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Cass R. Sunstein

Thanks, Justice Scalia, for the Cost-Benefit State

The Supreme Court's EPA decision is the culmination of a decades-long trend.
Taking costs into account.

Taking costs into account.

Photographer: Paul Morigi/Getty Images

Last week's Supreme Court decision striking down a federal regulation on mercury and other pollutants from coal-fired power plants is a temporary setback for those who seek to reduce air pollution. At the same time, however, it should be welcomed as a ringing endorsement of cost-benefit analysis by government agencies. It's a kind of rifle shot, with potentially major effects on a host of future regulations that have nothing to do with the environment. (Disclosure: As administrator of the White House Office of Information and Regulatory Affairs from 2009 to 2012, I worked on the regulation that the court invalidated.) 

In fits and starts, the U.S. has been turning into a cost-benefit state. A pivotal year was 1981, when President Ronald Reagan ordered executive agencies to calculate the costs and benefits of their regulations and to proceed only if the benefits exceeded the costs. In 1993, to the disappointment of many progressives, President Bill Clinton essentially ratified Reagan's approach.