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Jane T (LLC)
Jane T (LLC), Lawyer (JD)
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How does government regulation of pollution and ...

Resolved Question:

How does government regulation of pollution and environmental issues impact business? Debate whether pollution control regulations are a positive or negative impact on business and society?


Should American companies be held to the same environmental standards in their foreign branches as they are in those located in the U.S.?
Submitted: 10 years ago.
Category: Legal
Expert:  Jane T (LLC) replied 10 years ago.
Government regulation fo pollution and environmental issues hurts businesses in the short term, but, in the long term, helps businesses and can even help create new industries. Although many businesses, such as coal mining and the auto industry work very hard to keep the government from enacting or enforcing stricter standards because they say such standards would ruin them financially and destroy their ability to compete, this is not true. European auto manufacturers and mining companies do have to meet stricter standards and are operating quite fine. In addition, many of the American companies have European plants that have to comply with tougher standards, so they have the technology, all they need to do is import it to America.

There will surely be a cost, but once that cost is over, they cleaner production and the ability to appeal to consumers will help many manufacturers make up the short term loss with long term sales growth. They may even face fewer lawsuits from surrounding communities for things like cancer or other diseases caused through pollution.

Although some may argue that the market place will force out those who do not run clean, safe buisnesses, the history of the industrial revolution proved this is not true. The Triangle Fire proved businesses could not be trusted to operate safe working plants because they would rather gain profits. Upton Sinclair's "The Junge" proved both consumers and workers were at risk if government regulations did not take care of unhealthy working and manufacturing conditions. The market place is concerned with money and will try to get away with as much as it can in order to pursue profit.

Healthy air and environment are public goods, things which the market, and everyday citizens do not want to pay for, but admit they cannot live without. Just as no one would want to pay to have police and fire crews, we all know we need them and when we need them, are willing to pay anything for them. We must remember that healthy air and environments cannot be replaced once lost. Only government regulation can help maintain and protect them.

While many underdeveloped countries are endangering the environment through their need to raise capital, the US Government has long held the view that any company that operates in a foreign country, for the most part, can operate under local government rule. Yes, the world must work together to maintain the environment, but we cannot impose American laws on sovereign governments. A business that operates in a foreign country is subject to foreign laws as a corporation of that country. Although affiliated with an American company, it is a creature of the foreign land and only the laws of that country should control its actions.
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