read before you vote: WTI, Clinton-Gore's first broken promise

[Mark Robinowitz <mrobinowitz@igc.org>]

Clinton's Region 3 [mid-atlantic] EPA Administrator - Peter Kostmayer, a
democratic Congressman from Pennsylvania who lost his seat in 1992 (he'd
introduced legislation to ban new incinerators) - was fired for opposing the
Environmental Impact Statement for the proposed $1.5 billion 118 mile
"Corridor H" superhighway through the mountains of West Virginia and the
water discharge permit for the Parsons & Whittemore paper pulp mill in Apple
Grove, WV, on the Ohio River (the mill would be the largest in the country,
and would dump dioxin into the river).  West Virginia Governor Gaston
Caperton and Senators Byrd and Rockefeller complained to Clinton (the paper
mill contributed to West Virginia politicians and to the Democratic National
Committee), who complained to EPA Administrator Carol Browner, who fired
Kostmayer.

Hillary Clinton helped incorporate WTI while at the Rose Law Firm and served
on the board of LaFarge Cement, which operates a cement kiln in Alpena,
Michigan on Lake Huron that switched from natural gas to burning hazardous
wastes (used motor oil, solvents) in the mid-1980s.

Perhaps Bill Clinton can urge neighbors of the WTI incinerator not to inhale.

-----------

Pittsburgh City Paper
July 21-27, 1993

"WTI:  The election connection"

Observers called it the most ingenious protest they had ever seen.   At noon
on Monday, May 17.[1993]  in Washington, D.C., a yellow truck pulled up
outside the White House on Pennsylvania Avenue and stopped in the middle of
the street. Within a minute, a metal stack had been erected on the top of
the truck and 50 protestors had handcuffed themselves together around it,
some to the axle underneath, others with their hands thrust through the
sides of the truck, literally, then cuffed to blocks of concrete.

The protestors blocked traffic for six hours that afternoon while D.C.
police tried to extricate them from their mobile fortress.  As smoke rose
from the stack of the mock toxic waste incinerator, other protestors on the
sidewalk erected a banner facing the White House that read "You promised"
and chanted, "If you can't stop WTl, how on earth can you save the planet?"

WTI (Waste Technologies Industries), the nation's newest toxic waste
incinerator, began operating this year in East Liverpool, 30 miles upwind
from Pittsburgh.  The 50 arrested protestors included actor Martin Sheen
(whose mother-in-law lives in northeastern Ohio) and residents of the
community surrounding the Ohio River valley town. The taunts were aimed at
Al Gore, who promised that the Clinton administration would shut down WTI.
And the smoke pouring from the top of the stack unintentionally symbolized
the smoke screen behind which the Clinton administration has betrayed the
trust of these people, who believed Clinton and Gore would keep their word.

The protest, which attracted national media attention, was intended to
convince Clinton and Gore to fulfill the promise they made last December 6
to temporarily shut down WTI and launch a full investigation into
allegations of permitting violations and health risks to the local
community. The incinerator sits on the banks of the Ohio River within the
flood plain, 400 feet from a dense residential neighborhood and 1,100 feet
from an elementary school, in an area prone to air inversions that will trap
toxic pollutants in the valley.

Clinton and Gore gave the protestors no points for creativity, however. Not
only have they taken no action against WTI, but they allowed the U.S. EPA to
issue a permit for limited commercial operation on July 8.  Some critics
count this as simply another example of  Clinton's political indecisiveness.
But to local residents who can look out their windows and see the plume of
toxins released from the incinerator's stack, it is literally a deadly betrayal.

Unanswered Questions

A year ago, Clinton and Gore sang a very different tune. In July, 1992, when
they visited Weirton, West Virginia, on a campaign bus tour, Gore freely
spoke out against the WTI incinerator.  "The very idea of putting WTI in a
flood plain ... you know it's just unbelievable to me," Gore told the crowd.
"I'll tell you this, a Clinton-Gore Administration is going to give you an
environmental presidency to deal with these problems. We'll be on your side
for a change instead of the side of the garbage generators, the way
[previous presidents] have been."

Local opponents were elated. "We felt that this ushered in a new era in
national politics," said Alonzo Spencer, an East Liverpool resident and
president of Save Our County. "People here who were never involved in
politics became active in campaigning for Clinton and Gore."

Gore's announcement on December 7 [92] seemed to verify his commitment to
stop the incinerator. "Until all questions concerning compliance with state
and federal law have been answered, it doesn't make sense to grant any
permit," said the Vice President-elect in a press release.

Among the unanswered questions addressed by Gore: Was the permit issued
legally by the EPA?
Is the incinerator safe for the environment and the health of the local
residents?  After years of name changes and buy-outs among the original
owners, who now owns the facility, and who is responsible for its operation?
These were questions that incinerator opponents had been raising for years.
Finally, they thought, someone was listening.

By March, however, WTI was burning toxic waste to test the facility, and
Clinton and Gore, having answered none of these questions, had done nothing
to stop WTI.  Instead, they deferred to legal obligations from eleventh hour
decisions made during Bush's last days, ostensibly preventing them from
taking action.

"First of all," said Gore at a "town meeting" on March 10 in Omaha,
Nebraska, "the decisions relating to this particular permit were made
principally and almost exclusively during the last administration and that
incurred certain legal obligations toward the company that had invested tens
of millions of dollars." After only two months in office, the
environmentalist Vice-President was waxing apologetic for the hazardous
waste industry.

What happened? Did Clinton and Gore change their minds? Or are they really
fulfilling legal obligations? Environmental consultant Lynn Moorer doesn't
think so. "From the moment Gore and Clinton took their hands off the Bible,
they could have revoked WTI's permit," she said.

In a letter to Gore, Moorer cited federal laws and regulations that grant
the U.S. EPA authority to revoke or suspend a hazardous waste permit at
their discretion, at any time in the permitting process. "With respect to
the handling of WTl," said Moorer, "the Clinton EPA is no different from the
Bush EPA.  They both blink at blatant violations of federal laws and
regulations."

Follow the Money

On some points then, Clinton and Gore appear to have changed their minds.
The question that WTl opponents are asking is not >why did they change their
minds but who changed their minds?<  Opponents have long referred to a
driving force that has allowed WTI to begin operating despite over a decade
of legal challenge and public protest.   Hugh Kaufman, Assistant Director of
the U.S. EPA Hazardous Site Control Division and whistle-blower of the Love
Canal case, has worked with opponents in investigating WTI and helped them
identify this force. "Follow the money," he told them.

When they did, they discovered that the same man who founded the WTI project
was also the largest financial backer of Bill Clinton's [92] presidential
campaign.  The money trail leads all the way to Little Rock, Arkansas, to
the doorstep of billionaire investment banker Jackson Stephens, whose
investment firm, Stephens, Inc., is one of the wealthiest outside of Wall
Street.

Stephens raised $100,000 in contributions for Clinton during his 1992
campaign. He also supplied a $3.5 million line of credit through Stephen's
Worthen Bank, at a time when Clinton's campaign was starved for cash,
according to the Philadelphia Inquirer. Though sold out his proprietary
interest in WTI in 1990, Stephens arranged the $128 million financing for
the incinerator through the Union Bank of Switzerland the sane year. The
bank made the loan in anticipation that Ohio would issue tax-free municipal
bond: as bridge financing to pay back the money until the incinerator began
operating.

Shortly after, when the state discovered that WTI had lied to them about
their ownership, Ohio denied the application to issue the bonds, according
to Kaufman. With no means to repay the loan until commercial burning began,
WTI faced the threat of foreclosure.  Union Bank never did foreclose, but it
put WTI under more pressure to start burning waste as soon as possible.
Stephens must have felt this pressure. Besides the percentage of profits
that he probably earns from royalties, his reputation as a financier is
clearly at stake if WTI is closed down.

The King Maker

Besides financial brokering, Stephens also excels as a power broker. For
decades, he and his brother Witt, who together built the family's investment
empire, were recognized as kingmakers in Arkansas politics, and the most
powerful members of the state's oligopoly of corporate interests. According
to The American Spectator, Orval Faubus, Arkansas' segregationist governor
in the '50s and '60s, remembered the two as the state's "most powerful
single political force."

In the 1970s, Stephens became a national political fund-raiser for both
parties, and has had continual access to the White House since. He was a
business partner of Bert Lance, Carter's controversial Budget Director, and
was Carter's roommate at the U.S. Naval Academy in 1946. During the
Reagan-Bush years, Stephens was a major contributor to the GOP. and his
former wife, Mary Anne, served as co-chair for Bush's presidential campaign
in Arkansas in 1988.

In 1987, Stephens arranged the bail-out of a small Texas oil company, Harken
Energy, from near bankruptcy.  The bailout created a scandal for the Bush
administration when uncovered by the Wall Street Journal in 1991. It seems
Bush's eldest son, George W. Bush was a director and stockholder of Harken.
During Bush's presidency, Harken won the rights to a potentially lucrative
contract to drill offshore wells for the government of Bahrain, though
Harken had never drilled either offshore or overseas.  When Iraq invaded
Kuwait, just before Harken's stock dropped drastically, George W. sold
two-thirds of his stock for a significant profit.  The Wall Street Journal
speculated that the investors made the deal to cosy up to the President
through his son.

The Bank of Crooks and Criminals

This was not the first time Stephens served as the catalyst behind a
political scandal.  The biggest controversy surrounding him involves what
New York District Attorney Robert Morgenthau called "the largest bank fraud
in world financial history." Morgenthau was referring to the Bank of Credit
and Commerce International, a "criminal enterprise" that catered to drug
smugglers, arms dealers and money launderers, and bribed bankers and
government officials to gain power and money worldwide.  Investigators have
dubbed BCCI the "Bank of Crooks and Criminals International."

Among those currently under indictment are Clark Clifford and Robert Altman,
accused of receiving tens of millions of dollars from the corrupt bank for
their part in its illegal schemes.  Although Clifford and Altman are the
most prominent figures in the BCCI scandal, it was Stephens and Bert Lance
who were widely recognized as introducing BCCI to the U.S. banking industry.

In 1978, Stephens and Lance brokered deals through which BCCI secretly
acquired control of several banks in the U.S.  Stephens, Lance and BCCI were
indicted in the same year for violating U.S. securities laws when they
attempted a secret takeover of First American Bankshares, the largest bank
in Washington, D.C.

These charges were later dropped with the defendants agreeing to obey
securities laws in the future - which did not stop BCCI from secretly taking
control of the bank four years later.  Though Stephens' relationship with
BCCI ended after their indictment, BCCI went on to systematically loot
billions of dollars of deposits in banks they controlled and bilked
thousands of American shareholders out of their investments before the bank
collapsed in 1991. Stephens still maintained business relations with one of
BCCI's partners, Union Bank of Switzerland - the bank which bailed out
Harken Energy, and which lent WTI the money to build the incinerator.

Presidential Crony

Five years ago, Stephens relinquished control of Stephens, Inc. to his son,
Warren.  Today, perhaps as compensation for his high-profile influence
peddling, Stephens maintains a low public profile.  Once a golf partner of
Dan Quayle's, Stephens will never be seen jogging with Bill Clinton or
hugging trees with Al Gore.  But the political and financial ties that bind
Clinton and Stephens, fellow Razorbacks, are the strongest by far that
Stephens has made with any president.

Besides funding Clinton's presidential campaign, Stephens has supported
Clinton in every gubernatorial campaign as well as his run for attorney
general. Thomas McLarty, White House Chief of Staff, is the former CEO of
Arkla, Inc., Arkansas' largest natural gas utility, which Stephens owned
until the mid 1980's and in which he still has a sizeable interest.

Many other high-ranking members of the Clinton administration represented
Stephens while partners of Rose Law Firm in Little Rock, including Vincent
Foster, deputy White House counsel, William Kennedy, associate White House
counsel, Webster Hubbell, associate Attorney General, and Hillary Clinton.
To further consummate the relationship, their former boss, Rose Chairman
Joseph Giroir, who hired them and made them partners, is the former director
of the Stephens family's Worthen Bank.

Business As Usual

Stephens has never been accused of wrong-doing in connection with WTI, nor
is there any evidence that Clinton has ever acted under Stephen's advice
during his administration. The only evidence lies in what Clinton and Gore
have and have not done since their inauguration.

Though Gore did authorize a federal investigation, whose results are not
expected to be released before the end of the summer, they have never
fulfilled their promise to stop WTI. In fact, Clinton and Gore announced in
April, when the incinerator began operating on a commercial basis, that they
would not block its operation. Two weeks ago, they allowed the U.S. EPA to
issue the permit for commercial hazardous waste incineration.

Nor has Clinton restructured the EPA to reflect any change in policy on WTI
from the Bush years.  After taking office, Clinton fired and replaced all
regional directors of the EPA except one - Region V director Valdus Adamkus,
under whose jurisdiction WTI falls. Adamkus has been responsible for issuing
every federal hazardous waste permit to WTI.

Since her confirmation bearings, EPA Director Carol Browner disqualified
herself from WTI- related decisions because her husband works for a national
environmental organization [Citizen Action] whose state affiliate in Ohio is
involved in the issue - at best a tenuous conflict of interest. Instead of
choosing a neutral party to act on her behalf in the public's interest,
however, Browner chose someone with strong ties to the chemical industry.
She appointed deputy Administrator Robert Sussman as public liaison on the
WTI case. Sussman, it turns out, is a former attorney for the Chemical
Manufacturers Association, where he represented the interests of Dupont,
BASF and other chemical giants who are the largest toxic waste producers in
the country. Sussman was hand-picked for the administration by Hillary Clinton.

After stacking the EPA's deck in WTI's favor without removing the jokers,
Clinton gambled away the future health of tri-state residents by refusing to
even acknowledge that the incinerator had failed its test burn in March.
The EPA reported that WTI emissions of mercury, dioxin and carbon
tetrachloride exceeded federal limits.  Clinton subsequently gained the
dubious distinction of being the first president whose EPA issued an
operating permit to a toxic waste incinerator that had failed its trial burn.

White Collar Crime

Opponents contend that Clinton's EPA not only has the authority to shut down
but the legal obligation to do so. They point to a massive body of evidence
that proves that WTI's permit is invalid, including an illegal air permit,
an incomplete permit application and alterations to the permit by WTI's
lawyer Charles Waterman, who at one point whited out the issuance date on
the permit and wrote in a new one, according to Hugh Kaufman.

The incinerator no longer even has a legal owner, according to Ohio Attorney
General Lee Fisher. Fisher's office released the results of an investigation
of WTI on June 30, concluding that the original permit was issued in 1983.
The investigation, which lasted two years while Fisher's attorneys searched
through a labyrinth of name changes and ownership transfers, gives credence
to opponents' claims that the owners of the facility have engaged in an
elaborate corporate shell game to intentionally disguise their own
identities in the event of an accident. This pattern of confused ownership
is exactly what the SEC alleged was central to the indictment of Stephens
and BCCI in 1978.

Moreover, since the current owner of WTI - Von Roll America, Inc., a
subsidiary of a Swiss engineering firm - is not the same entity to which the
original hazardous waste permit was issued, Von Roll has no legal permit to
operate the facility.  Clinton's EPA, however, took none of these
illegalities into account. A week after the Attorney General released this
report, the EPA issued WTI a permit for limited commercial operation.

Clinton's EPA has continued the legacy of past administrations concerning
WTI, critics claim. "The EPA has done everything they can to permit the
incinerator," said Terry Swearingen, director of the Tri-State Environmental
Council. "They've done everything they can to work hand in hand with WTI,
regardless of the law."

Hugh Kaufman expressed a more sweeping indictment of the EPA.  "Everyone
involved with issuing WTI's permit to burn toxic waste is potentially liable
for criminal prosecution," he said. Kaufman, a former investigator with the
EPA, added that, "WTI is the best white collar crime case I have ever seen."

Winners and Losers

The winners in this case are clear. Von Roll will reap huge profits from the
incinerator, and Jackson Stephens, who has seen his baby WTI grow from
conception to delivery, retains his reputation as one of the country's top
financiers. The losers are tri-state residents, who are being exposed to as
much as 762 tons of toxic pollutants that WTI is permitted to release into
the air annually.  These include tons of mercury and lead, as well as
substances like dioxin that are considered among the most toxic elements
known. [ed: dioxins are compounds that are created by burning chlorine
containing wastes]

The protestors, for their part, will continue fighting. Over a hundred,
including local members of Pittsburgh Against Toxic Incineration, showed up
again last week in Washington, D.C. - this time in front of the Swiss
Embassy, where 23 were arrested for blocking the embassy's entrance. One of
the arrested, Alonzo Spencer of East Liverpool, said, "We will go anywhere,
appeal to anyone to stop the illegal burning of toxic waste at the WTI/Von
Roll incinerator."  They have already proved that, indeed, they will.

Clinton and Gore will probably lose very little. At worst, a few critics
will count them among the ranks of past administrations who compromise their
morals by playing stooge to corporate interests.  Certainly, many tri-state
residents who had faith in Clinton during the campaign no longer view him as
a "people's president." To them, Clinton and Gore's broken promise will
remain over their heads like a toxic cloud.