Public Citizen News 2006 Annual Report 5

Public Citizen’s p r o t e c

2006 t i n

a n n u a l r e p o r t g

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Public Citizen Defends Citizen Interests, u r

Challenges Unethical Congress in 2006 h

or ethically challenged politicians and the e influence-peddlers trying to woo them, 2006 Fwill be remembered as the year the party a ended. After more than a decade of mounting cor- l ruption from one-party, Republican rule, lobbyists t and lawmakers alike were indicted, convicted and carted off to prison for ethics abuses. h However, a growing chorus of public outrage , over these abuses of power still did not hold much

sway in Washington, D.C., last year. The leadership s on Capitol Hill offered only tepid reform bills to curb the influence of money in politics. The White a

House and federal agencies continued to attack f hard-won government safeguards and tailor regu- e lations to benefit corporate interests.

Public Citizen was in the fray, as it had been for t

35 previous years, defending the rights of citizens y and championing their interests in the halls of power. The organization showcased the worst of the worst in Congress and motivated citizens to a

band together to express their displeasure with the n corporate raiding of the federal Treasury.

Public Citizen also took the Food and Drug d Administration (FDA) to task on its 100th birthday for the agency’s conflicts of interest with the drug industry and for the unsafe medicines and treat- d

ments – such as Vioxx and silicone breast implants e Clockwise, from top: 1) Public Citizen Photo/Bridgette – that the FDA has allowed onto the market. Blair; 2) Public Citizen Photo/Valerie Collins; 3) Photo And as the National Highway Traffic Safety Courtesy of Texas Fair Trade Coalition m Administration (NHTSA) turned 40, Public Citizen Clockwise, from top: 1) The sign

President Joan Claybrook – a former NHTSA admin- pictured here was part of a 2006 o istrator – continued to push the agency to improve effort by Public Citizen and others safety and fuel efficiency in vehicles. to encourage incumbent lawmak- c

Public Citizen exposed the corporate mergers ers to sign the “Voters First” pledge; r and price-gouging that drove up fuel prices last 2) “Billionaires for Bush,” a grass- a year as drivers paid record prices at the pump and roots organization that uses humor oil companies raked in their largest profits ever. The and street theater to expose politi- c organization continued to push for increased fund- cians who support corprorate y ing for renewable energy sources and countered interests at the expense of every- day Americans,“crashes” a press efforts to falsely portray nuclear power as a cleaner conference on the estate tax in s alternative. April. 3) This “cat” was at a February

Public Citizen also fought attempts to rush con- 2006 event highlighting a Public i struction of new polluting power plants in anticipa- Citizen Global Trade Watch report. n tion of stricter regulations, such as Texas energy giant TXU Corp.’s plan to build 11 dirty coal-burning voting records and exposed which lawmakers were In 2007, the new leadership started addressing c plants in Texas. (Under pressure, they cut that num- most dependent on corporate cash and lobbyist the nation’s real concerns with a busy 100-hour e ber back to three in February 2007.) largesse. It helped organize the nationwide “Voters reform agenda packed with ethics and lobbying In the courts, Public Citizen continued to pro- First” pledge, putting members of Congress and reforms, repeals of handouts to Big Oil and other 1 tect free speech rights and challenge the Bush candidates on record as supporting ethics reform pro-consumer measures. Public Citizen continued administration’s flagrant disregard for the rule of and taking steps to reduce the influence of cam- to provide advice, lobby for high ethics standards 9 law. In a high-profile case against the Federal paign cash in politics through public funding of and government safeguards, and ensure that the Emergency Management Agency (FEMA), Public congressional elections. And the organization held voices of the people are heard in Washington. 7 Citizen secured continued housing assistance ben-

accountable members who voted for unpopular 1 efits for more than 1,000 households displaced by trade deals that have hurt American workers, labor Hurricanes Katrina and Rita and a better procedure standards and the environment. In November, fed- from FEMA to determine eligibility for federal aid. up voters crashed the party,sending tainted incum- With the 2006 congressional elections bents packing and handing both houses to the approaching, Public Citizen assessed congressional Democrats for the first time in more than a decade. 6 2006 Annual Report Public Citizen News

Influential Congressional Oversight Reports of 2006

January: “Rep. Roy Blunt: Ties to Special Interests Leave Him Unfit to Lead” documented Blunt’s ties to dis- graced lobbyist Jack Abramoff, unseated House Majority Leader Tom DeLay (R- Texas) and corporate interests.Soon after the report was published, Blunt was defeated in his bid to become House majority leader. (www.citizen.org/docu- ments/BluntReportFinal.pdf)

April: “Spending Millions to Save Billions” revealed that 18 super-wealthy families had financed much of the lobby- ing effort to repeal the estate tax. The

report demolished the argument that Public Citizen Photo/Bridgette Blair the repeal would help small businesses Public Citizen employees and interns gather near the U.S. Capitol on April 27 to protest the House of Representatives’ and family farms. (Public Citizen part- weak lobbying bill.The group positioned itself in the classic “See No Evil, Hear No Evil, Speak No Evil” pose.

t nered with Boston-based United for a Fair Economy to write and release this h report.) The report received extensive Corruption Tops 2006 Election Issues; g media coverage, and the U.S. Senate i rejected a permanent repeal of the New Congress Considers Ethics Reforms s estate tax in June. (www.citizen.org/doc- r uments/EstateTaxFinal.pdf) ublic Citizen warned for years that the influ- pledge drive. Candidates were asked to pledge e ence-peddling industries had taken over the support for meaningful new restrictions on con- v May: “Willful Misconduct: How Bill Plevers of power in Washington, D.C. At the gressional gifts and travel, disclosure of lobbyist Frist and the Drug Lobby Covertly end of 2006, the voters agreed that change was campaign fundraising activities and public financ- o

Bagged a Liability Shield” used private e- needed. ing of campaigns.

l mail messages obtained by Public In 2006, the year opened with very few mem- The plan worked beautifully. The pledge drive netted signatures from 364 candidates – almost a a Citizen to chronicle the roles pharmaceu- bers of Congress taking an interest in the lobbying tical and biotechnology industry lobby- and ethics reforms proposed by Public Citizen. third of all congressional candidates – including 73 n ists played in crafting legislation that All that changed on Jan.3,2006,when a Justice incumbents who were re-elected. Exit polls con-

o provided those industries with almost Department investigation netted a plea bargain firmed that the issue of corruption was the single i complete immunity from liability for any with former super-lobbyist Jack Abramoff. He most important issue for most voters in affecting

s their ballots, and angry voters tipped the partisan drugs used to combat pandemic dis- pleaded guilty in federal court to attempting to balance of power to the s eases. (www.citizen.org/documents/ bribe public officials but, in exchange for a lighter sentence, Democrats in both houses of

e 050406PandemicFinal_1.pdf ) agreed to point the finger at Congress.

r On Jan. 4, 2007, the those he bribed. While congressional May: “The Bankrollers: Lobbyists’ g Alarm bells rang in first day of the new Democrats must take their share Payments to the Lawmakers They Court, Congress. There was a legisla- of blame in the corruption scan- n 1998-2006” provided the first detailed tive stampede to introduce bills Congress, the House dals, they know they owe their

o accounting of campaign contributions to regulate the lobbying indus- election to the scandals, and to from lobbyists to members of Congress. nearly unanimously c try and its target audience (pri- their promise to clean up The tally: more than $100 million since marily Congress). Lawmakers accepted new rules Washington. As a result, the lob- 1998. Congress now is considering legis- who had ignored Public Citizen bying and ethics reforms champi- lation that would require more disclo- just months before advanced a with the same gift oned by Public Citizen are back sure of lobbyists’ campaign contribu- myriad of reform proposals, and travel restric- on the front burner. On Jan. 4, tions and fundraising activities. seeking Public Citizen’s advice 2007, the first day of the new (www.citizen.org/documents/BankrollersF and endorsements. tions that they had Congress, the House nearly unan- inal.pdf ) But as the months rolled on imously accepted new rules with and no additional criminal con- found so repugnant the same gift and travel restric- October: The “Special Interest Index” victions were handed down in a few months earlier. tions that lawmakers had found disclosed the amounts of money mem- the Abramoff scandal, Congress so repugnant a few months earli- bers of Congress received from political grew increasingly complacent. er.On Jan.18,the Senate passed S. action committees, individuals who gave The gathering “perfect storm”for 1,the most comprehensive lobby- more than $200 or more,individuals who reform miraculously transformed itself into light ing and ethics bill in decades, which is now pend- did not live in their state and lobbyists, showers with a few wind gusts. The resulting bills ing before the House. In addition, for the first time since 1974, and ranked each member of the 109th passed by the House of Representatives and the Congress is seriously considering public financing Congress by these categories and by Senate, which subsequently were stalled in confer- ence by the leadership, were devoid of real ethics for congressional and presidential elections – a their overall dependence on these types and lobbying reforms. legislative package that Public Citizen and the of campaign contributions. The report House Republican leaders assured themselves coalition has been discussing with the congres- focused on the types of donors who are that voters did not care about lobbying reform – a sional offices of Sen. Richard Durbin (D-Ill.) and most likely to want something in return claim that Public Citizen and others in a coalition Rep. John Tierney (D-Mass.) for the past six for their contributions. (www.cleanup- of reform organizations seized upon as a battle cry. months. washington.org/sii) Public Citizen worked with a large reform While 2006 was a roller coaster ride for Public coalition to expand the demands for lobbying and Citizen’s reform efforts, that ride is beginning to ethics reform to include public financing of elec- look like it was all worth it. tions and helped to orchestrate the “Voters First” Public Citizen News 2006 Annual Report 7

(Left) Photo Courtesy of Korean National Electrical Workers Union; (Right) Public Citizen Photo/Robert Yule (Left photo) Tyson Slocum, director of Public Citizen’s Energy Program (third from left), participates in an international symposium held in November 2006 in Seoul, South Korea. (Right photo) Slocum (left) and Michele Boyd, legislative director of the Energy Program, flank bestselling artist and accomplished songwriter Bonnie Raitt in July. Raitt donated 75 seats for her sold-out July 3 concert at Wolf Trap National Park for the Performing Arts in Vienna,Va., to benefit Public Citizen. Energy Program Helps Block Mergers, Educates Consumers

n the 1990s, utilities made a big push for dereg- ulation, and a number of states jumped on the Spent Nuclear Fuel Still Threatens U.S. Security Ibandwagon. Now, citizens around the country are beginning to experience the real-life problems with deregulation – including dramatic increases ore than five years after 9/11, the feder- number of sites.There is no national storage site in their monthly energy costs. al government has not yet addressed for nuclear waste; plans to build one in Nevada In 2006, Public Citizen fought to keep con- Mthe security threats posed by storing have stalled because of bad science and mis- sumers’ energy prices down and working to show spent nuclear fuel. management. the public the benefits of alternative energy. Instead, the Bush administration would To offer an alternative, Public Citizen collab- Most notably in 2006, Public Citizen’s Energy increase the danger with its proposed Global orated with national and grassroots groups to Program, along with groups from around the Nuclear Energy Partnership (GNEP), a program develop “Principles for Safeguarding Nuclear country, helped block two multibillion-dollar elec- that would restart reprocessing of nuclear waste Waste at Reactors,” which call for spent fuel to tric utility mergers – Chicago’s Exelon with New in the . Such reprocessing would be secured in robust structures at reactor sites.

Jersey’s Public Service Enterprise Group (PSEG) separate plutonium from nuclear waste and The groups supporting the principles – now e and Constellation Energy Group of with undermine global nonproliferation efforts, pol- more than 125 members strong – are urging FPL Group of Florida. lute the environment and cost taxpayers hun- Congress to enact legislation to implement n

Public Citizen provided research and helped dreds of billions of dollars. them. e organize communities to protest these mergers, In 2006, Public Citizen led a coalition of con- Instead of increasing its reliance on danger- r which likely would have led to higher electricity sumer, environmental, public health, peace and ous and expensive nuclear power, the United g bills and worse service for New Jersey and security, and taxpayer groups from around the States government should promote and invest Maryland consumers. country against GNEP. in renewable technologies and efficiency meas- y In the case of the Exelon-PSEG merger, Exelon As a result, Congress provided less than half ures. has a utility and 24 power plants in Pennsylvania of what the administration requested for GNEP’s Studies show that the United States can and New Jersey, so the move would have reduced fiscal year 2007 budget. meet its energy needs and address climate competition and allowed the remaining company Public Citizen also led a successful campaign change with renewable energies and efficiency. to price-gouge consumers, who would have had in 2006 to block legislation that would have For more information about the principles, no alternatives. established federal spent fuel storage sites that visit www.citizen.org/documents/Principles In the case of the Constellation-FPL merger, are located away from nuclear reactors. SafeguardingIrradiatedFuel.pdf. the new company would have been based in Currently, spent fuel is stored at about 77 sites; For more information about GNEP, visit Florida – far from Maryland regulators, thereby this legislation would have increased the total www.citizen.org/documents/WhatisGNEP.pdf. undermining the ability of the state’s lawmakers to reform Maryland’s failed deregulation model. These rate hikes would have come in addition to higher rates many consumers are paying as a in Washington, D.C. For more information, visit In addition, Public Citizen’s Texas office result of the deregulation of electricity markets, www.takebackthepower.net.) launched the “Campaign to Cool the Climate” in which Public Citizen continued to lobby against in 2006. The campaign educated mayors in Texas 2006. Global warming cities about global warming and the ways cities Households in deregulated states pay on aver- To expose the oil industry’s massive role in can reduce emissions of global-warming gases. age 13.5 cents per kilowatt/hour,while households causing global warming, Public Citizen’s Energy Public education in regulated states pay 9.1 cents per kilowatt/hour, Program released a report in September 2006 according to a Public Citizen analysis of govern- titled “Hot Profits and Global Warming: How Oil Public Citizen’s Energy Program spent a great ment data. Companies Hurt Consumers and the deal of time on outreach and public education in (To help educate federal and state lawmakers Environment,”which explained how oil companies 2006. Energy Program Director Tyson Slocum used about the failures of electric deregulation and the shortchange the public by price-gouging con- numerous television news interviews to speak reforms necessary to restore consumer protec- sumers and merging into non-competitive con- against the 109th Congress’ gifts of subsidies and tions,Public Citizen organized a Feb.26 conference glomerates. tax breaks to Big Oil campaign donors, debate The report also outlined the global warming disbelievers and tout the need for need to shift billions of dollars in renewable energy and mass transit programs to “Public participation is essential to the fight oil company subsidies to renew- reduce American dependence on oil. for clean, sustainable and renewable energy. able energy and energy efficien- He also branched out to new audiences, Unless someone takes the lead on explain- cy. appearing on Comedy Central’s “The Colbert These recommendations will Report,” where he spoke about renewable energy ing the benefits of alternative energy and be put to use if Congress passes sources. the danger posed by Big Oil’s cozy connec- a law that would invest money “Public participation is essential to the fight for tions with lawmakers, positive change isn’t in clean, renewable and alterna- clean, sustainable and renewable energy,” Slocum tive energy sources. (The House said.“Unless someone takes the lead on explaining likely to happen.” already has passed a bill, H.R. 6, the benefits of alternative energy and the danger – Tyson Slocum, director that would do this. See page 1 posed by Big Oil’s cozy connections with lawmak- Public Citizen’s Energy Program for related story.) ers, positive change isn’t likely to happen.” 8 2006 Annual Report Public Citizen News

Public Citizen Photo/Rachel Pleatman

Dr. Sidney Wolfe, director of Public Citizen’s Health Research Group, speaks at a June 2006 press conference on Capitol Hill about the Food and Drug Administration’s (FDA) failure to protect Americans from danger- ous drugs and unsafe food, as well as the FDA’s domination by the industries it is supposed to regulate. Seated are Rep. Henry Waxman (D-Calif.) (left) and Michael F.Jacobson (right), exec- utive director of the Center for Science in the Public Interest, who also participated in the press conference, which was held shortly before the FDA’s 100th anniversary. Public Citizen Keeps Close Eye on FDA in 2006

s the Food and Drug Administration (FDA) risk of tendon rupture associated with the use of these conflicts of interest in an April article pub- celebrated its 100th anniversary in 2006, these drugs. (A black box warning is the strongest lished in The Journal of the American Medical APublic Citizen was there to remind the warning the FDA can request that a manufacturer Association. The article, “Financial Conflict of agency of its shortcomings. place on a drug label. It is usually reserved for Interest Disclosure and Voting Patterns at Food More than 100,000 people die each year of drugs that can cause severe injury or death.) and Drug Administration Advisory Committee adverse drug reactions caused by medications This is the second petition Public Citizen has Meetings,” analyzed the prevalence of such con- approved by the FDA, making these largely pre- sent to the FDA regarding inadequate labeling of flicts as well as the voting behavior of FDA adviso- ventable tragedies one of the five leading causes fluoroquinolones. ry committees from 2001 to 2004. of death in the United States. Public Citizen’s In 1996, the consumer group requested a These conflicts of interest could have an Health Research Group works to get dangerous warning on fluoroquinolone labels to highlight impact on the drugs that receive FDA approval,

h medications banned or to have stronger warnings the problems associated with tendons when tak- the research showed.

t about unsafe drugs given to the public. ing these drugs but did not ask for a black box According to Public Citizen, for every advisory l warning. Public Citizen joined with Illinois Petitions committee member with a conflict, there was a 10 a Attorney General Lisa Madigan’s office in urging percent greater chance that committee would In 2006, Public Citizen filed six petitions with the agency to include the black box warning. The favor the drug being considered.If those members e the FDA – four asking the FDA to ban, relabel or FDA has yet to respond. were not allowed to vote, the overall committee

h remove certain drugs from the market, one asking vote would have been less favorable toward the the FDA to reverse its approval of an ineffective Advisory Committees drug, though in no case would the outcome of the medical device for depression called the vagus FDA advisory committees are critical to ensur- vote have changed. nerve stimulator, and one asking the Centers for ing the safety of the drugs that are put on the mar- The analysis also found that these conflicts Medicare and Medicaid Services to create special ket every year. They are made up of individuals were common but rarely led to members being requirements for genetic testing and establish outside the agency whom the FDA invites to give kicked off the committee. In response to Public standards to ensure the quality of genetic testing. advice about whether drugs should or should not Citizen’s article,the FDA presented ist own analysis One of the drug-related petitions asks the FDA be approved, relabeled or banned. of the data that differed in its interpretation of the to include a black box warning with certain antibi- Many of the committee members also have results. otics – specifically, fluoroquinolones such as Cipro, been consultants to,research grant recipients of or Public Citizen continues to hold the FDA Levaquin and others – to alert consumers of the investors in companies whose drugs the FDA is accountable in a variety of fronts. To read more considering for approval. Public Citizen exposed about HRG’s activities, visit www.citizen.org/hrg.

2006 health research highlights: a timeline 0 6 1 2 8 2 6 1 6 4 l l 1 2 . 1 1 . 1 ri ri y e t t. t. c p p a n ep c c e A A M Ju S O O D Filed a petition Calculated the Sent a letter to the FDA Sent a letter to the Filed a petition Called for a criminal Released a Testified before an FDA with the Food rate of serious requesting the immediate FDA urging the with the FDA to investigation of breast report that advisory committee and Drug disciplinary halt of advertisements for agency to stop five reverse the implant manufacturer described the strongly opposing the Administration actions (revo- vagus nerve stimulators, companies from ille- approval of the Mentor for withhold- availability of approval of a proposed (FDA) to cations, sur- manufactured by the gally promoting low- vagus nerve ing safety data from online doctor experiment involving remove the renders, sus- medical device company power laser therapy stimulation the FDA. A former disciplinary unconscious trauma diet drug orlis- pensions and Cyberonics, that included to curb smoking. device for the Mentor senior scien- information victims being given tat (Xenical) probation/ at least 10 false or mis- Laser therapy has not management of tist had sent a letter from state manufacturer Biopure’s from the mar- restrictions) leading statements.The been approved by the treatment-resist- to the FDA accusing medical blood substitute, ket.The FDA per 1,000 doc- devices are surgically FDA for this purpose ant depression. his company of with- boards and HBOC-201.This product approved orlis- tors in each implanted under the and there is no On the same holding information ranked the has been shown in pre- tat for over- state and patient’s clavicle and gen- acceptable evidence day, asked the about dangerous sites. vious trials to increase the-counter compiled a erate 30-second electrical to suggest it is effec- Centers for physical and chemical the risk of cardiovascu- use early in national pulses every five minutes, tive. Shortly after the Medicare and properties of its sili- lar events (such as 2007, a deci- report ranking stimulating a nerve lead- letter was sent, three Medicaid cone gel implants. heart attacks and sion that Dr. state medical ing to the brain. Despite of the five specified Services (CMS) Despite this, the strokes) and death. Sidney Wolfe, boards by the no acceptable evidence companies removed to not reimburse devices, which Wolfe (Ultimately, the adviso- director of rate of serious that the devices work, the ads promoting the for implantation called “the most ry committee did not Public Citizen’s disciplinary FDA approved them in benefits of laser ther- of the device. defective medical OK the study.) Health actions for July 2006 for treatment- apy for smoking ces- Early in 2007, device ever approved Research 2003-2005. resistant depression. sation from their Web CMS decided not by the FDA,” were Group, called sites. to reimburse for approved in “reckless.” this. November. Public Citizen News 2006 Annual Report 9 Public Citizen Fights Efforts to Undermine Government Regulations

or as long as corporate special inter- ests have attacked the regulatory Fprocess to undermine the federal gov- ernment’s ability to protect the public with health and safety regulations, Public Citizen has fought back, and 2006 was no different. Resisting extremists President Bush nominated anti-regula- tory extremist Susan Dudley,who was direc- tor of regulatory studies at the industry- funded Mercatus Center, in August 2006 to become administrator of the Office of Information and Regulatory Affairs (OIRA) in the White House Office of Management and Budget. From this powerful post, she could s a weaken, delay and eliminate needed regu- (Top) Public Citizen Photo/Angela Bradbery; (Bottom) Photos Courtesy of Xprts LLC latory safeguards for the public health, safe- (Top photo) Public Citizen President Joan Claybrook (left), Donald Friedman (center), an engineer and founder of Xprts f ty, civil rights, environment, privacy and LLC, and (right), executive director of the Center for Auto Safety, listen at a Dec. 12 press conference e consumers. about a new vehicle roof strength test. (Bottom photos) These vehicles were tested with the new test.The roof of the t Public Citizen investigated Dudley’s Ford Explorer (black SUV) crushed in severely, while the roof of the Volvo XC90 (white SUV) fared much better – its y record and co-authored a report with OMB windshield cracked just slightly, and its roof remained intact. Watch, a nonprofit government & group, “The Cost Is Too High: How Susan

Dudley Threatens Public Protections,”which

Vehicle Safety Makes Small Strides r exposed how, throughout her career, e Dudley has consistently fought against gov- he National Highway Traffic Safety Public Citizen and the Sierra Club sued NHTSA ernment safeguards and advocated a radi- Administration (NHTSA) took some small in May 2006, arguing that the agency’s new rule g cal, hands-off approach to regulating cor- Tsteps toward requiring automakers to build changing the way fuel economy standards apply u porations. Working with other public inter- safer vehicles in 2006 – but it also took some steps to light trucks, including SUVs, does not require est groups, Public Citizen convinced the backward from requiring vehicles to have better automakers to make vehicles that meet the maxi- l Senate not to vote on Dudley’s nomination. fuel economy. mum feasible level of fuel economy as required by a The organization will continue this fight law.The rule raised the standard for light trucks by, t in 2007; the White House renominated Safer vehicles at best, 1.8 miles per gallon by 2011. i Dudley on Jan. 9 and made her a “senior Public Citizen’s years of hard work on rollover Public Citizen also exposed the failure of Ford’s o adviser” to the acting OIRA head. prevention paid off – at least in part – on Sept. 16, flex-fuel vehicles to operate properly when they n when NHTSA issued a proposed rule to require a use E85 (a mixture of 85 percent ethanol and 15 Joining the fight in Congress s basic version of electronic stability control (ESC) in percent gasoline). Ford had used its Ford Taurus When Congress considered a bill in all passenger vehicles under 10,000 pounds by and Mercury Sable flexible fuel vehicles to avoid as 2006 that would have given small business- 2011. A final rule is pending. much as $135 million in fines for failing to comply es a free pass for “first-time” violations of ESC prevents a vehicle from shifting its center with fuel economy standards. requirements for reporting information that of gravity, which can cause a vehicle to flip. But Truck safety the public needs to know – such as the NHTSA’s proposed rule requires automakers to amount of toxic chemicals a company has install stability control systems that are less sophis- For years, Public Citizen has been fighting gov- released into the air – Public Citizen testi- ticated than systems installed in vehicles on the ernment efforts to increase truck drivers’ work fied against this bad idea. When 2006 road today. hours. In February 2006, Public Citizen, Advocates ended, the bill failed to get even a commit- Public Citizen has demanded that NHTSA for Highway and Auto Safety, Parents against Tired tee vote. Public Citizen also helped to lead address these shortcomings. Truckers, Citizens for Reliable and Safe Highways more than 400 public interest groups that Meanwhile, NHTSA has dragged its feet for and the International Brotherhood of Teamsters successfully thwarted legislation to create years while an increase in roof strength standards for the second time sued the Federal Motor Carrier unelected, unaccountable sunset commis- was needed. Its current method of testing roofs Safety Administration (FMCSA) because the sions with the power to sit in judgment over gives vehicles with weak roofs a pass, leaving dan- agency, after being reprimanded by the federal all federal programs, recommend which gerous automobiles on the road. Court of Appeals, issued an almost identical dan- programs live or die, and then force those On Dec. 12, Public Citizen and the Center for gerous rule increasing the number of hours truck recommendations through Congress. Auto Safety showed NHTSA that it can use a more drivers can work each week. Saving scientific evaluations realistic test – and, as a byproduct, showed the This increase amounts to 14 hours of daily agency that automakers can design vehicles with work,with 11 of those hours behind the wheel.The Public Citizen and OMB Watch coordi- much stronger roofs. The groups unveiled a roof case is pending. nated a network of scientists, law professors strength test developed by prominent test-device Public access to safety information and activists last year to oppose a White maker Acen Jordan and renowned auto safety House proposal to exert political power engineer Donald Friedman. The test, called the In 2006, Public Citizen received two favorable over scientific evaluations, or “risk assess- Jordan Rollover System (JRS), is the only repeat- decisions in a court case challenging NHTSA’s deci- ments,”which are conducted for a variety of able crash test that can recreate real-world rollover sion to shield injury, death and warranty informa- reasons – from determining how to get a forces the same way in test after test. tion from the public. Despite these wins, NHTSA space shuttle back to earth safely to figur- has once again proposed to withhold this informa- ing out how much pesticide residue we can Fuel economy tion. In response, Public Citizen submitted com- tolerate on our food. The National Research Public Citizen fought hard to improve vehicle ments to the agency in January 2007 detailing the Council condemned the proposal in 2007, fuel economy in 2006. changes needed to comply with FOIA. prompting the White House to back down. 10 2006 Annual Report Public Citizen News New Consumer Justice Project Takes On Unfair Business Practices

n its first year, Public Citizen’s Consumer Justice Project began to establish itself as Ian ally for consumer advocates nation- wide, working on issues ranging from mandatory binding arbitration and preda- tory lending to auto fraud and credit report- ing violations. In one of the project’s first cases, Public Citizen teamed up with a legal aid lawyer in Florida to object to an unfair class-action

settlement that would have stripped con- Public Citizen Photo/Bridgette Blair sumers of valuable legal defenses – meas- Supreme Court Assistance Project fellow Emma Cheuse (left) and Public Citizen staff attorneys Scott ures that they could use to defend their Nelson (center) and Allison Zieve (right) listen to a moot court presentation in February 2007. Each year, Public homes against foreclosure – without notify- Citizen holds an average of 15-20 moot courts, which help lawyers prepare for Supreme Court arguments. ing the citizens whose rights would be affected. As a result of Public Citizen’s efforts, the court approved a settlement last Lawyers Protect Citizen Rights in ‘06 June that required clear written notice to all class members, so they could decide attempt to alert him that the state was going to whether to opt out and preserve their espite having only 11 attorneys on staff, the sell his house to recover unpaid property taxes. rights. Public Citizen Litigation Group participated The letter was returned to the state undelivered. Public Citizen is also bringing its own Din more than 200 cases in 2006, tackling The state took no further action to tell Jones about class-action lawsuits on behalf of con- issues ranging from housing assistance for hurri- the impending sale – even though Jones could sumers who have been harmed by abusive cane survivors to a blogger’s right to criticize have been easily located – and, as a result, Jones business practices. In Maryland, Public politicians. lost his house. s Citizen teamed up last June with a private The following are highlights: Public Citizen represented Jones in the t lawyer to represent homebuyers who were Supreme Court and argued that when mailed r overcharged for title insurance. A proposed ACORN v. FEMA settlement in the case will give consumers notice of a tax sale is returned undelivered, the u Following Hurricanes Katrina and Rita, the Constitution requires the government to take compensation and reform the title compa- Federal Emergency Management Agency (FEMA) o ny’s practices. A court will decide at an April additional reasonable steps to attempt to provide provided housing assistance to hurricane sur-

c 2007 hearing whether to approve the set- notice to the owner before selling the property. vivors. tlement. The Court ruled in Jones’ favor on April 26, 2006. But in March 2006, FEMA began sending cryp- A major focus of the project has been Nickolas v. Fletcher, et al. combating abuses by debt collectors, which tic letters to thousands of evacuees, notifying have skyrocketed in recent years, through them that they would stop receiving aid on Aug. Online journalist Mark Nickolas is a frequent both class-action and individual lawsuits. 31, 2006, but failing to explain why benefits would critic of Kentucky Gov. Ernie Fletcher. Following a For instance, in a ruling issued last be discontinued. June 20, 2006, front-page New York Times article in September, the federal appeals court in Public Citizen, along with Texas RioGrande which Nickolas was quoted criticizing the gover- Atlanta agreed with Public Citizen to rein- Legal Aid, sued FEMA on behalf of the Association nor, the Fletcher administration banned state state a lawsuit brought against a debt col- of Community Organizations for Reform Now employees from accessing all blogs on state- lection agency that continued to harass an (ACORN), arguing that the Constitution requires owned computers – including Nickolas’ blog. elderly man over the telephone, even after FEMA to thoroughly explain its decisions and how In a federal case filed on July 10, 2006, Public he wrote a letter asking the collection to appeal them. Citizen argued that the state’s decision to ban agency to stop. The court agreed with Public Citizen on Nov. Nickolas’ Web site, which is devoted to Kentucky In 2006,Public Citizen also began litigat- 29, 2006, ordering FEMA to clarify its letters. As a news and policy, was made in retaliation for ing federal lawsuits in California, Florida, result, thousands of evacuees’ benefits were Nickolas’ criticism of corruption in Fletcher’s and Indiana against debt collectors that use restored. administration. threats of criminal prosecution to coerce Public Citizen is arguing that the state’s policy consumers who have bounced checks into Garcetti v. Ceballos violates the First Amendment and is asking the paying exorbitant collection fees. Courts in Los Angeles County prosecutor Richard Florida and California have reached oppo- court to hold the policy unlawful.The case is pend- Ceballos reported to his supervisors that he ing. site conclusions on whether the debt col- believed a police officer had falsified an affidavit lectors are entitled to the same immunity used to obtain a search warrant. Public Citizen v. Clerk from lawsuits in federal court that the states In response, his superiors demoted him, trans- On Feb. 8, 2006, President Bush signed into law are accorded. Public Citizen is handling the ferred him to a more remote location and gave appeals in both cases. the Deficit Reduction Act, a budget bill that, him fewer murder cases, thus undermining his among other things, made cuts to student loan consumer law and policy blog chance for promotion. funding, Medicare and Medicaid. However, the Public Citizen represented Ceballos before the House of Representatives had never passed the In September 2006, the Public Citizen Supreme Court, arguing that a restriction on version of the bill that he signed. Litigation Group’s Consumer Justice Ceballos’First Amendment protection ran contrary The Constitution requires both the House and Project, along with a group of legal aca- to the Court’s precedents and would cause many Senate to pass the same bill before it can be sent demics and consumer attorneys, whistleblowers to remain silent. The Court dis- to the president for his signature. launched the Consumer Law and Policy agreed by a vote of 5-4 on May 30, 2006. On March 21, 2006, Public Citizen filed a law- Blog to keep the legal community suit in federal court, seeking a declaration that the informed about developments in con- Jones v. Flowers Deficit Reduction Act is invalid. The case was dis- sumer law and policy. Check out the blog The state of Arkansas sent a certified letter to at www.clpblog.org. missed by the district court and is now pending in Arkansas resident Gary Jones in April 2000 in an the Court of Appeals. Public Citizen News 2006 Annual Report 11

The New Class of Fair Traders

More than 30 new fair-trade supporting members of Congress replaced free-trade supporters in the 2006 congressional elections. The following lists fair-trade supporting members.

Senators

Claire McCaskill (D-Mo.)

Jon Tester (D-Mont.)

Sherrod Brown (D-Ohio) Public Citizen Photo/David Edeli Bob Casey Jr. (D-Pa.) Participants at the “Lame Duck, Lame Deal” lobby day visited more than 400 congressional offices in November 2006. Participants included (from left to right) Meredy Throop, national organizer with the Student Trade Justice Campaign; Sheldon Whitehouse (D-R.I.) Julian Monroy, a Colombian-American activist from New York City; Alex Davis, a student from George Washington University and a constituent of U.S. Rep. Steven LaTourette (R-Ohio); Paul Adler, administrative assistant for Public Citizen’s Bernie Sanders (I-Vt.) Global Trade Watch program; and Katie Russell, a former Global Trade Watch intern.

Jim Webb (D-Va.)

Representatives Trade Issues Impact Elections

Harry Mitchell (D-Ariz.) he 2006 congressional elections marked a turn- and outside of Washington, D.C., to push for the t Gabrielle Giffords (D-Ariz.) ing point for U.S. policy on trade issues. Voters replacement of “fast track”trade negotiating author- r voiced their discontent with the policy of cor- ity – the mechanism that delegates to the executive a Jerry McNerney (D-Calif.) T porate globalization and instead elected lawmakers branch Congress’ constitutional d Ed Perlmutter (D-Colo.) who supported fair trade. authority to set trade policy. Fast Joe Courtney (D-Conn.) e Almost all the Democratic candi- After all the ballots track sunsets this year, and Public Chris Murphy (D-Conn.) dates who made fair trade a cam- Citizen is playing an active role in Kathy Castor (D-Fla.) paign priority won their elections, from the fall 2006 indicting it, illustrating the harmful Tim Mahoney (D-Fla.) while most of those who did not elections were trade deals it has delivered and Ron Klein (D-Fla.) have a strong fair trade message, building support among policy- including many high-profile candi- counted, voters sent makers and the media to replace it Mazie Hirono (D-Hawaii) dates supported by the national seven pro-fair trade with a mechanism that restores Joe Donnelly (D-Ind.) Democratic party, lost, according to Congress’ constitutional power to Bruce Braley (D-Iowa) a comprehensive midterm election lawmakers to the authorize trade policy. David Loebsack (D-Iowa) report,“No To Staying the Course on U.S. Senate and 30 In another significant victory Nancy Boyda (D-Kan.) Trade,” written by Public Citizen’s pro-fair trade law- against corporate globalization, John Yarmuth (D-Ky.) Global Trade Watch division. After all World Trade Organization (WTO) Tim Walz (D-Minn.) the ballots from the fall 2006 elec- makers to the U.S. negotiations to expand its harmful tions were counted, voters sent one-size-fits-all model into even Carol Shea-Porter (D-N.H.) House of seven pro-fair trade lawmakers to more areas of domestic policy- Paul Hodes (D-N.H.) the U.S. Senate and 30 pro-fair trade Representatives. making, known as the Doha round John Hall (D-N.Y.) lawmakers to the U.S. House of of WTO talks, were suspended Kirsten Gillibrand (D-N.Y.) Representatives. indefinitely in July 2006. Public Mike Arcuri (D-N.Y.) After the Bush administration pushed the Citizen‘s trade program worked with other activist Heath Shuler (D-N.C.) Central America Free Trade Agreement (CAFTA) groups for five years to derail the proposed expan- Zack Space (D-Ohio) through Congress in 2005, Public Citizen’s trade sion. team went to work researching, organizing and “The most interesting aspect of the trade elec- Chris Carney (D-Pa.) reaching out to the media about how the failed toral trend beyond its national scope is that it bust- Jason Altmire (D-Pa.) NAFTA trade model has harmed economies abroad, ed the myth of the trade debate being divided into Patrick Murphy (D-Pa.) as well as shifted valued jobs from the United States. ‘pro-traders’and ‘protectionists.’The candidates who Steve Cohen (D-Tenn.) Incumbents who supported CAFTA were placed on ran and won on trade explicitly advocated better Nick Lampson (D-Texas) the defensive, and many lost their elections. trade policies,” said , director of Public Ciro Rodriguez (D-Texas) Fast Track and the WTO Citizen’s Global Trade Watch division.“They were not Steve Kagen (D-Wisc.) against trade, but against the specific avoidable Public Citizen also is working closely with labor, damage delivered by more than a decade of the environmental, farm and consumer groups inside NAFTA-WTO model.”

LameDuckHunt.org prelude to new trade blog Public Citizen’s Global Trade Watch division started a new blog, LameDuckHunt.org, in late 2006 to keep a close watch on the 2006 “lame-duck” session of Congress, where fired and retired members of Congress, totally unaccountable to the public, were in the position to push through anti- consumer, anti-worker and other controversial bills. Global Trade Watch staffers and invited guests kept blog readers updated about bills Congress was trying to sneak through – such as the failed attempt at pushing through the Peru “free trade” agreement. The blog, while now dormant, is a precursor to a more permanent planned trade-focused blog, which is expected to be up and running soon. 12 2006 Annual Report Public Citizen News Texas Office Deals Major Blows in Coal Plant Controversies

n 2006, Public Citizen’s Texas office fought when Texas Gov. Rick Perry issued an exec- October predicted a 70 to 90 percent reduc- Ithe proposed construction of 19 coal-fired utive order in 2005 fast-tracking the permit- tion in emissions at 18 of the proposed coal power plants around the state – 11 of which ting of the plants by cutting the time for dis- plants if modern coal gasification technolo- Texas energy giant TXU Corp. would build, covery and hearings in half. gy was used. (The 19th plant had not been and the rest of which would be built by other In November, Public Citizen joined the proposed at the time of the study; it is a coal companies. Texas-based Sustainable Energy and gasification plant.) Public Citizen, however, To block the plants, which would be Economic Development Coalition in releas- prefers government investment in renew- located mostly in eastern and southern ing research linking the pollution that ables and conservation to any fossil-fuel Texas, Public Citizen helped build coalitions would be emitted by the 19 plants to 240 plants. with businesses that were also opposed to premature deaths per year and almost The work that Public Citizen and other the plants for economic and environmental 12,000 premature deaths during the expect- groups have done is having an impact. reasons, assisted with the statewide organi- ed 50-year lifespan of the plants. In February 2007, a Travis County, zation of mayors concerned about air quali- While not supporting the use of coal to Texas, district judge declared that Perry did ty and global warming, and publicized study generate power, Public Citizen studied and not have constitutional authority to fast- results about the damage that the coal publicized a coal-based alternative to burn- track decisions on coal plant construction. plants would do to the environment and the ing coal: coal gasification. And as part of the buyout proposal, TXU health of Texas residents. Their work paid In this process, solid coal is turned into a agreed to work toward global warming off in late February 2007, when TXU’s board gas before being burned for power, releasing emissions caps. of directors approved a buyout offer that fewer pollutants into the air. (Traditional Still, 11 plants are either under con- called for eight plants to be scrapped. coal-fired power plants burn solid coal.) struction or in the permitting process, and 6 The coal plant controversy heated up A Public Citizen study released in Public Citizen is vowing to fight them. 0 0 Public Citizen Foundation Public Citizen Board Members Public Citizen Bequests 2

Fiscal Year 2006 Public Citizen Inc. Fiscal Year 2006 t Support From Foundations/Organizations Adolph L. Reed Jr., Chair In sympathy for people who have lost a loved one r David E. Bonior and in deep appreciation for those who made an

o ultimate gift to protect our health, safety and Abraham Fuchsberg Family Foundation Joan Claybrook Howard Metzenbaum democracy.

p ARCA Foundation Center for the Study of Responsive Law Joseph A. Page, Secretary-Treasurer Alice Schneider Alexander Carl e Clean Air Task Force Len Schiff Robert Morrison r Public Citizen Foundation Inc.

Common Benefit Litigation Expense Trust Evelyn Haber Victoria Franklin

l Compton Foundation, Inc. Robert C. Fellmeth, Chair Norman Kay Gertrude Sandt Lisa A. Blue Theodore Lichtgarn James Shawley a CS Fund/Warsh-Mott Legacy Deer Creek Foundation Joan Claybrook Pamela K. Pedrucci Lester Waverly u Edna Wardlaw Charitable Trust Joseph W. Cotchett Charmianne Shipe

n Educational Foundation of America Morris Dees Energy Foundation Jim Hightower, Secretary-Treasurer n We acknowledge with deep gratitude those Environmental Defense Fund annuitants who have made gifts that will ensure a Equal Justice Works the continuation of Public Citizen’s work for the Everett Philanthropic Fund

s benefit of future generations.

’ Ford Foundation Houston Endowment Inc. n Irene Diamond Fund e Jewish Communal Fund FINANCIAL STA TEMENT z JMG Foundation i Magnolia Charitable Trust Public Citizen Inc. and Public Citizen Foundation Inc. t

i Moriah Fund Nathan Cummings Foundation Combined Statement of Revenue c Support and Expenses For the Year Ended Sept. 30, 2006 Park Foundation

c Rockefeller Brothers Fund Revenue and Support i Rockefeller Family Fund

l Contributions and Membership fees...... $6,367,588 SEED Coalition/Energy Foundation Publications/Subscriptions...... $2,566,132 b Solidago Foundation, Inc. Grants...... $1,283,000 The Braeside Foundation

u Program Income*...... $161,699 The Max and Anna Levinson Foundation Rental Income** ...... $200,136 p Tides Foundation/Working Assets Other...... $42,803 Unitarian Universalist Veatch Program at Shelter Income from Investments...... $443,103 Rock Total Revenue and Support ...... $11,064,461 Wallace Global Fund Expenses Programs...... $6,597,489 Publications...... $2,731,562 Public Citizen and the Center for Auto Safety would also like to give a very special thanks to Support Services...... $2,405,965 the Santos Family Foundation for providing General and Administrative ...... $1,425,765 grant money for conducting the vehicle roof Development ...... $980,200 crush tests using the Jordan Rollover System. Total Expenses...... $11,735,016

Change in net assets***...... ($670,555) Public Citizen Mission Statement *Court awards **Net of Operating Expenses Public Citizen fights for openness and democratic *** In accordance with Statement of Financial Standards No. 116, Accounting for Contributions Received accountability in government; for the right of and Contributions Made, Public Citizen is required to record all grants and contributions in the current fis- consumers to seek redress in the courts; for clean, cal year even if the monies have not been received or related expenses have not been expended. As of safe and sustainable energy sources; for social and Sept. 30, 2006, Public Citizen had temporarily restricted net assets of $1,636,024, which represent restricted economic justice in trade policies; for strong health, grants and contributions whose donor-stipulated time or purpose restriction has not been accomplished. safety and environmental protections; and for safe, Several of the net assets included in this amount are intended to be expended over several subsequent effective and affordable prescription drugs and years. health care.