(/sites/default/files/uploads/2012/04/120110_obama_jackson_epa_ap_605.gif)For those of us in industry who have watched the agency grow in power and arrogance over the decades, there wasn’t anything all that surprising about somebody suggesting that the EPA uses threats and intimidation against the regulated community. We all know, from long and bitter experience, that’s how the EPA works. What was remarkable is that it was an EPA official admitting it.
Al Armendariz, EPA Region 6 administrator, was caught on tape urging the troops attending a 2010 meeting to be ruthless in their dogged pursuit of dirty rotten polluters (aka: anybody in the private sector). “You make examples out of people who are in this case not complying with the law … and you hit them as hard as you can,” he said. But it was the spectacularly inappropriate analogy Almenadariz utilized to underline the point that really caught the public’s attention:
“It was kind of like how the Romans used to, you know, conquer villages in the Mediterranean,” he said. “They’d go in to a little Turkish town somewhere, they’d find the first five guys they saw, and they’d crucify them. And then, you know, that town was really easy to manage for the next few years.”
Yet, as spectacularly inappropriate as that analogy was, it was also dead-on accurate. When the EPA undertakes an enforcement initiative against one industry sector or another, it goes for the jugular. We’ve seen it time and time again. The initial “crucifixions” take the form of crushing fines against a handful of supposed bad actors, which serves to send a singular message to the rest of the companies in a particular industry sector: resistance is futile. It doesn’t matter whether the administration in power is Republican or Democrat. It’s an EPA thing. Congress has handed the EPA a tremendous amount of power over the years and the Agency isn’t at all shy about wielding it.
Consider the Clean Air Act, for example. Under the Clean Air Act the EPA has the authority to levy fines of up to $25,000 per day for each violation. Those violations don’t have to (and frequently don’t) have anything to do with emitting more pollutants into the air than are allowed by applicable regulations. If the EPA finds that a company didn’t file the right paperwork at the right time, or failed to keep a required record in exactly the right form, or committed a host of other environmental sins that don’t have anything to do with protecting the environment, they can wield their $25,000 per day per violation cudgel to get what they want. And what they want is revenue, both as an end for its own sake, and as a tangible means to “prove” to enviro-activists and Congress that they are doing their job. As I detailed in my book Regulators Gone Wild: How the EPA is Ruining American Industry, the more complex regulations become, the more opportunity the EPA has to pick meaningless nits and jack up enforcement revenue.
It’s all about the price point, as is the case with any protection racket. If the target is a big corporation, you have to load up a lot of alleged violations such that the possible penalty is huge, and then hit them with a settlement offer that makes just a little more fiscal sense than the company deciding to lawyer-up.
The little guys are easier marks. There’s not as much money to be made of course, since one can only squeeze so much juice out of a turnip, but all the Agency has to do is point at the monster settlement it made with the big boys in the target industry and the rest of the peasants are as sure to fall in line as any ancient Turk facing the might of Roman legions.
Need an example? Consider the electric power industry. Starting in 1999 and continuing through present day, the EPA went after coal-fired power plants for allegedly violating certain portions of the Clean Air Act. These complex cases were, in many ways, without real merit in my opinion but it was easier for the big guys to pay what amounted to a tax for daring to operate a coal-fired power plant than engaging in a long, costly legal battle. These cases affected large utilities who operate plants that generate hundreds and thousands of megawatts of electricity.
On the other end of the spectrum, there are the little guys – the local co-ops and municipal utilities that operate small power plants that generate a couple dozen or so megawatts per facility. Some of these local players burn coal. The Obama administration doesn’t like coal. And so, like the heavy in 1930s gangster movie, EPA officials have been calling on these small, environmentally insignificant coal-fired power plants and presenting them with a simple choice: shut down or switch to another fuel, because if you don’t we’re going to come after you, and you’ve already seen what we can do to the big guys. It’s like one of Capone’s boys showing up and darkly observing: “nice power plant you got there pal – it would be a shame if anything happened to it.”
Almost none of this racket is about actual environmental protection. The United States is one of the most environmentally pristine nations in the world and continues to get cleaner every year. No matter. The more we reduce pollution, the more outrageous EPA enforcement becomes. How can it be otherwise? The Agency, the environmental groups whom it answers to and their leftist supporters in Congress use enforcement activity as the primary metric by which the EPA’s successes and failures are judged. As a result, to bastardize Churchill, never in history have so many been fined so much for so little.
Republican Senator James Inhofe announced that he’s launching an investigation into EPA abuse as a result of Armendariz’s all-too-honest comments. Here’s hoping that something comes of the senator’s efforts. There are a few million of us in the private sector ready, willing and able to bear witness to what has been going on, and the nation will be far better off if Inhofe can help rein in this out-of-control agency.
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