When a Watchdog Isn't

By Ruth Marcus
Wednesday, April 9, 2008

In an era of lousy customer service, when there is never an actual human being at the end of the alleged help line, it may seem refreshing to encounter an institution still guided by the principle that the customer comes first. Unfortunately, that institution is the federal government, and the coddled customers are, all too often, the industries it is supposed to regulate.

You might dismiss this as a fanciful analogy, but it's not. When the Federal Aviation Administration launched a program to give aggrieved airlines a way to plead their case, the agency blithely named it the "Customer Service Initiative."

The program was described at a House Transportation Committee hearing last week at which two FAA whistle-blowers detailed how they were harassed and threatened when they tried to report lapses in Southwest Airlines' maintenance that let planes fly with potentially catastrophic cracks in their fuselages.

In the delicate phrasing of the Transportation Department's inspector general, the FAA official overseeing safety at Southwest had developed an "overly collaborative" relationship with the regulated entity -- oops, I mean customer. How collaborative? Well, a different FAA employee, the inspector who monitored Southwest's maintenance operations, left the agency and two weeks later became a Southwest manager in charge of -- you guessed it -- complying with safety rules.

Having just put a nervous 10-year-old on a Southwest plane and airily assured her that there was no reason to worry, I found the Southwest story particularly galling. Turns out, the FAA "did not ensure that its inspectors carried out critical safety inspections," and that, far from being unique to Southwest, these lapses were "symptomatic of much deeper problems with FAA's oversight."

The lapses are symptomatic, too, of much deeper problems across the government. These are not outbreaks of sheer, "heck of a job" incompetence. There is some of that, certainly, but this administration's allergy to government intervention and affection for the private sector have contributed to a spate of regulatory failures, from lead in imported toys to dangerous prescription drugs to subprime mortgages.

The course of these events traces a depressingly familiar arc: paeans to the free market followed by disaster followed by grudging acceptance of regulation. Just a year ago, Treasury Undersecretary Robert Steel proclaimed that new regulation of financial markets was unnecessary because "sophisticated financial firms have both the direct financial incentives and expertise to provide for effective market discipline." Right. Just ask Bear Stearns.

A few days before the FAA hearing, a report by the Labor Department's inspector general reached disturbingly similar conclusions about the roof collapse at Utah's Crandall Canyon mine that killed nine people last August. It found that the Mine Safety and Health Administration (MSHA) was "negligent in carrying out its responsibilities to protect the safety of miners" -- and, again, that this illustrated a "serious and systemic lack of diligence in protecting miners."

Like the FAA, the mine agency was responsive to the needs of its customer, the mine. In a 2007 memo, an official at Murray Energy, which owned the mine, described how he told the MSHA's district manager that the company needed speedy approval of a particular mining plan. "He said he would help expedite the process," the company official reported. The agency okayed the plan the next day.

A few months later, when Murray Energy talked, MSHA listened. "I have a fire under my axxxxxx to get this approved. I need your help," a company official e-mailed the agency official reviewing its roof safety plan. The proposal was accepted two days afterward.

Now that's customer service.

Regulatory failure is hardly as sexy a story as war or a presidential election. As a result, these episodes don't tend to get much notice unless they involve activities, such as flying unsafe planes, that affect millions, or until they end in disaster, such as the mine collapse. Even then, once the tragedy has faded from public view, the media move on.

In addition, the absence of oversight from the Republican-led Congress eliminated one way of prying open a window into governmental decision-making during the first six years of the Bush administration. Now that window has been cracked open a bit -- in part by congressional prodding, in part by unfortunate events. The odor wafting out is distinctly unpleasant.


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