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1. Chapter 2: Ethical Principles in Business (Page: 80)

Should Companies Dump Their Wastes in Poor Countries?

Should Companies Dump Their Wastes In Poor Countries? L awrence Summers, Director of the White House National Economic Council for Presi- dent Barack Obama, once wrote a memo claiming that the world's welfare would improve if the wastes of rich countries were sent to poor coun- tries. He gave four arguments for this claim which we can summarize as follows: welfare." 1. Clearly, it will be best for everyone if pollution is shipped to the country where its health effects will have the lowest costs. The costs of "health impair ing pollution" depend on the wages lost when pollution makes people sick or kills them. So the country with the lowest wages will be the country where the health effects of pollution will be lowest. So with "impeccable" "economic logic" we can infer that it will be best for everyone if we dump our toxic wastes in the lowest wage countries. 2. Adding more pollution to an environment that is already highly polluted has worse health ef- fects, than putting that same pollution into a clean environment where it can disperse. So we can reduce the harm pollution causes by transferring it out of highly polluted cities like Los Angeles, and dumping it into countries in Africa that are under polluted." This will make better use of the countries' clean air quality which we now ing "vastly inefficiently," and it will improve won 3. The same pollution will cause more harm in country where people have "long life span than in a country where people die young. When people have "long life-spans," they survive long enough to get diseases, like prostate cancer, that people who die young do not get. So pollution will cause more diseases like prostate cance in countries where people have long lives the countries where people die young. It follows that we can reduce the diseases pollution causes by moving it out of rich countries where people have long lives, and dumping it into poor countries where people die young. 4. Pollution can cause "aesthetic" damage, such as dirty-looking air, that "may have very little direct health impact." Since the wealthy are willing to pay more for clean-looking air than the poor, clean looking air is worth more to the wealthy than to the poor. So it should be possible for people in wealthy countries to find people in poor countries who are willing to trade their clean air for the money the wealthy are willing to offer. This kind of trade will be "welfare enhancing" for both parties. Source: "Let Them Eat Pollution The Economist, February 8, 1992. TAXI no wowo 1. Explain which parts of the reasoning in this memo a utilitarian would have to accept and which parts a utilitarian could reject. 2. Assuming the four arguments are cor- rect, do you agree or disagree with the conclusion that those in rich countries should ship their wastes to poor coun- tries (perhaps by paying poor countries to take them)? Explain why or why not