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She has regularly espoused an unfettered market as the solution to almost any of the nation's problems you'd care to name. The answer for struggling mothers who need day care so they can support their families? Forget government programs or parental leave, she says, and look to free markets and a strong economy. What about helping minorities climb the economic ladder? Forget affirmative action or quotas, she says. The answer is free markets and a strong economy. Federal deficits? Environmental protection? Free markets and a strong economy.
Whether they agree with her politics or not, virtually everyone Gramm dealt with vouches for her intellect, ability and effervescence.
"I never worked for a better person, and I worked for a lot of people I respected," says former Gramm aide Kate Hathaway.
An ardent foe of regulation in her own right, friends and former colleagues say, Wendy Gramm was a natural fit for the Reagan/Bush era. Like the two presidents, she believed that unfettered entrepreneurial genius was the cornerstone of the nation's success -- and a strong economy the balm for most social ills.
That "genius" would ultimately produce a few troubling failures, like the multibillion-dollar bailouts of failed S&Ls, massive trade deficits, bouts of crippling interest rates and unemployment, and scandalous frauds perpetrated by corporate takeover artists.
But despite the carnage of the financial frenzies of the '80s, Wendy Gramm was, and by all available accounts remains, a foursquare advocate that America can be great -- and people like her can rise from immigrant roots to the loftiest social heights -- only if private corporations and free markets are left unrestrained to work their will.
During her 13 years on the federal payroll, Gramm held a series of titles guaranteed to induce yawns. She toiled in jobs that seem important only to the quibbling power cliques of Washington, but which actually profoundly affect everyone from elderly retirees to Hawaiian sugar cane workers.
Gramm did not surface in mainstream news reports often. Usually, her brief forays into the sunlight exposed only the surface ripples of much deeper rip tides pulling at the nation. But within the exclusive corridors of commerce and economic power, Gramm was a well-known, and well-liked, watchdog.
"Her philosophical outlook jibed pretty well with the nature of this industry," says John Damgard, president of the Future Industry Association, the trade group for brokers and dealers in commodities and futures markets Gramm oversaw for four years. "We're looking to keep the government off our backs and out of our business, and Wendy saw to that."
Gramm's career in curtailing government began in earnest in 1985, when she followed her boss, Jim Miller, from the Federal Trade Commission to the White House Office of Management and Budget (OMB). Reagan, riding high off his whomping of Democrat Walter Mondale, was pressing on with his administration's efforts to cut back federal regulation.
Miller hired Gramm to run the Office of Information and Regulatory Affairs. By title, the job sounds deathly dull. In practice, it was one of the most powerful positions in Washington, affecting federal rules governing everything from worker safety to the conduct of the national census. The task of Gramm and her staff was to review and pass judgment on virtually every single proposed federal rule before it could go into effect. Critics say she used the position to stamp out the good with the bad, hamstringing crucial new regulations that would have protected consumers and the environment.
Gary Bass, executive director of OMB Watch, a public advocacy group, says Gramm's academic background was reflected in the way she approached new regulations. She emphasized cost-benefit analysis, he says, which is a nice way of saying you have to prove people are being killed before you enact a rule to protect them.
"During her tenure, she stressed things like basing risk assessments on epidemiological studies," Bass says. "Meaning, you have to have dead babies before you regulate -- or bodies."
Gramm's reluctance to approve new regulations slowed federal efforts to limit asbestos exposure, study Agent Orange problems among Vietnam veterans and control pollution.
"You couldn't regulate until you could show that the substance you wanted to regulate was actually causing death and injury to an exposed population," says David Vladeck, director of the litigation group for Public Citizen, one of the myriad Ralph Nader-inspired watchdog groups.
Since researchers cannot, of course, intentionally expose people to a suspected killer -- such as a toxic substance -- just to prove their point, Gramm's standards made it impossible to pass new regulations governing hazards that might take 20 years before their toxic effects actually claimed a life.
And under Gramm, her critics say, the office was uncharacteristically secretive about its activities. Gramm and her staff met privately with business lobbyists to discuss proposed rules that might affect them, but she never accorded the same access to consumer and environmental protection groups.
Proposed regulations would enter OMB and disappear for years, critics say, with no word to their supporters -- or the people whose lives might be changed by them -- as to what had happened.
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