.7 percent. Cleaning up polluted areas under the EPA’s Superfund program reduces the incidence of congenital anomalies—such as Down syndrome and heart defects—by 20 percent to 25 percent for children born near these sites.
Recent research verifies the causal link between a child’s exposure to pollution and worse economic outcomes as an adult. The Clean Air Act Amendments of 1970 led to a reduction in air pollution that translated into a 0.7 percent increase in the annual number of quarters worked and a 1 percent increase in earnings—equal to $4,300 over a lifetime.
Effective environmental enforcement is therefore pro-growth since the resulting increases in birth weight will raise children’s labor-force participation and earnings once they reach adulthood. In light of this evidence, attempts to reduce the EPA budget are puzzling. In 2015, the House Appropriations Committee attempted to cut the EPA budget by about 9 percent. The House budget resolution would force the House Appropriations Committee to work within even lower spending levels in future years. Therefore, these unspecified cuts would likely force even deeper reductions at the EPA. Adam M. Kushner, the former director of the Office of Civil Enforcement at the EPA, warns that these cuts could reduce environmental laws to “just paper” due to a lack of enforcement, which will increase the amount of pollution to which children are exposed.
The vague cuts in the Congressional budget resolution also would likely impact a program targeting the removal of lead-based paint from low-income housing. The House Appropriations Committee has attempted to make huge cuts to this program for three years in a row, and the spending limits that this year’s budget resolution endorses for future years could force even steeper cuts. These cuts to the lead abatement program deserve particular attention given the catastrophe in Flint.
The research shows that these cuts will significantly reduce future economic growth because of their effect on children’s cognitive abilities and job performance. One study of Rhode Island children shows that even small increases in their exposure to lead permanently reduce their test scores—an effect that is most pronounced for poor children. A study of Swedish children reached similar conclusions about children’s academic performance, cognitive ability, and job performance. It concludes:
[A] decrease in a child’s blood lead level from 10 to 5 micrograms per deciliter would imply an average increase in 9th grade GPA by 2.2 percentiles and an increase in the high school graduation rate by 2.3%. In terms of labor market outcomes the same decrease would imply an estimated increase in earnings (average for ages 20-32) by 5.5%.
Given the strong negative consequences of lead on children’s future economic outcomes, it is no surprise that cuts to lead abatement programs are the ultimate example of a penny wise, pound foolish budget policy: A dollar of lead abatement spending is estimated to return $17 to $221 in benefits to society as a result of improved health, less need for special education, reduced crime, and higher earnings.
Perhaps the most serious example of the anti-growth policies in the House budget is a $2.1 trillion cut to Medicaid and the Children’s Health Insurance Program over the next 10 years. This results from converting these programs to a smaller block grant that would fail to adequately support the health care needs of low-income Americans and from repealing the Medicaid expansion in the Affordable Care Act. Urban Institute researchers studied a similar proposal in 2012 and found that it would slash the number of people enrolled in Medicaid by 42 percent to 50 percent. The researchers concluded that, “Enrollment reductions would likely affect children, because they are a disproportionate share of Medicaid enrollment.”
Other research leaves no doubt that reducing the number of children on Medicaid would result in a sicker and less-educated workforce, because Medicaid makes children healthier and better educated. One study found that the 15 per