March 7, 2018
By Elisabeth Gilmore
As a teacher of benefit-cost analysis (BCA), I find that current events often provide "teachable moments". The review by the current administration of the Clean Power Plan (CPP), a cornerstone of the Obama era climate change regulations, is one such event. Federal regulations that may have significant impacts on segments of the economy are subject to an assessment that contains a BCA. The CPP adopted under the Obama administration was accompanied by a finding that benefits exceeded costs. However, the revised estimates produced by the Trump administration indicate that costs exceed benefits. Each year, many students in my class question the usefulness of BCA in promoting good policy, often asking whether the BCA framework is too flexible, and therefore meaningless. Does this example support their skepticism? I am anticipating some tough questions from my students and here’s how I plan to answer them.As a teacher of benefit-cost analysis (BCA), I find that current events often provide "teachable moments". The review by the current administration of the Clean Power Plan (CPP), a cornerstone of the Obama era climate change regulations, is one such event. Federal regulations that may have significant impacts on segments of the economy are subject to an assessment that contains a BCA. The CPP adopted under the Obama administration was accompanied by a finding that benefits exceeded costs. However, the revised estimates produced by the Trump administration indicate that costs exceed benefits. Each year, many students in my class question the usefulness of BCA in promoting good policy, often asking whether the BCA framework is too flexible, and therefore meaningless. Does this example support their skepticism? I am anticipating some tough questions from my students and here’s how I plan to answer them.
December 8, 2017