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James Heintz has written on a wide range of economic policy issues, including job creation, global labor standards, egalitarian macroeconomic strategies, and investment behavior. He has worked as an international consultant on projects in Ghana and South Africa, sponsored by the International Labor Organization and the United Nations Development Program, that focus on employment-oriented development policy. He is co-author, with Nancy Folbre, of The Ultimate Field Guide to the U.S. Economy. From 1996 to 1998, he worked as an economist at the National Labour and Economic Development Institute in Johannesburg , a policy think tank affiliated with the South African labor movement. His current work focuses on global labor standards, employment income, and poverty; employment policies for low- and middle-income countries; and the links between macroeconomic policies and distributive outcomes.
PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Washington. In 1976, an act was passed called the Toxic Substance Control Act. It grandfathered about 62,000 chemicals and, according to most critics, was rather weak in enforcing chemical companies to really disclose to the EPA what their chemicals were made of. It put the burden of proof onto the EPA to prove that these substances would not cause harm, where the chemical companies did not have any burden, really, of proof on them. And as a result, there was a new act that's been proposed. It's called the Safe Chemicals Act of 2011. It was introduced by Senator Lautenberg from New Jersey, and he produced a little video on YouTube to introduce his act. And here's a little clip from it.~~~TEXT ON SCREEN: We Are Exposed to Untested Chemicals Every DayMOLLY JONES GRAY, MOTHER AND ADVOCATE: I had struggled with fertility and repeated miscarriages. And as I searched for an answer to why, why I was having such a hard time carrying a baby to term, I discovered the connection between our environment, our toxic exposures, and our health, particularly our reproductive health.DR. SANJAY GUPTA, CHIEF MEDICAL CORRESPONDENT, CNN: What we don't know can really hurt us, and there's a lot that we don't know.DR. PHILIP LANDRIGAN, MOUNT SINAI MEDICAL CENTER: Eighty percent of the common chemicals in everyday use in this country we know almost nothing about.KEN COOK, PRESIDENT, ENVIRONMENTAL WORKING GROUP: From our own studies, we've tested 200 people. We found 482 chemicals. And there are 15,000 chemicals out there in heavy use. How many are showing up in our blood? How many of them might pose a risk?GRAY: We have no idea what the long-term health implications of these results are. And I do not want my son or anyone's children to be our scientific experiment.LISA JACKSON, EPA ADMINISTRATOR: The American people expect that all chemicals used in the American economy are safe. But, Mr. Chairman, the 30-year-old law that gives EPA that authority is outdated.~~~JAY: Now joining us from Amherst, Massachusetts, is James Heintz. He recently coauthored a study with Bob Pollin at the PERI institute which came to the conclusion [that] not only was more regulation necessary, but more regulation would lead to more jobs. Thanks for joining us, James.JAMES HEINTZ, ASS'T DIRECTOR, POLITICAL ECONOMY RESEARCH INSTITUTE: Thanks a lot.JAY: So, first of all, what do you make of Lautenberg's act? Does it solve the problem?HEINTZ: I think it incorporates a lot of the changes that many people have been recommending in terms of how chemicals are regulated in the US and a lot of the reforms to the Toxic Substances Control Act that have been proposed. So some of the major provisions: it would require a minimum database on all chemicals that are bought and sold and used in the US, also existing chemicals, as well as newly introduced chemicals. So it would change that situation where the old existing chemicals were grandfathered in under the Toxic Substances Control Act, the older piece of legislation, and so are virtually unregulated. So [incompr.] require the same minimum database on all these substances. It would also prioritize certain chemicals that we know are potentially harmful because of their profiles in terms of toxicity or because they're bioaccumulative, meaning that there's evidence that they're building up in our bodies over time as we become exposed to these chemicals. So the EPA would develop a priorities list and would target those chemicals for immediate action.JAY: Right. Now, in part one of our interview, we talked about some of the industry objections to these kinds of reforms. But the main argument they make other than the copyright issues of more disclosure is that more regulation leads to offshoring of jobs--how do we compete with China and other places? You've modeled this, and your main argument is [that] more regulation actually creates or forces more innovation. So what's your evidence of this?HEINTZ: Well, there are several pieces to the story, so let me just kind of walk you through. One is that the chemical industry, if we look at the past trends of the past 20 years and we extrapolate into the future, under the current regulations, the chemical industry is going to shed even more jobs than it has in the past. Over the past 20 years, it got rid of around 300,000 jobs. And we look at if it continues on the same path that it has been following over the past 20 years, it's going to eliminate another 230,000 jobs by the year 2030, basically cutting employment in half again. And so it's already destroying jobs by competing on the basis of the same old products and the lack of innovation in the industry. If we look at the fast-growing areas, some of the fastest-growing areas, areas that are growing at 18 percent a year or 20 percent a year, a lot of these involve greener alternatives or more sustainable, safer alternative, so things like producing bioplastics, plastics produced out of biomass, or green building materials that doesn't have formaldehyde in it or other carcinogens. So these areas are actually very--are rapidly growing. They're rapidly growing. This is important because US market share in the chemical industry has been falling. So by shifting into these rapidly growing areas, you're going to get more jobs being created out of them.JAY: Now, in terms of the--on the consumer end of things and protecting consumers, one would think that if you can produce these chemicals offshore, but if they don't meet standards of what can be sold in Europe and the United States, that's another way of forcing companies to have to produce and innovate. I know there's evidence that there's toys made in China and they have two assembly lines: one assembly line for Europe does not contain certain toxic chemicals, and the one for the United States does 'cause there's no regulation against putting them into children's toys.HEINTZ: Yeah, exactly. And so if you're concerned about offshoring, I mean, the current regulatory system just makes the US kind of a low-cost market where you can just dump your toxic products. And by improving the regulatory standards, what you would be doing is preventing at least the products that contain toxic substances from coming into the US market until they meet the same standards that are met elsewhere. And so, you know, updating these--one of our main arguments is [that] by updating this regulation, it not only provides new incentives to innovate, 'cause you have to come up with new products that are as good as existing ones, but not as harmful, not as toxic, not as threatening to the environment. So you have that incentive in place that currently doesn't exist. It also gives a lot of information that doesn't exist, 'cause consumers are demanding safer products. They don't want to be buying toxic products. It's just that they don't know what is safe and what is not. Investors, in terms of just the liability issues, don't want to be associated with funding corporations that could turn out to be the next tobacco industry. And so there's a lot of concern there. But again, investors don't have enough information. So one of the fundamental things that legislative reform will do is just flood the marketplace with information that we currently don't have. It makes markets work better for consumers and for investors, and it would change the incentives so that the chemical industry would have an incentive to move into these areas of safer and greener chemicals that create more jobs and that are the faster-growing areas.JAY: Well, there's a general feeling about--I think, in public opinion, and I think even in the media, that if something's really bad enough, the EPA will catch it. If something's really toxic enough, there'll be a lawsuit, and that will put an end to it. I think most people go around thinking that this is more or less overseen in a way that would prevent the worst abuses.HEINTZ: I think you've hit the nail on the head is that a lot of people don't realize how unregulated large portions of the chemical industry are. So some portions of the chemical industry are highly regulated. So the pharmaceutical industry is regulated by the Food and Drug Administration, the FDA. Pesticides, for some reason, historic reasons, are regulated separately. So if you're looking at pesticides or pharmaceuticals, yeah, there are some regulations in place, and there's regulations that are meant to assess health hazards linked to these products and to protect consumers. But apart from those categories, a lot of the chemicals--and these are often referred to as industrial chemicals, in that they're used in industry--they also find their ways into a lot of consumer products--it's that category of chemicals that is virtually unregulated. And it's very prevalent. There's an estimate that 96 percent of all manufactured products in the US contain inputs from the chemical industry. And yet these inputs are unregulated in terms of their health and safety risks.JAY: Now, I guess we--given that the Republicans at the moment are trying to actually defund the EPA to some extent, any sense of what the politics of this bill are?HEINTZ: I think we still have to see how it plays itself out. I mean, within Washington this bill has been introduced in the Senate. There's been no comparable piece of legislation introduced in the current Congress in the House. There were two pieces of legislation in the last Congress in both the House and the Senate, but those are effectively dead now, so they have to be reintroduced. And the House dynamics are where it's really going to be tricky because of the Republicans' hostility to the EPA. Having said that, I think there's broad-based support across the political spectrum for people who really care about wanting to know the toxic characteristics of the chemicals that they, their families, their kids are exposed to on a day-to-day basis. State-level legislation--.JAY: Just before we finish off, let's go back into one point in your report. You did some modeling on one of the things where there needs to be innovation, you say, which is bioplastics, less toxic waste to produce plastics. So what is that? And what did you find in terms of job creation?HEINTZ: So one area that we looked in, because the chemical industry is a very heterogeneous industry--there's 80,000-plus substances being produced, and each of them's a little bit different. So in order to look at job creation potential, we chose one kind of broad product area, and that was the bioplasticsa area. And so plastics in the US and, well, worldwide traditionally were manufactured as a byproduct of the petroleum industry. So they used petrochemicals as the basic building block. But you can actually use biomass as the same basic building block for many plastics that are out there. So we looked at what would be the job creation potential of shifting from petroleum-based plastic production into bioplastics in the US, and we found that if you shifted about a fifth of all of the plastics production in the US from petroleum-based plastics into bioplastics, that alone, even if plastics production didn't increase at all, would itself create 100,000 new jobs. It creates new jobs because you're using biomass which is produced in the US, as opposed to petroleum, which is imported, and the fact that a lot of the production of the inputs into bioplastics just use more labor. They hire more people to produce a particular level of output. And for those two reasons, the imports and the higher labor intensity of production, you get a much bigger jobs kick out of bioplastics than you do out of traditional plastics.JAY: Okay. If you want to see the whole report by James Heintz and Bob Pollin, we're going to put a link to it down here below the video player. And I've mentioned in the first segment, I should mention again, this report was commissioned by the Blue Green Alliance, which is a organization of unions and green organizations. Thanks very much for joining us, James.HEINTZ: Thanks a lot.JAY: And thank you for joining us on The Real News Network.
End of Transcript
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