Chemical & Engineering News

January 20, 1997

Copyright © 1997 by the American Chemical Society


Issues on the agenda: Balancing the federal budget; rewriting Superfund law; improving FDA, OSHA operations

Lois Ember, David J. Hanson, Bette Hileman, Wil Lepkowski, Janice R. Long, and Linda Ross Raber

C&EN Washington

What a difference a year - especially an election year - can make. Conciliation and cooperation may be this year's postelection theme in Congress, but last year at this time the government was shut down while President Clinton and Congress battled over how to balance the budget and over who was more devoted to meeting the country's needs.

At the height of confrontation last year, several Cabinet agencies and several Administration technological programs were marked for elimination by the Republican Congress. Environmental protection was in disrepute in some circles. The free market as the solution to all ills was the key. Not since the darkest days of Watergate during the 1970s was the partisan scene so grim in Washington.

But as the year went on, the mood changed. Sensing public disgust with the Washington spectacle, Congress reached agreement on a balanced budget. The Energy Department survived. Likewise the Department of Commerce. The industry-government initiative to reinvent the automobile (the so-called Clean Car Initiative) became a good idea after all. Dual-use technology programs at the Defense Department also made it through, with lesser funding to be sure, and so did the much-maligned Advanced Technology Program (ATP) at the Commerce Department's National Institute of Standards & Technology.

The November elections have had their impact; the dynamics have shifted to some degree. Although the leadership in the House has changed little, the Republicans have a smaller majority than they had in the last session. In the Senate, however, retirements of a number of moderate Republicans and Democrats mean that conservative Republicans wield more power. Most members of Congress would agree that the voters sent them a strong message last November - that they prefer cooperation and progress, not gridlock.

And then there are the legislatively mandated changes in the relationship between Congress and the executive branch that may have sweeping impacts. For the first time, the president has the power to veto individual line items in spending and taxing bills, and Congress has the power to veto regulations that the Administration wants.

But some things never seem to change. One is congressional and independent counsel investigations of the conduct of Clinton and his staff, which show no sign of waning. The House is mired, and shows signs of remaining so, in interparty conflict over investigations of the conduct of House Speaker Newt Gingrich (R-Ga.), whatever the outcome of the vote by the full House on the Ethics Committee's recommendations in his case. Both could come to occupy so much congressional attention that other important issues are pushed aside. But for now, pledges of cooperation and willingness to compromise abound.

With that as background, what can be said to be in store for the chemical community in this 105th Congress, one that is still taking shape?

Budget. The context this year, as one congressional staffer puts it, is "budget, budget, budget." Budget policy is driving science policy and that is that. "The real question," he says," is how you fit $35 billion [the civilian R&D budget] into a $30 billion box." That is the amount, $5 billion, by which this staffer expects the R&D budget to be reduced. However, several coalitions of scientific societies, universities, and high-tech corporations will be threading through the hallways in attempts to "save" the R&D budget and make it an exception to the overall downward trend in federal spending.

Leading these groups in size and money is the Science Coalition, spurred mainly by Harvard University and Massachusetts Institute of Technology and consisting of several universities, technical societies and associations, and high-tech companies. This coalition is managed by the Washington, D.C.-based Wexler Group, whose president is the just-retired House Science Committee chairman, Robert S. Walker. It will focus on personal relations with key members of Congress instead of high-profile campaigns. The irony is that Walker quite likely will be advocating some of the very issues he opposed while a committee chairman.

While people in the know are saying that the basic science budget - mainly the National Science Foundation and the National Institutes of Health - will enjoy at least a 3% increase, other research units of government will be taking hits. In terms of tough-to-take declines, most seriously affected will be the Defense Department's Naval Research Laboratory and Office of Naval Research. There will be pressure to close some of DOD's research labs as well. Those close to that issue say those labs are 40% overstaffed and due to be cut. One major reason for the "hit" - some say it could be as much as 25% - is the cost of maintaining troops and rebuilding the infrastructure in Bosnia. However, the Commerce Department's ATP program will quite likely be spared again as not constituting a large enough budget item to care much about.

There are some new power players who will be helping to shape the federal science and technology budget on Capitol Hill this year. Two personages to keep an eye on are F. James Sensenbrenner Jr. of Wisconsin, the new chairman of the House Science Committee, and the new chairman of the Senate Appropriations Committee, Ted Stevens of Alaska. Both are, of course, Republicans. Sensenbrenner replaces Walker and Stevens replaces a renowned Republican friend of science, particularly of NIH, Mark O. Hatfield of Oregon. Sensenbrenner's agenda is nowhere near firm - he is still building his staff - and his record is a mixed bag, but what all observers point out is that he and George E. Brown Jr. (D-Calif.), the Science Committee's ranking minority member, will have a much smoother relationship compared with the turbulence that existed between Brown and Walker.

Chemical Weapons. To date, 67 countries - but not the U.S. or Russia - have ratified the Chemical Weapons Convention. Senate approval of the treaty imploded last September after Republican presidential candidate Robert J. Dole indicated disapproval of the accord.

So, as it did last year, the treaty must again wend its way through the Senate Foreign Relations Committee whose chairman, Sen. Jesse Helms (R-N.C.), opposes ratification. Nevertheless, Administration sources expect to reach an agreement with Senate Majority Leader Trent Lott (R-Miss.), setting firm dates for votes by Helms's committee and then the full Senate on treaty ratification. Administration sources tell C&EN they are convinced the Senate will approve the treaty before April 29, when it is set to go into effect.

They base their conviction on President Clinton's direct engagement in the issue, an involvement absent since the U.S. signed the treaty on Jan. 13, 1993. For example, Clinton took the opportunity offered by his Jan. 7 acceptance of the final report of the presidential panel on Gulf War veterans' illnesses to "urge Congress to ratify the Chemical Weapons Convention."

At that press conference and again on the fourth anniversary of the treaty's signing, Clinton spoke of security costs to the U.S. should the Senate not ratify the treaty. But there are political and economic consequences as well.

On the anniversary date, Clinton stressed the economic costs, saying the" economic well-being of our chemical industry" was at stake. "I urge the Senate to act promptly to ensure that the U.S. remains at the forefront of international efforts to combat the spread of weapons of mass destruction, and the U.S. chemical industry maintains its international competitiveness."

According to the Chemical Manufacturers Association's (CMA) best estimate, direct chemical trade impacts will amount to $600 million per year "if the trade sanctions provided for in the convention go into effect" before the U.S. ratifies the treaty, says the association's senior assistant general counsel, Michael P. Walls. This is 1% of the U.S. chemical industry's annual exports, he notes.

There are unquantifiable impacts too. U.S. industry could be "considered an unreliable supplier in the global marketplace because of the U.S.'s failure to ratify," Walls says. U.S. industry is also concerned that some foreign governments might use U.S. nonparticipation in the convention as a pretext for imposing other barriers to trade, Walls adds.

Energy. Although the Republican juggernaut failed to eliminate the Department of Energy from the Cabinet last year, a dramatic overhaul of DOE in this Congress is possible. Other energy issues that will be engaging Congress' attention include the fate of the national laboratories and electric power deregulation.

Sen. Pete V. Domenici (R-N.M.) is expected to propose a plan this year that would eliminate DOE but also boost the profile of the national research laboratories: Two are, after all, located in his home state. In a back-to-the-future move, the responsibility for nuclear weapons and energy research would be put into a new civilian organization, the same as it was before the Energy Department was created in 1977. This would undoubtedly give research more visibility since it would no longer be buried in the mammoth DOE bureaucracy. Will it happen? Some say yes; some say no.

Electric utility deregulation, however, is the hottest topic facing the two energy committees this Congress. Rep. Dan Schaefer (R-Colo.), chairman of the House Commerce Subcommittee on Energy & Power, will reintroduce legislation left over from last year that would allow consumers to choose a power company as they now choose a long-distance phone company. This would put retail users, including industrial customers such as chemical plants, in the same markets as wholesale buyers.

Environment. It may seem strange, but electric utility deregulation may also have environmental consequences. Many environmentalists say deregulation could lead to a major increase in air pollution because, in some regions, electricity from coal - the dirtiest fuel - is cheaper than that from any other source. For example, they fear that under deregulation, New England, where electricity is expensive and comes largely from oil-fired or nuclear plants, would instead buy cheaper electricity from coal-fired plants in the Ohio Valley.

CMA President and Chief Executive Officer Frederick L. Webber, however, does not expect air quality to decline because of deregulation. "That argument is based on the assumption that cheap power is always going to come from coal," he says, when in fact much competitive power comes from natural gas, hydro, and some of the older nuclear plants. "If deregulation is done right, the typical consumer [including CMA member companies] is going to benefit," he says.

Congress also is expected to put a significant amount of effort this year into reauthorization of the Superfund hazardous waste cleanup law. The debate over Superfund now centers on whether the law needs to be restructured to accomplish needed reforms. Some Environmental Protection Agency sources indicate that a reauthorized Superfund law is needed to institute major changes. But Justice Department officials say administrative reforms already made and planned obviate the need for fundamental changes in the law. They believe a simple reauthorization of the tax on chemical production that supports the fund and perhaps codification of what has already been accomplished administratively is all that is needed.

CMA's Webber couldn't disagree more with this second approach. "We want reform in the areas of liability, funding, and remedy selection, and we're optimistic that this is the year to get it," he says. CMA would prefer a total repeal of retroactive liability, but that's not realistic, he explains. Instead, the organization advocates a fair-share approach in which each polluter pays for its portion of the cleanup, and cleanup of "orphan shares" - those that can't be assigned to any entity - are paid for by Superfund. This approach would mean the end of joint-and-several liability, in which one party sometimes must pay for the total cleanup when other responsible parties cannot be found.

Also on the congressional environmental agenda is legislation to establish an interim storage facility for high level nuclear waste at Yucca Mountain in Nevada, where a permanent geologic repository is being built. Similar legislation almost passed the 104th Congress, and many members are planning to push a similar bill this year.

Spent nuclear fuel is now being stored on-site at 73 nuclear power plants. A July court decision requires DOE to start accepting the spent fuel by January 1998. But DOE Undersecretary Thomas P. Grumbly said in October that DOE cannot meet that deadline. And DOE's Office of Civilian Radioactive Waste Management argues that another law prevents it from placing an interim storage facility on the same site as the permanent facility. Outgoing Energy Secretary Hazel R. O'Leary recently said there is no need for an interim facility in 1998 because the geologic repository will be ready to accept spent fuel only 12 years later, by 2010.

An interim storage facility likely would help keep electricity rates down. The Nuclear Energy Institute (NEI), the trade association for the nuclear power industry, argues that if DOE continues to postpone its acceptance of spent nuclear fuel, utilities may have to spend $5 billion for new on-site storage facilities. "Reform of the program now rests squarely on the shoulders of the 105th Congress," says NEI President Joe F. Colvin.

Food & Drug Administration. Efforts will proceed this year to push through major reforms in operations at FDA. House Commerce Committee Chairman Thomas J. Bliley Jr. (R-Va.) has pledged to make FDA restructuring his top priority this year. And the Administration is reportedly drafting its own FDA reform bill.

Bliley said he is determined to get the agency to speed up the approval process for new drugs and medical devices. So among provisions that might be included in his bill is one that would let private companies take over some of the responsibility for reviewing new product applications. Last year's high-profile efforts to restructure FDA met with strong opposition from the Clinton Administration. New legislation involving smaller scale approaches may be more successful this Congress.

For example, reauthorization of the Prescription Drug User Fee Act likely will come up early in this Congress. Under this law, which has been given credit for shortening the time it takes FDA to review new drug applications, the pharmaceutical industry pays FDA user fees. In exchange, the agency is supposed to meet specific drug-review deadlines. The law is set to expire in September. The Administration and industry are said to be near agreement on a reauthorization bill, and the Administration is expected to send it to Congress shortly.

The Senate also faces the task of confirming a new FDA commissioner. Exiting Commissioner David A. Kessler takes credit for the significant cuts achieved in drug approval processing times, but Bliley has said Kessler did so only under the threat of congressional reform action. The Administration has not been very prompt in making appointments to scientific posts, including FDA commissioner, so Kessler may be around for a while. His successor's confirmation is in the hands of the Senate Labor & Human Resources Committee, which has a new chairman, James M. Jeffords (R-Vt.). The moderate Jeffords has not been active on the FDA reform issue, but already has announced he will take up the debate in his full committee, rather than giving it to a subcommittee to handle.

Immigration. In 1996, the 104th Congress got tough on immigrants - even legal immigrants - but could not pass a bill restricting the numbers of legal immigrants into the U.S. Now-retired Sen. Alan K. Simpson (R-Wyo.) led the charge to reduce all types of immigration, including employment-based immigration. "Simpson banged his head against a wall for 18 years," says Mark Krikorian, executive director of the Washington, D.C., Center for Immigration Studies. "Simpson was frustrated and bitter at the end, but he got a lot more done than he thinks he did. The climate is really radically different from what it was two years ago."

Reductions in employment-based immigration are of great concern to scientists and engineers, some of whom believe they are being squeezed out of good jobs by the foreign born. However, when the dust settled, restricting U.S. access to "the world's best and brightest" had proven too unpopular with a broad coalition of concerns - from industry groups to software developers to trade unions - to be enacted into law.

It's still too early to tell where immigration legislation is headed in 1997, because the most crucial decision is yet to be made. As C&EN goes to press, Sen. Jon Kyl (R-Ariz.) hasn't decided if he wants to be chairman of the Senate Judiciary Committee's Subcommittee on Immigration. If he wants it, he gets it for reasons of seniority.

Kyl was one of only a few senators who voted for an amendment to Simpson's bill last year that would have cut legal immigration. Krikorian thinks Kyl, if he decides to chair the subcommittee, may try to get some of the less controversial legal immigration limits - none of which focus on populations some scientists want to see limited - enacted into law.

However, Kyl is reported to be very interested in other subcommittee assignments - for example, Judiciary's Antitrust, Business Rights & Competition Subcommittee. Poised to pounce on the chairmanship in the event Kyl refuses it is Sen. Spencer Abraham (R-Mich.). Abraham is a vocal opponent of restrictions on legal immigration and would block any attempts to restrict employment-based immigration to the U.S.

Occupational safety. Rep. Cass Ballenger (R-N.C.), chairman of the Education& Workplace Committee's Subcommittee on Workplace Protection, says his first priority is a bill, already introduced, that would allow hourly employees to accrue time off instead of getting cash payments for overtime work. Such a bill would overturn the 1938 Fair Labor Standards Act, which required employers to pay their workers overtime wages. The House passed similar legislation last year, but it was shot down by unions and the Administration, which said the law gave too much power to management.

And Republican leaders may take another stab at crafting a new package of OSHA reform initiatives, one that incorporates some of the Clinton Administration's own reinvention plan for the agency. Ballenger does plan to hold hearings on the progress of OSHA's reinvention efforts. He wants to find out which initiatives have been the most effective and incorporate them into any reform bill. Any reform effort is likely to be much more low key than last year's high- profile efforts, which were criticized as too extreme and held up by some as an example of the Republican revolution overstepping its mandate.

Patents. To those following attempts to reform patent law in the U.S., 1997 is shaping up as déjàvu all over again. The players have changed a little, but it's the same game. Just before the House recessed on Jan. 9, Rep. Howard Coble (R-N.C.) introduced an updated version of H.R. 3460 - legislation drafted in the last Congress by two members of the Judiciary Committee who have now retired - Carlos J. Moorhead (R-Calif.) and Patricia Schroeder (D-Colo.).

Virtually identical to H.R. 3460, the new bill - the 21st Century Patent System Imrovement Act (H.R. 400) - is comprehensive legislation. In addition to providing for the publication of patent applications 18 months after first filing, the bill converts the U.S. Patent & Trademark Office (PTO) into a government corporation. It provides a defense against patent infringement charges to parties who have used a patented invention in the U.S. at least one year before that patent's filing date. It also gives third parties greater ability to participate in patent reexamination proceedings in the PTO.

Last year, this legislation was supported by the Clinton Administration, Republicans, and Democrats alike. In fact, it was unanimously approved in the House Judiciary Committee last year, so it has a lot of momentum behind it.

Once again, vigorously opposing this bill will be Rep. Dana Rohrabacher (R- Calif.), who, according to his staff, will introduce a bill incorporating much of one bill he introduced in the last session, H.R. 359. That bill seeks to return patent protection in the U.S. to the way it was before it was changed by international treaty. In other words, patent protection would once again run 17 years from the date a patent is granted. Rohrabacher and his supporters, many of whom are individual inventors, claim that the 20 years from filing protection results in less protection for them because of extraordinary delays in the patent office.

Product liability. Interest groups on both sides of the issue expect product liability legislation to be introduced again this year. A product liability bill was vetoed by President Clinton in 1995. Consumer groups, such as U.S. Public Interest Research Group and Public Citizens' Congress Watch, are gearing up to fight the issue. They believe tort reform would severely limit legitimate product liability cases that expose dangers, punish wrongdoers, and provide fair compensation for injured victims. CMA, on the other hand, is very much in favor of tort reform. "Those who supported it in the last Congress and were disappointed over the veto are going to work hard to get something going again this year," Webber says. CMA would be satisfied with a bill like the one that was vetoed.

Regulatory reform. Senate Majority Leader Lott has said regulatory reform will be a high priority in the 105th Congress. But because the reform bill passed by the House last year aroused such a firestorm of criticism, most observers do not expect regulatory reform to be moved as a stand-alone bill. Instead, it will be incorporated into individual environment or health and safety bills.

The earlier House regulatory reform bill was "mischaracterized" as antienvironmental, says Webber. "We certainly didn't win the communication battle on that."

Gregory S. Wetstone, legislative director of the Natural Resources Defense Council, holds an opposite view. "The single most sweeping and dangerous environmental threat of the 104th Congress was the backdoor effort to block enforcement of America's environmental laws in the name of 'regulatory reform,'" he says." Far from reform, these bills would have dramatically increased bureaucracy and litigation, while drastically reducing environmental and health protection."

Congress has always had the power to invalidate agency rules by enacting legislation. But last March, a new law was passed that gives Congress potentially much more influence over the rule-making process. Called the Small Business Regulatory Enforcement Act, it allows Congress to overturn rules that have significant impacts - those that cost the economy $100 million or more - by passing a joint resolution of disapproval within 60 days after the rules become final.

The test case for this new congressional power may involve new standards for particulate matter and ozone that are required under the Clean Air Act and were proposed by EPA late last year. The House Commerce Committee's Subcommittee on Oversight & Investigations, chaired by Rep. Joe Barton (R-Texas), definitely plans hearings on EPA's proposed air rules, and a number of other committees have expressed an interest in holding similar hearings.

Industry representatives argue that science does not support the new standards and that achieving them would be extremely disruptive to the economy costing millions of jobs. They want costs to be taken into consideration when setting clean air standards, something that is prohibited under current law.

Rep. Henry A. Waxman (D-Calif.), one of the Clean Air Act's principal authors, maintains that the "guts of the Clean Air Act are health-based standards. To sacrifice the standards themselves would be a fundamental repeal." Rep. Wayne T. Gilchrest (R-Md.) concurs: "To base clean air standards on anything other than health is ludicrous." Waxman predicts that a clean air fight this year would be "the mother of all environmental fights."

Science and technology policy. The new Congress will see a maturation, as it were, of how the science and technology are embedded in everyday concerns. This week, the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine as a group were sending to Congress in the form of white papers their own sense of priorities facing the country. The official unveiling of the reports will take place on Jan. 29, but the subjects covered in the papers are known to include education at all levels, the size and quality of investment needed in science and technology, and the role of the social and behavioral sciences in helping determine a national science and technology agenda.

Issues in space policy will largely be articulated in February, when the White House holds its space summit. The value of space science is hardly contested, but the space station is another matter, because of its cost and the uncertainty over the ability of Russia to hold to its end of the bargain involving early missions. Plans for the Russian mission to its space station Mir for building the first module of its promised part of the international (read: primarily U.S.) space station seem to be in doubt. "We just don't know whether the Russians are going to deliver or not," says one House Science Committee staffer.

Information superhighway issues also are sure to be debated, including the federal role in paying for some of the new "wiring" of schools, hospitals, and other service institutions-the government's attempt to bring computers and the Internet to these institutions. Of keen interest lately is the debate over efforts to copyright the digitized and encrypted messages that stream over the Internet. The U.S. has supported changes in the world copyright treaty before the World Intellectual Property Organization, which would regard as intellectual property such free and universally available Internet material. The information industry will continue to press Congress to allow for the free flow of information, while proptecting its legitimate intellectual property.

Overall, what seems to be in the offing, at least in the House Science Committee, is a series of oversight hearings on the role of science and technology in - for lack of a better word - the "remaking" of the system that is evolving throughout society. How, for example, is managed medical care affecting the research functions of teaching hospitals? How much of welfare reform should contain strong efforts to restrain people for the technical world? Have research universities overbuilt? Are they truly cutting out the fat, as they say they are? How well have civilian technology progrmas affected the economy of the country and innovation in corporations?

So in sum, the next Congress could represent a watershed in the evolution of science and technology policy in the U.S. It will not stand out by itself but will probably seem hidden by events that make up the political headlines. Space science and technology are undergoing reassessment; the health care system likewise. Civilian technology as policy is in a holding pattern. Basic and academic research are also on their own colsolidation course. It is as if the whole country were reassessing itself, determining what in the end is and isn't important.

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