Gore’s Views on the Environment

In his column, Will took a distorted interpretation of a RAND study on the Superfund program that appeared in the National Review and gave it wider circulation. Will echoes an assertion in the National Review that we found that 80% of the money spent on Superfund has gone to lawyers. Our study, “Superfund and Transaction Costs: The Experiences of Insurers and Very Large Industrial Firms,” of which I am a co-author, came to no such conclusion.

We have collected data from various parties involved in Superfund cleanups. For some, the percent of outlays that went to lawyers and others involved in the apportionment of liability is high. For others, it is quite low. We did not try to project legal and other transaction costs for the nation as a whole. Before we can do this, we must collect information from more parties involved in the Superfund process.

So far, we have no compelling evidence that Superfund is drowning in transaction costs. What is more, the share of transaction costs in total costs to date may not be representative of what the share will ultimately be when all the nation’s hazardous waste sites are cleaned up. One expects transaction costs to be highest at the beginning of the program and then fall as legal issues are resolved. The bleak picture painted by Will is unfounded.

LLOYD DIXON

Economist, RAND

Santa Monica