Crimes Against Nature (17 page)

In December 2003, Leavitt and Holmstead scrapped the Clinton reforms and proposed new ones. These would leave mercury pollution nearly seven times as high as the Clean Air Act would require for at least the next 14 years. But that’s only the beginning. Lawyers for these polluters would be able to delay implementation of even those feeble standards using huge loopholes that they themselves buried like land mines in the provision’s language. Portions of Holmstead’s proposal came verbatim from a memo prepared by Holmstead’s old law firm, Latham & Watkins, which represents some of the affected utilities.

After giving his industry cronies rollbacks beyond their wildest dreams, Holmstead continues to troll for new ideas for federal giveaways. In January 2004, he attended a conference for lobbyists at the Arizona Biltmore. The event followed a $3,000-per-person golf-and-dinner Republican fundraiser, dubbed “Mulligans and Margaritas.” The conference was touted as an opportunity to draft a to-do list of industry-friendly legislation.
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Among the top 10 priorities targeted by the conferees were: reforming the Endangered Species Act, the National Environmental Policy Act, and the Clean Air Act; expanding access to public lands; enacting the federal energy bill; and reforming the legal tort system.
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The gathering was organized by Jim Sims, a Denver-based coal and utility lobbyist and former spokesman for Cheney’s energy task force.
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Also on hand at the boondoggle-fest were James Connaughton, Bush’s Council on Environmental Quality director and former asbestos attorney, and deputy secretary of the Interior J. Steven Griles. While Holmstead is an extremely useful ally of energy, the appointment of Steve Griles was arguably the biggest payback to the coal industry.

There was nobody in the United States better positioned than Steve Griles — with his 35 years of working for the energy industry, both in and out of government — to do King Coal’s bidding.

Ironically, it was the very statute Griles spent his career trying to destroy that catapulted him to fortune and power. From 1970 to 1981, Griles worked at Virginia’s Department of Conservation and Economic Development, which operates a sleepy permit office charged with issuing mining permits to coal companies in Virginia’s Appalachian country. During the early 1970s, Griles made a name for himself by running interference on behalf of the coal business. “I found Steve to be extremely pro-industry,” recalls Frank Kilgore, a Virginia lawyer who worked on mining reforms during that period. “No matter what evidence you showed him about people having their houses blown apart, or rocks coming through the roof, or private cemeteries or water supplies being destroyed by stripping, it didn’t seem to make any impression on him. He was always pretty up-front that he was an industry man — and get out of the way.”
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Then, in 1977, in the wake of the Buffalo Creek massacre, Congress passed the federal Surface Mining Control and Reclamation Act (SMCRA). Suddenly Griles’ agency was required to regulate an industry with which it had always been chummy. He took the new law as a personal affront. He led Virginia in challenging the SMCRA as an unconstitutional infringement on states’ rights.
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Although his suit suffered a rare 9–0 loss in the Supreme Court, it did earn Griles plenty of industry gratitude, the only credential he needed to land a job in Jim Watt’s Department of Interior in 1981.

Watt appointed Griles to run the very agency he had vowed to destroy — the Office of Surface Mining (OSM), an agency in the Department of Interior that was created to administer the SMCRA. As deputy director from 1981 to 1983, Griles is said to have promised to “turn the lights out at the OSM.”
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While he neither confirms nor denies the statement, everyone agrees that Griles gutted the agency. He cut staffing by a third, dramatically reduced the number of federal inspectors at mine sites, and sharply curbed enforcement actions.
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Griles recruited industry-friendly personnel, fired or transferred environmentally friendly regulators, and fought to shift regulatory authority to the states. Staff morale plummeted. Griles himself told the
Washington Post,
“We tore this agency to hell.”
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Griles continued his campaign as he moved up the food chain in Reagan’s Interior Department. When he landed the job of assistant secretary for lands and mineral management at the Department of the Interior in 1985, the
Oil Daily
endorsed the appointment as the “ideal choice.” During his tenure, Griles leased more federal offshore oil and gas acreage than anyone in the history of the Interior Department.
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He was accused of orchestrating what amounts to a criminally negligent giveaway of 82,000 acres of federal oil and shale lands for a ruinously cheap $2.50 per acre.
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The government received $200,000. One claimholder got title to 17,000 acres for $42,500 — and then immediately sold the same land for $37 million.
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Griles tried to open the Arctic National Wildlife Refuge to drilling and vigorously promoted offshore oil leasing in California and Florida. The House Government Operations Committee said Griles’ program was so badly administered that Congress should consider transferring it to another agency.
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In 1989, investigators for the California legislature uncovered internal Interior Department records revealing that Griles deliberately concealed from the public and state regulators the true risks of oil spills from drilling off the California coast.
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At the end of the Reagan administration Griles formally went to work for the coal industry. From 1989 to 1995 he was a senior vice president for the Virginia-based United Coal Company, where he oversaw operation of one of the nation’s largest mountaintop-removal operations. In 1995 he founded J. Steven Griles and Associates, a lobbying firm that represented over 40 coal, oil, gas, and electric companies and trade associations. Subsequently, he merged his firm with National Environmental Strategies (NES), a lobbying outfit founded by former Republican National Committee chairman Haley Barbour. NES represented the National Mining Association and Dominion Resources, one of the nation’s largest power producers, as well as the Edison Electric Institute, Shell, Texaco, Chevron, Arch Coal, and Pittston Coal, to name just a few.

These clients poured millions of dollars into George W. Bush’s presidential campaign, and Bush’s appointment of Griles as second in command at Interior was exactly what they were paying for. Griles served on President Bush’s transition team, helping to fill key administrative posts with reliable lobbyists from regulated industries. Following the announcement of his appointment, the National Mining Association hailed Griles as “an ally of the industry.” The
Denver Post
lamented that the “champions of industry will be running the department that oversees most of the nation’s public lands.”
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Like Holmstead, Griles has a tortured relationship with the truth. It’s bad enough that a former mining lobbyist was put in charge of overseeing mining on public land. But it turns out that Griles is still on the industry’s payroll. In 2001, he sold his client base to his NES partner Marc Himmelstein for $1.1 million, payable in four annual installments of $284,000, making Griles, in effect, a continuing partner with a direct financial stake in the firm’s profitability.
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The Senate made Griles agree in writing that he would avoid contact with his former clients as a condition of his confirmation.
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Under the agreement, Griles is prohibited from dealing with matters involving NES for six years and is barred from matters concerning “former” clients for a year.

Griles has trouble keeping his promises. His appointment calendar, obtained by Kristen Sykes of the environmental organization Friends of the Earth, indicates that Griles met repeatedly with oil-industry clients to discuss offshore leases in which they had an interest.

One of those companies was Chevron, which paid Griles $80,000 to lobby the Interior Department even while his nomination was pending before the Senate in 2001.
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As soon as he was confirmed, Griles negotiated a lucrative deal for Chevron in which the federal government would pay the company a whopping $46 million to drop its plans to drill off the Florida coast. This decision both enriched Griles’ former clients and enhanced the reelection prospects of President Bush’s brother Jeb as governor of Florida.
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Griles continued to flout ethics laws. He had signed a second recusal agreement when he took office, this one banning him from involvement in decisions about a coal-bed methane project in Wyoming and Montana, which was being promoted by six former clients. Career personnel in the EPA’s Denver office had delivered a devastating assessment of the proposal, which called for building 51,000 wells in Wyoming’s Powder River basin.
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The project will require 17,000 miles of new roads and 20,000 miles of pipeline and will foul pristine landscapes with trillions of gallons of toxic wastewater.
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Several months after Griles signed his recusal agreement, he wrote a memo to Linda Fisher, EPA deputy administrator, demanding that she overrule her Denver employees. In his letter, Griles scolded the EPA for investigating the effects of coal-bed methane development on water quality and warned Fisher not to “impede the ability to move forward in a constructive manner.”
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Thanks to Griles, the project was approved.

Griles again violated his recusal pledge by meeting with the National Mining Association, a former client, while the industry group was lobbying the administration to relax restrictions on mountaintop-removal operations. He also had 14 other meetings on mountaintop removal with industry and government officials.
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And then on April 15, 2002, he assembled the officials who oversee the mining and drilling operations of his former clients for a dinner party at the home of the owner of NES, Marc Himmelstein, who was now representing those clients. Included at Himmelstein’s soiree were Rebecca Watson, assistant secretary for Land and Minerals Management; Kathleen Clark, director of the Bureau of Land Management; and Jeffrey Jarrett, director of the Office of Surface Mining.
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With Republicans chairing the committees, no congressional subpoenas have interrupted the Griles scandals. In fact, an Interior Department spokesman has gone so far as to say that Griles’ conduct represents “the highest ethical and professional standards.”
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In May 2002, Senator Joseph Lieberman asked the Interior Department to investigate Griles. On June 3, 2003, environmental and government ethics organizations, including the NRDC, joined Whitney North Seymour Jr., former independent counsel and Richard Nixon’s U.S. attorney for the Southern District of New York, in calling for the appointment of a special counsel to conduct a criminal investigation of Griles for perjury and ethics laws violations, and for steering government contracts to former clients.
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The Interior Department has refused to turn over 300 pages of documents concerning NES’s $1.1 million payment to Griles that environmental groups requested in September 2002 under the Freedom of Information Act.
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On March 16, 2004, the Office of the Inspector General for the Interior Department concluded an 18-month investigation, commenced at Senator Lieberman’s request, with a report setting forth strong evidence of unethical conduct by Griles. The report characterized the initial choice to appoint Griles, with all his inherent conflict of interest, as “a train wreck waiting to happen.” It confirmed that Griles had regular dealings with energy- and mining-industry clients of his former lobbying firm even as he continued to receive income from the firm’s owner. The report concluded that evidence showed that “the department’s leadership did not take ethics seriously.”
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The inspector general describes an ethical atmosphere within Interior so lax that when an “onslaught of public criticism erupted” over Griles’ dinner at Himmelstein’s, Griles was told by Timothy S. Elliott, the department’s deputy associate solicitor, that there would be no problem so long as Griles paid for the dinner himself.
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Griles wrote Himmelstein a $180 check, which went uncashed for many months.

Investigators complained of the rough-man handling they got from Griles, Norton, and their powerful friends. The investigation, the report says, was obstructed by “an unanticipated lack of personal and institutional memory; conflicting recollections; [and] poor record-keeping.” The report added, “When we interviewed the Deputy Secretary and discussed our efforts to discern the status of his client list, he commented simply, ‘Good luck.’ ”
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When investigators questioned Griles and Himmelstein about Griles’ involvement in the federal payoff to former clients Shell and Chevron, in light of the formal recusal he had signed banning him from any dealings with those companies, Griles told them that he had listed these companies erroneously on his recusal form. Himmelstein claimed, apparently with a straight face, that Griles had not lobbied for Chevron, despite Griles’ having been listed as a Chevron lobbyist in filings with ethics offices.

Griles told the inspector general that he could not explain why Chevron’s first six payments to his firm included the annotation “Attn.: Steven Griles.” At first he maintained that his meetings with Shell’s subsidiary, Aera, were permitted because his recusal did not apply to subsidiaries; he later changed tack and claimed he was unaware that Aera was owned by Shell.
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