What Ghostbusters can teach us about environmental regulation

Is the best movie of my childhood an unintentional allegory on the pitfalls of environmental regulation?

If you haven’t watched Ghostbusters yet this Halloween season or if its not your annual tradition (why not?), I’ll explain. The film’s antagonist is not Gozer the Gozerian, or his fluffy alter-ego.

No, the villain is Walter Peck, an EPA lawyer whose ire is drawn by the small business doing work he doesn’t understand and without his permission. The Ghostbusters don’t give into his intimidation, which infuriates him.

Peck’s behavior cleverly demonstrates the harms of the precautionary principle: the idea that anything new is assumed to be catastrophically dangerous unless proven absolutely safe (a difficult, if not impossible feat). Peck’s interest in the Ghostbusters isn’t based on any harm they’ve done (aside from getting slime on a few people, they hadn’t done any). Nor does he know that their work will likely be harmful; it’s made clear that he doesn’t understand their work at all. But that’s the precautionary principle at work. When ignorant, assume the apocalyptic worst.

As many have pointed out, the precautionary principle is self-defeating. If you’re unsure whether to apply the precautionary principle, it implies that you shouldn’t because that uncertainty could mean ruin. But it’s harmful for another reason: it is dramatically wrong about the pace and effect of technological innovation. In a world where innovations consistently made things worse, the precautionary principle would be a sensible rule of thumb. But that’s not our world. The impact of technological progress is overwhelmingly positive, both for people and the environment.

Regulation is inherently anti-innovation, forbidding any change unless approved by the Walter Pecks of the world. Free-markets are enthusiastically pro-innovation, promising fame and fortune to anyone who can make the world better. The differences between the two approaches is stark but often difficult to see. It’s measured in the technologies that aren’t developed or are rolled out slower than they otherwise would, and the environmental resources, expense, and effort wasted as a result. The precautionary principle is perhaps the clearest division between “upwingers” and “downwingers,” between environmental optimists and pessimists, or (because two redundancies are better than one) between environmental liberals who embrace change and environmental conservatives (in the philosphical, not partisan sense) who fear it.

You could easily imagine Walter Peck as an anti-nuclear activist or GMO scaremonger. But by making him a government bureaucrat, Ghostbusters could also portray how regulation inevitably leads to bureaucracy for bureaucracy’s sake and a lack of accountability on the part of bureaucrats. Recall Peck set Gozer’s arrival in motion by shutting off power to the ghost containment system.

Of course, when the building exploded, Peck did not accept blame for the accident. Instead, he blamed the Ghostbusters, demanding they be arrested and making up claims that they were using dangerous chemicals. Bureaucrats almost never accept responsibility for the consequences of their actions. And, unlike private companies, there’s no way for us to hold them accountable. You can’t generally sue a government agency for money or recompense if they harm you or degrade the environment. But when a private company does it, there are lots of ways to demand justice.

A final note of optimism for the holiday: my friend Tim Sandefur rightly describes the message of Ghostbusters as “entrepreneurial capitalism will overcome the apocalypse itself.” If entrepreneurial innovation can take on the end-times, what chance does the doom-and-gloom regulation crowd have against it?

Have a happy Halloween!

1 Comment

  1. Good stuff! It is opportunity cost that bureaucrats, regulators and their supporters never understand. What they cannot see (and often cannot know) they discount at 100%. Governments almost never use opportunity costs in their assessments (at least not properly) and many don’t even understand the concept.


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