Consumer Group Says OMB Is Meddling With Fuel Efficiency

Let's just say they have never been friendly.

Public Citizen, one of the nation's leading consumer groups, and John Graham, the head of OMB's regulatory review apparatus, butted heads before the former Harvard professor took the top regulatory job at the Office of Management and Budget in 2001.

The consumer group whipped up a 150-page report on Graham, his history as director of the Harvard Center for Risk Analysis, and the potential conflicts it thought he would have in his new job. Public Citizen made it clear he was not their choice for the below-the-radar, influential job that involves assuring that the major rules issued by the federal government pass muster.

Now, the two have locked horns again. Convinced that Graham is exerting extraordinary influence over the federal agency in charge of setting fuel efficiency standards for cars and trucks, the group has tried to document -- without much luck so far -- the early involvement that Graham has had in the process.

The group has asked OMB for all kinds of information under the Freedom of Information Act that it thinks would allow it to connect the dots to show that Graham has not only been reviewing regulations, but actively directing agency action on how to restructure the highly controversial fuel economy program. The National Highway Traffic Safety Administration issued a proposal in December 2003 asking for comments on "reforming" the program as it applies to light trucks, which include pickups and SUVs.

The corporate average fuel economy, or CAFE, program has been around since the 1970s as a congressional response to oil shortages. Since 1990, the standard for passenger cars has been 27.5 miles per gallon. It is 20.7 miles per gallon for light trucks, but will increase to 22.2 miles per gallon by 2007 -- its first increase in more than a decade.

Since the program's inception there has been tension between environmental and consumer groups, those who believe the standard should be much more stringent and those who favor the status quo. The argument against raising the standard has traditionally been that to meet it, car companies would be forced to produce smaller, lighter cars that are less safe than heavier vehicles.

This is a view that Graham took when he studied CAFE issues from 1988 to 1992. At that time, Graham's work was funded by the federal government and donations from the Big Three automakers.

"Now at OMB, he is asserting a profound influence over the outcome of the Bush administration's efforts on fuel economy regulations. Indeed, the agency's recent proposal regarding light truck fuel economy regulation is completely aligned with Graham's long held, yet inaccurate belief, that fuel economy regulation results in significant weight reduction," and thus less safe vehicles, Public Citizen said in a background memo.

That school of thought was aired, along with others, after the National Academy of Sciences proposed that regulators consider various attributes, including weight, in 2001 when it studied the effectiveness of the mileage standard.