TCS Daily


A Coal Miner's Daughter She Ain't

By Michael Catanzaro - November 8, 2001 12:00 AM

During her brief tenure as EPA Administrator, Christie Todd Whitman has endured swarms of criticism, not least from Republicans. The stormy battle over Ohio EPA Administrator Donald Schregardus, nominated to be the federal EPA Administrator for Enforcement and Compliance, was a case in point.

As a highly controversial figure for pursuing pro-business environmental enforcement in Ohio, Schregardus badly needed early support from Whitman. But the former New Jersey Governor, despite strong support from several Republican senators, was largely indifferent to Schregardus's nomination.

In fact, she offered only a tepid and belated endorsement, which -- along with an overblown EPA report questioning Ohio's enforcement record and the usual bickering from environmentalists -- forced Schregardus to withdraw his name from consideration. Republicans accused Whitman of being "aloof," and insensitive to environmental politics.

Whitman now faces a much tougher struggle, this time with her own bureaucracy. Late this summer, EPA bureaucrats leaked a multi-pollutant "straw man" proposal, which includes draconian emissions reductions for three pollutants: sulfur dioxide, nitrogen oxide, and mercury. The legislative proposal was widely denounced. According to a Republican senator on the Senate Environment and Public Works Committee, the proposal would "totally destroy the coal industry in this country."

Bureaucracy Run Amok

So a crucial question now is whether Whitman can exert effective control over the EPA's Office of Air and Radiation, which has been working on a multi-pollutant scheme since the Clinton Administration. Many current and former EPA officials doubt that she can. Within the agency, there is a pervasive lack of understanding of the office's highly complex modeling techniques, which are understood by only a select few. After plugging in arcane scientific assumptions, those models produce regulations.

What's more, according to a former EPA official, these initiates "share a very different philosophy from the current Administration." They are highly experienced, ideologically driven, and largely in control of the EPA's terribly complex regulatory apparatus. And these technocrats are formidable. Few staff members, let alone a political administrator, can compete with them. "Career officials [inside the Office of Air and Radiation] are very smart, very knowledgeable," said another former EPA official. "When they draft these kinds of proposals, they are hard to overcome, both politically and technically."

Jeff Holmstead, head of the Office of Air and Radiation, is a highly knowledgeable manager, and no friend of onerous regulatory schemes. Confirmed only recently over objections from several Democratic senators, Holmstead has had little time to assert control over the office. As a result, according to an EPA staffer, Holmstead has been "co-opted by the bureaucracy."

In short, a hard green bureaucracy continues to run amok, just as it did under Whitman's predecessor, Carol Browner. For an administration trying to balance its loyalty to the coal industry-which helped Bush carry West Virginia-and its appeal to moderate voters concerned about the environment, that can be problematic.

"A De Facto Kyoto Treaty"

Which raises an unsettling question: Which group is more important politically? Whatever the answer, coal industry representatives are certainly not happy. "This multi-pollutant proposal is essentially a de facto Kyoto Treaty," said Rob Long of the United Mining Association. "If it becomes law, many of our companies would effectively be shut down."

Such a scenario could undermine an economy teetering on the brink of (if not already in) a full-blown recession. Coal-fired generation provides approximately 52 percent of the nation's electricity. Without coal, many electric utilities nationwide would be forced to use highly priced alternatives.

That's exactly the point made by Michael Baroody, executive vice president of the National Manufacturers Association. In a September 21 letter to Whitman, Baroody wrote that the proposal would force "electric generators to choose between spending large amounts of capital to continue using coal or to switch to using increasingly expensive natural gas."

By leaking their numbers to reporters, EPA's apparatchiks cleverly set the parameters of the multi-pollutant debate. In what coal industry officials describe as a "hideous negotiating position," the debate currently consists of EPA's numbers and legislation sponsored by Senate Environment and Public Works Committee Chairman James Jeffords.

In some respects, the EPA's numbers are more stringent than the Jeffords bill. To industry officials and everyday consumers, though, the Jeffords bill is downright scary. It includes tight caps on carbon dioxide emissions, similar to the economically disastrous Kyoto Treaty. No one expects the Jeffords bill will become law, but one never knows what the quirky politics of environmentalism will produce.

According to the Energy Information Administration (EIA), the Energy Department's statistical arm, compliance costs with the Jeffords bill would be $140 billion over the next decade. Also, the price of electricity will be 29 percent to 32 percent higher in 2010-in other words, a $145 to $163 higher annual electricity bill for the average consumer.

According to testimony from Whitman, EPA's rationale for its proposal is a quid pro quo: eliminate the morass of clean air programs in exchange for tighter controls. That also includes significant reforms to New Source Review, which was abused during the Clinton Administration. But heavy-handed emissions reductions would certainly undermine any sound policy reforms.

Fortunately, the EPA's proposal has some powerful enemies inside the administration. Cooler heads within the Energy Department and Vice President Dick Cheney's Energy Working Group have raised objections. The most obvious objection is that EPA totally contradicts the conclusions of Bush's National Energy Policy report. "A primary goal of the national energy policy is to add supply from diverse sources," according to the report. "This means domestic oil, gas, and coal."

Jeffords recently began marking up his bill. The expectation on Capitol Hill is that multi-pollutant legislation won't be finalized until next year. The White House, though preoccupied with a war, should intervene and take the multi-pollutant debate seriously. If not, the consequences, political and economic, could be dire.
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