What do MMS and MSHA have in common?

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Written by Lisa R. Pruitt

In addition to being acronyms most of us had never heard before two different disasters brought them to our attention in April, the Minerals Management Service (MMS) and the Mine Safety and Health Administration (MSHA) are both examples of apparent regulatory failure.

The MSHA and its failings attracted public scrutiny in the wake of the Upper Big Branch mine explosion on April 5, an accident that took the lives of 29 miners.  Turns out, the Upper Big Branch Mine (UBB) had long been on MSHA’s radar screen as a bad actor.  In December 2007, the MSHA, a division of the Dept. of Labor, noted that the mine had been cited for 204 serious and significant violations in the past two years, a rate about twice the national average.  MSHA warned the mine’s owner, Massey Energy, that  it had a potential “pattern of violations,” a designation that would have permitted MSHA to close the mine each time it found a significant violation.  While Massey cleaned up its act enough in the months following that warning letter to avoid the “pattern of violations” scrutiny and consequences, it nevertheless continued to accumulate violations.  After the rate of violations decreased in 2008, they again accelerated.  One news report indicates that, in March 2010 alone, the MSHA cited the UBB mine 53 times.  Another indicates 515 citations at UBB in 2009.  Analysis by New York Times reporters indicates that one of the problems with the MSHA was not its failure to watch Massey, but rather a huge backlog of appeals by mining companies challenging citations.  According to the NYT, one in four MSHA citations are now appealed, which has resulted in a 18,000 pending appeals and $210 million in contested penalties.  Massey alone appealed 37 of the 50 citations it received for serious violations in 2009.  Read more here, here and here.

A New York Times editorial summed up the problems with MSHA and called for its reform in the wake of the explosion at UBB:

“[The MSHA’s] powers are limited. It has been remarkably forgiving of bad actors. And even when it uncovers serious, repeated violations, its cumbersome, industry-friendly appeals process makes shutting down a mine virtually impossible.”

At a late April Senate hearing, the head of MSHA advocated a law “requiring mine operators to pay penalties into escrow accounts before appeals were settled. He also called for his agency to be granted subpoena power to require companies to turn over documents promptly, and for lawmakers to strengthen criminal penalties carried by some mining violations so the threat of jail time became real.”  Read more here.

A few short weeks after the UBB mine disaster came a second explosion–this one offshore, at the Deepwater Horizon drilling rig in the Gulf of Mexico.  Initially, we mourned the 11 rig workers who died, but the grief soon spread beyond the loss of human life as an environmental disaster of enormous proportions unfolded.  Both wildlife and coastal economies have been devastated, and no relief for either is in sight.

As with the UBB catastrophe, reports of regulatory failure quickly emerged regarding the Deepwater Horizon, this time implicating the Minerals Management Service.   Turns out that MMS had a history of problems that were cataloged in a March 2010  report by the Dept of the Interior’s auditor general, but which were known long before.  MMS “inspectors had accepted meals, tickets to sporting events and gifts from at least one oil company while they were overseeing the industry.”  Employees of the Service were also found to have used crystal meth and viewed pornography while on the job.  Perhaps most salient to Deepwater Horizon was the report’s evidence of regulatory capture.  Just by way of example, one MMS employee had conducted four inspections of drilling platforms while negotiating employment with the very drilling company that MMS tasked him with scrutinizing.  Read more here, here and here.   House Natural Resources Committee Chairman Nick Rahall (D-W.Va.) expressed frustration a few weeks ago saying,  “It’s past time for MMS to stop acting as a farm team for the industry — the Deepwater Horizon oil rig explosion is proof that this isn’t just a game.”

Finally, just today the New York Times reports what it calls a “chasm between the oil industry’s assertions about the reliability of its blowout preventers and a more complex reality. It reveals that the federal agency charged with regulating offshore drilling, the Minerals Management Service, repeatedly declined to act on advice from its own experts on how it could minimize the risk of a blind shear ram failure.”

Yet even in the wake of these disasters, industry officials have called for less regulation and more cooperation between regulators and those whom they regulate.  Read more here.  Of course, decisions made by Massey Energy and BP were the primary causes of the UBB and Deepwater Horizon disasters, but we’ve come to expect no less from greedy corporations.  We should, however, expect more from our government.

I’ve never as much as taken an administrative law course, so my response to recent revelations about the MMS and MSHA’s failures may be uninformed and naive … but we claim to be a nation of laws, and we like to think our system for enforcing those laws works pretty well.  Yet these crises have revealed major shortcomings in our regulatory apparatus, including enforcement components.  Some of these failures appear to be holdovers from the Bush Administration, and we can identify efforts by the current administration to do better.  For example, Secretary of the Interior Ken Salazar says that the Obama Administration prioritized cleaning up the MMS and that he “directed a strong ethics reform agenda” during his first ten days of office.  We also see the Obama Administration taking steps to enhance enforcement of laws that protect other vulnerable groups, such as this report about child labor laws in the agriculture context.

Regulators–including generally obscure agencies like MMS and MSHA–clearly play critical roles in a range of contexts where the human, environmental, and economic stakes are extraordinarily high.  I find myself hoping not only for changes to existing laws to enhance penalties, but also for more vigorous enforcement of these laws by various regulatory arms of the Obama Administration.