Environmental Cost

The toxic waste case on the Haulbowline Island, Cork Harbor in the Republic of Ireland is a good representation of the increased entropy according to the Second Law of Thermodynamics that resulted from the continuously accumulating by-product of the former steel-producing industry for over 60 years (Bandara 2006; Daly and Farley, 2004; Friends of the Irish Environment 2009a).

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Situation at present is rather unsatisfying, where the local population is extremely concerned with the toxicity rate of the waste deposited on the island and suspects it of being the cause for elevated regional cancer rate, while the government is reluctant to accelerate the process of clean up.

The process is ongoing since 2008, where first concerns were raised with the nature of the waste that was produced by the production, yet the clean up is still in progress (Friends of the Irish Environment 2009a) This case is associated with several negative externalities such as the aforementioned social concern, environmental degradation and damage of the steel-producing factory’s reputation worldwide.

This case presents a continuous crude violation of the third generation of human rights, specifically the right to a healthy environment, where the local population has been subjected to potentially carcinogenic substances, among them Chromium 6 (Friends of the Irish Environment 2009a; Morgan 2008; O’Riordan 2010). So far, no specific policies for addressing the health and safety of the local population have been issued. At the moment, there is a debate about the need for a health study which will show whether there is a relation between toxicity of the waste and the increased cancer rate among the local population.

The Haulbowline case is an indicator for the need for a proper CBA and planning to be carried out before any project is implemented in order to account for potential issues and externalities associated with it (Pearce et al 2006; Daly and Farley 2004). However, as we have already discussed in the Assignment II, the approach that CBA and economic planning take into consideration when dealing with the environmental issues is extremely monetary beyond our capacity to estimate the value of environmental goods and services (UNEP 2010; Heinzerling and Ackerman 2002).

In other words, the economic methods of putting monetary value to everything is “counter-productive” to its original objective of “taking the economic worth of un-priced environmental goods and service into account” (Farrell 2007). Technically, modern environmental economic methods fail to properly assess the “priceless economic worth” of the environmental ecosystems that are the key resource suppliers to the humanity (Farrell 2007). The Haulbowline case is in the process of being resolved at the moment.

There are some economic and political methods that are being planned in order to resolve the issue the most logical way. The Irish Government will be subjected to heavy fines from the EU in order to accelerate the clean up process and make a lesson out of neglecting behavior (Friends of the Irish Environment 2009a; O’Riordan 2010). Yet for the past two years the clean up only dealt with a small portion of overall toxic waste stored on the island.

So far, more than 50 million Euro were spent on employing the German laboratory to export waste in order to further reprocess it and modify its composition. Overall projected costs of the project exceed 300 million Euro (Friends of the Irish Environment 2009a). It is possible to discuss this case from a point of view of utopia, or dystopia, yet this paper will address some potential policy and economic resolutions for this case. If we look at the case of utopia, the Haulbowline Island will have to be cleaned and the toxic waste extracted in the least amount of time possible.

This means extra money paid to the German laboratory and hence an increase in taxes from the citizens. The associated policy that will result from the Haulbowlie case most likely will be a set of “direct regulations” (Daly and Farley 2004). The idea of “direct regulation” associated with fines that represent a powerful tool used by the stable governments in order to address crisis situations. For example, ban certain waste from being deposited in an unprotected soil and build special containers for it.

(Friends of the Irish Environment 2009a; Daly and Farley 2004). The Haulbowline case might produce an effective outcome for new policies regarding the steel production factories to emerge. The case of dystopia implies the reluctance of the Government to deal with the waste site at all. This attitude proved to be useless given the Irish Government was trying to convince the local population in the absence of pollution since 2008 (Friends of the Irish Environment 2009a; O’Riordan 2010).

It is already 2010, yet the local population and involved environmentalists are not satisfied with the slow clean up and reluctant attitude of the Government towards this case. This way, this paper will focus on practical applications this case might apply in terms of both economics and policy decision-making. At the moment, the EU is claiming that the Irish State breached the “Waste Management Directive 75/442/EEC” which states the need for licensing of all sites that carry any types of post-production waste (O’Riordan 2010).

There is a hope for European Union to push for the “command and control” policies, which encompass “direct regulations”, i. e. heavy fines for the Irish Government since it failed to resolve the issue quickly enough (Daly and Farley 2004; Friends of the Irish Environment 2009a). These policies are the result of an extreme situation associated with health concerns rather than a planned action. Further use of these policies may apply to the already existing steel-production factories in order to control for their emissions and waste generation (Daly and Farley 2004).