July | August 2017

By Debra Miller, CSG Director of Health Policy
After his election in 2010 and before he took office, Ohio Gov. John Kasich signaled that he wanted to make his state business-friendly.
He appointed leaders to the state’s Environmental Protection Agency and the Department of Natural Resources to strive to do just that.
“These departments are going to send a message to Ohio that we are open for business,” Kasich said in making the appointments, according to The Columbus Dispatch. But Kasich also said he didn’t plan to empower business at “the cost of environmental degradation.”
The careful balance policymakers work to achieve between business interests—which also provide jobs to their constituents—and protecting the environment was evident that day in Ohio. Three years later, when Ohio EPA chief Scott Nally suddenly resigned, Kasich acknowledged that balance.
“For the past three years, Scott worked hard to keep Ohioans and our environment safe, but he also helped begin to make the agency more business-friendly,” Kasich said in a statement. “Today, Ohio has some of the strongest environmental regulations in the nation, but they are also grounded in common sense.”
It’s that balance states across the country are striving to meet. It’s not always easy, particularly in today’s economic climate.

Setting Priorities

“The real question for legislators and voters is to decide if they want jobs in the first place,” said Mark Mills, a senior fellow with the Manhattan Institute who studies energy issues. “No business in America today wants to operate with damaging the environment. They all want to meet regulations and rules that are sensible to maintain clean air and clean water.”
The Manhattan Institute is a conservative think tank in New York City that focuses on market-oriented policies fostering economic choice and individual responsibility.
“The most important thing in my view for citizens of any country and any state is to have enough jobs to keep everybody employed,” he said. “This is utterly the first priority. Everything else takes second place.”
But, he argues, there can be an artificial conflict between jobs and the environment.
“There’s nothing that human beings do that doesn’t have some impact. It’s impossible. We impact our environment; we just want to minimize our impact on the environment,” he said.
He said he isn’t biased against regulations, but he believes priorities must be set.
“What’s happened in many places, we flipped it around where an aggressive pursuit of a perfect environment without regard to impact on jobs, of course, causes a loss of jobs,” Mills said.

Looking Long-Term

But Tim Kelsey, an economics professor at Penn State University, said the type of jobs being created must be weighted along with the impact on the environment in any business decisions, like those connected to expansion in the energy sector.
“The critical question is what benefits the community in the long run,” he said.
Kelsey has studied the economic impact of the development of the Marcellus Shale region in Pennsylvania.
It’s like empty calories, he said.
“There may be lots of employment and lots of other benefits to the community in the short run, but if it leaves the community worse off after the activity,” the boom, he suggested, hasn’t left the community better off in the long run.
To be sure investment dollars are not wasted, Kelsey said, the state must consider how investments can be repurposed for something else in the long run. This can lead to more diversified economies, protecting communities from boom and bust cycles.
Building value-added industries and jobs, where the natural resources are processed into a secondary product, can be a win-win for local communities, he said. For instance, Pennsylvania has the most timber resources in the East and is moving to build furniture factories and other businesses that turn that resource into another product, he said.
The tradeoff between jobs and the environment, Kelsey believes, is a false equation.
“We can have environmental protection at the same time we are creating jobs,” he said. “What that means is you have to think carefully about what jobs you want.”
That changes the questions that policymakers ask.
“It’s not what are you willing to sacrifice to create jobs,” he said. “Instead, what are the effects here, both short term and long term?”

Finding a Real Balance

Sometimes, that’s not always easy to predict.
The January 2014 chemical spill that left 300,000 people without access to safe water has brought the issue of environmental protection to the forefront in West Virginia, according to Delegate Barbara Evans Fleischauer.
“There has been a whole lot of talk about job-killing regulations and so there has been a real de-emphasis on regulation,” Fleischauer said. “That talk has gone on for so long in our state and it has permeated our enforcement structure. Last year, we cut a half million dollars out of our Department of Environmental Protection.”
The spill into the Elk River involved Freedom Industries, a manufacturer of specialty chemicals, including 4-methylcyclohexane methanol, or crude MCHM, used in the coal industry. Fleischauer said the coal industry has spent millions of dollars fighting regulations they claim are killing industry.
“As a consequence of this kind of talk, we have a major disaster on our hands that is, ironically, a job killer,” Fleischauer said. “Why would you want to come to West Virginia if you aren’t sure you can drink the water?”
Fleischauer said West Virginia has been trying to diversify its economy, especially looking to tourism. The chemical spill is hurting those efforts, she said.
“Our brand has really been jeopardized. It is a wake-up call that water is essential to economic development,” Fleischauer said, adding it is government’s role to assure clean water for the state. To do that, she said, states need regulations and must fund enforcement of those regulations.
“It can’t happen if you starve the agencies,” she said.
It’s important that when people talk about balancing jobs and the environment, they follow through, she said.
“There really needs to be a balance,” Fleischauer said.