Subject:
        Washington Post Expose on Nav Study Cheating
   Date:
        Sun, 13 Feb 2000 06:45:03 GMT
   From:
        "mark beorkrem" <[log in to unmask]>

Mark Beorkrem
Sierra Club Midwest Region


>From [log in to unmask] Sat Feb 12 22:39:11 2000
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>To view the entire article, go to
>http://www.washingtonpost.com/wp-dyn/articles/A46091-2000Feb12.html
>
>How Corps Turned Doubt Into a Lock
>
><p>Seven years ago, the generals running the Army Corps of Engineers
tapped
>Donald C. Sweeney II for a vital mission. The barge industry was
clamoring
>for huge lock construction projects on the Mississippi and Illinois
rivers,
>and Congress had put up $50 million for the most ambitious navigation
study
>ever. Sweeney led the study's economics team, producing work the Corps'
top
>economist hailed as "the greatest advance we have made in . . . quite a
few
>years."</p>
><p>But Sweeney didn't reach the conclusion the generals expected. After

>five years of analysis, he calculated that the costs of any major
project
>would far outweigh the benefits.</p>
><p>The Corps brass then took the study away from Sweeney, launching a
>determined campaign to justify a billion-dollar construction plan. An
>affidavit by Sweeney – backed up by several Corps witnesses, along with
a
>revealing trail of internal e-mails and other documents – suggests that

>senior officials directly ordered the study team to figure out a way to

>make lock improvements seem cost-effective. Eventually, it did.</p>
><p>Last week Sweeney filed a detailed request for an investigation with
a
>federal whistleblower agency, alleging that Corps leaders illegally
>manipulated the study's data to manufacture a rationale for
construction.
>The officials deny the allegations; they say they did end up with
different
>conclusions, but insist they only reassigned Sweeney because he was
working
>too slowly.</p>
><p>Still, at a time when pressure is building for the Corps to curtail
its
>historic penchant for massive spending on environmentally insensitive
>projects, this dispute has cast new light on an apparent agencywide
>strategy to "grow" the Corps.</p>
><p>From its modest origins as a Revolutionary War regiment, the Army
Corps
>has expanded into a $12 billion Pentagon behemoth with 37,000
employees.
>While it still handles engineering projects for the military, it is
best
>known for reshaping the American landscape with locks, dams and other
>public works that the Corps itself acknowledges have damaged thousands
of
>miles of rivers, many of them for barges that never arrived.</p>
><p>These days the Corps is portraying itself as a reformed agency,
"cleaner
>and greener," devoting more than one-fifth of its civil works budget to

>environmental restoration. But the paper trail of the Upper Mississippi

>study suggests the resilience of some agency traditions. Top officials
>ordered the study team "to develop evidence or data to support a
defensible
>set of . . . projects," and eventually rearranged the numbers so that
they
>supported a case for construction. One memo candidly declared that if
the
>economics did not "capture the need for navigation improvements, then
we
>have to find some other way to do it."</p>
><p>The agency is now poised to recommend doubling the size of five
barge
>locks on the Mississippi above St. Louis, and maybe two more on the
>Illinois. Environmentalists believe the project could ravage one of
>America's most fragile ecosystems, including an Upper Mississippi
wildlife
>refuge that attracts more visitors than Yellowstone Park. And the
Corps,
>after conducting the analysis of the project, would get to build it as
>well.</p>
><p>"It's very sad that this study is becoming another embarrassment,"
says
>Corps research analyst Jeffrey Marmorstein, who worked on the study
before
>and after it was taken away from Sweeney. "Unfortunately, the
management of
>the Corps has lost all respect for unbiased analysis."</p>
><p>In fact, according to a memo summarizing a December meeting in
>Vicksburg, the agency's generals have announced a goal of "growing the
>civil works program" for the Mississippi Valley Division – the section
in
>charge of the Upper Mississippi study – by $100 million a year for five

>years. "If that goal is met we are all going to be very busy," the memo

>said.</p>
><p>"To grow the civil works program, [headquarters] and the Division
have
>agreed to get creative," the memo continued. "They will be looking for
ways
>to get [studies] to 'yes' as fast as possible. We have been encouraged
to
>have our study managers not take 'no' for an answer. The push to grow
the
>program is coming from the top down."</p>
><p>"That is the problem in black and white," said Tim Searchinger, an
>Environmental Defense Fund attorney who provided the memo, along with
>Sweeney's affidavit and other documentation of his complaints.
"Planners at
>the Corps are told that no is not an acceptable answer."</p>
><p>Maj. Gen. Russell Fuhrman, the deputy commander of the Corps, said
the
>agency's military leaders do consider themselves "advocates" for
navigation
>projects that help move America's freight to market. In an era of
budget
>surpluses, he said, the nation should invest in water transportation
just
>as it is investing in highways and airports. But he said the Vicksburg
memo
>misinterpreted the leadership's goals: It wants to finish studies more
>quickly, not manipulate them to rubber-stamp construction projects.</p>

><p>"The longer it takes to get a project approved, the more it costs,"
>Fuhrman said. "So we want to cut through bureaucracy. But we're not
talking
>about dummying up numbers."</p>
><p>But environmentalists say the Upper Mississippi study – which
already
>has cost more than Kenneth W. Starr's investigations of President
Clinton –
>is the best evidence yet that the Corps is still, at heart, a
military-run
>engineering agency addicted to large projects. They say the study's
fate
>recalls the famous 1889 advice by Mark Twain, the sage of the
Mississippi,
>to the young Rudyard Kipling: "Get your facts first, and then you can
>distort them as much as you please."</p>
><h1>'We'll Have to Work on a Story Line'</h1>
><p>Q=t*[(a-w)/(a-e)]n is a pretty complex equation. But the story of
what
>happened to it is pretty simple.</p>
><p>The story begins on the Mississippi and the Illinois, two of the
>once-rambling rivers the Corps has dammed, diked and dredged into
placid
>barge canals over the last century. Unlike most of the 27 other
>Corps-constructed waterways, the Mississippi and Illinois are truly
vibrant
>freight channels, floating tens of millions of tons of coal and oil and

>grain. In fact, barge tows sometimes encounter hour-long waits at the
>busiest locks, partly because standard 1,200-foot chains of 15 barges
must
>pass through the 600-foot locks in two shifts.</p>
><p>In the transportation world, of course, time is money. So barge
>interests – including Washington-wired conglomerates such as ConAgra
Inc.,
>Cargill Inc. and Archer Daniels Midland Co. – helped persuade Congress
to
>order a study of navigation improvements, hoping for locks that would
>accommodate 1,200-foot tows. Congress has always loved navigation
projects,
>and the Mississippi – flowing through 10 states – has a particularly
mighty
>political base.</p>
><p>To lead the federally mandated cost-benefit analysis, the Corps
turned
>to Sweeney, 48, an intense economist who joined the agency while still
in
>graduate school in 1977. The bespectacled number-cruncher – and former
>college linebacker – has always received excellent job evaluations;
despite
>his falling-out with Corps managers, his latest review calls him an
>"exceptionally competent economist" who is "highly committed to
producing
>quality products."</p>
><p>That daunting alphabet soup of an equation is one of those
products.</p>
><p>Sweeney realized that the Corps' old economics models had glossed
over
>the idea that when barge costs go up, shippers may not use barges as
much.
>So Corps studies had consistently overestimated the barge traffic that
>lock-and-dam projects would attract, which had helped justify elaborate

>river-taming efforts that often seemed unnecessary in retrospect.</p>
><p>Sweeney's more complex model avoided that problem, and it was
heralded
>as a supermodel in reviews inside and outside the Corps. "I tried as
hard
>as I could to tear down Don's work, but it's brilliant," said Marshall
>University economist Mark Burton, who conducted one review.</p>
><p>Sweeney concluded that for the next 50 years, most congestion could
be
>relieved simply by building a few modest mooring facilities to promote
>"industry self-help" – the already common practice of towboat operators

>helping each other pass through locks. He saw no need for major
>construction.</p>
><p>In April 1998, Sweeney presented his preliminary results to Corps
>leaders such as Maj. Gen. Fuhrman, then director of the civil works
>program, Maj. Gen. Phillip Anderson, Mississippi Valley division
commander,
>and Col. James Mudd, Rock Island district commander. They were not
pleased.
>In June, just three months before the study's due date, Gen. Anderson
>transferred all economics questions to a new panel, demoting Sweeney to
a
>mere "adviser" to the panel. Sweeney has not lost his job, but he has
filed
>a whistleblower complaint with the federal Office of Special Counsel,
and
>recently was disciplined for insubordination.</p>
><p>In an interview, Mudd described Sweeney as too much thought, not
enough
>action. (Anderson was unavailable for comment.) "He did good work,
don't
>get me wrong," said Mudd, a firebrand of an officer who was a key
planner
>for Gen. Norman Schwarzkopf during the Persian Gulf War. "But there's a

>point where 'I'll-get-to-it-when-I-get-to-it' won't cut it. . .‚.‚We've

>been very careful to make sure we don't have a foregone conclusion, to
make
>sure we're not cooking the books."</p>
><p>Pretty soon, though, the Corps' brass made it clear that those
economics
>questions had a correct answer, and it wasn't the answer Sweeney had
>suggested. As Sweeney's boss in the St. Louis office pointed out in an
>e-mail: "It's pretty clear to me where this is headed."</p>
><p>On Sept. 3, an official laid out the panel's new mission in an
e-mail:
>"The team should determine an alternative . . . that appears to be the
most
>likely to justify large-scale alternatives in the near-term." And in a
>briefing on Sept. 23, Gen. Fuhrman declared even more forcefully that
the
>"well-being of the Midwest" depended on new improvements.</p>
><p>"There is a need to improve the system," project manager Dudley
Hanson
>wrote in a memo relaying Fuhrman's instructions to the panel. "If the
>demand curves, traffic growth projects and associated variables . . .
do
>not capture the need for navigation improvements, then we have to
figure
>out some other way to do it. . .‚.‚We need to develop a rationale for
>taking this relatively more subjective approach to our analytical
>process."</p>
><p>The memo's "Guidance" section was even more explicit about Fuhrman's

>call for preordained results: "He directs that we develop evidence or
data
>to support a defensible set of capacity enhancement projects. . .‚.‚The

>rationale should err on the high side."</p>
><p>Fuhrman said in an interview that while he did have a "gut instinct"

>that improvements were necessary, he never ordered anyone to devise a
>rationale to build them. He said Hanson, who recently retired and could
not
>be reached for comment, must have misunderstood him. But in another
e-mail,
>Hanson had no doubt what Fuhrman meant: "This overt advocacy role, to
me,
>is a new departure. We'll have to work on a story line. . .‚.‚We will
need
>corporate solidarity when we go back to our publics with this more
>aggressive advocacy position."</p>
><p>Mudd also insisted that the Corps has "bent over backwards to take a

>balanced approach," and noted that barge interests have complained
>furiously about the agency's deliberations. Christopher Brescia,
director
>of MARC 2000, the main navigation lobby in the Midwest, agreed,
describing
>the Corps as too slow and too conservative, although he did say the
agency
>had "come a long way since they got Sweeney off the economics
team."</p>
><p>But Mudd added that he was "very careful not to push anyone to do
>near-term improvements, large-scale improvements, whatever." In an Oct.
2
>memo clarifying Fuhrman's commands to the economics panel – a memo Mudd
now
>says he can't remember writing – he seemed to do just that.</p>
><p>"MG Fuhrman has clearly stated that the Corps has the responsibility
as
>the Federal Government's advocate for the inland waterway system," he
>wrote. "To help in the execution of this responsibility, you will
develop
>the economic component of the case for a recommendation that includes
>near-term improvements, recognizing that the nation is better served by

>improvements that err on the large-scale side than by actions that err
on
>the underdeveloped side."</p>
><h1>In the 'N,' a Way to Say 'Yes'</h1>
><p>Then it was just a matter of figuring out how to err. And it didn't
take
>an economist to see that Q=t*[(a-w)/(a-e)]n was a good place to
start.</p>
><p>The key term in all that gobbledygook was "n," the variable that
Sweeney
>designed to account for alternatives to barge transportation. The
higher
>the value of "n," the lower the benefits of improvements. Sweeney
computed
>the main n value at 2. Burton later concurred. Under pressure from
above,
>Richard Manguno, the new economics team leader, reluctantly reduced n
to
>1.5. But that was still too high to justify lock expansions, and he
refused
>to go lower without a command.</p>
><p>Ultimately, according to Sweeney's affidavit and a source who was
>present, he got one.</p>
><p>On May 5, 1999, Maj. Gen. Anderson and other Corps officials held a
>closed-door "economics summit" with Brescia and other industry leaders,

>including representatives from ConAgra, Cargill and American Commercial

>Barge Lines. "I think we helped them understand the sensitivity of all
>this," Brescia recalled. Immediately after the meeting, an aide to
Anderson
>asked Manguno what n would have to be to justify lock expansions.</p>
><p>I've already figured that out, interjected Mudd. It's 1.2.</p>
><p>Three weeks later, Mudd called Manguno. N, he declared, was now
1.2.</p>
><p>The new n was apparently grounded in a basic math error, but that
wasn't
>the only effort by the Corps to exaggerate benefits and understate
costs,
>Sweeney charged. There were others, and all were needed for lock
expansions
>to pass muster.</p>
><p>In fact, the day after the metamorphosis of n, a Corps "study
update"
>announced a sudden new benefit: Lock expansions would preempt the need
for
>renovations in 2015 – even though an earlier Corps analysis had found
there
>would be no need for renovations until at least 2033. The same update
also
>included a sudden new cutback in costs: The estimate for overruns was
>chopped from 35 percent to 25 percent. Earlier, Corps officials had
>inflated the benefits of lock expansions by assuming that tows would no

>longer use much self-help, Sweeney argued.</p>
><p>Even these changes barely pushed the predicted benefits past the
costs,
>according to Corps documents. And the Corps is still basing its entire
case
>for improvements on an forecast of barge growth that has proven
>tremendously overoptimistic over the last several years.</p>
><p>So on June 29 Sweeney sent out a detailed memo noting all these
>discrepancies, suggesting there might be "an appearance of cooking the
>economic books." Another economics panel member, Wesley Walker,
submitted
>several of his own objections the same day.</p>
><p>On July 4, at Mudd's recommendation, Anderson disbanded the panel.
>"Thank You to everyone for helping to get the study to where it is
today,"
>his memo declared. "The team effort has had support from many
individuals.
>Your contributions are appreciated."</p>
><h1>Competing Visions of 'Green'</h1>
><p>Flash back a moment to 1929, long before Don Sweeney was born.</p>
><p>Maj. Charles Hall, the chief Corps engineer in the Rock Island
district,
>had conducted an exhaustive study of a plan to build new dams on the
>free-flowing Upper Mississippi, and had concluded it wouldn't justify
the
>economic costs. His superiors had overruled him. So Hall raised a new
issue
>in a speech at the American School of Wildlife, arguing that locks and
dams
>would "radically change" the river's habitats. "The public can properly

>demand that the biological effects of a proposed movement be stated
before
>it was adopted," Hall said.</p>
><p>At the time, that was a radical notion. The barge-friendly
Minneapolis
>Journal denounced these "gratuitous opinions," wondering "why Major
Hall
>should worry about flora and fauna at all." A Minnesota senator fumed
that
>"it would be unfortunate and against public policy if collateral
matters
>are permitted to interfere." Hall was quickly relieved of his duties on
the
>study.</p>
><p>Seventy years later, Sweeney suffered a similar fate. So has the
Corps
>changed?</p>
><p>Today no one dares to suggest publicly that nature should be a
>"collateral matter," and top Corps officials insist it is a high
priority.
>The agency's spending on environmental projects has quadrupled since
1992,
>highlighted by a $33-million-a-year program to revive the Upper
>Mississippi's health. The Corps is now pursuing several huge
restoration
>projects, most notably a bold replumbing of the Florida Everglades.</p>

><p>At the same time, though, critics say the agency continues to pursue

>huge traditional projects that could endanger wetlands and wildlife,
from a
>navigation canal in Louisiana to a pumping station in Mississippi to
>port-dredging efforts all along the Atlantic coast. A coalition of
>environmental groups along the Gulf of Mexico recently published a
report
>titled "Destruction by Design: The U.S. Army Corps of Engineers'
Continuing
>Assault on America's Environment." Taxpayer groups continue to blast
the
>agency as a money sinkhole.</p>
><p>There is a battle raging for the soul of the Corps, in part pitting
>civilian leaders who want to nudge the Corps toward a more
environmental
>outlook against military leaders who tend to respond to traditional
>constituencies in the barge, farm and construction industries. The
agency
>is an odd hybrid in the Pentagon chain of command, staffed almost
entirely
>by civilians, run predominantly by uniformed officers. A civilian
assistant
>secretary of the Army is supposed to set civil works policy, but most
of
>the actual engineering and analysis gets done in 49 division and
district
>offices commanded by military personnel.</p>
><p>Now the war is playing out on the Upper Mississippi. A top Corps
general
>did order a review of the lock construction study last week, around the

>time Sweeney filed his affidavit. A decision is expected next month,
and
>outside observers think it will say a lot about the future of the
>Corps.</p>
><p>Environmental groups believe the extra barges lured by lock
expansions
>would grind up more fish, uproot more vegetation, silt in more side
>channels and further erode shorelines. They also warn that if the Corps

>builds these improvements, relieving congestion at some locks, it will
>create new bottlenecks at other locks, fueling demands for more
>improvements. But even though a 1996 Corps poll found that
"environmental
>considerations are people's biggest concerns" for the river, the agency
has
>released preliminary data justifying seven lock expansions.</p>
><p>"This is a real test for the Corps: Are they going to rubber-stamp
more
>corporate welfare, or are they going to look out for the river for a
>change?" asked Dean Rebuffoni, a Sierra Club leader in Minneapolis. "I
hear
>the green rhetoric, but I don't see the action."</p>
><p>Fuhrman insists the Corps is trying to strike a balance. He
acknowledges
>that the Corps wants to support the navigation system, just like the
>Department of Transportation wants to support the transportation
system.
>But he says the agency is committed to the environment as well, and
>recognizes its "awesome responsibility" to keep its analyses on the
>level.</p>
><p>"I would be the last person to advocate an increase in capacity for
the
>sake of increasing capacity," he said. "I think we've been an honest
>broker."</p>
>

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