BETTY ANN BOWSER: Don Kaeding doesn't get around much anymore.
DON KAEDING: I got a little strawberry patch down there. I take care of my strawberry patch. And that's about it. I don't really... I feel so dang worthless at times about what I do.
BETTY ANN BOWSER: He needs oxygen 24 hours a day, and constant care from his wife, Louise. The 78-year-old former mine worker suffers from asbestosis; it's destroying his ability to breathe. Kaeding is only one of potentially thousands of victims in what the federal government says could be the most severe exposure to a hazardous material in American history. Kaeding got sick while working at this vermiculite mine near his home in Libby, Montana, during the 1960s.
At one time, this was the largest vermiculite operation in the country, moving 15,000 tons of rock a day to produce a thousand tons of concentrated vermiculite. It was used to make household and industrial products, including potting soil and home insulation. But there was a deadly downside. The vermiculite ore contained veins of tremolite asbestos, a commercially useless, cancer-causing waste product. When the tremolite asbestos was separated from the ore, the process created big plumes of thick, white dust that spewed 5,000 pounds of fibers into the air each day.
DON KAEDING: You'd come home with dust on you, you know. My little boy, he was just a baby then, I’d pick him up out of the crib you know and hold him. He'd have that dust on him.
BETTY ANN BOWSER: Did it ever occur to you that it might be dangerous?
DON KAEDING: No. We asked, you know, once in a while. Guys would say, "what about this dust?" And they'd say, "aw, it's nothing. It's just a nuisance dust. You can eat a ton of it and it will float right back out."
BETTY ANN BOWSER: But it didn't float right back out. The tremolite fibers stuck in people's lungs, and over time the number of asbestos-related deaths and illnesses grew. Until now, the Environmental Protection Agency wasn't sure about the real magnitude of the problem.
PERSON: Breathe deep. Test breath in. Blat. Keep going. Go, go, go, go, go.
BETTY ANN BOWSER: Over the past year, the Agency for Toxic Substances and Disease Registry has been doing screenings like this of Libby area residents. In results released today, nearly half of 328 former mine workers who were X-rayed showed lung abnormalities. But of the nearly 6,000 residents overall who were tested in Libby, 18 percent showed signs of lung abnormalities. That's at least nine times what surveys have shown when conducted in non-contaminated areas of the country. And this doesn't even include those yet to be diagnosed, since the asbestosis and related disease can take up to 40 years to show up.
PAUL PERONARD: Is there risk in doing clean ups? You bet there is.
BETTY ANN BOWSER: And what Paul Peronard of the EPA finds most disturbing, is that some of those diagnosed never worked at the mine; they simply lived in Libby, Montana.
PAUL PERONARD: In a lot of ways it is unprecedented. In terms of the number of people who are impacted, the number of people who are sick or who have died as a result, nobody has ever really documented until we got to Libby the concept of environmental exposure with an observable medical consequence.
BETTY ANN BOWSER: EPA officials say, at one point, asbestos tailings from the mine were used all over town. Residents were invited to come and get it by the truckload for free. It was used in landfills, at elementary schools, at the Little League ball field. When the high school needed a new track, the mine donated truckloads of raw vermiculite to cover the running surface.
PAUL PERONARD: There was a period of time where kids were running directly on vermiculite mine tailings, which had huge asbestos concentrations and resulted in all sorts of exposures. And you had these piles of vermiculite ore that, you know, kids were actually playing directly on top of. Your brother was out in right field and you didn't want to watch him in the little league game, you went and played king of the mountain on this. And so in a lot of ways, this material was in the fabric of the local culture.
BETTY ANN BOWSER: W.R. Grace, the company that owned the mine from 1963 until it was sold in 1994, has pledged $250,000 a year to help fund Libby's Center for Asbestos Related Diseases. But critics say Grace knew for years that asbestos was dangerous and did nothing. Company memos show that from 1964, the year after Grace bought the mine, the company began taking chest X-rays of its employees, which found a great deal of lung abnormalities.
A 1969 internal report sent to top executives warned that asbestos is definitely a health hazard. And this confidential memo, written in 1977 and revealed in a court case, shows that W.R. Grace knew there was a problem in Libby back then, as it outlined business plans on how to deal with the problem. Today, W.R. Grace, headquartered in Maryland, is run by a whole new group of executives. William Corcoran is a vice president and company spokesman.
WILLIAM CORCORAN: Based on all the information and all the knowledge we had at the time, we did the best we could.
BETTY ANN BOWSER: Are there things that W.R. Grace should have done, back in those days, that they didn't do?
WILLIAM CORCORAN: I don't know. I mean, I don't know everything that was done in those days. You know, in the 1960s I was a teenager. So I really... I can only look at the files and look at things that were said. I mean, I wasn't part of the organization, so I wouldn't even want to speculate.
BETTY ANN BOWSER: But Corcoran defends Grace, arguing little was known back in the 1960s about the dangers of asbestos exposure. He cites a recent EPA report.
WILLIAM CORCORAN: The report basically said no one at EPA could have known the risk faced by the workers at this facilities, could have known or understood based on the science or technology available at the time. And I would tell you I think the same is true for the EPA who had all the knowledge and all that, if they weren't in a position to understand the risk, I don't think Grace was in a position to fully understand the risk.
BETTY ANN BOWSER: In 1973, Grace spent millions of dollars to convert the mine from a dry mill process to a wet mill procedure that eliminated large quantities of dust. The company also required workers to wear respirators, and it added showers so that workers could get the dust off before they went home.
But Gayla Bennefield says damage to her parents' health was done long before changes at the mine took place, Bennefield's father worked at the mine; her mother did not. Yet they both died from asbestosis.
Bennefield herself has been diagnosed with lung abnormalities; so has her husband and one of her grown children. In 1998 she went to the media, giving Libby its first national attention. She also went to court. The jury agreed Grace was guilty of the wrongful death of her mother.
GAYLA BENEFIELD: They had the knowledge, when they bought the mine, what was out there. They should have told the men. By the time, when they realized that their men in 1969, 92 percent of their men, they knew were going to develop asbestos-related diseases; they should have given the men a choice. Told the men of the dangers, assured the men that we'll do everything we can to protect you and given them a choice.
BETTY ANN BOWSER: In the only other cases to go to court, three other juries ruled against Grace. The majority of claims are being settled out of court. In a news release and on the company's Web page, W.R. Grace officials promised to take their "responsibilities to the people of Libby and the situation there very seriously." They pledged full cooperation with government agencies and reopened this office in downtown Libby, which the company said would assist the state and the EPA in their ongoing investigation. But last year, Grace bought back the abandoned mine site they'd sold in 1994, and refused to allow the EPA on the property. The EPA had to sue the company to get access to the site for cleanup.
WILLIAM CORCORAN: Before we wanted them to come on our property we said, "tell us what in... What you're going to put on the property." And they didn't want to do that for one reason or another. And we said, "okay, until you tell us that we're not going to let you on the property."
BETTY ANN BOWSER: Is that in the spirit of cooperation?
WILLIAM CORCORAN: Well, we wanted to make sure we weren't putting contaminates that would get into the river, get into the stream and get into the Kootenai River.
PAUL PERONARD: We've had problems working with them now, and, you know, we've had problems with them to get through the cleanup work now. We've had problems cooperating with them in any fashion, whether it's on doing analytical testing and interpreting results. I mean, to me they aren't cooperating now. I've had an attorney from W.R. Grace look at me from across the table and say "there are no risks in Libby. This is a complete fiction, a fantasy."
BETTY ANN BOWSER: In April W.R. Grace filed Chapter 11 bankruptcy proceedings. The company said it had nothing to do with the situation in Libby, but cited lawsuits elsewhere over Grace products that contained asbestos. The action means no one else can file lawsuits, for now.
WILLIAM CORCORAN: We made the decision to file for reorganization under Chapter 11 when the claims just... There was no end in sight. We expected our claims to be decreasing at this point in time.
BETTY ANN BOWSER: Grace officials say despite the bankruptcy filing, they've designed a new medical plan that is fair and responsive to the needs of the community,
CHILD: Are we going to go swimming?
SANDY WAGNER: Yeah.
BETTY ANN BOWSER: But Sandy Wagner isn't convinced that the money will be there, if and when she needs it. She, her husband John, a former mineworker, and 19 other members of her family have all been diagnosed with lung abnormalities.
SANDY WAGNER: It's an unfunded, unregulated, at-will plan that Grace brought into being to try to help the people in the community. But given their financial position, the bankruptcy action, and the very fact that it is not regulated, it could be gone tomorrow.
WILLIAM CORCORAN: We look forward to getting through the re-organization process in a few years and coming up on the other end with a viable company, and a system for compensating... and funding that system for compensating those people who are sick from asbestos related disease that W.R. Grace is responsible for.
BETTY ANN BOWSER: Wagner is also critical because the Grace plan does not cover long term care in a nursing home.
WILLIAM CORCORAN: We put in... We went around and met with different people that are health care providers, and we decided that this was the plan that made the most sense. A lot of it occurs in the home. My father was sick with emphysema. He was cared for in our house right up to the very end.
BETTY ANN BOWSER: The Grace medical plan provides for no more than 100 days of home health care a year.
Do you think that you need to have a provision for long term care -- either in the home or nursing home?
WILLIAM CORCORAN: We'll look at the program and change it if we need to.
BETTY ANN BOWSER: Although a lot of anger has been directed at W.R. Grace, even the EPA admits its own record on Libby is flawed. The agency's inspector general recently found that "EPA did not issue regulations that could have protected Libby citizens from exposure to asbestos-contaminated vermiculite." Now, the EPA is removing contaminated soil from the mine site, from public school grounds and private homes. But it's unlikely anything can make the second poorest region in Montana prosper again soon. Libby lies in the mountainous West, with opportunities for trout fishing, hiking and wilderness recreation everywhere. But the asbestos problem has driven real estate prices down and left many merchants looking for greener pastures.
DEBORAH LOOMIS: Okay, you folks ready?
BETTY ANN BOWSER: Restaurant owner Deborah Loomis is one of those who's sticking it out, but doesn't know how long she can last. And she blames the anti-W.R. Grace forces in town.
DEBORAH LOOMIS: People are going out of business right and left. And I meet with the other business people and to see what their views are, and they feel the same way as me. They are just devastated and they're saying to these people, "you know, you need to look at the whole big picture of this, not just what is happening to you."
BETTY ANN BOWSER: What happened in Libby, Montana has divided neighbors, cut lives short and left future generations wondering if they'll be sick someday too. And the EPA's Peronard thinks there should be lessons learned.
PAUL PERONARD: The federal government, the state government, the locals, the company. I mean, there is nobody who should look at Libby and say we did a good job here because frankly, nobody did. We all need to stand up and learn that... You know, how not to let stuff like this happen.
BETTY ANN BOWSER: While the courts ponder the future solvency of W.R. Grace, the EPA is considering whether to declare the entire Libby area a superfund site. If that happens, the taxpayers will foot the bill for the cleanup. A decision is expected in October.