Last Wednesday I wrote about a new report by the Brussels based Hayek Institute examining the impact of the Precautionary Principle which the EU wants to impose on chemical substances in the so-called REACH regulation.

The precautionary principle could have a substantial impact on innovation and growth, not to mention the quality of life in Europe and the rest of the world. Essentially the principle states “Better safe than sorry.” In the 1980’s the idea spread and became the rallying cry of the environmental movements in Europe. The principle can be interpreted in two ways, one strict and one weaker.

In the EU there is a tendency to make a strict interpretation, such as the one found in the Wingspread Statement.

When an activity raises threats of harm to human health or the environment, precautionary measures should be taken even if some cause and effect relationships are not fully established scientifically. In this context the proponent of an activity, rather than the public, should bear the burden of proof.

Or as stated by Jeremy Leggett of Greenpeace International:

The modus operandi we would like to see is “do not admit a substance unless you have proof that it will do no harm to the environment.”

Both of these absolutist approaches are problematic because they shift the burden of proof from proving harm to proving harmlessness. The latter, as I pointed out in my previous post, is impossible.

Greenpeace and similar organizations demand that companies prove “no harm.” They want the companies to prove a negative, and they have been successful in setting this agenda with REACH.

In the strictest possible interpretation the precautionary principle would entail that no new substances are introduced – ever. No matter how much good they might do, neither penicillin nor a future AIDS vaccine could be introduced under this interpretation.

Besides a strong or strict approach there is a weaker interpretation, which is based on cost-benefit analyses, such as the one found in Principle 15 of the Rio Declaration:

In order to protect the environment, the precautionary approach shall be widely applied by States according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.

The lack of full certainty is not a justification for preventing an action that might be harmful, because inaction is also an action, and inaction may also have irreversible consequences. If the precautionary principle is to be used in public policy it must be in its weak form. The consequences of any other interpretation would end civilization as we know it.

When interpreted in a cost-benefit perspective the precautionary principle becomes different. It is no longer sufficient to look at the risks of introducing the product on the market; it will also be required that the costs of keeping it off the market be analyzed. And that is where REACH fails. Its proponents forget that keeping a product off the market can have negative impacts, as some of the comments to my previous post illustrated.