We often, in public policy, end up making claims about what will happen if we do x or y. But it is constructive, among other things, to go back and see if the promises that were being made about its proponents actually occurred. We are secondly going to look at the way in which the Clean Air Act was fashioned within the executive branch and the proposal that was developed before president bush sent it to congress. Third, you are going to look at how the legislation actually got passed and, in particular, focus on the action in the senate with respect to securing this legislation. First, let us turn to bob grady, the chief speechwriter for president bush during his 1988 campaign. Bob was the one who came up with the wonderful line that the time for study has ended and the time for action has arrived. Once president bush got elected, bob served at the associate director of the office of management and budget for National Resources, energy, and science, and played a pivotal role i think it is fair to say dick darmin effectively outsourced the environmental portfolio to bob and bob is going to talk to us about how the act has impacted practice. I tell people that my black socks are in my suitcase. [laughter] i was just getting twitchy there. [laughter] so i am just relaxed and ready to go. Here we go. First, let me say what an honor it is not only to be on the panel, but good friends with dr. Porter and senator simpson. As many other speakers said, such a privilege to be here at this reunion celebration. The privilege of serving in the administration of this not only wonderful president , but great man, was probably the greatest honor and one of the most fun experiences of my life. [applause] now to judge whether this clean air statute worked, i want to take you back in time. 1988, george h. W. Bush ran for the presidency. The environment was a much bigger issue than recently. Part of that was we were coming out of an era where we discovered over 1000 sites around the country. The air pollution in the United States was terrible. In many cities, we had smog in los angeles. Think about los angeles. They exceeded the Health Standards for smog on 188 days of the year. In other words, half of the days in l. A. In a year, it is unhealthy to go outside. Pollution was washing up on the shores of new jersey and, famously, the Boston Harbor. There was some argument about the Health Effects of acid rain, but there was no question that lakes in the northeast, forests in the northeast, were being denuded of trees. People like the governor of New Hampshire and senator olympia snowe, who is here, we were very worried about that. And canada was tougher on the suffering from the effects of acid precipitation and prime minister, a very close friend of this president , spoke about it quite a bit. So people were concerned. If you roll the clock forward today, one of the reasons that the environment has not been quite as much an issue is that the environmental laws we have enacted in the last 45 years have actually worked very well. Our air and water are cleaner. Conditions in the rivers are safer to swim in. Our landfills are safer. We have measurable Health Results to show that. Of all of those laws, i believe there is a very strong case that the single most effective has been the clear act amendment of 1990. Amendment of 1990. I think it would be accurate to say that this is the most effective environmental statute ever enacted. Why do i say that . First of all, the Clean Air Act is still in the books today and still working well. 23 years later, it still has an effect. More importantly, the actual result of the statute has been staggeringly effective. It regulates fixed criteria air pollutants, Carbon Monoxide, smog, lead, etc. But in the 23 years since this law was enacted, the concentrations annually has been reduced very dramatically. From 1990 to 2012, according to the epa people might not know this, but the epa has monitors all around the country. So they have monitors of all these different pollutants. From 1990 to 2012, the ambient concentration of Carbon Monoxide in the air is down by 75 . The amount of lead in the air is down by 87 . The amount of nox, nitrogen oxide, is down by 50 . The amount of fine particulate matter is down by 40 . The compounds, smog, down about 50 . Sulfur dioxide, the cause of acid rain, down 72 . If you add all that up, our air today has 67 fewer pollutants floating around in it then it had 23 years ago. Annual emissions are down very sharply as well. You think of how much came out of every smokestack in 1990 and measure it against 2012, Carbon Monoxide is down 65 . Lead annual emissions are down. Particulate matter is down 57 . Sulfur dioxide is down 72 . Americans live with much cleaner air. A practical explanation of what that means. In 1988, the healthbased standards for smog, l. A. Was 188 days. In 2013, 25. Not far from here, in houston, the secondworst city in terms of smog, in 1980, they were out of containment 80 days. Last year, 10 days. Baltimore, another city we have had a big problem with. In 1988, 65 days. Last year, 4 days. By the way, that is despite the fact that the epa has moved the goalposts. In other words, the standards are tighter than they were. They are about 30 more difficult to reach as of late. If they had not moved the goalposts, we would have gone to zero in most of the country. This is really important. This took place in a timeframe in which your economy is almost three times as big as it was in 1990. The u. S. Economy was 6 trillion in 1990. It is 17 trillion today. Even as you adjust that for inflation, our population in that time is up 20 . The amount traveled is up 25 . The economy is bigger, the population is bigger, people are driving more, but emissions are down 65 to 70 acrosstheboard. It is really quite remarkable. In addition to those six criteria and other things that had never been regulated before, there was a problem, something called air toxics. These were never actually controlled by the law. In 1974 and 1977, Congress Passed a law about a margin of safety. A u. S. Court of appeals decision written by the late robert bork said it was zero so the epa could never figure out how to regulate it. In 1990, we created a framework for regulators using available technology. Today, the epa regulates a list of 187 identifiable carcinogens coming out of plants around the country and emissions of those air toxics are down 73 . Now, one reason that all of that became possible, reducing air toxics by 73 , reduce Carbon Monoxide, and have the economy have a boom, was because, unlike much of todays lawmaking, we took lost into account. Cost into account. We agreed in terms of how to do things in the most costeffective way. So the most clear example that, the Clean Air Acts signature program, the first ever to control acid rain, sulfur dioxide, mainly from power plants. We went to the Domestic Policy Council in the roosevelt room and we presented president bush with three options. Reduce emissions from power plants by 4 million tons. We could reduce by 8 million tons and 10 million tons. The president picked the most ambitious target, to cut it in half, to cut it by 10 million tons. We were definitely afraid of the cost. We had studied analyses from the Consulting Firm about where your costs would get out of control. What we were able to do was cut it in half because we had an Innovative Program to allow the trading of sulfur dioxide emissions. They could sell excess emissions to another plant and it would be more expensive to install control. That was also the key to the political conundrum. It used to be the reason that there was no acid rain, the people who lived in states in the midwest, they said, this is a national problem. People who live on the coast said, wait a minute, we should not pay a national tax. The trading system was an ingenious way to solve that political conundrum. People in the midwest could sell those excess emissions allowances to the people on the coast. It was sort of a voluntary way of subsidizing, but it was not an actual tax and it was the key national tax and it was the key to solving the political problem. Here are the results from that. In 1990, there were 23 million tons of sulfur dioxide. Now there are 6 million. So we overachieved. In terms of cost, he actually did it at a much lower price. At a time when we were debating and enacting this bill, it would cost about 700 per to reduce the cost. The electric facility said it would be 1500. If that is the case, just do not control and you can pay the penalty. The average price of a traded ton of sulfur dioxide was 125 a ton. It was literally 1 5 the cost of what we expected at the time. I will say that the trading system is now kind of frozen. I am not going to take the time to talk about that now. But if you look at the measured benefits versus the measured costs, according to an epa study, i read it prior to coming here, the benefits of the Clean Air Act are 30 times the measured costs. We had a requirement, the benefits and costs of this statute. The last one was in 2011 and they modeled that the annual cost was about 40 billion a year. Half of that changes to cars. About 20 is cost of electric eels. The annual benefit was 1. 25 trillion a year, literally 30 times the cost. Others was avoiding premature mortality from breathing in things like particles. Of course, they project to 2020 and say by then it will be benefits of 1 trillion and cost of 6 billion. Not everything in the law came out as expected. One thing that happened is, in wyoming, a second rail line was built. The Clean Air Act has been a tremendous benefit to the state of wyoming. The beauty of the act is because it embodies the concept of freedom of choice in terms of how to comply. In the end, if you look at this law, i think you can take three lessons away from it. Perhaps from this great president , george h. W. Bush, to future president s. The first is bipartisanship. I have the old paper roll call from the clerk framed and hanging in my study and it is signed by bob dole and alan simpson. It passed the house 40121. Compare that to more recent stats, where one party jammed it down the throats of the other party. That is why it will not stand the test of time. I will borrow a line from senator simpson. If you do not believe in compromise, you probably should not run for congress. And for damn sure, you do not get married. [laughter] do you still stand by that . The second lesson is costeffectiveness. The effect on the economy does matter. President bush, in this law, was realistic in balance. We talked about the process. At one seminal moment, we sent a letter to the hill saying we would not sign the bill. It cost more than 20 billion a year in 1990. If you look at the cost today at 40 billion a year, it is up about 20 billion. The law is Still Holding the cap that we put in. That concept was something that allowed us to control emissions while still having the tremendous Economic Growth that we have had. And the last one is leadership. In this case, the president did not just articulate principles, we spent six months in a very dense process with a lot of people involved and sent out a 420page bill. Everybody was negotiating off of our piece of paper. So those are three key lessons. A final point. Clean air was just one of a list of major environmental accomplishments by this president. He launched the cleanup of new york harbor, baltimore, new york, los angeles, seattle harbor. I think my most favorite day of the entire 1988 campaign was the day we went up to boston, behind enemy lines, and gave a speech about Boston Harbor and sailed around in a little boat. They put copies of the Boston Herald on the press bus and everybody was cheering. Before that, the president had been given a hard time by the press, a splash of coffee. One time, he said something wrong and said he was in deep doodoo. We did this calculation. If you took all of the sludge that the governor has dumped in boston and spread it over the 40 towns that made up the Massachusetts Water development authority, it would cover those towns to a depth of 17 feet. Talk about deep doodoo. [laughter] but to go down the list, he proclaimed no loss of wetlands. People said we were crazy to do it, but here is the interesting thing. For the first time, in 2003, because of things enacted by this president , the United States has been a net gainer of wetlands. So that came through. The president had 57 total new wildlife refuges. A big expansion of parks, boat ramps, trails. They spearheaded a plan for a billion trees. Cleaned up and oil fell and passed a statute to require double hulls in the oil tankers. Made all the landfills and the country safer and revolutionized a landfill industry in the United States. The point is this in august of 1988, he went to michigan and he went to Boston Harbor, yours a shore, delaware, and he promised all of these things. He said he would expand the parks. In short, what he said is i will be the environmental president. And you look back today, i do not think he has gotten enough credit. The Interest Groups have become so partisan, but by george, he made good on that promise. [applause] thank you very much, bob. That reminds me of a poem that came out shortly after the Clean Air Act had been passed, where environmental organizations gave grades to the president , and there were very few high grades. A couple of bs and some cs. It was very disappointing after having passed the most significant piece of environmental legislation in our history. I remember walking in one morning in the oval office and the president looked up and said, did you read this mornings paper . I said, are you referring to the report card that you received . And he said, yes. I said, well, what do you think . He said, well, i am not going to send it home. [laughter] and i said, you know, mr. President , i do not agree with the report card. But that is not why you did it. You did it because it was the right thing to do. And there will be other report cards later and my guess is it will be much better. And as he pointed out, those report cards 25 years later are now coming in and it is a very impressive record indeed. The question is, how did this happen . When president s come into office, they have to make a set of decisions about people and about processes and priorities. I think it is very interesting. When president bush came in, he appointed bill riley as his administrator of the epa, someone who had a great deal of credibility and was a very strong administrator. He appointed James Watkins as secretary of energy, someone with a lot of credibility and stature in the energy field. He appointed as his white house chief of Staff Governor sonunu, who had a great deal of experience and understanding about environmental issues. He appointed gordon gray to his white house counsel, who had a real passion for and a love and interest on environmental issues. I served as his assistant for economic and domestic policy. People like bob grady, the office of management and budget. And the council of economic advisers. So he assembled a group of people who had differing viewpoints, for sure, but a lot of passion and interest on this issue. Secondly, he decided that the way in which he was going to go about making decisions was through a process which has become known as multiple advocacy. That is a process in which the white house engages with departments and agencies in a very open and transparent process so that the president is presented, as bob pointed out, with a series of options that reflect a great deal of expertise that has been assembled from all across the it ministration so that he can make an informed decision. President s have to worry about priorities. When president bush came in, it is worth noting that if you look at the president s, the last 13 we have had since franklin roosevelt, nine of them came into office with majorities of their own parties in both houses of congress. One of them, ronald reagan, came in to office with a majority a republican majority in the senate and a democrat majority in the house. Only three president s came in to office with opposition majorities in both houses. Of those three, the one with the largest opposition majority of any president in u. S. History was george h. W. Bush. So he had to decide, when he came in, how am i going to try to provide leadership in a situation in which i am going to be dealing with a congress that has large opposition majority . And so, in his very first address to the joint session of congress on february 9, 1989, he announced that a series of priorities, proposals that he would be making, including one to deal with the comprehensive Clean Air Act. This was an indication, on his part, that he was prepared to spend the Political Capital that he had on an issue in which it had effectively been gridlocked for the previous 13 years. It reflected a very courageous decision on his part. In developing the 400plus page proposal that was advanced, we engaged in a process that included all the departments and agencies and also involved, thanks to the offices of good people like fred mcclure, who helped to arrange these meetings, over 20 meetings with republicans and democrats, house and senate, in advance of the president s decision, engaging them and asking them what they thought and what their biggest objectives were and what their biggest concerns were. We similarly met with more than two dozen outside groups, environmental, agricultural, industrial, to get their ideas. So that when the president had to make the choice that he did about what he was going to advance in this proposal. He had, in fact, a good amount of Information Available to him as to where those in the congress were coming