The Center for Public Integrity

Ever since Vice President Cheney’s Energy Task Force took up the issue in 2001, the Environmental Protection Agency (EPA) has looked for ways to loosen the New Source Review (NSR) rules that require old power plants to meet modern pollution standards. NSR amendments to the Clean Air Act in 1977 exempted existing power plants, allowing them to maintain their pollution levels until they were retired, expanded, or significantly modified. In 1999, the EPA and the Department of Justice launched an enforcement campaign after discovering that 70 percent of coal-fired power plants in the United States had violated this arrangement by modifying their facilities while passing it off as “routine maintenance.” This allowed the aging plants to emit tens of millions of tons of pollutants that pose health risks such as respiratory problems and heart disease.

After Cheney’s task force examined the NSR, the EPA proposed a series of rules in 2002 and 2003, which critics say undercut the NSR rules and related enforcement cases. The new rules called for power plants to be reviewed only at higher emission levels than previously established, while simultaneously widening the definition of routine maintenance. The U.S. Court of Appeals struck down that routine maintenance rule in 2006. By then, the EPA had proposed further changes allowing power plant operators to “modify” their facilities as long as maximum hourly emissions do not rise — while making no requirements for annual emissions. Internal documents revealed the Air Enforcement Division of the EPA strongly opposed the proposal.

The Highway Trust Fund — the funding source that pays for most of the nation’s highway improvements — received an emergency infusion of $8 billion from Congress in fall 2008, but the program still faces a long-term cash crisis. The problem, say government watchdogs, is an outmoded revenue-raising model that relies largely on a federal gas tax that has not been adjusted since 1993. This has allowed inflation to eat away at the available money while also leaving the fund short of money when Americans drive less, as in the current economic environment. Overall spending out of the fund has topped revenue since 2002, and the Congressional Budget Office recently estimated that the trust fund would need transfers of a whopping $100 billion from general fund revenues from 2010 to 2018 to cover projected spending unless reforms are made. In 2008 the Government Accountability Office (GAO) listed transportation financing as a “high-risk area” and reported that the Highway Trust Fund “faces a fiscal imbalance at a time when both congestion and travel demand are growing.” The Department of Transportation (DOT) has repeatedly warned Congress to change a funding approach that is now “ineffective and unsustainable.” In January 2008, a National Surface Transportation Policy and Revenue Study Commission recommended increasing the gas tax over the short term, and focusing long-term on a variety of user fees such as “congestion pricing,” for vehicles traveling at peak times in crowded metropolitan areas. A gas tax hike — never an easy sell politically — is likely to face even tougher going in hard economic times, but clearly new funding streams are needed. “It’s not too late, but we’re running out of time,” said a DOT communications official.

The U.S. Food and Drug Administration (FDA) has failed to adequately safeguard the nation’s drug supply, according to various studies and watchdog groups. The agency’s most glaring failure: its lack of action against the popular arthritis and pain medication Vioxx despite clear and convincing evidence that the drug posed a threat to thousands of heart patients. Instead, the FDA — which is responsible for guaranteeing “the safety, efficacy, and security of human and veterinary drugs, biological products, medical devices,” as well as America’s food supply — waited for the drug’s manufacturer to act on its own. In September 2004 the pharmaceutical giant Merck voluntarily withdrew Vioxx after it became evident that the drug increased the risk of cardiovascular events and may have caused tens of thousands of heart attacks. After the tragic failure, FDA whistleblower David Graham testified before a Senate committee that “the FDA, as currently configured, is incapable of protecting America against another Vioxx. We are virtually defenseless.” The incident raised troubling questions about the adequacy of the FDA’s safety-monitoring and the agency’s record on safety issues. A 2007 report issued by the Institute of Medicine, a center under the National Academies, blamed the FDA’s problems on “a lack of clear regulatory authority, chronic underfunding, organizational problems, and a scarcity of post-approval data about drugs' risks and benefits.” In the past decade, more than a dozen drugs have been withdrawn from the U.S. market, and around the world, because of risks to patients.

As the most industrialized nation, the United States has been the largest historical contributor to the fossil fuel emissions that have placed the planet in peril of dangerous warming. Yet the government has failed to lead the way to a national or international solution. The Clinton administration participated in the 1997 U.N. negotiations in Kyoto, Japan, for a treaty that would begin to cut emissions of carbon dioxide and other greenhouse gases in the developed world. But faced with tough Senate opposition, the Clinton White House never brought up the treaty for a ratification vote. President Bush rejected Kyoto early on as “fatally flawed,” but did not work to negotiate an alternative. Instead he advocated for further scientific research and emphasized that progress could be made with voluntary cutbacks. A Climate Leaders program was established, now involving 232 companies, many of which have reduced carbon emissions through energy efficiency measures — but most have set no goal at all. And the United States, which has seen no reduction in greenhouse gas emissions since 2000, is on track for a 16 percent increase through 2030.

President Bush's military commissions for trying suspected terrorists have fought legal challenges for years, and they have only produced three convictions so far. Before 9/11, terrorists such as Ramzi Yousef, architect of the 1993 World Trade Center bombing, were routinely tried in U.S. criminal courts. Two months after the 9/11 attacks, President Bush issued an order setting up the commissions, saying it was “not practicable to apply . . . the principles of law and the rules of evidence generally recognized in the trial of criminal cases in the United States district courts.” In 2002 the Department of Justice advised that Geneva Convention protections for prisoners of war did not extend to members of Al Qaeda. This set off a series of battles among the executive branch, Congress, and the courts. After defeats in the Supreme Court, Bush enlisted the help of Congress, which passed the Military Commissions Act in 2006, reestablishing many of the provisions in the president’s original order. But the Supreme Court declared parts of it unconstitutional. In 2007 David Hicks, an Australian who converted to Islam and served with the Taliban in Afghanistan, pleaded guilty and was returned to Australia. In 2008 military commissions finally convicted Salim Ahmed Hamdan, Osama bin Laden’s driver, and Ali Hamza al-Bahlul, bin Laden’s personal secretary. The Department of Defense’s website lists 13 additional cases, one including all six “Sept. 11 Co-Conspirators.” Among the defendants is 9/11 mastermind Khalid Sheikh Mohammed, who, seven years after the attacks, still has not been fully tried.

The Department of Defense (DOD) has long been plagued with cost increases and delays in buying new weapons, but an already bad situation became worse over the course of the Bush administration. In 95 weapons programs that the Government Accountability Office (GAO) reviewed in 2007, costs grew by nearly $300 billion over the initial estimates, and weapons deliveries were behind schedule by an average of 21 months. The GAO testified before Congress in September 2008 that: “Since fiscal year 2000, DOD significantly increased the number of major defense acquisition programs and its overall investment in them. During this same time period, the performance of the DOD portfolio has gotten worse.” As costs rose, DOD typically bought smaller quantities of new weapons. Meanwhile the need for new equipment has grown more dire, as conflicts in Iraq and Afghanistan have used up the supply of ground vehicles and aircraft faster than expected. The GAO stated that the Pentagon's "implied definition of success" is whether it gets funding for programs, not how well it manages programs. The DOD "cannot continue to view success through this prism," the GAO stressed.

Follow-up:
DOD Under Secretary of Defense for Acquisition, Technology and Logistics John Young has changed some policies in response to the GAO’s criticisms, such as linking award fees to contractors more closely to their performance. The GAO noted, however, that these policies will have to be “adopted and implemented,” and only then may “provide a foundation” for addressing key problems. The DOD press office did not respond to a request for comment, but James Finley, a high-level Pentagon procurement official, told Congress in April 2008 that although Pentagon’s acquisition process was “not broken,” there is a need “to add discipline into the process.” He also noted that DOD was more than two years into a plan to address acquisition problems.

Next time a disaster sends water flooding into the homes of Americans, the insurance system that protects some of them, the National Flood Insurance Program (NFIP), might not have the money to fill their claims. The NFIP covers areas that private insurers do not want to take the risk of insuring, including the New Orleans floodplain; when Hurricane Katrina hit, the damage was so great that it wiped out NFIP’s funds. The program typically had paid under $2 billion a year to flood victims using the insurance premiums it collects. But claims from Hurricane Katrina alone exceeded $16.3 billion. NFIP could not cover those losses on its own and had to rely on a boost from the Treasury. “The program has been unable to set aside sufficient funds to meet future expected losses,” the Government Accountability Office (GAO) warned in 2008. As of December 2007, the Federal Emergency Management Agency, which oversees NFIP, still owed $17.3 billion against the loans it took from the Treasury to cover losses in the 2005 hurricane season — and that number is growing. For many years, incoming premiums and claims paid tracked fairly closely, but the GAO found that the program’s budgeting method was inadequate to account for the level of risk faced by the NFIP. Congress is working on legislation to forgive the NFIP’s debt and reform the program, but for now the NFIP must bank on updated zoning requirements, like those in New Orleans that require many houses to be elevated on stilts or walls, to keep the program's risk under control. Without reform, the program could lead to another multibillion dollar rescue plan shouldered by American taxpayers.

Days after terrorists brought down the World Trade Center towers, the Environmental Protection Agency (EPA) announced that the air was safe to breathe, but that proved to be a dangerously optimistic assessment. Nearly two years later, EPA’s Office of the Inspector General (OIG) reported that the EPA “did not have sufficient data and analyses to make such a blanket statement,” as “air monitoring data was lacking for several pollutants of concern.” The OIG also discovered that the White House Council on Environmental Quality (CEQ) significantly revised EPA press releases “to add reassuring statements and delete cautionary ones.” Samples showed asbestos levels between double and triple EPA’s danger limit, but CEQ edits defined the results as “slightly above” the limit.

EPA was instructed to clear all statements to the media through the National Security Council, giving National Security Advisor Condoleezza Rice’s office final approval. While the EPA pointed to its recommendations that workers and volunteers on site take precautions such as using respirators, OIG said “EPA’s basic overriding message was that the public did not need to be concerned about airborne contaminants.” Former EPA Administrator Christine Todd Whitman maintains that her assurances referred to lower Manhattan in general and not the Ground Zero site. Yet, first responders like Vinny Forras told CBS, “We were being told ‘Don’t worry about it.’” Forras is one of the nearly seven out of 10 World Trade Center responders who reported new or worsened lung problems, according to a 2006 study by Mount Sinai Hospital.

As a former border-state governor, President George W. Bush sought a systematic answer to America’s immigration problems, but found himself repeatedly stymied by the fallout from 9/11 and rifts within his own party. During the 2000 campaign, even The New York Times' usually critical editorial board said Bush “deserves credit for altering the tenor of his party's rhetoric on immigration.” Bush’s platform said he believed immigration “is not a problem to be solved, but the sign of a successful nation,” and his plan for comprehensive reform included both stepped up border security and a path to citizenship for the more than 12 million illegal immigrants residing in the United States. But by the time the administration began to lay out its plan for comprehensive immigration reform in 2004, Americans rattled by the events of 9/11 were focused largely on border security and enhanced enforcement. Meanwhile, conservative Republicans derided the “path to citizenship” proposals as an unfair amnesty for lawbreakers.

In the 1970s, when the federal government tightly regulated the oil market, federal policies encouraged construction of gasoline refineries. But deregulation in the first year of the Reagan administration allowed the oil industry and market forces to decide how many refineries were needed. As a result, the number of refineries and total capacity to produce gasoline in the United States peaked in 1981 with 324 refineries able to process 18.6 million barrels of crude oil per day. Today, with U.S. demand for oil more than 20 percent higher, refinery capacity is roughly 1.7 percent lower. Refineries operate near full capacity in the summer, leaving the nation’s fuel supply chain vulnerable to disruption, as in September 2008 when Hurricanes Gustav and Ike shut down most Gulf Coast refineries, and gasoline stations throughout the Southeast ran out of fuel.

Refining historically has been the low-profit segment of the oil business, so the industry has had little incentive to build. Some economists believe the Federal Trade Commission made things worse by forcing oil companies to divest themselves of refineries when they merged with other oil companies. The smaller companies that bought the refineries often did not have resources to expand them. And, during the past decade, the Environmental Protection Agency (EPA) required refineries to invest $50 billion, according to industry, to meet regulations for cleaner burning fuels. Over the same time period, neither the EPA nor Congress did anything to force the auto industry to make more energy-efficient vehicles, which would have helped curb pollution and lessen the squeeze on refineries — and on wallets at the gas pump.