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The EPA Has Joined the IRS and the DOJ

The figurative cauldron containing recently revealed federal government shenanigans just might be overflowing. Indeed, some significant transgressions are now going essentially unreported.

You of course have heard about the IRS's targeting of conservative groups for what I'll euphemistically call special attention. Ditto the Justice Department's violations of journalists' privacy. And regardless of your political persuasion, you likely were taken aback last week by the news that the National Security Agency has possibly been collecting metadata records of your phone calls.

But I'm willing to wager that some Fools -- who obviously constitute an attentive set -- are unaware that the Environmental Protection Agency has also allegedly been discriminating against conservatives in the area of fee collections. Conversely, their liberal counterparts have been receiving fee waivers at an alarming rate. The fees have been tied to Freedom of Information Act requests by the media, think tanks, and non-profit activists. And, since no other government agency has a greater effect on fossil fuel companies, attention to EPA machinations should be de rigueur for energy investors.

The allegations of political favoritism within the agency are being investigated by the House Energy and Commerce Committee and the House Oversight and Government Reform Committee. The latter is also looking into the concurrent charges against the IRS. At the same time, Louisiana's Republican Sen. David Vitter and California Republican Rep. Darrell Issa are demanding more information on the charges against the EPA from its acting administrator, Bob Perciasepe.

Tending to a tiny town
Fossil fuel companies and the EPA have hardly formed a mutual admiration society during the past four years. The Wall Street Journal maintained as much 18 months ago in an editorial precipitated by an interminable -- and still ongoing -- look into the possibility that fracking by Encana (NYSE: ECA  ) has fouled the water table at minuscule (population 175) Pavillion, Wyo. As the paper observed: "The agency is dominated by anticarbon true believers, and the Obama Administration has waged a campaign to raise the price(s) and limit the production of fossil fuels." 

Given the EPA's respective treatment of conservative and liberal groups, the duration of the Wyoming study, and the Journal's assessment of the agency's attitude toward traditional fuels, it's unlikely that hydraulic fracturing will escape further federal hindrances. That, despite a recent 16-month Pennsylvania study that found that fracking isn't to blame for high methane levels in drinking water.

Coal in our stockings
Nevertheless, it'll likely be a lifetime before the frackers are forced to contend with the level of regulatory impediments that have been hurled at coal producers. Indeed, the latter industry has been buffeted by numerous EPA regulations that have essentially knocked the skids out from under coal companies.

No one can say with certainty whether those strictures, which have been either proposed or fully implemented, are related to the president's 2008 campaign promise to bankrupt the coal industry. Nonetheless, coal executives and Republican lawmakers are complaining of a "war on coal" by the EPA.

Don't completely turn your back on coal
One thing is demonstrable: The coal companies have taken it on the proverbial chin from a share price perspective during the past few years. Whether solely from an EPA regulatory overload, or with the added effects of an increased availability of cleaner-burning natural gas, even the biggest of the coal companies, Peabody Energy (NASDAQOTH: BTUUQ  ) , has seen its share price plummet by about two-thirds in just the past two years.

That, perhaps somewhat surprisingly, is not to indicate that I'd steer clear of the St. Louis-based company. After all, Peabody has mining interests in Australia and Venezuela -- in addition to the U.S. -- and is involved in export agreements with India and China, and the European Union. It thereby stands to become increasingly well-positioned to circumvent the EPA's heavy hands.

An even more insulated coal producer is mining giant, BHP Billiton (NYSE: BHP  ) , which conducts major energy coal operations in Australia, South Africa, the U.S., and South America. Further, its metallurgical coal activities include 11 existing and two green-field mines, all in Australia. However, even more important from the perspective of immunity from coal fluctuations are the company's other mining ventures, which include most minerals from alumina to zinc.

For virtually identical reasons, the other Anglo-Australian mining behemoth, Rio Tinto (NYSE: RIO  ) , also warrants monitoring. A producer of thermal and coking coal, the company operates virtually worldwide in also turning out copper, gold, diamonds, titanium dioxide, and a host of other commodities. It's worth noting that all of the analysts who follow the company rate it at least a buy.

No end in sight
In the meantime, the beat is certain to go on vis-a-vis questionable EPA measures. As Wyoming's Republican Sen. John Barrasso said in a recent Wall Street Journal opinion piece: "The (agency) has proposed dropping the acceptable amount of ozone in the air from the 75 parts per billion allowed today to 60 or 70 parts per billion. The agency concedes that the rule would have a minimal effect on Americans' health but says it would cost as much as $90 billion a year." 

It's worth noting that Sen. Barrasso is a surgeon by profession. He also represents the state where a fracking study in a small village has now reached virtual dog's-age status.

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Read/Post Comments (21) | Recommend This Article (7)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 12, 2013, at 9:04 AM, ChuckT63 wrote:

    I am so surprised, another corrupt Government Agency! This is my shocked face :O, and this is what happens when they stop creating laws that control government, and start, only creating laws that control the people. Our Government was suppose to be answerable to us, but instead, we are now answering to The Government, and those few in power, are creating laws that ensure that will continue to happen. This is exactly what our forefathers were hoping to avoid, when they penned The Constitution.

  • Report this Comment On June 12, 2013, at 9:36 AM, SLTom992 wrote:

    I have been rather astonished that there are so many public servants willing to take political positions regarding neutral offices. So the new revelations about the EPA come as no surprise.

    There is simply too many doing this to be personal choice. I feel that this could only happen if someone is in a threatening positions and forcing people to do this.

    This isn't just corruption - it is an assault on the political freedoms of this country and must be met with heavy investigations, arrests and trials.

  • Report this Comment On June 12, 2013, at 9:38 AM, lmvh71 wrote:

    As usual, this is just another corrupted agency within the Obama's regime. They are basically doing is bidding by picking winners and losers and pushing the administration's agenda. Like the IRS, NSA, and FBI, this three-letter agency needs to be investigated and their funding either pulled or reduced until they can "Clean up" their act. No pun intended.

  • Report this Comment On June 12, 2013, at 9:46 AM, amysname wrote:

    This administration is so INCOMPETENT that I am not surprised! The departments feel that they are not answerable to the people that pay their wages, the same as the Obama people. They are UNION workers wanting to protect their lucrative salaries at any cost. No one has been held accountable at the IRS and nowhere else. They are going after the whistle blower at the NSA but what about the HEADS of the NSA that allowed their secrets to be exposed?Holder lies, Clapper lies, Clinton lied and nothing has happened to any of them!

  • Report this Comment On June 12, 2013, at 9:52 AM, agoudy wrote:

    If you look at commnson all the news sites, violence over this government is coming. D or R...doesn't matter. People are mad and they are buying guns and ammo like it's war...guess what? It will be. I'm scared for my family, but it's coming.

  • Report this Comment On June 12, 2013, at 10:16 AM, AtariHero wrote:

    This is a terrible article. There's no evidence of corruption in this article. And, any economist or honest energy executive will tell you that the reason that coal is suffering has nothing to do with regulations, it has to do with natural gas being cheaper right now.

  • Report this Comment On June 12, 2013, at 10:20 AM, Gingyt wrote:

    Media certainly have created scandals out of legitimate government practices. It always is playing favorites when the other side is in office. A majority of citizens favor more government policies to ensure we are protected from terrorists even if it means giving up some privacy. When Busch was in office Republicans were the largest majority of supporters for this approach. Now that Obama is in office Democrats are the largest supporters of this approach. It's all about party politics. To me, if you have nothing to hide you have nothing to fear.

  • Report this Comment On June 12, 2013, at 10:38 AM, Stevegarry22 wrote:

    This should come as no surprise to anyone. Everything that has been going on has come from the top. There is no way a handful of people in one IRS office decided on their own to hold up not just Conservative groups but every group that disagrees with odumbo. The same with the EPA, odumbo said in 2008 he would break the Coal industry, and he ordered his EPA to do it....Hopefully the 2014 elections will flush out the socialists democrats from the Senate, and then the Republicans will have the veto proof power to override the boi king. I also hope in 2015 the House and Senate launch a full scale investigation into how odumbo won 2 elections with so much voter fraud, and pass a National Voter ID law.

  • Report this Comment On June 12, 2013, at 10:46 AM, NoBiasYeahRight wrote:

    I don't suppose it matters that both major political parties are guilty of the privacy rights violations recently revealed regarding domestic surveillance. The same is true of the IRS with the program being investigated having been instigated when a Bush appointee headed the IRS. Further, since the acronym that the "Tea Party" stands for is "taxed enough already", I think it's at least somewhat reasonable to carefully scrutinize tax exemption requests by groups with that phrase as part of their names and/or philosophy. Finally, It is entirely disingenuous for you to baldly state that the EPA is targeting conservative organizations without again stating the obvious correlation that Big Energy, which includes all carbon-based sources (coal, natural gas, and oil) are closely allied with the conservative political philosophy that holds that regulation that impedes making money, their shared god, is anathema. Of course, these industries also lobby and give money to Democrats, but it is the same as it is with the banking and finance and pharmaceutical and any other industry or group that curries favor: they want to give money to whomever is in the best position to assist their goals, and they don't care what political party said potential ally calls his or her own. You are over-simplifying and omitting this perspective for some reason. I wonder what that could be? Perhaps you share a similar position at the alter of Mammon.

  • Report this Comment On June 12, 2013, at 11:04 AM, chlpro wrote:

    Color me oh so surprised that another government agency is corrupt. I will be more surprised if another government agency isn't corrupt. This is why we need to do away with most of them.

  • Report this Comment On June 12, 2013, at 11:14 AM, kfcoupe wrote:

    There's another government agency you can add to the list.

    In an apparently unsuccessful effort to illegally keep The Fisker automobile concern in business, the agency responsible for compliance of new motor vehicles to current safety mandates exempted them from having to meet the 2012 and 2013 standards. Anyone doubting this need only look at the window sticker papers on any new, untitled, unsold Karma and you will see the statement that the car does not meet applicable safety standards BUT has been exempted from same by the government, under exemption #001. Can you imagine the uproar if GM, Ford or Chrysler asked for an exemption on one of their products? Supposedly, the edict that exemption be granted came from the White House but no names are currently available.

  • Report this Comment On June 12, 2013, at 11:19 AM, Sagittarius2012 wrote:

    More people should stop watching the 'everything’s fine’ news stations, NBC, CBS, CSPAN, etc., and start watching John Stossel. Stossel has already coved many over reaches of the EPA and their excessive fines, which have become a Cash Cow for the government. Why do we need useless government workers, in a useless government agency like the EPA sitting around all day thinking up new regulations that make life harder for us? Only Congress should pass environmental regulations, and only in the extreme situations that they are needed. Abolish the EPA!

  • Report this Comment On June 12, 2013, at 11:29 AM, MontanaLiving wrote:

    Whats more important is that Fracking can and will poison the water tables across the country and that in 2005 it was Bush who made it possible to do this to our nations water supply by screwing with the safe drinking water act. This is what should be important. Wake up people. Your Kids have to drink this water. Unless there is a secret magic political party recipe to create water magically.

  • Report this Comment On June 12, 2013, at 11:46 AM, mdk0611 wrote:

    NoBias -

    1. Regarding the EPA, you need to check the WSJ coverage of the fee waiver issue

    2. Regarding IRS, if everybody does it why did's 501(c)(4) application sail through the IRS back in 2003?

    How on earth did Media Matters:

    a. Get approved as a 501(c)(3) (not (c)(4)), where no politics is permitted, during the Bush Administration and,

    b. Not get audited during the Bush years when their activities screamed for review.

    The fact is that the actions of the Obama IRS was not par for the course. Abuses have happened in the past (Nixon, LBJ, FDR), but not like this. Those were personal. This is systematic.

  • Report this Comment On June 12, 2013, at 12:59 PM, ObsidianMTness wrote:

    Was there any wrong doing? Not sure. Was there reporting bias? Maybe, maybe not. Every second term president goes through scandals and turmoil. Perhaps, Clinton, GW, and Obama could have bow out when they are on top.

    However water interesting because it is fluid. it travels from its source from the mountains, rivers, and lakes. Then, it continues to go wherever that the ground will carry it. There is an interconnectedness when it comes to water. So, one water table doesn't exist by itself and it in turn feeds other smaller pockets of water or other water tables. Also, every living thing needs water, including ourselves.

    Thus, if and when contamination of one water table occurred, its deleterious effects from water quality, everything living in that area, and beyond. The effects could last for many many years and cause terrible medical, developmental, genetics of generations to come. A town of 175 might be insignificant to some larger cities, but there exist people with families, mothers, fathers, children, and even those who haven't been conceived yet. If one is not convinced, search for the effects of Agent Orange in Vietnam, Exxon Valdez oil spill, Chernobyl, Gulf oil spill. Although cleaned up, the negative results from contamination will last, even when invisible to the human eye.

    Europe looks at fracking in America as a huge experiment and they are learning how and what to do in order to protect their citizens. Why not here in America?

  • Report this Comment On June 12, 2013, at 2:03 PM, healthyinMN wrote:

    So how much time are we going to waste again trying to involve the President!!!

    We are sick of all this waste of time!!! Do the job we hired you people to do!!!

  • Report this Comment On June 12, 2013, at 2:30 PM, scottscarborough wrote:

    Sen. Rand Paul has been pointing this out for the past 4 years. The media is biased toward this administration. Our constitution puts limits on government. This administration bypasses the constitution with the full support of CNBC, CBS, AP, ABC,CNN, etc. The truth has been out there there is no investigation s or reporting of the truth.

  • Report this Comment On June 12, 2013, at 6:45 PM, NoBiasYeahRight wrote:

    Mdk 0611:

    1) The WSJ article you cited is from the Editorial / Opinion pages in a newspaper that is known to be conservative editorially and is further owned by Rupert Murdoch, a fairly well-known conservative propagandist, and the only other sources I could find on this matter were patently biased to the conservative side politically. The following article on Politico, which is also imperfect due to editorial bias, does at least present the EPA's rebuttal, which is fairly convincing to me.

    The original source of the complaint, Chris Horner, a senior fellow at the Competitive Enterprise Institute, appears not to have accurately accounted for his statistics, but then you know what they say about statistics. In any event, this whole matter has the tell-tale taint of conservatives over-stating a situation to trump up a scandal out of what is far more likely to be typical bureaucracy. I am completely unconvinced that it represents deliberate targeting of conservatives, and I am particularly unconvinced that the White House or Obama played any role in it.

    2) If he is so certain it will prove his case that the White House or at least those under direct guidance of high level Obama appointees are involved in the IRS scandal, then why won't Darrell Issa release the full transcripts of the IRS employees' testimony? A Democratic member of his House Oversight Committee, Elijah Cummings, has stated: "'I wrote Chairman Issa on Thursday and I wrote to him this morning. I want those transcripts to be released,' Cummings said. 'I’m willing to come on your show [CNN's State of the Union] next week with the chairman with the transcripts if he agrees to do that. If he doesn’t, I’ll release them by the end of the week.'

    Cummings insisted that the interviews will prove that 'the White House was not involved in this,' pointing out that the Cincinnati IRS manager of the screening group, a career veteran at the agency who identified himself as Republican, told investigators that Washington did not direct the targeting. 'I do not believe that the screening of these cases had anything to do other than consistency and identifying issues that needed to have further development,' the individual told investigators according to portion of the transcripts released by the Democratic staff on the House Oversight Committee."

    The follwoing link is from a progressive web site, but I think it is fair to say that they have quoted their source correctly as there is no indication elsewhere on my internet search that Mr. Cummings has asked for a retraction. The point is that if the full transcripts would support his case, then why won't Issa release them?

    3) You have me confused with an Obama apologist. I abhor his continuation of post-9/11 civil rights and privacy violations in the name of Homeland Security, a term that Orwell would find sadly ironic. It's not that I don't believe there are dangerous people ready and willing to resort to violence and murder to press their political and religious points; it's that I don't want to give up the rights guaranteed me in the U.S. Constitution for the sake of some impossible quest to prevent the unpreventable, some of which is driven by the fear that one's political opponents will pounce on any failure to prevent all and every terrorist (that's foreign, not domestic, because if the skin tone isn't vaguely dark and the name doesn't sound Arabic [Muslim], then those political opponents are staunchly uninterested) attack as a failure worthy of being drummed out of office.

    I further believe that, if it’s possible, Osama bin Laden is either literally or figuratively laughing as his molecules drift about the ocean floor at how his evil, cowardly attack succeeded beyond his wildest dreams at providing cover for those who always did think that Constitutional protections are only for the rich and powerful and not the little people as the former have gone about depriving us of them ever since in service of sweetheart deals on fat government contracts and resource pillaging overseas and at home.

    The solution isn’t to stop all surveillance; it’s to do it legally, which means real Congressional and judicial oversight by the courts. We have three branches of government, faulty as each one individually may be, for the really good reason that there is at least a chance then that they do what they are meant to, which is to check and balance each other.

  • Report this Comment On June 12, 2013, at 8:01 PM, VegasSmitty wrote:

    A fish rots from the head down!

  • Report this Comment On June 12, 2013, at 9:38 PM, bamissfa wrote:

    the deal is this

    Obama said " i reward my friends and punish my enemies".

    This is exactly what all these federal agencies are doing.

    That means obama is the one ordering it.

    now we have an ambassador accused of pedophilia and engaging in sex with prostitutes.....again the state department HID and covered this up.

    This president is so corrupt he has put in his financial backers in key positions and they have not a clue what they are doing other than they have too much damn power, they abuse their power and their position.

  • Report this Comment On June 13, 2013, at 1:27 AM, The1MAGE wrote:

    ...When they came for me,

    there was no one left to speak out.

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