risks of consuming cheese made from unpasteurized milk.
But many other important differences in policy preferences on both sides of the Atlantic are neither deeply historically rooted nor are they an expression of national cultures; rather, they are politically constructed, which means they are subject to change. The claim that deeply rooted cultural or social attitudes toward risk, technology, or environmental protection can adequately explain the large number of current differences in consumer and environmental risk regulations in Europe and the United States rests on a myopic understanding of the historical pattern of protective regulation across the Atlantic: many recent European cultural and social attitudes toward risk and risk regulation were previously more characteristic of the United States than of Europe.
Explaining Policy Divergence
In this book, I identify three critical factors that have shaped transatlantic regulatory policy divergence since 1990. The first part of my explanation focuses on changes in political salience of consumer and environmental risks and the extent and intensity of public pressures to ameliorate them. During the last two decades, Europeans have perceived more health, safety, and environmental risks caused by business to be both credible and politically unacceptable than have Americans. The breadth and intensity of public demands for more stringent risk regulations has declined in the United States and increased in Europe.
My second explanatory factor involves changes in the political preferences of influential policy makers. While Democrats have generally supported more stringent risk regulations than Republicans, through around 1990 there was also considerable bipartisan support for stronger consumer and environmental regulation. But beginning in the 1990s, regulatory policymaking, especially in the area of environmental protection, became increasingly polarized along partisan lines. Republicans, who were the majority party in both the House of Representatives and the Senate between 1995 and 2006 (with one brief exception in the U.S. Senate), and Republican President George W. Bush, who held office between (p.35) 2001 and 2008, were less willing to support more stringent consumer and environmental risk regulations than were many previously elected Republicans, including Presidents Richard Nixon, Ronald Reagan, and George H. W. Bush. This increase in partisan polarization played an important role in slowing down the rate at which new, more stringent risk regulations were adopted, especially through legislation.
By contrast, in 1995, the same year that a more conservative Republican Party became the majority party in Congress, Sweden, Austria, and Finland, three states with strong “green” preferences, joined the EU. In 1997, members of Green parties served in the governments of France, Germany, Belgium, Italy, and Finland, and the party occupied a total of nearly 150 seats in the national legislatures of eleven member states. Between 1994 and 1999, the number of seats held by European Greens in the European Parliament (EP) increased from twenty-three to thirty-eight, making them the fourth largest party group in the EP. Through 2004, the European Commission had a center-left administration and the EP, center-left majorities. Transatlantic differences in the relative political strength of center-left and center-right political parties between 1995 and 2004 as well as changes in the national composition of the EU help explain the differences in regulatory policies adopted in the EU and the United States during this period.
However, by 2004 most EU member states were governed by center-right majorities and the representation of Green parties in European governments had significantly declined. Elections to the EP in 2004 and 2009 resulted in center-right majorities and the EU has been governed by a center-right European Commission since 2004. But, significantly, center-right politicians and political parties in Europe have been more willing to support expansions of risk regulations than national Republicans have been since the early 1990s in the United States. The politics of European risk regulation has been less polarized along ideological and partisan lines than in the United States.
The third key factor influencing changes in regulatory policymaking on both sides of the Atlantic involves the criteria used by policy makers to decide whether or how to respond to particular risks. While previously, many American policies reflected a willingness to impose regulations in the face of scientific uncertainty, beginning in the 1980s, formal risk assessments began to play an increasingly influential role in the making of risk management decisions. This has often increased the level of scientific evidence necessary to justify new risk regulations, most notably by regulatory agencies. By contrast, the EU’s inclusion of the precautionary principle in the 1992 Maastricht Treaty on the European Union has strengthened both the ability and willingness of European regulatory officials to enact more stringent regulations in the face of scientific uncertainty (p.36) about the causes and consequences of the risks being regulated. It has facilitated their ability to ban or restrict existing commercial activities and to withhold approval for new ones. Equally important, in the United States, federal courts have increasingly subjected the rules issued by regulatory agencies to close and careful scrutiny. By contrast, European courts have been more willing to defer to the decisions, directives, and rules of the European Commission and the Council of Ministers—including those based on the precautionary principle.
As relatively few elections in either the United States or in Europe have been fought or decided on the basis of the electorates’ regulatory policy preferences, and much regulatory policy is made by appointed officials, policy makers typically enjoy a degree of discretion in making risk management decisions. This is particularly true in the case of the EU, as most European officials are not directly accountable to the European electorate. Accordingly, policy makers may choose to be more or less responsive to public pressures for more stringent regulations.
But when policy makers are more willing to adopt more stringent risk regulations, it becomes easier for activists to mobilize public support for them. Conversely, when policy makers are less willing to do so, the “hurdle” that new risks must surmount to become politically salient increases. Since around 1990, it has become more difficult for new health, safety, and environmental risks to be placed on the policy agenda in Washington than in Brussels. Alternatively, when public pressures for more stringent regulations are extremely strong, policy makers are more likely to be responsive to them. This helps explain, for example, the support of Republican Presidents Richard Nixon and George H. W. Bush for stricter federal controls on air pollution as well as the Barasso Commission’s willingness to back stronger climate-change regulations.
The relative importance of each of these three factors in explaining any particular policy decision or non-decision varies from policy domain to policy domain, and for some of the policies discussed in this book, other factors have also played an important role, which I discuss. But both separately and often in relationship with one another, they provide a useful framework for explaining the shifts in public policies toward a wide range of health, safety, and environmental risks that took place in on both sides of the Atlantic beginning around 1990.
Public Risk Perceptions
I have suggested that public opinion is one of the three key factors that have shaped regulatory policies and politics on both sides of the Atlantic. (p.37) But this, in turn, raises a critical question that merits further discussion: what explains public opinion, or more specifically, what determines the public’s risk perceptions and the extent and intensity of its demands for more stringent regulations to address them?
The more risks that are regarded as both credible and unacceptable by politically influential segments of the electorate, the more likely policy makers will find themselves pressured to adopt more stringent risk regulations. Increases in public demands for more stringent risk regulations essentially stem from a gap between the public’s perceptions of the risks they consider both credible and unacceptable and the existing scope and stringency of government regulation. Both dimensions of public perceptions are critical. For example, while the risks of smoking are widely regarded as credible on both sides of the Atlantic, it would clearly be politically unacceptable for any country to ban cigarettes. Likewise, while the risks of consuming dairy products made from unpasteurized milk are credible, European consumers consider them to be acceptable.
As is true for many public policies, changes in risk regulations typically have their origin in some kind of triggering mechanism, i.e., some event, information, or development that disrupts or “punctuates” the existing political equilibrium and thus “opens the previously constrained decision-making domain to other interests and participants, and [leads to] a ‘refraining’ of the issue that undermines the previous policy justification.”27 Such triggering mechanisms or focusing events can include a major accident, catastrophe, or highly visible policy failure, new reports or studies, an influential book, stories in the media, and/or a public campaign waged by activists.28 “The stronger public concerns are, the more effective NGOs [non-government organizations] are likely to be in affecting public opinion.”29 Likewise, the greater the media coverage of a particular risk, the more likely it is to become politically salient.
A succession of such “triggers” can then create what Cass Sunstein describes as a “risk availability cascade,” or what David Hirshleifer (p.38) characterizes as an “informational cascade.”30 Such a “cascade” changes the way in which other risks are perceived. They make influential segments of the public more likely to regard claims, reports, or information about other risks which they learn or hear about—often indirectly or unrelated to the original triggering mechanism or mechanisms—as both credible and unacceptable. Paul Slovic writes:
An unfortunate event can be thought of as analogous to a stone dropped in a pond. The ripples spread outward, encompassing first the directly affected victims, then the responsible company or agency, and in the extreme, reaching other companies, agencies and industries. … Some events make only small ripples; others make larger ones.31
A stream of “unfortunate events” or other policy triggers can then produce what has been described as a “precautionary risk culture” or a “risk society,” characterized by a continuous stream of both highly credible and politically unacceptable business-related health, safety, and environmental risks, or a succession of “larger ripples.”
Such a “precautionary risk political culture” or “risk society” periodically characterized the United States beginning in the 1960s and especially during the 1970s and 1980s. As a British journalist observed in 1972, “We saw the Americans thrashing around from one pollution scare to the next … One moment it was cyclamates, mercury the next, the ozone, lead cadmium—there they seem set on working their way in a random manner through the whole periodic table.”32 A British social scientist commented in 1979, “Americans seem to have taken an excessively strict interpretation of risk, reducing ‘reasonable risk’ to practically ‘zero risk.’”33 Three years later, Mary Douglas and Aaron Wildavsky wrote:
Try to read a newspaper or news magazine … on any day some alarm bells will be ringing. What are Americans afraid of? Nothing much, really, except the food they eat, the water they drink, the air they breathe … In the (p.39) amazingly short space of ten to twenty years, confidence about the physical world has turned into doubt. Once the source of safety, science and technology has become the source or risk. … America is more passionately involved than any other nation in the debates about risks to nature.34
As these observations suggest, from the early 1960s through around 1990, significant segments of the American public heard and found both credible and politically unacceptable a continuous stream of “alarm bells.” These included contaminated cranberries, cyclamates, DES in livestock, strawberries, thalidomide, pesticides, unsafe cars, high levels of air pollution, lead, contaminated toxic waste dumps, a nuclear power accident, mercury-contaminated fish, DDT, asbestos, and two major oil spills, one in Santa Barbara in 1969 and a second, much larger one in Alaska in 1989, to name but a few. Many became associated with one other. As Alan Mazur notes in his historical study of the political salience of many risks that have emerged in the United States,
Public warnings did not arise in isolation. Nearly every one of them is connected to some other warning or public concern, recently or currently in the news. In motivating partisans to support or oppose it, a technology’s association with other contentious issues in politics and society may be as important as its intrinsic risk.35
Since around 1990, a similar kind of “precautionary risk culture” has emerged in Europe. In 1988, the Washington Post reported: “Dead seals in the North Sea, a chemical fire on the Loire, killer algae off the cost of Sweden, contaminated drinking water in Cornwall. A drumbeat of emergencies has intensified the environmental debate this year in Europe, where public concern about pollution has never been higher.”36 In 1992, the protection of the environment and the fight against pollution had become “an immediate and urgent problem” in the view of 85 percent of EU citizens.37 In 2001, the Washington Post observed:
Wealthy, well-educated Europe is regularly swept by frightening reports of new dangers said to be inherent in contemporary life. … Americans have health concerns too, but not on this scale. The year is two months old and already in 2001 public opinion and public officials have been rattled by alarms over (p.40) risk—proven and not—from genetically modified corn, hormone fed beef and pork, “mad-cow” disease, a widely used measles vaccine, narrow airline seats said to cause blood clots and cellular phones said to cause cancer.38
Whether or not objectively Europeans have recently had more reasons to be “scared” than in the past, they often perceived themselves as more vulnerable.39
What Happened in the United States?
But what, then, subsequently happened in the United States? Why did fewer consumer and environmental risks become salient in the United States? Why did public pressures or demands for more risk-averse regulations diminish?
One plausible explanation is that after around 1990 Americans experienced fewer “unfortunate events”—or at least certainly none that appeared as threatening to the health of so many people as the outbreak of BSE in Britain or which resulted in as many preventable deaths as from HIV-contaminated blood in France. But this can be only a partial explanation. For one of the central findings of this book is that a dramatic or highly visible “unfortunate event” is neither a necessary nor a sufficient condition to trigger intense public dissatisfaction with the regulatory status quo. Risks rarely speak for themselves. Most “alarm bells” are not based on harms or dangers that are visible or self-evident. Rather, they are typically rooted in claims that a particular commercial activity or product poses a credible and politically unacceptable health, safety, or environmental risk—often made by an activist group, private or government scientific report, a book, or article, and then widely disseminated by the media.
The significance and causes of these (alleged) risks are often based on scientific studies which can be subject to conflicting interpretations and whose data or conclusions few citizens are in a position to independently assess. In many cases, the causal links between these “risks” and the harms associated with them are contentious or difficult to prove or verify, especially as many are based on claims about future harms or dangers.
Most of the politically influential “alarm bells” that have rung on either or both sides of the Atlantic, ranging from cyclamates, Alar, and ozone depletion to antibiotics in animal feed, beef and milk hormones, (p.41) GM foods, global climate change, phthalates in children’s toys and cosmetics, fall into this category. For each of them, citizens, the media, and opinion leaders must decide who is more credible: those who insist on the need for more stringent regulations or those who question or challenge such claims. In short, the public must decide what to worry about and how much to worry.
After around 1990, Americans did not necessarily have fewer health, safety, or environmental risks to worry about.40 Nor did they hear fewer alarm bells than Europeans. New health, safety, and environmental risks continued to emerge in the United States, many of which were similar to or echod those raised in Europe. Rather, what changed was their political impact: compared to both the United States before 1990 and Europe since then, fewer alarm bells in the United States rang as loudly or for as long. They became less likely to produce the kind of sustained and intense public response that is necessary to turn an “alarm bell” into a “policy trigger.” Equally important, the ringing of one “alarm bell” was less likely to set off a cacophony of others.
Rather than a risk “availability cascade,” the last two decades in the United States have been characterized by a risk “availability blockade.” Widely publicized disagreement about the credibility of many of the alarm bells rung by activists made it more difficult for the influential segments of the public to be persuaded that additional stringent and comprehensive regulations were needed to protect them. For example, in 2010, a record 48 percent of Americans stated that the “seriousness of global warming” is “greatly exaggerated.”41
Significantly, according to survey data (discussed in detail in chapter 7), after peaking around 1990, the gap between public demands for more risk regulations and the scope and stringency of existing regulations that had helped drive the previous expansions of consumer and environmental regulation diminished; the latter finally caught up with the former. After around 1990, large segments of the public became more likely to believe that the United States was now (finally) making adequate progress in protecting and improving environmental quality. This in turn affected the extent and intensity of public demands for additional regulation; it made it more difficult for new alarm bells to gain sufficient political traction to become policy triggers. By the twenty-fifth anniversary of Earth Day in (p.42) 1995, “the public’s sense of urgency about the environment had declined considerably.”42
In short, enough had now been done: the median voter had become more broadly satisfied with the regulatory status quo. These broad trends continued. According to a Gallup public opinion survey conducted in March 2010, Americans were less worried about a wide range of environmental problems than at any time during the past twenty years. Gallup primarily attributed the long and steady decline in concern for environmental issues since 1989 to “a general belief among Americans that environmental conditions in the U.S. are generally improving.”43 Americans did not become less committed to or concerned about protecting the environment; what did change was the extent and intensity of public support for additional regulations necessary for accomplishing this objective.
In this chapter I have reviewed several plausible explanations for the post-1990 divergence in risk regulation between Europe and the United States. Although many of these explanations offer important insights, none provides an adequate explanation for the significant discontinuity in risk regulation that occurred on both sides of the Atlantic after around 1990. I have identified three factors that, based on the evidence I present in this book, provide a more consistent and comprehensive explanation for the transatlantic divergence in regulatory stringency. The case studies presented in the next four chapters both document my dependent variable, namely the transatlantic shift in regulatory stringency, and provide empirical support for my explanatory framework.
(1) Matthew Baldwin, John Peterson, and Bruce Stokes, “Trade and Economic Relations,” in Europe, America, Bush: Transatlantic Relations in the Twenty-First Century, ed. John Peterson and Mark Pollack (London: Routledge, 2003), 29.
(2) EU Focus, December 2010.
(3) Quoted in Baldwin et al., “Trade and Economic Relations,” 31.
(4) Wyn Grant and David Coen, “Corporate Political Strategy and Global Policy: A Case Study of the Transatlantic Business Dialogue,” Regulatory Initiative Working Paper series, 42 (November 2000); Carl Lankowski, “The Transatlantic Environmental Dialogue,” in Green Giants? Environmental Policies of the U.S. and the European Union, ed. Norman Vig and Michael Faure (Cambridge, MA: MIT Press, 2004), 329–44. According to a 2009 study released by the European Commission, aligning non-tariff measures (NTM) would increase the U.S. GDP by $53 billion per year and the EU GDP by $158 billion, though only a portion of these NTMs include the risk regulations explored in this study.
(5) Lyle Scruggs, Sustaining Abundance: Environmental Performance in Industrial Democracies (Cambridge: Cambridge University Press, 2003), 51.
(6) Sonja Walti, “How Multilevel Structures Affect Environmental Policy in Industrialized Countries,” European Journal of Political Research 43 (2005): 627.
(7) Environmental Performance Measurement: The Global Report 2001–2002, Daniel Esty and Peter Cornelius, eds. (New York: Oxford University Press, 2002), 16.
(8) Ronald Inglehart, Modernization and Post Modernization: Cultural, Economics and Political Change in 43 Societies (Princeton, NJ: Princeton University Press, 1997).
(9) towardOliver Cadot and David Vogel, “France, the U.S., and the Biotechnology Dispute,” Brookings Foreign Policy Studies (January 2001).
(10) European Imperialism,” Wall Street Journal, October, 2007. This article specifically cited the fact that foreign cosmetic companies were required to register all the chemicals in their products three years earlier than European firms.
(11) An important example of the former are European restrictions on methods for cleaning poultry, which were strongly supported by European farmers and which have eliminated poultry exports to Europe from the United States.
(12) David Vogel, Fluctuating Fortunes:The Political Power of Business in America (New York: Basic Books, 1989).
(13) David Bodansky, “Transatlantic Environmental Regulation,” in Europe, America, Bush: Transatlantic Relations in the Twenty-First Century, ed. John Peterson and Mark Pollack (London: Routledge, 2003), 64.
(14) David Levy and Peter Newell, “Oceans Apart? Business Responses to Global Environmental Issues in Europe and the U.S.,” Environment (November 2000): 10.
(15) Ludwig Kramer, “The Roots of Divergence: A European Perspective,” in Green Giants? Environmental Policies of the U.S. and the European Union, ed. Norman Vig and Michael Faure (Cambridge, MA: MIT Press, 2004), 66–7.
(17) Christoffer Green-Pedersen and Michelle Wolfe, “The Institutionalization of Attention in the US and Denmark: Multiple vs. Single Venue Systems and the Case of the Environment,” Governance 22, no. 4 (October 2009): 626.
(19) David Mayhew, Divided We Stand: Party Control, Lawmaking, and Investigations 1946–1990 (New Haven, CT: Yale University Press, 1991).
(20) Jeffrey Lantis, “The Life and Death of International Treaties: Double-Edged Diplomacy and the Politics of Ratification in Comparative Perspective,” International Politics 43 (2006): 24–52.
(23) Bodansky, “Transatlantic Environmental Regulation,” in Peterson and Pollack, Europe, America, Bush, 64.
(24) Theofanis Christoforou, “The Precautionary Principle, Risk Assessment, and the Comparative Role of Science in the European Community and the US Legal System,” in Vig and Faure, Green Giants? 18.
(25) Mary Douglas and Aaron Wildavsky, Risk and Culture: An Essay on the Selection of Technological and Environmental Dangers (Berkeley: University of California Press, 1983); Aaron Wildavsky, The Rise of Radical Equalitarianism (Washington, DC: American University Press, 1991); Sheila Jasanoff, Risk Management and Political Culture (New York: Russell Sage Foundation, 1986).
(26) Cass Sunstein, “Precautions Against What? The Availability of Heuristic and Cross-Cultural Risk Perceptions,” Alabama Law Review 57, no. 1 (2005): 75–106.
(27) Robert Repetto, “Introduction,” in Punctuated Equilibrium and the Dynamics of US Environmental Policy, ed. Robert Repetto (New Haven, CT: Yale University Press, 2006), 13. The concept of punctuated equilibrium as applied to politics was developed by Frank Baumgartner; see Frank Baumgartner, “Punctuated Equilibrium, Theory and Environmental Policy,” in Ibid., 24–46.
(28) Repetto, “Introduction,” in Repetto, Punctuated Equilibrium, 11.
(29) Thomas Bernauer and Ladina Caduff, “In Whose Interest? Pressure Group Politics, Economic Competition and Environmental Regulation,” Journal of Public Policy 24, no. 1 (2004): 105.
(30) Cass Sunstein, Laws of Fear: Beyond the Precautionary Principle (Cambridge: Cambridge University Press, 2005), 97. See also David Hirshleifer, “The Blind Leading the Blind: Social Influences, Fads, and Informational Cascades,” in The New Economics of Human Behavior, ed. Mariano Tommasi and Kathryn Ierulli (Cambridge: Cambridge University Press, 1995), 1882
(31) Paul Slovic, “Perception of Risk,” in The Perception of Risk, ed. Paul Slovic (London: Earthscan, 2001), 227. See also the collected essays of Nick Pidgeon, Roger Kasperson, and Paul Slovic, eds., The Social Amplification of Risk (Cambridge: Cambridge University Press, 2003).
(32) Stanley Johnson, The Politics of the Environment: The British Experience (London: Tom Stacy, 1972), 170–71.
(33) David Vogel, National Styles of Regulation: Environmental Policy in Great Britain and the United States (Ithaca, NY: Cornell University Press, 1986), 182.
(35) Alan Mazur, True Warnings and False Alarms: Evaluating Fears About the Health Risks of Technology, 1948–1971 (Washington, DC: Resources for the Future, 2004), 44.
(36) R. Herman, “An Ecological Epiphany,” Washington Post National Weekly Edition (December 11, 1988), 19.
(37) Elizabeth Bomberg, Green Parties and Politics in the European Union (London: Routledge, 1998), 13.
(38) T. R. Reid, “Be Careful What You Eat, Where You Sit and …” Washington Post National Weekly Edition, May 12–18, 2001.
(39) Ulrich Beck, World Risk Society (Cambridge, MA: Polity, 1999).
(40) Jane Spencer and Cynthia Crossen, “Why Do Americans Feel that Danger Lurks Everywhere?” Wall Street Journal, April 3, 2003.
(41) Gallup poll, “Americans’ Global Warming Concerns Continue to Drop,” March 11, 2010, available at http://www.gallup.com/poll/126560/Americans-Global-Warming-Concerns-Continue-Drop.aspx, accessed 11/20/2010.
(42) David Moore, “Public Sense of Urgency about Environment Wanes,” Gallup Poll Monthly 335 (April 1995): 17.
(43) Gallup poll, “American’s concern for Environment at 20 Year Low,” March 16, 2010, available at http://ecopolitology.org/2010/03/16/gallup-poll-american-concern-for-environment-at-20-year-low/, accessed 11/20/2010.