By John Kemp
LONDON Dec 20 The Environmental
Protection Agency's draft report blaming hydraulic fracturing
for contaminating drinking water in Pavillion, Wyoming, has
triggered a furious pushback from the industry questioning the
robustness of the agency's conclusions.
In an angry press release, the local gas field operator,
Encana, blasted the conclusions as "irresponsible" and
complained "many of the EPA's findings from its recent deep
monitoring wells ... are conjecture, not factual and only serve
to trigger undue alarm".
Encana has raised a series of technical questions about the
methods employed by EPA investigators, which were reproduced at
length in a frack-friendly article by the Wall Street Journal on
Tuesday ("The EPA's Fracking Scare").
The frack storm centred on Pavillion is a good example of
why both science and policymaking suffer when they get too close
to one another. It is a microcosm of the bigger controversy
about climate science and emission controls. The same problem is
also apparent in macroeconomics.
When scientists and economists become policy advisers,
advocates and makers they lose much of the necessary scepticism
and openness that is the characteristic of Popperian scientific
method. They become less good as scientists and economists.
On the other side, when policymakers hide the distributional
trade-offs involved in many policy decisions behind scientific
and economics studies, implying they have found the unique
correct answer, the quality of the debate suffers and the
science itself is discredited.
Both the EPA and Encana have framed the issue in scientific
terms, offering competing views of the scientific evidence, and
trying to discredit one another's findings.
"Encana is especially disappointed that the EPA released its
draft report, outlining preliminary findings, before subjecting
it to qualified, third-party, scientific verification,"
according to a statement on the company's website ("Why Encana
refutes U.S. EPA Pavillion groundwater report").
Despite the language, the debate is not really about the
science but the policy implications that might be drawn from it.
Encana's Executive Vice President Eric Marsh explains "Safe
and responsible natural gas development is vital to North
America's energy security, and hydraulic fracturing is an
important, necessary and safe part of natural gas development,"
which is a good point, though it does beg the question about
whether fracking is safe.
The Wall Street Journal concurs: "The safety of America's
drinking water needs to be protected, as the fracking industry
itself well knows. Nothing would shut down drilling faster, and
destroy billions of dollars of investment, than media interviews
with mothers afraid to let their kids brush their teeth with
Encana's self-interest in the case is obvious. But the
Journal also questions the objectivity and credibility of the
EPA, noting, with some fairness, "the agency is dominated by
anti-carbon true believers, and the Obama administration has
waged a campaign to raise the price and limit the production of
RAWLSIAN VEIL OF IGNORANCE
To maintain objectivity, the function of providing technical
advice should be strictly separated from the responsibility for
taking a decision based on it. In practice, strict separation of
technical advice and decision-making is difficult to achieve.
But in too many areas the "scientization" of policymaking has
led to a dangerous blurring of the two.
The San Francisco and New York Feds, both of which have been
headed by prominent supporters of quantitative easing, have
issued a string of research papers showing QE is effective in
lowering interest rates, boosting growth, and has no adverse
impact on inflation or commodity prices.
Other regional Feds, headed by sceptics, have produced
papers showing the opposite. It is not clear whether some or all
of these papers are really economic research or advocacy.
In the United Kingdom, Bank of England researchers
conveniently released a research study showing "QE asset
purchases have had economically significant effects" in
September 2011, just as the central bank was contemplating and
building a public case for another round of large-scale asset
purchases. The Bank's researchers concluded the first round of
QE purchases cut average gilt yields by 100 basis points.
The research paper provided much of the justification for
launching a second round of QE a month later, and was cited by
the governor and other officials as evidence that a second round
But researchers for the Bank for International Settlements,
which is highly respected and had no interest in the outcome,
concluded QE cut government bond yields by only 27-74 basis
points, far less than the Bank of England's own assessment. It
remains unclear which of these economic assessments is right.
Britain's central bank has also been widely pilloried for
the poor quality of its inflation forecasts, which some have
blamed on conflicts between objective technical assessments and
The problem is that when technical advisers (whether
scientists, economists, lawyers or accountants) know how their
technical advice is likely to affect outcomes, that knowledge is
apt to colour their findings, as they try to ensure the advice
supports their preferred outcome.
As far as possible, scientific research, economic research
and technical advice should take place behind a "veil of
ignorance" like that described by philosopher John Rawls.
In the case of fracking, it is important to separate the
question of whether contamination occurred at Pavillion (a
scientific question) from broader policy debates about the
desirability of fracking, production of fossil fuels and global
warming (which are political questions).
Both Encana and EPA have recognised it would be
inappropriate to generalise from the unique conditions at
Pavillion, which are not typical of fields across the United
States. But opponents and supporters of fracking want to do just
No one knows yet what really happened at Pavillion. It would
be surprising, however, if fracking did not result in
contamination of drinking water at some locations at some point
in the United States. It is only a matter of time.
But finding some (inevitable) instances of contamination
says nothing about whether fracking should be banned or
restricted. All energy production involves trade-offs between
risks and benefits. Scientists and other technical experts can
illustrate what those risks and benefits are, but they cannot
make a decision on how to balance them. Only voters and their
representatives can make those choices.
The same problem bedevils climate science and monetary
policy. The more scientists and professional economists have
taken a central role formulating policy rather than just
offering technical advice, the more their objectivity and the
underlying science and economics themselves have come under
attack from those with different views.
Climate scientists and economists like Paul Krugman complain
bitterly their opponents are distorting the science/economics,
and argue science and economics should be reserved for those
with appropriate technical training. That is true, but only in
the narrowest sense. The philosopher Plato might have said the
Krugman, Fed Chairman Ben Bernanke or the U.N. panel dealing
with climate change are entitled to a good deal of deference
when offering a technical view about how the climate will evolve
or the economy works.
But when they offer a view on how far to limit emissions, or
how to balance price rises and unemployment, and allocate loses
from the financial crisis among taxpayers, bank shareholders,
borrowers and savers, those are distributional questions to
which there is no one right answer. Their views are no more
valid than those of anyone else.
Some commentators have celebrated the rise of technocrats,
for example the installation of technocratic governments in
Greece and Italy during the crisis, and the rise of
"independent" central bankers.
But confusing technical advice with policy decision-making
has damaged both. It has stifled legitimate political debates
about distribution, while undermining the credibility of the
Rather than celebrate technocracy, it is time to aim for a
much clearer division between those who provide scientific,
technical and economic advice and those charged with
responsibility for acting on it and taking decisions with
political and distributive consequences.