°'A M.~ Cep Q.. Q'. 'C3 vii `Z$ .-O L1. The Peril and Promise of Risk Assessment Richard B. Belzer Unfortunately, the practice of risk assessment by the federal government routinely departs from the academic ideal. Federal risk assess- ments continue to rely on conservative models and assumptions that effectively intermingle important policy judgments with science. This often makes it difficult to discern serious hazards from trivial ones, and it distorts the ordering of the government's regulatory priorities. These distortions typically lead to disproportionate investments in reducing very small threats to health and life. In some cases these distortions may actually increase net health and safety risks. Widely acknowledged problems that continue to plague the practice of risk assessment in the federal government were described in the 1990 edition of the Regulatory Program of the United States, an annual publication of the Office of Management and Budget. The issues were not new, nor was the forum original inasmuch as previous editions of the Regulatory Program had raised similar concerns. But the unusual candor of the 1990 edition provoked a storm of controversy within federal regulatory agencies. The policy issues kindled by risk assess- ment, which for years had been relegated to obscure scientific journals, had finally become visible to Richard B. Belzer is a staff economist in the Office of Information and Regulatory Affairs of the Office of Management and Budget. the highest levels of the federal government. The 1990 Regulatory Program highlighted three concerns. First, the continued reliance on "reason- able worst-case" assumptions distorts risk assess- ment and yields estimates that may overstate the expected level of risk by several orders of magnitude. Second, the assumptions embedded in risk assess- ments impart arbitrary "margins of safety" for which there is no scientific basis. The choice of an appropriate margin of safety is a value judgment that should remain the province of responsible risk management officials, and it is inappropriate to conceal it within ostensibly scientific risk assess- ments. Third, current risk assessment procedures distort the regulatory priorities of the federal govern- ment and direct scarce resources toward reducing trivial carcinogenic risks while failing to address more substantial threats to life and health. Cancer risk assessment has become extraordi- narily controversial over the past few years. It has been subjected to a crescendo of criticism by promi- nent scientists, risk assessment professionals, and policy analysts. Defenders of the faith have re- sponded in kind by challenging the arguments of the accusers with gusto and occasional vitriol. It remains an open question whether risk assessment can survive this internecine warfare. Despite these battles over its underlying validity, quantitative risk assessment plays an increasingly important role in the federal government's manage- ment of risks. Public confidence in the government's 40 REGULATION, FALL 1991