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Published: Thursday, 1/17/2013

DEADLY ALLIANCE: WEAPONS OVER WORKERS

Death of a safety plan

Industry, defense establishment twist a proposal to protect beryllium workers into a secret deal protecting their own interests

BY SAM ROE
BLADE STAFF WRITER
James R. Schlesinger, left, former Energy Secretary, cited safety risks as reasons to continue production. Martin Powers, right, former beryllium executive, helped lead industry's attack on stricter safety standards. James R. Schlesinger, left, former Energy Secretary, cited safety risks as reasons to continue production. Martin Powers, right, former beryllium executive, helped lead industry's attack on stricter safety standards.
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It was supposed to be a plan to protect workers.

It was supposed to reduce the amount of toxic beryllium dust floating in many plants and machine shops.

And it was supposed to limit the number of workers developing an incurable and often-fatal lung illness called beryllium disease.

That was the plan at least.

But this simple plan -- proposed by federal regulators in 1975 -- would eventually die, replaced by something far different.

DEADLY ALLIANCE: How government and industry chose weapons over workers

For what started as a government effort to protect workers from this rare but dangerous metal was slowly twisted into a secret arrangement protecting government and industry.

First, the safety plan was attacked by the beryllium industry.

Then several U.S. senators -- all of whom had beryllium plants in their states -- stepped in.

Then came the defense establishment: Energy Secretary James Schlesinger and Defense Secretary Harold Brown. They feared the plan would cut off beryllium supplies for nuclear bombs and other weapons, and that would "significantly and adversely affect our national defense," Secretary Schlesinger wrote to two cabinet members at the time.

In fact, the Energy Department, which is responsible for maintaining the nuclear arsenal, was so concerned about beryllium supplies that it struck a bargain with the Brush Wellman beryllium company, government and industry documents show.

DEATH OF A SAFETY PLAN

1975: Occupational Safety and Health Administration proposes safety plan

1977: Beryllium company Brush Wellman Inc. mounts counter-attack

1978: Defense establishment, U.S. senators weigh in, delaying the plan

1979: Brush, Energy Department cut deal; terms involve U.S. opposition to plan

1980s: Safety plan dies -- 'a terrible disappointment,' former OSHA head recalls

Today: 47 Brush workers have contracted beryllium disease since plan proposed

The government got its valuable beryllium for years to come, and Brush Wellman got more money, a virtual monopoly on government work, and assurances that defense officials would lobby against the safety plan.

Within a few years, the safety plan died.

"It was a terrible disappointment," recalls Eula Bingham, former director of the U.S. Occupational Safety and Health Administration, which had proposed the plan.

The plan remains the only significant effort by the U.S. government in 50 years to tighten controls on the beryllium industry. This is true even though beryllium workers continue to become ill and die from inhaling the metal's dust.

About 1,200 people have contracted beryllium disease -- 127 at Brush Wellman Inc., the Cleveland-based mining and beryllium company with plants in several states. Fifty workers have contracted the disease at Brush's main plant outside Elmore, O., 20 miles southeast of Toledo.

Perhaps what is most remarkable about the safety plan is not that it failed, but how it failed.

How industry executives, sensing they could not defeat the plan on its merits, huddled with their lawyers and devised a strategy of attack.

How several members of Congress, responding to industry concerns, went to bat for the industry even though the record clearly showed that the beryllium business was harming workers.

How defense officials, fearing beryllium would no longer be available, cut a deal to keep an aging, unsafe plant open.

"A lot of this," retired Brush Wellman executive Stephen Zenczak says, "really gets into inside dirty linen."

Over the last 22 months, The Blade has pieced together the death of this safety effort, using thousands of industry documents disclosed in recent court cases as well as government records obtained through federal Freedom of Information requests.

Among the documents: a recently declassified Energy Department report on beryllium supply problems and the transcript of a candid talk by Brush executive Martin Powers at a company seminar. In his talk, Mr. Powers details Brush's legal maneuverings to quash the safety plan.

"It was not intended that [my talk] be recorded," Mr. Powers, now retired, recalls. "I didn't know it was being taped."

In total, the industry and government documents show how the regulatory process can be slowly undermined. Moreover, the records provide a rare window into the inner dealings of what President Eisenhower called "the military industrial complex" -- an economic and political alliance he so firmly warned against.

Officials deny any wrongdoing in the safety plan's demise, saying it was not needed in the first place.

Mr. Zenczak, a senior Brush Wellman manager who helped cut the deal with the government, says the company did not sabotage the regulatory process. Rather, he says, Brush was simply fighting back against zealous safety regulators who were trying to "make an example of us and hang us up as a trophy."

Jerry Evans, an Energy Department official who has handled beryllium issues for the government for years, says the safety plan was never valid because its underlying scientific data were flawed -- an argument the beryllium industry has also made.

Still, two federal agencies were convinced that tougher controls were needed, and an independent panel of experts confirmed the safety plan's underlying science.

Throughout the fight, one fact remained constant: Workers continued to contract beryllium disease, which eats away at the lungs and proves fatal about one-third of the time.

Eisenhower warns about arms industry

In his farewell address in 1961, President Eisenhower offered America a warning: The nation, he said, "must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist."

Such comments were surprising coming from Mr. Eisenhower, the supreme commander who led the Allies to victory in Europe in World War II and who, as president, was considered a friend of business.

Yet he warned of the "grave implications" of the massive arms industry.

Until World War II, he noted, America had no such industry. Now, it had a "permanent armaments industry of vast proportions."

The beryllium business was a small but vital part of this Cold War economy.

And Brush was a key beryllium supplier, enjoying significant government support.

In 1949, for example, the government paid Brush to build and operate a plant in nearby Luckey. Later, the government subsidized a Brush facility a few miles away near Elmore.

The U.S. Atomic Energy Commission was in charge of overseeing safety conditions at the plants, but it was also responsible for ensuring that nothing disrupted beryllium supplies -- duties often at odds with one another.

And for several years in the 1960s, when the contractual restraints on Brush loosened, no federal agency oversaw worker safety.

That would change in the 1970s.

America was now focusing less on the Russians and more on social issues, such as civil rights, the women's movement, and the environment. Several historic laws were passed, including one in 1970 that created the Occupational Safety and Health Administration.

Now there was a federal agency -- one wholly independent of industry -- that could set safety standards, inspect factories, and fine violators.

It was only a matter of time before these two entities -- OSHA and the military industrial complex -- would collide.

Safety proposal stuns, angers Brush Wellman

For the beryllium industry, that collision occurred Oct. 14, 1975. That day, OSHA held a news conference to announce it planned to crack down on beryllium.

The agency said a dozen workers a year were being diagnosed with beryllium disease. Moreover, OSHA said, studies suggested the metal caused cancer. So OSHA proposed cutting the worker exposure limit in half -- from 2 micrograms of beryllium dust per cubic meter of air to 1 microgram.

The amounts of dust were small: 2 micrograms is equivalent to the amount of dust the size of a pencil tip spread throughout a 6-foot-high box the size of a football field.

But the proposal to cut the limit was not small: The beryllium industry would probably have to spend millions of dollars on new safety equipment and lose customers unwilling to do the same.

Brush Wellman executives were completely blind-sided by the safety plan. They had no idea it was coming, and they knew nothing of the news conference.

In fact, top Brush officials did not learn of OSHA's announcement until the day after the news conference -- and then perhaps in the worst possible way.

Brush chairman and CEO Robert Biggs was on his way to a board of directors meeting, and just before he arrived, he picked up a newspaper and saw an article about OSHA's plan.

He was furious. He showed the article to board members and blasted Brush executive Martin Powers, who had been monitoring OSHA's activities and had assured him the firm had nothing to fear.

Luckily for Mr. Powers, he was out of town.

"My understanding is that Biggs tore me up and down, said that I had lied to him," Mr. Powers later told Brush managers in the candid, tape-recorded talk.

Mr. Powers was summoned back to the office. By the time he arrived, Mr. Biggs had cooled off -- "enough that he decided not to fire me, but not enough that he was willing to talk to me," Mr. Powers recalled.

The two met with Brush's attorneys at Jones, Day, Reavis & Pogue, the Cleveland-based law firm that is one of the largest and most prestigious in the nation.

"Biggs wanted this thing fought, and he wanted it fought with every weapon we had," Mr. Powers recalled. "It was to be a first priority in everything in the company and that he expected it to be the first priority at Jones Day."

Brush has been a key supplier for the U.S. government for more than half a century, supplying beryllium for the defense and space industries. Brush has been a key supplier for the U.S. government for more than half a century, supplying beryllium for the defense and space industries.
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Losing the argument, Brush switches strategy

Jones Day assigned one of its top lawyers to the matter, Patrick McCartan.

A former law clerk to U.S. Supreme Court Justice Charles Whittaker, Mr. McCartan would one day go on to become one of the nation's leading attorneys. Today he is managing partner of Jones Day.

Joining him on the Brush case was John Newman, Jr., a graduate of Harvard Law School.

In a 12-page internal memo, Brush laid out its strategy for fighting OSHA: The firm would challenge the merits of OSHA's plan -- attacking the underlying research, for example -- but Brush would also rely on "informal pressures."

Brush officials, the memo states, should talk with several members of Congress "to see what they can do to help and what suggestions they might have with respect to others who might have an effect upon Labor Department policies."

And Brush should talk with the Atomic Energy Commission, the Defense Department, and the Commerce Department "to find out as much as we can about what common interests they may have to motivate their support."

Over the next two years, from 1975 to 1977, Brush vigorously fought OSHA's plan, submitting rebuttals, lining up witnesses for public hearings, and soliciting more than 100 supportive letters from customers.

The battle came to a head in Washington in 1977, when OSHA held three weeks of public hearings on the matter.

At first, Brush stuck to its strategy of fighting the plan on its merits. The company argued that the tighter exposure limit was not needed and that it was technologically and economically impossible to achieve.

But toward the end of the hearings, company records show, Brush's lawyers acknowledged things weren't going well. In fact, Brush was going to lose.

And if Brush challenged the outcome in court, the lawyers said, Brush would probably lose again. The courts seldom overturned such decisions -- unless the government had been deliberately unfair. If Brush could prove that, it might have a chance to win.

Brush officials immediately switched strategies.

"We decided that the only chance we had was to indict the government for bad faith," Mr. Powers told Brush managers in 1986 at the seminar that was tape-recorded.

So when it was Mr. Powers's turn to speak at the hearings, he blasted OSHA's research arm, the National Institute for Occupational Safety and Health, saying it had concealed information, misused its power, and treated the beryllium industry as "the enemy."

OSHA, he declared in his written statement, just wanted to appear to be "doing something" about beryllium. He called the agency's plan "an arbitrary and capricious misuse of regulatory authority."

Brush's strong words didn't change much.

When the hearings ended, OSHA moved ahead with its safety plan.

U.S. Senators put pressure on plan

Brush Wellman did not give up.

Shortly after the hearing, the company started "a publicity campaign," according to Mr. Powers's 1986 talk with Brush managers.

One action that captured attention: Eight scientists -- at least four of them Brush consultants -- wrote a scathing letter to two cabinet members.

The letter was in line with Brush's new attack-the-government strategy: The scientists called the federal regulators' cancer studies on beryllium "shocking examples of the shoddy scholarship and questionable objectivity utilized in making important national regulatory decisions."

Such studies, they wrote, "do the nation a disservice."

None of the scientists identified themselves as beryllium industry consultants.

In fact, three had testified on behalf of Brush Wellman at the recently completed OSHA hearings.

The scientists' letter was sent to Labor Secretary Ray Marshall and Health, Education, and Welfare Secretary Joseph Califano, Jr., and subsequently released by a Washington-based public relations firm.

That same letter wound up in the hands of several members of Congress. These lawmakers, in turn, started writing letters to Carter administration officials, expressing concern about the scientific basis of the safety plan.

Among those who wrote letters: Sen. John Glenn of Ohio, Sen. Orrin Hatch of Utah, and Sen. Richard Schweiker of Pennsylvania -- all from states with beryllium plants.

Senator Hatch weighed in several times. In a letter to HEW Secretary Califano, the senator said he was "deeply concerned" by the scientists' letter and called for a "truly independent review" of beryllium.

"I feel that it is the mutual responsibility of the Administration and the Congress to guarantee the integrity and reliability of the studies and of the rulemaking process," Senator Hatch wrote.

Senator Glenn also wrote to HEW Secretary Califano, calling for a review. And Utah Sen. Jake Garn told Energy Secretary James Schlesinger that he, too, didn't want the rule adopted prematurely.

But Senator Garn's interest went beyond the opinions raised by a few industry scientists.

A member of the Armed Services Committee, he was concerned how the safety plan might affect America's ability to build nuclear weapons.

That was a concern of defense officials, too.

After the deal was cut, workers at Brush's Elmore plant continued to be exposed to high levels of beryllium dust. After the deal was cut, workers at Brush's Elmore plant continued to be exposed to high levels of beryllium dust.
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Defense officials cite national security risk

At first, defense officials didn't take much interest in the safety plan.

Few testified at the OSHA hearings in the fall of 1977, and few submitted written comments.

But after the hearings were over, and adoption of the safety plan appeared imminent, they grew increasingly concerned.

One reason: They learned that stiffer regulations might drive an important yet financially strapped beryllium supplier, Pennsylvania-based Kawecki Berylco Industries, out of the metal business.

Now, "the full significance of the proposed standard impact was appreciated," a recently declassified government report states.

So in January, 1978 -- about the same time Brush Wellman began its "publicity campaign" -- defense officials created a beryllium task force.

Its stated mission: to study what impact OSHA's safety plan would have on the beryllium industry and U.S. supplies.

But Mr. Powers, the retired Brush executive, told his colleagues at the 1986 seminar that defense officials informed Brush that the task force was set up "to try to get the OSHA thing reversed."

Four months after it was created, the task force concluded in a report that the OSHA plan had serious national security implications.

It said the nation's two main beryllium producers -- Brush Wellman and Kawecki Berylco -- would likely stop making beryllium for the government if the safety plan were adopted. Both companies made little money on government orders, and so the firms would rather shut certain operations than invest millions of dollars on new safety equipment.

If the government wanted to pay for the improvements or build its own beryllium plant, the cost would be high: tens of millions of dollars.

The task force concluded the bottom line was this: The Energy Department needed several tons of beryllium each year. If supplies were cut off, there would not be enough beryllium in the stockpile to last two years.

In a memo to top defense officials, the Energy Department's J.K. Bratton recommended that the Energy and Defense departments express these national security concerns to U.S. health and labor officials.

Such letters, he said, would likely "moderate" OSHA's safety plan.

Energy Secretary Schlesinger took the advice: In August, 1978, he wrote identical letters to Labor Secretary Marshall and HEW Secretary Califano. A copy was sent to National Security Adviser Zbigniew Brzezinski at the White House.

Mr. Schlesinger warned that if the safety plan were adopted, the costs of complying with the regulations might drive beryllium firms out of the metal business and cut off U.S. supplies.

"The loss of beryllium production capability would seriously impact our ability to develop and produce weapons for the nuclear stockpile and, consequently, adversely affect our national security."

And that, he said, would be "unacceptable."

Substitutes for beryllium, he wrote, could not be used in existing nuclear weapons without testing the bombs to verify performance. "In some cases, full-yield testing would be necessary."

Weapons under development would have to be redesigned, and that "would require a long-term major investment and would incur significant penalties in performance, safety, and cost."

Mr. Schlesinger concluded by asking Secretary Califano to conduct an independent review of OSHA's basis for the safety plan.

Defense Secretary Harold Brown made a similar request, calling it a matter of "national interest."

In the end, Secretary Califano agreed to an outside review.

This pleased Senator Hatch, who had lobbied Mr. Califano for such a move.

"My congratulations for your excellent judgment," the senator wrote.

The following month, October, 1978, a panel of seven nongovernment scientists convened in Atlanta. They reviewed the cancer studies on beryllium and heard from industry, labor, and OSHA representatives.

The experts' conclusion: The science behind the safety plan was valid.

Finally, it appeared that work places handling beryllium would be made safer.

U.S., Brush Wellman strike agreement

THE DEAL

In May, 1979, the Cabot Corp. announced that it was dropping out of the beryllium metal business. Shortly after, the U.S. government and Brush Wellman cut a deal. In a Dec. 3, 1984 letter, Brush executive Stephen Zenczak wrote to an Energy Department official. An excerpt of the letter, below, outlines the deal.

Following that (Cabot's) decision, Brush Wellman representatives were invited to the DOE offices in Germantown, Maryland to meet with representatives of the Office of Military Applications. In that meeting Mr. R.W. Biggs, Chairman of the Board of Directors of Brush Wellman, committed Brush to the following actions, conditioned upon certain commitments of DOE, as follows:

Brush Wellman Commitments

1. Brush would not discontinue beryllium production without notice to the government sufficient to allow an alternative production arrangement to be developed.

2. Should Brush serve notice of its intention to cease beryllium production, it would serve as consultant to DOE to impart its beryllium expertise to any contractors of DOE designation.

3. Brush would exert best efforts to enhance the quality, cost and delivery dependability of its products to the level required by DOE and DOD.

DOE Commitments

1. DOE and DOD would exert best efforts to have OSHA reconsider its proposed unrealistic beryllium standard.

2. DOE would accept a one time 35% price correction on existing beryllium components being supplied to DOE, and thereafter agree to negotiate prices that provided for a commercial rate of return on Brush's efforts.

3. DOE would not condone competitive manufacturing operations in GOCO facilities.

It is our belief that all parties have discharged their obligations under the foregoing agreements. The OSHA problem has become dormant, the prices of beryllium have stabilized, the quality of beryllium parts have been improved and major programs have been carried out within planned budget costs and delivery schedules. And, perhaps most importantly, a cooperative environment of mutual confidence has developed between the user community and Brush Wellman.

Then something happened that changed everything.

In May, 1979, the Cabot Corp., now the owner of Kawecki Berylco, did exactly what defense officials feared: It dropped out of the pure beryllium metal business after repeatedly losing money in that venture.

That left Brush Wellman as the sole supplier in the non-Communist world of the kind of beryllium that America needed for weapons.

Needless to say, this put Brush in a strong negotiating position.

Brush executives soon met with defense officials in a series of discussions at the Energy Department's headquarters outside Washington and at its Albuquerque, N.M., office.

At a meeting in June, 1979, a deal was struck, government and Brush documents show. Brush promised to continue to supply the Energy Department with beryllium for its weapons; in return, the agency promised to:

  • Pay Brush a one-time 35 per cent price increase.
  • Not develop other sources of beryllium.
  • Try to persuade OSHA to drop its safety plan.

Former Brush executives Stephen Zenczak and Martin Powers were at this meeting and confirm in interviews with The Blade that these were the terms of the deal.

Mr. Powers, testifying under oath in a recent court deposition, explicitly stated that this was the agreement.

And no action was taken contrary to the terms of the deal.

In addition, Energy Department files contain four separate letters from Brush that detail the agreement. The letters repeatedly stress the importance of the deal to Brush's future business plans.

In one, Brush explicity states that if the government didn't live up to the agreement, Brush would get out of the beryllium business.

Mr. Zenczak, who retired from Brush in 1987 as vice president and general manager of the company's metals and minerals division, says the government never put the agreement in writing. That's why Brush repeatedly sent letters to the weapons officials outlining the deal.

"We put them on notice as to what our understanding was, the theory being that if they disagreed with it, we would hear from them. We never had a rebuttal."

In fact, in 1985, Brush's Mr. Powers met with Energy Department officials and outlined the history of the deal. He mentioned the written confirmations that Brush had sent to the government and then suggested that the lack of a government rebuttal was tantamount to acceptance.

Even knowing this, the government did not object.

One of Brush's letters was sent to the Energy Department's Dr. Richard Jiacoletti, who has since died. His replacement, Jerry Evans, a senior program engineer, has handled beryllium issues ever since.

He confirms that the government never answered Brush's letters. He speculates that is because Energy officials did not agree with Brush's understanding of any agreement.

"This is my opinion, and it may or may not be factual, but I believe that Brush has greatly exaggerated what they felt they walked out of that meeting with," says Mr. Evans, who was not at the meeting and was not working for the Energy Department when the deal was cut.

He did confirm a portion of the deal: The Energy Department agreed to pay a price increase when Brush became the sole beryllium supplier.

Mr. Zenczak, the former Brush executive, says he thinks Energy officials didn't put the deal in writing because it was potentially embarrassing. "That's the nature of the bureaucrats: Never write something that five years later somebody might dig up and accuse you of."

He says the deal was cut unbeknownst to OSHA and that Energy officials gladly accepted the terms, including the promise to try to persuade OSHA to drop its safety plan. "Actually, they were relieved we weren't going to [go out of the beryllium business]."

One additional note: When Brush spelled out the deal in a 1984 letter to the Energy Department, it did so in great detail. The company wrote that it wanted to provide the necessary background for a new request: Brush proposed building a new beryllium plant -- provided that defense officials gave the company additional "protective assurances" on competition.

Defense officials met to discuss Brush's letter and request, but in the end, a new plant was not built, so additional "assurances" did not apply.

According to handwritten notes from that meeting, copies of which were obtained through a Freedom of Information request, a defense official wrote:

"Assurances cannot be in writing this time either."

Plan dies; OSHA head blames 'powerful voice'

Within a few years of the 1979 deal between Brush and defense officials, OSHA's safety plan died.

Concerted governmental opposition played a pivotal role in its demise.

Eula Bingham, OSHA's director at the time, says Defense Secretary Brown's and Energy Secretary Schlesinger's opposition to the plan in 1978 was instrumental in the plan's death. "It was a very powerful voice," she says.

Dr. Bingham, now a professor of environmental health at the University of Cincinnati, says her boss, Labor Secretary Ray Marshall, told her that the plan would not go forward because Mr. Brown and Mr. Schlesinger opposed it.

Mr. Marshall is now a retired professor at the University of Texas. A spokeswoman says he did not recall much of the issue and could not comment.

Likewise, his former Carter administration colleagues -- Defense Secretary Harold Brown and National Security Adviser Zbigniew Brzezinski -- say they did not remember the matter and could not comment.

Former Energy Secretary James Schlesinger is now with the Center for Strategic and International Studies, a public policy research institution in Washington. Through a spokeswoman, he says he recalls the issue but feels his 1978 letter detailing his concern with OSHA's plan speaks for itself.

Carter White House Science Adviser Frank Press says he recalls the beryllium controversy, but no details.

"There are hundreds of these kind of issues," says Dr. Press, now a technology consultant in Washington.

Former Brush executives Mr. Powers and Mr. Zenczak say that defense officials in 1979 clearly promised to try to persuade OSHA to drop its safety plan. But they say they don't know exactly what, if any, action they took.

Says Mr. Zenczak: "It was my understanding that [defense officials] made it known how critical this material was to their programs. That was one of the reasons why [OSHA] backed off and went on to other things."

More high exposures, more workers get ill

Brush Wellman's deal-making with the government wasn't over.

One last issue had to be resolved: the condition of Brush's aging metal plant near Elmore -- the plant where government materials were made.

At the time, about 1979, workers at the plant were being exposed to extremely high levels of beryllium dust, company records show.

The dust, Brush's Mr. Powers recalls, was "impossible to control."

So Brush wanted the Energy Department to help pay for a new facility.

Although that request never went far, Energy officials did give Brush $3.5 million in 1982 to study the problem.

One of the main questions that the study posed was: Could the Elmore plant produce 100,000 pounds of beryllium annually for the government and not expose workers to levels of dust over the legal limit?

The company's conclusion: No.

Still, Brush went ahead and produced that amount -- and more -- two out of the next three years.

And as predicted, workers were exposed to unsafe levels -- some four times the legal limit, the Brush study shows.

One of the Brush officials involved in the study was Marc Kolanz, the company's current director of environmental health and safety.

When asked why Brush proceeded with a production schedule that guaranteed workers would be overexposed, he said: "I don't know the answer to that question."

Brush records show that several workers who were overexposed during this period went on to develop beryllium disease.

One victim recalls having coughing fits at the plant.

"I was coughing so hard I was close to passing out," says the victim, who requested anonymity. "I had to hold onto barrels to keep myself up."

In all, 47 Brush Wellman workers have contracted beryllium disease since 1975 -- the year OSHA proposed its ill-fated plan.



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