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Regulatory Capture: Flying on the Small Modular Reactor via Fairewinds Energy Education

By Arnie Gundersen

October 8, 2020

Yes, Fairewinds tracks nuclear safety issues, and no, Boeing will not build Small Modular Reactors that fly.  

However, when most of my colleagues and I look at the Nuclear Regulatory Commission (NRC) and its supposedly thorough technical review of an allegedly different and newly designed Small Modular Reactor (SMR), we are very disturbed by the NRC’s pending regulatory changes. Quite simply, where the SMRs are concerned, severe regulatory changes are being made within the NRC to facilitate growth within the atomic power industry. As a former nuclear whistleblower, I have spent my life looking at the risks and failures of nuclear reactors. I find many parallels between the recent fatal crashes of two newly-certified Boeing 737 Max airplanes and the spate of NRC nuclear waivers and fast-tracked reactor designs. The industry-wide effort to massage scientifically based engineering analyses is alarming and a poignant symbol of Regulatory Capture in both industries.

What is Regulatory Capture? The American Institute for Economic Research (AIER) definesregulatory capture as the theory that regulating agencies created by the federal government to protect public rights and health and safety forms a close relationship with the industries they regulate. When this occurs, the regulators make decisions that benefit corporations and entire industries instead of protecting people and the environment as federal law requires.


Following an 18-month-investigation emphasizing how Boeing’s production pressures jeopardized public safety, the U.S. House of Representatives issued the Final Committee Report on the Boeing 737 MAX on September 16, 2020. In its report, Congress said there was tremendous financial pressure on Boeing and the 737 MAX program to compete with Airbus’ new A320neo aircraft. This pressure resulted in Boeing’s extensive efforts to cut costs while maintaining the 737 MAX program schedule and subsequent production line.


Lastly, in this crucial and industry critical report, Congress pointed out that between 2013 and 2019, which were the critical years that Boeing was developing the 737 MAX, Boeing spent $60 billion on shareholder dividends and stock buybacks as part of an investment strategy for the corporation. Money paid to corporations for shareholders rather than to protect people “may have played key roles in Boeing not spending enough money on issues critical to the safe design and development of the MAX.”


My 45+ years of studying and critiquing the atomic industry make it very clear that the nuclear power industry has co-opted the NRC.

Let me discuss the three similarities of regulatory capture I am most concerned about at the NRC:

First, while the NRC is a federal government commission, it can promulgate (create) its regulations within the Code of Federal Regulations. The NRC employees are federal employees and are brought in under federal employee hiring processes. The President appoints the Chair of the five-member Commission, and there is usually a mix of Republican and Democratic appointees for specific terms. All five Commissioners are politically appointed, so they are beholden to the party that appointed them.

When I was a nuclear whistleblower in 1990, Ivan Selin, the Chair of the Commission, had donated more than $300,000 to the Republican Party, so he received the NRC appointment he desired. It’s five politically appointed Commissioners control the regulatory focus of the Commission and the entire NRC, and therein lies the problem. The Nuclear Energy Institute, the lobbying group that promotes nuclear power’s interests in Washington DC, vets every Commissioner before any appointments are made to the NRC. Unless NEI approves the applicant’s credentials, the Commissioner is not appointed. This political favoritism effectively gives five foxes oversight of the proverbial chicken coup of 2,000 nuclear engineers who make up the technical staff and other positions within the NRC.


The NRC Commissioners are political appointees who are beholding to the party and people who appointed them and the nuclear industry that vets all appointees to the commission well before the public is even involved. Such politicized appointments are an example of a quid pro quo – of one hand washing the other – and not the independent public body meant to protect the health and welfare of people and communities throughout the U.S.

This year, amid Pandemic 2020, the NRC has modified some of its regulations, claiming that the new rules are ‘more realistic’ than those they replace. Honestly now, who in the world can argue with a federal body claiming to be more realistic? Unfortunately, it is not valid. These new regulations are entirely unrealistic and create much higher nuclear risks to residents, their families, and the communities in which they live!

Again, we at Fairewinds get tired of saying it over and over: the NRC’s founding documents created an agency to protect people; it is why Congress separated the NRC from the Department of Energy (DOE) with one mandate: to promote public health and safety.

Look at every nuke plant in the U.S. and look at all the other NRC licensees from hospitals to cancer treatment centers to labs and nuclear fuel manufacturing. Quite simply, the NRC fails to perform its function to protect public health and safety. After technical review, my colleagues and I see essential conservative safety calculations entirely rewritten to unsafe, less rigorous standards.


Third, the nuclear industry knows that the competitive price pressure from reliable and economical solar, wind, and storage batteries is a threat to its future designs, as well as a threat to its old and risky reactors. Due to this economic pressure, the newest nuke marketing ploy is rapidly constructing thousands of smaller reactors (SMRs) instead of the hundreds of larger ones that NEI and nuclear manufactures previously claimed would save the planet. You, too, may end up with one of these little nukes in your community, village, right on your block, or in your development. These allegedly new designs (taken from the concept of the small submarine reactors are incredibly hyped as “newly-designed Small Modular Reactors (SMRs)”), and that is fake news.

Each of these SMRs still contains more radioactivity than was released by the bombs dropped on Hiroshima and Nagasaki during WWII. Let’s be clear here; there is nothing small about the consequences of an SMR failure! Having all that uranium and plutonium will make them a real terrorist target – not just for foreign terrorists but also for proliferating militia types like Timothy McVeigh or the proud boys.


It begins with each of us. We must demand that the U.S. Congress and state legislatures wean themselves from nuclear lobbyists and place public safety before corporate profits.

Our futures and those of our children and grandchildren depend upon your efforts!

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