Debate over restructuring Energy Department heats up

It has not been Bill Richardson's month.

First the embattled Energy Secretary had to defend his department against a House select committee led by Rep. Christopher Cox, R-Calif., which slammed Energy for letting Chinese spies steal secrets from its leaky laboratories. Two weeks later, at a Capitol Hill hearing, Richardson found himself dueling with Senate Intelligence Committee member Jon Kyl, R-Ariz., who proposed to place the weapons labs in a semiautonomous agency under their own director-a plan that Richardson found so threatening to his authority as Secretary that he promised a presidential veto.

Then, just six days later, President Clinton's own Foreign Intelligence Advisory Board, chaired by respected former GOP Sen. Warren Rudman, issued a blistering report with recommendations even more threatening to the Secretary's authority-yet remarkably protective of the reputation and independence of the labs, which had been widely denounced just weeks before as out-of-control nests of foreign spies. Richardson promptly issued a statement rejecting the Rudman recommendations.

But the White House failed to back him up, and one administration official, who asked not to be named, told National Journal that Richardson's rejection of the Rudman report was not White House policy, saying, "At this point, it's a DOE [Department of Energy] position only."

In response to the unnamed official's comment, Richardson was undeterred: "Well, I can say that the White House supports me, and you can print that," he said. "I don't know who you're talking to." The Energy Secretary, while willing to make some concessions, said he will still recommend a veto of Rudman and Kyl's core proposal: a semiautonomous agency.

But Kyl, too, was confident that his ideas, in some form, would prevail. "I can't imagine the President of the United States vetoing a bill that would improve the security at the national laboratories," Kyl said. The co-author of the Kyl proposal, Sen. Pete V. Domenici, R-N.M., agreed, saying with assurance that the White House "will be on board [with us]."

Yet while Richardson and the Energy Department's Washington headquarters face an ever-tightening siege, another herd of China-scandal scapegoats seems to be scampering to safety. For, in stark contrast with proposals earlier in the scandal, both the Rudman and Kyl plans take great care not to throw the scientific baby out with the security bathwater. (The Rudman report's title is "Science at Its Best, Security at Its Worst.")

Both plans bash Energy's employees at headquarters and its satellite offices while protecting the core interests of the contractor employees at the labs. And both plans bear the imprint of longtime lab allies: Kyl's co-author, Domenici, is famous for protecting his home-state labs, Los Alamos and Sandia; while Rudman relied on what he called the "invaluable contribution" of one member of the intelligence board, a career lab scientist named Sidney D. Drell.

Although the labs' escape from legislative harm now seems increasingly likely, it was by no means a predetermined outcome. For all the acknowledged incompetence of Energy's bureaucrats, who sat on a decade of dire warnings of security breaches at the labs, it was the labs that had those breaches in the first place, and it was from the labs that experts suspect (though none can prove) that the nuclear secrets were stolen.

No wonder, then, that Senate Intelligence Committee Chairman Richard C. Shelby, R-Ala., initially proposed to "put a tourniquet" on the labs' exchanges with foreign scientists, while House Armed Services Committee Chairman Floyd Spence, R-S.C., introduced a bill to put the weapons labs under Pentagon control. Both prospects were horrifying to lab scientists: "If one just goes overboard and closes down the labs behind walls of secrecy," said Drell, "you're going to do bad science." The Shelby and Spence proposals have been upstaged by the Kyl proposal, and both were categorically rejected by the Rudman report.

Indeed, the Rudman report's harsh language softens when it turns to the shortcomings of the labs. While the Department as a whole is said to be "thoroughly saturated with cynicism and disregard for authority," a later section of the report excuses the indiscipline of lab scientists: "It is not surprising that they might bristle under the restraints and regulations of administrators and bureaucrats who do not entirely comprehend" cutting-edge research. This point of view persists throughout the report.

"We wrote it that way intentionally," Rudman told National Journal. "We felt that they should not be blistered to the point which everyone else was. . . . They are brilliant scientists who have helped win the Cold War, and even though they may have some attitudes about security and counterintelligence that are really quite antithetical to good management, nonetheless, that's not really their primary responsibility; whereas the managers, it is their responsibility."

But why do even the labs' managers get off relatively lightly? "[Things] that they did improperly, in many cases, were because they were not getting the direction and support that they needed [from Energy headquarters]," Rudman said. "Quite frankly, I was rather impressed with several of the labs' managers." Impressed in a way that he was not, with Energy officials? "Absolutely."

But one former weapons scientist, who has been critical of lab security, said of the Rudman panel: "They didn't go hard enough on the scientists and the engineers and the laboratories themselves."

The labs not only get off lightly but, in many respects, come out ahead. The Kyl and Rudman plans are an Energy headquarters official's nightmare. But the Rudman report recommendations, in particular, consistently match long-cherished lab desires for independence from Energy Department headquarters. Said Rudman: "You must get the weapons laboratories out from under the general bureaucracy of that agency."

The former weapons scientist, however, said that it was no surprise the labs came out well in the Rudman report, because of the influence of Sidney Drell.

"Dr. Drell [is] a legend," said an unprompted Rudman, "a man who has been a consultant to Presidents, Congresses, irrespective of party." And Drell's closeness to the labs? "He had a great history there, which was wonderful. We had somebody inside." Drell himself said of the skeptics' raising questions: "They have a right to, [but] we talked to a lot of DOE headquarters people, [and] we were absolutely evenhanded."

Indeed, of the four former Energy officials interviewed for this article, all four largely agreed with the Rudman report. The four included James D. Watkins, President Bush's reformist Energy Secretary and no shill for the labs, who declared, "I applaud this report: I think it hits the nail on the head." But current Energy Department officials in Washington, as opposed to frustrated former reformers, may well quail at the Rudman recommendations, which propose to seriously reduce their control over the labs.

For example, the labs have long chafed under the direction of Energy's nationwide network of field offices, which most sources agree are a redundant layer of bureaucracy. The Rudman report recommends disbanding the offices altogether. Another, even more telling detail of the Rudman recommendations is their call to abolish Energy's recently upgraded Office of Intelligence, whose main job is to coordinate-skeptics say "control"-the work lab scientists do for outside intelligence agencies. The Rudman report recommends leaving only a few liaison officers, which Richardson has said he will accept.

What Richardson rejects, however, goes to the heart of both the Rudman and the Kyl plans: the creation of a new agency to consolidate all of the department's national security functions, still (technically) reporting to the Secretary but largely outside the control of Energy headquarters.

The weapons labs have mixed feelings about such plans. The upside: They would no longer be lost in a vast, diversified department, and would once again be the centerpiece of a focused agency, much as they were in the days of the old Atomic Energy Commission. The downside: Such a focused agency might not support the labs' extensive work outside the nuclear weapons field-research into dentistry and geology, for example. Skeptics consider this sort of work a distraction, but the labs insist that it is a complement to their core mission.

Both Rudman and Kyl give the labs the best of both worlds: a special agency built around their weapons mission but with strict instructions to collaborate with Energy's other labs and with outside agencies on nonweapons work. In other words, the labs would still get department support but not department control. Rudman said Drell was influential in bringing the board around to the view that a semiautonomous agency, still tied to Energy, was the best choice.

Richardson insists this scheme is unacceptable. He repeated to National Journal his vow to seek a presidential veto for any plan creating "an agency within an agency that does not report to me."

But the new system would report to Richardson, Kyl protested: "The very first sentence of this amendment makes it very clear that the Secretary is still the top dog," he told National Journal, repeating a point the visibly frustrated Senator had debated with the Secretary, clause by clause with text in hand, at the June 9 hearing. And, indeed, both the Kyl legislation and the Rudman report do leave the newly created nuclear weapons agency and its director reporting to the Energy Secretary.

"What's going on here is not really the Secretary," Rudman said. "It's all that bureaucracy [at Energy headquarters]. All that bureaucracy is saying to him, `Hey, Mister Secretary, defend our turf.'. . . Secretaries become captives of their own organizations."

A valid point, but there is also a strong, substantive reason for Richardson's objections. Under both proposals, the Secretary would lose hands-on, day-to-day control over the most prestigious part, indeed the core mission, of his department. The Rudman report goes further, giving the agency its own budget and a general counsel, and guaranteeing the new administrator a fixed tenure of five years.

What's more, Richardson's entire strategy for reforming the department has been to create high-powered new positions-for counterintelligence, physical security, general oversight-reporting directly to him. An autonomous agency within Energy-with its own counterintelligence, security, and oversight staffs-would complicate that centralized control.

But Kyl said that Richardson's reading is "simply a misunderstanding of our proposal. This entity has to cooperate with whomever the Secretary puts in charge of counterintelligence and security." But even after Kyl altered his bill, Richardson told National Journal he still saw "duplicative lines of authority" between his advisers and Kyl's proposed agency chief. And the Rudman report makes none of Kyl's concessions to secretarial control. So what will result?

"There will be major reform," Rudman predicted. "Will it all take place? Well, I doubt it, but I'd be happy for 80 percent. There's a principle here, and that principle must be adhered to, or I don't care what they do, but it won't be reform. And that [principle] is that there must be a semiautonomous agency within the [Energy Department]."

Which is exactly what Richardson will not accept. While the Secretary has made a number of concessions, his current counteroffer is to create a new undersecretary position responsible for all national security work-a Rudman recommendation-but without the full structure of a semiautonomous agency. "That's what he said so far," acknowledged Rudman. "I think he may be changing his mind." But the key mind to change in all of this is not Richardson's, it's Clinton's. And so far, not even Rudman would venture to guess what the President plans to do.