Administrative Persistence in the Face of a Hostile Regime: How the Environmental Protection Agency Can Survive the Trump Administration

Principals, Agents, and Environmental Policy

A common conceptual framework used in fields such as economics, political science, and policy studies to understand how regulatory agencies, such as the EPA, behave is known as the principal agent (PA) model of agency decision making. ⁵ The PA model holds that various political principals, such as the president, Congress, and the courts, pass rules, laws, executive orders, court decisions, statutory interpretations of law, and other actions that either direct the agency to act in a certain way or cause them to act as the result of these actions. ⁶ All of these political principals have certain powers over agencies and can legally require the agency to act within certain parameters. ⁷ In another vein, principals are essentially delegating powers to administrative agents on their behalf to engage in functions they are unable to perform, while engaging in various forms of oversight to ensure compliance with their stated or implied intent. ⁸

The EPA, like many U.S. federal regulatory agencies, is often delegated power to interpret congressional laws, due to the complexity of their mission, which gives them a degree of discretion on how to comply with congressional mandates. ⁹ For example, the U.S. Clean Air Act and its subsequent amendments set goals and broad parameters, but much of the technical policymaking came down to the agency and career staffers to write rules and regulations to comply with the Act. Subsequently, through executive actions, congressional lawmaking, and court decisions, the actions of the agency have been upheld, amended, or overturned.

The process of principals giving discretion to agents while engaging in oversight is a complex one. Agencies often make policy not within a closed loop with one principal in a policy area, but are subjected to multiple principals with competing goals and dictates across institutions and political parties. While a president may, for example, issue an executive order to get the EPA to move in a certain direction, Congress may pass a subsequent law that contradicts that order and a federal court may later engage in statutory interpretation of that same law as a result of a lawsuit filed by an interest group, which reverses the agency's original interpretation of how to comply and mandates it changes course. The EPA exists in a politically salient environment, where principals are often at cross-purposes with one another. ¹⁰ While they may have certain powers to incentivize compliance and punish noncompliance (change management of the agency, restrict funding, etc.), the agency is often swimming upstream against multiple currents when trying to make policy. ¹¹

The dynamics of the PA process can be confounding for agents and principals. While the agency often struggles to balance competing demands, principals often find it difficult to get exactly what they want. Any presidential administration quickly discovers that the U.S. constitutional system was designed to facilitate compromise and slow down the political process, rather than to facilitate executive control of it. As the current administration discovered with healthcare reform, even controlling Congress under a unified government does not mean that major overhaul of a policy area is easy or often feasible. Certainly, the environmental policy is arguably easier to augment than repealing the Affordable Care Act, but the institutional dynamics is the same. A president can issue executive orders to direct agency's actions, appoint sympathetic administrators to act on its behalf, and submit reduced budgets to Congress to defund certain priorities; the next president can of course undo these as well.

This discussion of the PA model in the context of the EPA's mission and its ability to survive a hostile Trump administration is generalized. Ultimately, how much control the president exerts directly or indirectly over the agency falls on quite a few factors. Research finds that using budgetary powers over an agency (i.e., to say cut enforcement budgets to limit the agency's ability to properly oversee industrial polluters) works when Congress and the Executive branch communicate with agencies over the long haul, rather than short-term budget slashing. ¹² If the current healthcare shakeup is any indication, the current presidential regime has a lot of work to do if they seek to use budgetary controls effectively in this manner. Complex policy areas and the agencies that make such policies tend to frustrate political principals, which means the type of policy and even the structure of the agency and how it is designed to deal with problems impact political control; it is a lot easier to control the Social Security Administration in other words than the EPA. ¹³ Research notes that all agencies have little control over this environment anyway and must find and do find ways to navigate it. ¹⁴

The greater history of the EPA has been a tug of war between presidents with different prerogatives. This is not entirely different from other regulatory agencies, but it is a highly salient case. Executive principals have tremendous influence over administrative agents, but this influence is conditional on the political situation of other institutional actors, as well as other groups, such as organized interests, nongovernmental organizations, and the like that attempt to influence agency actions outside of the standard separation of powers. While presidents differ widely here, no president since the inception of the agency has actually made environmental policy itself or EJ specifically the number one priority to pursue or to destroy. The history of the EPA has been as much as anything defined by how the agency navigated these turbulent political waters and the kind of culture that developed as a result by long-term, career administrators to blunt the sharper ends of this fight.

Historically, we often find the EPA navigating between the various dictates of the courts, president, and Congress, all of which have some power to direct their actions. In practice, they are often treading water even if their intent is to move forward. When it comes to enforcement actions specially, these often take many years to pursue and investigate, and thus, it is difficult for a more progressive administrator to enhance enforcement in this process, given the multiyear nature of most enforcement actions. Administrators also tend to inherit the cases of past administrators and administrations and the agency is not able to prosecute offenders directly. All of these represent obstacles to the agency taking a strong enforcement role or alternatively, for an incoming president to simply undo ongoing agency actions, particularly given the lack of control over the appropriation process and the legal and multijurisdictional nature of ongoing enforcement actions.

Old Administrator, Meet the New President

While presidents hold important appointment powers over the top administrators at regulatory agencies, they have less power over the career administrators. Like any public agency, new management often comes in with ideas for radical change, which comes into direct conflict with the more long-standing agency culture that develops over time. Research shows that regulatory agencies tend to develop their own unique culture, with their own priorities, prerogatives, unwritten rules, and processes. ¹⁵ The entrenched culture of the agency is likely to persist across presidential regimes. Studies have shown that the EPA in particular has developed a strong organizational culture that values enforcement. ¹⁶

We find in the academic literature ample evidence to support the case that regulatory agencies can persist or better put, can persist in maintaining long-term goals, even with a change in the presidential regime and subsequent management changes that follow. Mintz has produced an excellent line of research into the agency's enforcement culture, showing it has persisted across even the most hostile presidential regimes. ¹⁷ This was true in the Reagan EPA, which has strong parallels to the rhetoric coming from the current presidential regime. Career administrators managed to weather the storm of antienvironmental sentiment and action coming from the White House, maintaining to some degree their enforcement prerogatives.

We see similar findings in Ringquist's work, where political principals influenced agency outcomes, but the agency was able to passively and quietly resist these changes to maintain key agency prerogatives. ¹⁸ In this case, career administrators managed to use the administrative process to keep moving forward on enforcement actions and other priorities that exist before a hostile presidential regime or Congress, even if this hostility from political principals slows down their ability to act. Research has found, for example, that a Republican Congress did not reduce the EPA's enforcement efforts. ¹⁹ Additional research has found there are not significant criminal enforcement differences across the G.W. Bush and Obama administrations. ²⁰ The latter study found that these two regimes with very different rhetoric and action toward the environment and EPA actually had similar outcomes when it came to criminal enforcement penalties, suggesting the importance of agency culture and institutional dynamics for both blunting the ends of the most hostile regimes and alternatively preventing even sympathetic regimes from vastly enhancing these efforts and outcomes.

A good case in point is the Nixon administration, which helped to create the EPA in response to national news coverage of environmental disasters, such as the Santa Barbara Oil Spill that drew widespread attention to the failures of the U.S. states and federal government to manage serious environmental problems. When Bill Ruckelshaus took over the agency, Nixon did not intend for it to vigilantly enforce the law against some of his corporate friends and supporters, but Ruckelshaus carefully took enforcement seriously and the initial culture of the agency, based on a model of issuing penalties to deter environmental crimes, developed. In this vein, the agency took itself and enforcement seriously (at least in theory, as developing the rules, regulations, and tools took time) and began to become institutionalized over time, which is not something Nixon necessarily intended or wanted. The agency was developing its enforcement culture at the time and moving forward toward the institutionalization of a broader organizational culture that emphasized strong enforcement and deterrence.

Trump's rhetoric best matches in many ways with the rather open hostility to environmental and other forms of regulation professed by Ronald Reagan. A good example of how agency and principal dynamics worked in the Reagan administration was that of the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) also known as Superfund. Created in 1970, CERCLA had a mandatory taxing mechanism for potential responsible parties to require polluters to pay into the fund and to create a self-funding program. This worked in theory, but in reality the Superfund was soon overwhelmed with claims. Ann Gorsuch was openly hostile to strong enforcement and the agency sought to relax standards on these responsible parties by emphasizing voluntary cleanup and doing away with the taxing mechanism. ²¹ Congressional opposition by sympathetic legislators resulted in the investigation and ultimate resignation of Gorsuch. Ruckelshaus was reappointed to head the agency and we find a renewed emphasis on enforcement. ²² Again, in this example, the agency was moving forward, encountered a hostile regime, but then due to agency dynamics and the dynamics of principal-agent adaption managed to persist if not on a reduced level through the Reagan years, but its efforts were not systemically altered or reduced. The same can be said for the Clinton years under a hostile Congress, but sympathetic president, and under the G.W. Bush and Obama Administration-moving forward, moving back, but still ultimately forward toward agency prerogatives of strong enforcement. ²³

We then find Clinton pushing new forms of environmental regulation that focus on compliance rather than deterrence, self-reporting of violations, and other programs that focused on admitting errors with less punishment and other pilot programs that were meant to encourage innovation in environmental policy. ²⁴ While Clinton was arguably positive toward stronger environmental enforcement, this approach caused concern for agency staff. Career staffers in the EPA were still committed to the traditional enforcement model and that commitment paired with Republican opposition in Congress meant that most of these programs did not get out of the pilot stage or receive widespread acceptance, but the agency did move forward with its enforcement efforts. ²⁵

George W. Bush wanted to emphasize returning power to the states and fewer regulations similar to other Republican presidents. Yet, cutting career administrators out of the decision-making process and trying to reduce regulations did not abolish enforcement prerogatives at the agency. We also do not find Bush significantly cutting the agency's budget. Research shows that the Obama administration, while very supportive of strong enforcement in rhetoric, did not always do so financially. ²⁶ While he certainly valued a stronger environmental policy more than Reagan or Bush, he did not prioritize it in the same way as healthcare reform or national defense.

What all of this research demonstrates is how environmental policy is affected by the interplay of competing political principals and long-standing agency culture; while principals matter, presidents have neither destroyed the agency nor been able to elevate it to a significant executive priority. The more accurate picture is that the agency waivers between changing regimes and tries to maintain its commitments to strong enforcement and deterrence over time, it has been arguably successful in this goal, given its limited budget and wide-ranging obligations. In short, Reagan did not destroy the agency, nor did Obama redeem it.

A new presidential administration may damage the agency and slow it down if it sets out to do that, but will be unlikely to devastate the enforcement actions undertaken by the agency that protect fence-line communities. Much of what we see in the research can be described by Joel Mintz's phrase that the agency is often “treading water” when it comes to enforcement efforts under hostile regimes. ²⁷ Alternatively, even under sympathetic presidential regimes, the dynamics of multiprincipal competition for agency goals and outcomes often means we do not find superior enforcement outcomes under Clinton or Obama. ²⁸

If the Trump administration sends long-term signals to a Republican Congress, cooperates, and prioritizes an attack on the agency, they can defund their ability to enforce the law, and deprioritize it as a management priority, which would be most damaging to EJ communities. If presidents in practice have not differed widely on how they fund environmental enforcement, this begs the question: Has any president truly prioritized EJ as an issue in both rhetoric and practice?

Presidents, Enforcement, and Ej

Looking at how presidential administrations impact the EPA and subsequently how they offer protection for fence-line communities through the lens of enforcement is appropriate. Until President Obama, no president has really given serious attention and financial backing since Clinton's Executive Order 12898 in 1994, which required federal agencies to develop strategies and goals for implementing EJ (not that this order came with significant long-term funding). While this executive order was groundbreaking and important (it required agencies to actually acknowledge EJ was a problem), no president, including Clinton, made this a serious political priority with significant funding.

In reality, the EPA waffles between administrations and has failed to complete many of its assigned tasks from presidents, Congress, and the courts. The agency rarely bans toxic materials and is backlogged by decades in trying to find acceptable exposure levels to the many toxic compounds that people are exposed to on a daily basis. How the agency is able to enforce the law is difficult and often poorly funded. The most intuitive conceptual model for understanding why and how the EPA chooses to enforce the law is what Daley and Layton refer to: a “transaction costs” approach. ²⁹ According to this model, agencies must consider the costs and benefits of pursuing certain actions in a politicized policymaking environment. The costs are often financial—how much would it cost the agency to pursue a particular offender and the political costs of potentially angering sympathetic politicians and organized interests. The agency's reality is that the vast majority of all of its new regulations result in lawsuits. Many of the worst polluters are large industrial facilities located in close proximity to EJ communities. These corporations have significant resources to put forward to fight the agency and political connections as well. The EPA must make enforcement decisions, while weighing these costs, versus the myriad mandates it holds and has a rather modest enforcement budget in line with its obligations.

No doubt Obama made many strides toward strengthening environmental policy and the EPA. Lisa Jackson also made EJ a public priority for the agency, but what did that actually mean in either case for environmental enforcement and EJ communities? In practice, the agency has limited options for helping EJ communities. ³⁰ It does not have much jurisdiction to prevent the sitting of industrial facilities near EJ communities nor does it possess the power to move those facilities or in the vast majority of cases the people living within those communities. The agency's greatest ability in terms of its powers to protect fence-line communities is to enact stricter regulations, often on air and water pollution. It may also offer guidance or enhanced grant funding to help communities, all of which occurred under Jackson's tenure at the agency.

The agency approaches EJ issues mostly as enforcement and compliance issues. In the author's own experience engaging in field research observing regional administrators, it became apparent the agency did not view removing victims from harm as a priority or even a possibility, but enforcing the law and negotiating better pollution controls as the answer in practice to reducing harms, which would be seen as a success. In this realm of thought, reducing toxic exposures represents increased justice for fence-line communities and comes often as a consequence of negotiated settlements or other enforcement actions and is really the strongest option in the agency's tool belt.

We see the above account play out indirectly in the enforcement outcomes of the EPA during the early part of Obama administration. Research that compares criminal enforcement actions across the G.W. Bush and Obama administrations does not find a wide gap between the two presidents in terms of penalties assessed. ³¹ The budget for the Office of Enforcement and Compliance Assurance (OECA) and staffing has declined relative to the 1990s level. ³² Research does not find a strong relationship between enforcement outcomes and presidential regimes. ³³ The author's own research into the agency suggests, for example, that the Criminal Enforcement Division had roughly 200 investigations for the entire country in 2004 and that number fell to 186 by 2009. The budget hovered in the $40 million range during this time period. ³⁴

Given the staggering costs and lack of human capital, the agency overwhelmingly chooses to negotiate with environmental offenders, rather than take them to court. ³⁵ Enforcement generally means fines or settlements to require upgrading of pollution control equipment; the latter being particularly important, given the lack of on-the-ground oversight. In reality, the EPA relies heavily on the states to police polluters and by proxy protect fence-line communities. The efforts are often very weak, with state environmental agencies relying on selective monitoring, self-reporting, and the honor system. ³⁶ Because of the massive disparity in the cost/benefit ratio of pursing strong enforcement, the agency continues to rely on negotiated settlements and fines. ³⁷

The EPA does have the ability to engage in criminal investigation of environmental offenders to help EJ communities, but this has always been underemphasized and underutilized, due to the transaction costs associated with criminal enforcement. While some cases that are prosecuted criminally involve serious harm, research shows that only a relatively small number involve identifiable victims and most do not seem to be generated on behalf of fence-line communities directly, although this is hard to tell in the strictest sense. ³⁸ State enforcement efforts tend to be slower and less frequent in minority communities and those same communities continue to bear the brunt of environmental harm in the United States. ³⁹ When the agencies do pursue investigations, they do not have the ability to prosecute directly and must work with attorneys representing the Department of Justice, the U.S. attorneys, or the U.S. states.

Conclusion

Ever since President Clinton's Executive Order 12898 was issued in 1994, the EPA has held a mandate to examine EJ as a policy issue when making administrative decisions. While there is no doubt many of the regulators who work for the agency believe strongly in this mandate, it must compete with myriad problems and responsibilities faced by the agency and must do so with relatively limited resources. Its budget in FY 2016 of approximately $8 billion under President Obama is actually less than it was in 2004 under President Bush, not accounting for inflation. Sympathetic administrators, such as Lisa Jackson, who elevated EJ as an agency priority, have in reality few available options to help communities in the short to medium term, except offering guidance, grant opportunities, or trying to strengthen oversight and enforcement. Her ability to remove communities from harm, stop the sitting of an industrial facility, or remove it is strictly limited. Many of the broader Obama era environmental policies and regulations will bear fruit over time after lengthy battles through the courts, new administrations such as Trump that are less than sympathetic to the intent and outcomes of some if not most of these policies, and the funding commitments of various congresses over the coming years.

The immediate future does not look promising for the agency or EJ communities. Recently, Mustafa Ali, a key administrator who helped found the EPA's Office of Environmental Justice, resigned amid the intense budget cuts proposed by the Trump administration, which would impede the agency's financial ability to vigorously pursue EJ initiatives, by cutting “the budget by about 25%, and result in an ∼20% reduction in force.” ⁴⁰ These fears are real and mirror the concerns of a 30% reduction in force proposed in the Reagan era. ⁴¹ The same expectation was had when George W. Bush took office, but the agency's budget actually increased slightly. The agency's budget went from approximately $4.7 billion in FY 1980 to $3 billion in 1981, but rebounded above $5.3 billion for FY 1987, its workforce went from 13,078 to 13,442 during this time. ⁴²

Budget and workforce figures are rough measures of presidential commitments to agencies, presidents submit budgets, but Congress ultimately doles out the funds. This power alone illustrates the conditional nature of presidential influence. While a hostile president can have an impact in many ways on an agency's budget, administration, and prerogatives, he does so within the context of the separation of powers and the structure of the PA game. ⁴³ Yet, a more accurate picture is not that a hostile president guts the agency never to return and a sympathetic president prioritizes the agency and raises it to a new financial height never to descend to earth. ⁴⁴ Instead, presidents who want less environmental policy often seek weaker regulations, less enforcement, and fewer people to enforce the regulations and presidents who want stronger versions of these variables tend to boost them, but not significantly prioritize them. Presidents themselves have many priorities, some inherent when coming into office, some learned, and some forced by circumstance. Sadly, environmental problems rarely top the list of presidential or congressional priorities in practice and the public does not seem to care as much either, relative to the other problems facing them and the country. When Gallup asks a random cross-section of Americans monthly what they think the most important problem facing the country is at the time, the responses tend to be dominated by terrorism, the economy, and even immigration, but rarely the environment and never EJ. “In March, 2017 only 3% of respondents said the environment was the most important problem, which was unchanged from election time in November, 2016.” ⁴⁵ In the budgetary bargaining that ensures with Congress, the current president will have to choose if he wants to throw in his chips with healthcare, defense, tax reform, immigration/border wall, environmental regulation, or other issues, but not even Franklin Roosevelt or Lyndon Johnson got everything they wanted.

The agency itself will find ways to maintain its commitments to EJ specifically and enforcement generally. There is a long-standing culture that values enforcement and pursuing a continual commitment to these programs within the agency, these will likely persist under Trump, even if they receive less funding and administrative support. Career administrators will not step back and let the president “drain the swap,” but will engage in hidden actions and other stealth methods of keeping these initiatives going. ⁴⁶ After all, when you look at the history of the agency, it has managed to keep its priorities under other less-than-sympathetic presidents, but it has failed to be blessed under sympathetic presidents as well. ⁴⁷ The agency will, like in times past, suffer setbacks under the current presidential administration, but will likely rebound, perpetually moving in place as it tries to catch up with mandates left over from as far back as the Nixon administration, when it managed to sprout and grow from a less than generous presidential environment.