Protecting the Environment The regulation of practices that affect the environment has been a relatively recent development in the United States, but it is a good example of government intervention in the economy for a social purpose. Beginning in the 1960s, Americans became increasingly concerned about the environmental impact of industrial growth. Engine exhaust from growing numbers of automobiles, for instance, was blamed for smog and other forms of air pollution in larger cities. Pollution represented what economists call an externality -- a cost the responsible entity can escape but that society as a whole must bear. With market forces unable to address such problems, many environmentalists suggested that government has a moral obligation to protect the earth's fragile ecosystems -- even if doing so requires that some economic growth be sacrificed. A slew of laws were enacted to control pollution, including the 1963 Clean Air Act, the 1972 Clean Water Act, and the 1974 Safe Drinking Water Act.