Former White House counsel C. Boyden Gray on partisan Hill battles, more

What's next for "Clear Skies" and other attempts to revise the Clean Air Act? Is national security a critical argument for moving toward energy independence? C. Boyden Gray, veteran Washington insider and a former White House counsel, joins OnPoint to discuss legislative battles on energy and environment, judicial nominees, national security and possible presidential candidates for 2008.


Darren Samuelsohn: Hello, and welcome to OnPoint. I'm Darren Samuelsohn. Joining us today in E&ETV studios in Washington is C. Boyden Gray, a former White House general counsel under President George H.W. Bush. Mr. Gray, thanks for being here.

C. Boyden Gray: My pleasure.

Darren Samuelsohn: Start off, you've been with the Bushes for quite a while, about 20 years. You were with former President Bush, even going back to when he was a vice president. What's your role in advising the current President Bush?

C. Boyden Gray: Oh, I don't have any formal role. I'm in the private sector. I help on judges where I think the work we do is prompted by the Senate, by Senator Lott, when he was majority leader. But I think the White House appreciates what we're doing, but it's not -- they're not asking directly for our advice. And I advise on a bunch of other things as a counselor to my clients, but I have no official role with the White House. I do a couple of other things. I'm chairman of a thing called the HELP Commission, which is a commission to re-examine aid projects and which hasn't gotten under way yet. And then I also am on a thing called the International Risk Governance Council, which is trying to rationalize risk assessments across the Asian, Pacific, Europe, and the United States. I'm doing that at the request of OMB, but, again, it's not official.

Darren Samuelsohn: Informally, have you had contacts with the administration where you do, you know, you just have your personal relationships with these people?

C. Boyden Gray: Of course I have personal relationships. I have actually occasionally lobbied them, but not very much. But some, I mean I can't say I haven't done any of that kind of thing. Of course, I have many, many friends in the administration; and they do call me up from time to time; and I have been a guest at the White House Mess; and it's a nice place to go eat.

Darren Samuelsohn: I've heard you recommended Jeff Holmstead for the job at the EPA Air Office four years ago.

C. Boyden Gray: Well, I didn't really have to recommend him, but he had worked for me, and I do claim some credit or blame for having trained him.

Darren Samuelsohn: [Laughter] I was going to ask you, what's your assessment? How do you think he's done in the course of four years? He's one of the longest-serving EPA officials.

C. Boyden Gray: I think he's done a terrific job in a very, very difficult circumstance.

Darren Samuelsohn: He's taken a lot of heat, clearly.

C. Boyden Gray: Taken a lot of heat and handled it very well.

Darren Samuelsohn: During the presidential campaign in 2000, did you have a role in advising President Bush or, I guess as the candidate, as the Texas governor?

C. Boyden Gray: In 2000.

Darren Samuelsohn: In 2000, yeah.

C. Boyden Gray: No, but I did get heavily involved in the Florida recount; and I was deeply, deeply involved there doing TV, involved in some litigation indirectly. So that was a very active time for me. It was the most busy 35 days of my life.

Darren Samuelsohn: There's -- let's move on to sort of where we're at today in terms of Capitol Hill and the air pollution debate. You played a big role back 15 years ago with the Clean Air Act amendments of 1990. Can you give me any sense -- Democrats tried to move a bill in 2002, and then a couple of weeks ago, Senator Inhofe tried to move a bill and ran into a 9-9 tie. Can you give any sense, what would unravel this pretty complicated debate?

C. Boyden Gray: I don't think anything will unravel it. The Democrats want to have the perfect be the enemy of the good. They want to cover something, CO2, which I think is really a dangerous thing to do unilaterally without covering China and India. And so they're holding that hostage, holding the bill hostage to get that, and I think there's no way out of the impasse. Luckily, the administration can do this administratively, and they're going to do it administratively.

Darren Samuelsohn: Can you give any sage advice? I mean I guess from watching the 1990 amendments move through, that could encourage lawmakers to try and move a bill or the White House to help move a bill?

C. Boyden Gray: Well, you know, I have a sneaking suspicion that the Democrats feel they own the issue of the environment so much, and they feel they almost lost it with the 1990 amendments, because it was such a sweeping statute, and the most sweeping environmental statute probably ever passed. And I think they don't want a Republican president to do something like that again.

Darren Samuelsohn: Senator Carper has recently put a hold on the EPA nominee, Steven Johnson, and he's wanting information from the U.S. EPA. Recently, he had a press conference where he's talking to reporters about this, and he said that he'd be will -- you know, Bush would deserve to get credit if he were to sign the Clean Air Act, the Clear Skies bill into law, no matter what it is. It sounds like Senator Carper, at least, wants a bill. I mean, do you think that there's factions in the Democratic Party?

C. Boyden Gray: It's possible. It would be much better if the Congress would sign off on this. You would terminate or eliminate the possibility of the litigation you know is going to occur. It's a much cleaner way to do it. The 1990 amendments have been a great, great success, but it's a puzzle to me. I think Democrats just don't want to let go.

Darren Samuelsohn: We've talked before, and you've mentioned that, in the consent of the Clean Air Act amendments, why not include mobile sources, and you've mentioned aromatic specifically to me before in terms of benzene toluene. Is that a risky proposition to try and really open this thing up to all things air pollution?

C. Boyden Gray: I don't think it would be risky. Given the difficulties they're having now, I don't see how you can make life any worse. I really do think they ought to open up aromatics. I really think they really ought to put that on the table. It would puncture the belief that the utilities are the source of all evil, and it might actually accomplish something beyond, well beyond what they're now doing. If you cleaned up the aromatics, you would put the East Coast into attainment for both PM and ozone in my opinion. That would be a great achievement.

Darren Samuelsohn: How come nobody's really talking about this on the Hill?

C. Boyden Gray: You know, that's one of the greatest mysteries of Washington.

Darren Samuelsohn: OK. Let's turn to something else that you work on -- the Energy Future Coalition, a bipartisan group. You're trying to forge together energy security, U.S. dependence on foreign oil. You've put out reports. You've written letters. You've talked to the press about this. I don't know, though, that the current energy bill really takes into account what you've been pursuing. Can you give me any idea, how do you think your ideas have been incorporated by Congress or have they at all?

C. Boyden Gray: Well, they haven't really been. Pieces have. I think some of the ethanol provisions would be good. I think if they equalize the tax credit as between ethanol and ATBE, that would be a big, big plus. So I think there's some things that are in there that would help, but they just don't go far enough. We've really got to think in a bigger context, and these bills are really descendents of much smaller ideas that were in process even before 9/11, back in 2000.

Darren Samuelsohn: One of the main prongs of one of the letters that you wrote mentions climate change and a need to reduce the dependence on foreign oil, linking the two together. And I'm curious, I mean where do you stand on CO2?

C. Boyden Gray: Well, I have a slightly different take on it than my colleagues on the Energy Futures Coalition. I believe that we shouldn't do anything unilaterally unless we also have China and India aboard, and I think their being aboard and a cap-and-trade system would result in the kind of technology transfer to them that would benefit them enormously, because there are reductions that are cheaper than they would be in this country. So I think it's a mystery why they resist so much, because I think it's not that against their best interests. If we do CO2 controls unilaterally, it's really bad for the environment; because the cost is so much, it will cause an outsourcing of the fuel manufacturing jobs that we have remaining in the Midwest to China, and then where there are no controls, and that pollution will go up and much of it will end up back over here as we now see in California. So you actually make things worse, not better, by outsourcing our own manufacturing.

Darren Samuelsohn: By the United States taking a lead, though, isn't there an opportunity for like economic technologies, for our technologies to be used in other countries?

C. Boyden Gray: Well, for those who are already complying with Kyoto, the economic opportunities are there for U.S. industry, and they'll take advantage of it if they see fit. We don't have to do this unilaterally in this country in order for our multilateral companies to take advantage.

Darren Samuelsohn: Some of the largest, sorry, not some of the largest, but a couple of the largest power companies in the country, Cinergy, American Electric Power, and, most recently, Duke, have come out in saying that they're going to lobby on behalf carbon taxes and also planning for greenhouse gas regulations down the line. How do these three companies, and maybe more, shift the debate that is going on right now in the United States?

C. Boyden Gray: You know, I don't know how they do it. I think that one of the problems that we have here goes back again to -- I'm sort of nervous about mentioning their role -- the oil companies. They've done a very, very neat thing, which is to claim, at least the foreign companies have, to claim meeting 1990 goals, the Kyoto targets, way ahead of schedule. But the only way they can do that is by declaring that their principal product, gasoline, is not their responsibility. Well, if you're a manufacturer, and you can say the principal product is not your responsibility, you can comply with all kinds of things, and I think that's where we need to bring the oil companies into the debate in a fair and honest and transparent way, and I think a lot of dominoes would then fall, if that were to happen.

Darren Samuelsohn: You've mentioned biofuels also in the context of climate change. Can you give us a sense, what's the incentive in terms of reducing CO2 for biofuels, and is the existing, not Clean Air Act, the energy bill, in terms of the ethanol mandate, I mean how does that potentially have a --

C. Boyden Gray: It'll have a very positive impact on global warming, but we -- I think the world is being misled into thinking, again, that the bad guy is just the utility sector, not the oil --

Darren Samuelsohn: The transportation.

C. Boyden Gray: To the extent that transportation's implicated, the blame is always on the car companies, but it's not their fuel. They didn't make the fuel. They can only burn what they're given to burn, and the fuel that they burn doesn't have to have as much CO2 in it. If the fuel were a large mix of renewables like ethanol or even natural gas or methanol or mixtures of all those, there would be a lot less CO2, but the car companies can't control it. That's up to the oil sector.

Darren Samuelsohn: Can President Bush be doing more on the issue of global warming and climate change?

C. Boyden Gray: I don't know. I think he could be publicizing better, publicizing, using the bully pulpit to point out that if we cashier our manufacturing sector and send it to India, it's going to make pollution worse everywhere, and they're rioting -- now there's a story in the papers that I read just yesterday, were rioting in a southern China town because the pollution's so bad. We really ought to be helping the Chinese fix that, and we could.

Darren Samuelsohn: Do you believe that the reformulated gasoline provisions from the 1990 Clean Air Act amendments, should those go away?

C. Boyden Gray: No, probably now, we probably know enough to -- what should happen is what I've already said. We should probably get rid of those provisions, but substitute air toxins control, which those were really designed to do in a backdoor way. They succeeded. They compelled or led to a dramatic reduction in aromatics, but we need -- not dramatic, but sizable. We need now to go all the way with that, but we ought to do that directly. We ought to reduce the aromatics directly and not use that 2 percent oxygen requirement as a surrogate.

Darren Samuelsohn: On the issue of oil dependence from foreign countries, you teemed up with John Podesta, former CIA Director James Woolsey, in terms of a letter that you wrote. And, again, on the energy bill, the House Energy and Commerce Committee rejected CAFE standards, increasing fuel efficiency. And how does that square with where you're at?

C. Boyden Gray: Well, I don't think we actually recommend strengthening CAFE standards. We don't want to do that. That is, we think, a highly regulatory way of doing it. We would rather incentivize people to do the kinds of things that should be done, such as encouraging them to buy hybrids, leveling the playing field so that ethanol, natural gas, methanol, those alternative fuels have a bigger shot at the octane market, if you will, the gasoline market. We think a lot can be done to encourage diversification without having to use CAFE.

Darren Samuelsohn: One of the things on energy security, when James Woolsey was here for an earlier show, he said that there was just too much -- too many committees, too many hands in the pot. Do you agree with that assessment?

C. Boyden Gray: I agree with that completely. He may have taken that page from my book. I mean we have, in the Senate, we have an Energy Committee, and we have an Agriculture Committee, and we have an Environment Committee, and we have a Foreign Relations Committee, we have a Armed Services Committee. At least in the House, the Energy and the Environment Committees are combined.

Darren Samuelsohn: Right.

C. Boyden Gray: But as you said, they're even spread apart. Agriculture's a big hunk of this. They're a separate committee. There needs to be a rationalization of this in order to have a comprehensive look at the whole problem.

Darren Samuelsohn: Do you see Congress taking the issue of energy security more seriously and actually incorporating it in their debate right now?

C. Boyden Gray: Not at the moment. I mean I think they'll get these bills out, but it may take another Congress and continued high gas prices in order to really focus attention on this.

Darren Samuelsohn: Let's turn back to air pollution again for a second. In 1997, the Clinton administration set new standards, federal standards, for PM and ozone pollution. Those are just now being implemented. You were one of the people, I believe, who was arguing against those standards and against the way EPA went about setting them. We're now at a point where EPA is again reviewing the science on PM and ozone, and I believe EPA scientists and staff have said that they think that there should be a new standard for ultra-fine particulate matter, and also the dust between microns of 2.5 and 10. Do you think that you're going to be strategizing again and questioning the science?

C. Boyden Gray: You know, I don't know. That's up to potential clients to decide. My complaint then was that we were premature, that we didn't know what the recipe of PM was. I'm still not sure we really fully understand it. If you can't set a system whereby you can trade between systems of PM, because you don't know what they are, you shouldn't be regulating them. We still don't know what they are, and I believe we're not being publicly told, but if you look at the maps, you will see that carbon matter is over half the recipe in all the big Eastern cities. That's not utility emissions. That is tailpipe from diesel and from gasoline. That's what needs to be regulated. We're not doing it. You can lower the PM standard, and if you don't start to target those pollutants, you're not going to make any progress.

Darren Samuelsohn: I've got to bring up New Source Review with you, as well. I know you've been an active participant in this. With recent settlements with Ohio Edison, Illinois Power, and upcoming court cases coming up against Cinergy, American Electric Power, the Bush regulations to change New Source Review are stayed before the D.C. Circuit. Where is the New Source Review today, at now? Is it effectively dead, or is it still thriving?

C. Boyden Gray: No, no, no, no. There are two important cases that are going to be decided in the next few months. One is in the D.C. Circuit, a challenge to the rule change, and the other's in the 4th Circuit, which is a challenge to one of the prosecutions.

Darren Samuelsohn: The Duke.

C. Boyden Gray: The Duke Power case, and those will determine the future. I could easily see contrary results that are enough in conflict that you could see a Supreme Court resolution of this, you know, in the next term.

Darren Samuelsohn: OK, in the next presidential term.

C. Boyden Gray: Presidential term, yes.

Darren Samuelsohn: OK, moving on --

C. Boyden Gray: Well, now it could be even during this term. I'm talking about the next Supreme Court term.

Darren Samuelsohn: OK.

C. Boyden Gray: Not this year, but possibly the year after.

Darren Samuelsohn: Gotcha. Let's move on to judicial nominations, another thing that you've been very active in. Senator Bill Frist is contemplating doing something in the near future. There was a story very recently talking about the political ambitions of Senator Frist, and he's being pushed by conservatives to make a move on this. First off, does he have the votes to do the, I guess it's the constitutional option or some people call it the "nuclear option," does he have the votes to try and make this happen?

C. Boyden Gray: I don't know. I can't speak for him, but I think he will have the votes when he does this, and I think he will do it.

Darren Samuelsohn: Why do it in the sense of, right now, Democrats are in the minority, and they're using this. But eventually Republicans might be in the minority. This could --

C. Boyden Gray: You want the simple answer to that?

Darren Samuelsohn: Sure.

C. Boyden Gray: If that ever were to happen, which I don't think it will soon, do you think the Democrats would hesitate a minute to change the rules themselves and say, "Ah, we never meant what we said eight years before or 10 years before." No, they'd change the rules.

Darren Samuelsohn: One of the things --

C. Boyden Gray: They'd do what we're trying to do.

Darren Samuelsohn: One of the things you recently wrote in a memo to reporters is that this is not only the principled approach, it's a step that President Rodham Clinton or President Obama will appreciate one day, too. So you think, I mean right now they're both senators, and they're both against this idea. But you think if they were ever to become the president of the United States, that they would probably oppose -- or I'm sorry -- support.

C. Boyden Gray: Of course they would. And I do believe, maybe it's because I worked too long in the White House, but I do believe in executive authority, even when a Democrat's president, that the system of our country is predicated on the balance between the three branches, and equal competition between the three. This would tilt this thing so far in favor of Congress, so take away from presidential authority, that it would really alter the constitutional balance that's been in existence for over 200 years.

Darren Samuelsohn: Would it bring the Senate, though, to a screeching halt in terms of --

C. Boyden Gray: I think the Democrats were bluffing. I mean I think that really is a bluff. If they bring the Senate to a screeching halt, they'll get the same opprobrium the Republicans did when they tried to slow things down or stop things, what, almost 10 years ago.

Darren Samuelsohn: In the government shutdown.

C. Boyden Gray: Yeah.

Darren Samuelsohn: OK, one other thing. I know you're close to the Bush administration and the Bush family. Do you think that Governor Jeb Bush of Florida should reverse his decision, change his mind and actually run for president in 2008?

C. Boyden Gray: Not in 2008, but I wouldn't want to rule out a further look at it some other -- he's very young, and he could do it in a subsequent year.

Darren Samuelsohn: Do you think -- who do you think are the leading candidates right now, I guess, for 2008?

C. Boyden Gray: Well, I think you mentioned Frist is one. I think there's some governors, Massachusetts and Mississippi, who might be candidates. McCain, of course, probably will be something of a candidate. I think the idea that there's some sort of Bush dynasty, you wouldn't want to take advantage of the family, I mean, is sort of silly. He would only be a presidential candidate if half the public, the Republican side of the public, voted him in as the candidate, and there's no way a family can torque that. That's up to millions of individual voters. I think if he got the nomination, he would have deserved it, and he would then be free to run. But I think that he will probably not do it in 2008.

Darren Samuelsohn: Speaking of families, obviously, Hillary Clinton is weighing, I guess, a run, or we, at least, are writing a lot of stories and seeing a lot of stories about that. Do you think she'd be probably the candidate to beat in 2008?

C. Boyden Gray: I think she will be, and I think she will be beatable.

Darren Samuelsohn: OK, you think she'll run again in 2008?

C. Boyden Gray: You mean run for president.

Darren Samuelsohn: Yeah, run for president.

C. Boyden Gray: Oh, yes.

Darren Samuelsohn: OK.

C. Boyden Gray: Oh, yeah, I think she's positioning herself now to do that, and she's being very clever at it. But I just don't think she will be able to win the presidency.

Darren Samuelsohn: Mr. Gray, thank you very much for your time.

C. Boyden Gray: My pleasure.

Darren Samuelsohn: This is Darren Samuelsohn for OnPoint. We'll see you again next time for another edition.

[End of Audio]



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