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Coal ash pollution and a free market solution

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On Feb. 2, a 27-acre coal ash pond operated by Duke Energy leaked into the Dan River in North Carolina, releasing up to 82,000 tons of coal ash mixed with 27 million gallons of contaminated water.

Environmental regulators first reported that arsenic levels in the water were safe, but later acknowledged that they had misreported test results, which showed that arsenic concentrations exceeded the standard of 10^-5 grams per liter. Other tests showed elevated levels of copper and iron in the water. Coal ash is also known to contain cadmium and selenium, the former of which is extremely toxic and the latter of which is a trace nutrient but is toxic in large amounts.

“We're not downplaying risks. We're doing our objective analysis of what we're seeing so far, and I think we are concerned,” said Jamie Kritzer, a spokesman for the North Carolina Department of Environment and Natural Resources. “The Dan River is a gem, and people value it throughout the state for not only being a source of drinking water, but also for its aquatic life that it provides a home to and all the recreational uses. This is certainly something that concerns all of us.”

Situations like this one present one of the greatest challenges to free market advocates, as many people cannot envision how people could solve a problem like environmental pollution without government intervention, and will thusly support state action out of this believed necessity. It is therefore worth examining how voluntary methods can solve pollution problems, as well as how statist methods actually interfere with solving pollution problems.

First, we must define what pollution is. The Free Dictionary provides a useful definition: pollution is the contamination of soil, water, or the atmosphere by the discharge of harmful substances. As such contamination results in damage to private persons and property, this creates a tort (specifically known as a mass toxic tort) for which victims may sue the polluter for damages and restitution.

But this is where government intervention actively prevented a free market solution to the coal ash problem. According to the AP, three citizen lawsuits prior to the recent leak concerning the danger of such pollution and ongoing leaks of coal ash dumps were blocked by the N.C. Department of Environment and Natural Resources, which asserted its regulatory authority to take enforcement action and then declined to take such action. The agency has now proposed a settlement in which Duke would pay slap-on-the-wrist fines but is not required to perform any restitution for its property damage. Those who would suggest an increased need for regulation should bear in mind how regulation stopped a potential solution to the problem, as well as how large corporations can bribe politicians and regulators to treat them favorably (and any competitors unfavorably).

The solution is thus counter-intuitive; less regulation leads to less pollution because allowing pollution (or the imminent threat thereof) to be treated as a violation of property rights and thusly handled by civil courts (or private dispute resolution organizations) can lead to action in time to prevent an environmental disaster, while stopping this process with government regulation and oversight allows polluters to get away with substandard environmental protection until it is too late.

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