By Jeff Bennett And Siobhan Hughes 

The National Highway Traffic Safety Administration should have known as early as 2007 of the General Motors Co. ignition switch issue but either overlooked evidence or failed to understand it, according to a new report.

A House Energy and Commerce Committee report, reviewed by The Wall Street Journal, criticizes both traffic safety regulators and GM for failing to take action on the safety issue now linked to 19 deaths.

While GM was chided for not taking the appropriate measures, the harshest criticism fell on NHTSA for not holding itself to the same standard of accountability of those it regulates, according to the report.

GM and NHTSA didn't immediately respond to requests for comment.

According to the report's findings, the agency tends to deflect blame and "get bogged down" in specific issues. The report also said the NHTSA diverts staff from their normal responsibilities and collects a vast amount of data that is disjointed and not shared across the entire agency.

Perhaps more surprising, the report questions whether NHTSA has a "fundamental understanding" of how air bags systems work.

NHTSA's lack of understanding in air bag technology is a common theme that has emerged from the GM switch issue. Earlier this year, the safety agency reached out to all auto manufacturers asking them to explain how their systems work.

The report comes as NHTSA acting administrator David Friedman prepares to testify before a Senate committee later Tuesday afternoon on the agency's capability to keep U.S. roads and highways safe.

The House Energy and Commerce Committee report is based on 15,000 pages of agency documents and interviews with its staff in the wake of the GM ignition switch recall.

GM has recalled 2.6 million Chevrolet Cobalt, Saturn Ion and other older cars earlier this year for a problem first discovered almost 11 years earlier. Jarring or putting too much weight on the ignition key can cause the switch to slip from "run" to "accessory" thereby cutting power to electronic steering and air bag deployment.

Compensation expert Ken Feinberg--hired by GM--has certified that 19 deaths were attributed to the issue. That number is expected to go higher as he currently combs through some 125 death claims.

"It is tragic that the evidence was staring NHTSA in the face and the agency didn't identify the warnings," Rep. Fred Upton, (R-Mich), and the chairman of the committee said in a statement. "NHTSA exists not just to process what the company finds, but to dig deeper. They failed."

The agency was also faulted for not making any changes to its internal structure while GM has taken many steps including hiring a safety chief and intensifying its reporting process when a vehicle problem and potential recall is discovered.

"Five months later, there is no evidence, at least publicly, that anything has changed at the agency," according to the report. "No one has been held accountable and no substantial changes have been made. NHTSA and its employees admit they made mistakes but the lack of urgency in identifying and resolving those shortcomings raises questions about the agency's commitment to learning from this recall."

The biggest fault lies with the NHTSA's handling of a Chevrolet Cobalt rash in Wisconsin in 2006. A subsequent investigation by Wisconsin State Trooper Keith Young revealed that the vehicle's ignition switch was in the "accessory" position. The State Trooper located a technical service bulletin--generated by GM--which suggested the vehicle could be inadvertently turned off.

Trooper Young, in his own February 2007 report, determined the likely cause of the non-deployment of the frontal air bags was tied to the vehicle being in the "accessory" position.

"Investigators did not recall any agency discussions regarding the details of these reports, including the suggested link between the ignition switch and air bag deployment," according to the report. "The agency, instead, focused on the circumstances of the crash based on outdated perceptions of how air bag systems functioned. This contributed to the years of delay in identifying this defect."

The report concluded that the tragedy must serve as a reminder that safety is a collective responsibility.

"GM, as a company, lost sight of this and thus failed to identify a defect that was staring them in the face for over a decade. This was not isolated to one individual, division or team. GM suffered from a culture of complacency," the report said. "NHTSA also lacked the focus and rigor expected of a federal safety regulator. The agency's repeated failure to identify, let alone explore, the potential defect theory related to the ignition switch--even after it was spelled out in a report the agency commissioned--is inexcusable."

Write to Jeff Bennett at jeff.bennett@wsj.com and Siobhan Hughes at siobhan.hughes@wsj.com

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