In July 1969, Supreme Court Justice William O. Douglas declared the Army Corps of Engineers America's "public enemy number one." In an exhaustive screed in a national magazine, he detailed how the Corps had plundered the U.S. environment and ransacked the U.S. Treasury with preposterous water projects designed to keep its employees busy and its congressional patrons happy.

The magazine was 'Playboy,' which should give a sense of how much has changed since 1969. And so should this: After spending the 20th century trashing the landscape with dams and dredges, the Corps has been assigned to start cleaning up its mess, to resuscitate some of the rivers, marshes, and coastal swamps it has diverted, polluted, and desiccated.

The most prominent test of this turn-back-the-clock mandate is unfolding in the Florida Everglades, where the Corps is overseeing the largest environmental restoration project in history. It has been replumbing the Everglades with ditches and dikes since the 1930s, diverting and degrading the magical River of Grass. But in 2000, Congress approved a 4,000-page Corps plan to replumb the replumbing: an $8 (now $10) billion effort to revive the wetland ecosystem, an unprecedented rescue mission for panthers, gators, otters, and sportsmen. The project is already a model for ecosystem projects around the world, from the Great Lakes and Chesapeake Bay to the Pantanal of South America and the Garden of Eden marshes of Iraq.

Yet some things have not changed since 1969. The Corps still builds ecologically destructive boondoggles for special interests. It still has a dysfunctional relationship with the Capitol Hill politicians who use it to steer jobs and money to constituents and contributors. And its recent failures include killing 1,000 people in New Orleans. Even its multibillion-dollar shot at redemption, the 'Glades renewal, is behind schedule, over budget, and off-track. Meanwhile, the region remains vulnerable to flooding that could make the post-Katrina devastation seem like prologue rather than history.

The Army Corps of Engineers is one of the oldest, strangest, and most influential federal agencies. It got its start as an engineering regiment in the Revolutionary War; it's still run by army officers and still works on military projects, including the reconstruction of Iraq. But most of its 35,000-plus employees – more than the Education and Labor departments combined – are civilians working on domestic water projects. The Corps spends billions taming rivers for flood control and navigation, deepening ports, pouring sand onto beaches, chauffeuring salmon around its fish-killing dams, and exercising power wherever water is found in America. It's even responsible for protecting wetlands from development, even though it destroys more wetlands than any developer. Predictably, it approves almost every dredge-and-fill application it receives.

"No entity has done more to destroy America's natural gems," says Tim Searchinger, a wetlands expert with Environmental Defense in DC. "The landscape is littered with sterile bargeways to nowhere that were once great rivers, and counterproductive flood-control projects that destroy thousands of acres of wetlands while promoting development in vulnerable floodplains."

Officially, the Corps is a Pentagon agency, but it's really a congressional toy, with a budget consisting almost entirely of "earmarks" requested by members of Congress. President Bush, like every commander in chief since FDR, has tried to rein in the Corps, with little success; as Justice Douglas wrote, "Getting a man off heroin is easy compared with getting Congress off the kind of pork barrel the Corps administers." And pork knows no party lines; as Bush's former budget director Mitchell Daniels Jr. once complained in a memo after a congressional hearing on Corps bacon, "The festival was bipartisan." So the U.S. doesn't have a water resources policy, just pet projects. The Corps evaluates whether those projects make sense; if the answer is yes, the Corps gets to pour the cement. And the Corps likes to pour cement (its motto is Essayons, or "Let us try"), so the answer is usually yes.

In its heyday the Corps helped develop America. It imprisoned the Mississippi behind dikes, enabling cities like New Orleans to grow and prosper. It controlled the Everglades with 2,000 miles of levees and canals, transforming South Florida from backwater to megalopolis. It launched a national war against Mother Nature on behalf of economic prosperity. But controlling nature had hidden costs. The armoring of the Mississippi obliterated coastal wetlands that once served as hurricane shock absorbers for New Orleans. The replumbing of the Everglades nearly destroyed the South Florida ecosystem. Corps dams on the Snake River in the Pacific Northwest have decimated native salmon; Corps dredging of the Apalachicola River in northwestern Florida has threatened endangered mussels; Corps management of the Missouri River has nearly wiped out the pallid sturgeon, which had done fine for millions of years before the men of Essayons came along.

These unintended ecological impacts were problematic enough for projects with dramatic benefits. But more recent projects rarely make economic sense either. The Corps predicted that its Tennessee-Tombigbee Waterway would cost $300 million and float 28 million tons of coal its first year; the actual totals were $2 billion and 1.4 million tons. And the Corps still manages the Missouri River for the barge industry, even though barges produce less than 1 percent of the river's economic benefits. Fishermen, bird-watchers, and ecologists – along with the EPA, Fish and Wildlife Service, and National Park Service – constantly complain about anachronistic Corps projects, but they don't have Corps juice.

I spent most of 2000 investigating Corps projects for the 'Washington Post,' from a plan to build the world's largest flood-control pump for Mississippi Senator Trent Lott (at a cost higher than the value of all the soybean farms it was designed to protect, according to one study) to a jetty project to protect private fishing trawlers for North Carolina Senator Jesse Helms (at a cost of $500,000 per boat, another report found). Corps leaders devised a secret "Program Growth Initiative," as if they were dot-com execs desperate to increase market share, and sent damning e-mails ordering aides to concoct a rationale for Mississippi River locks demanded by Missouri Senator Kit Bond. After brutal reports on the locks by Pentagon investigators and other agencies, the Corps was forced to redo its analysis of the $1.2 billion project. Soon it metastasized into a $7.7 billion project.

And then the Corps drowned New Orleans. After Hurricane Katrina toppled Corps flood walls that were supposed to protect the city, the Corps hid behind the-act-of-God disaster and denied responsibility, so the media focused on FEMA's slow response to the flood. Eight months later, when the Corps finally admitted that "design failure" led to the collapses, Katrina was no longer front-page news. When Lieutenant General Carl Strock, the Corps commander, announced in August that he was retiring, it barely made the papers.

Katrina was a disaster of lousy priorities as well as lousy engineering. Corps projects helped destroy hundreds of square miles of marshes and cypress swamps that once provided the city's natural storm protection. And the Corps failed to provide adequate man-made protection, despite spending more money in Louisiana than in any other state in the five fiscal years before Katrina, because most of that money went to useless pork. A stone's throw from flood walls that failed along the Industrial Canal, the Corps was building a $750 million lock project justified by increasing ship traffic – even though ship traffic was decreasing. The Mississippi River–Gulf Outlet, another seldom-used Corps canal, served as a hurricane highway into New Orleans, amplifying Katrina's surge by two feet.

Needless to say, the catastrophe has persuaded Congress to…do nothing about the Corps. Senators John McCain of Arizona and Russell Feingold of Wisconsin, the bipartisan team behind campaign finance reform, proposed a modest Corps reform bill last year, but that stalled. The Corps emerged from Katrina with even more power. And it has received 6,000 percent more money for fixing levees than restoring wetlands.

Yes, the corps has an estimated $14 billion plan to restore Louisiana wetlands, even more ambitious than the Everglades project. But has it seen the error of its ways, or has it just found a new way to keep busy? Former Corps commander Joe Ballard, who devised the Program Growth Initiative, once screamed at underlings to save the Everglades, "We have no choice! We must put our best foot forward. The future of the Corps depends on it!"

It's that "We have no choice!" that reminds you this will never be a Corps of Biologists. It's still an agency of builders, and it still responds to customers who want things built.

The Corps' Everglades plan had support from sugar farmers, developers, and every Florida politician, largely because it's a water storage project, with 180,000 acres of reservoirs designed to hold enough drinking water for double South Florida's population. But it's not clear if any of that water will get to the Everglades. Scientists at Everglades National Park have attacked the plan as a windfall for economic interests, with few benefits for the ecosystem and its 69 endangered species. And the Corps still gives permits to rock miners and developers who are digging up Everglades wetlands – even areas designated for restoration.

"It's crazy," says Shannon Estenoz, Sun Coast regional director for the National Parks Conservation Association. "Even when the Corps has a progressive mandate like 'restore the Everglades,' we often watch them buckle under pressure to compromise restoration."

Six years in, the plan is already in rough shape. "It's different from what we told Congress we would do…and it's not restoration!" one Corps manager wrote in an internal memo. Congress has lagged on funding, and the Corps has not finished any of the projects scheduled for completion in 2005. Not one. Meanwhile, independent engineers have warned that the Corps dike that's supposed to protect the Everglades region during hurricanes poses a "grave and imminent" danger to the area should it fail.

Environmentalists like to say the Everglades is a test; if we pass, we may get to keep the planet. And it is a test – of man's ability to fix his mistakes and repair his abusive relationship with nature. Many Corps engineers came of age after the first Earth Day and understand that South Florida's economic health depends on a healthy Everglades. "We are not your grandfather's Corps of Engineers," Stuart Appelbaum, a manager on the Everglades project, has said. "We want to do the right thing."

The Corps has reinvented its rhetoric, and if it can reinvent its priorities it can help create a sustainable future for places like South Florida and New Orleans. But the Corps has always reflected the desires of Congress, so unless reformers can beat pork purveyors on the Hill, the Corps will have to reform itself. Today that seems about as likely as another Supreme Court justice critiquing water policies in a skin mag.

South Florida, Are You Listening?

Katrina wasn't the big one.

In 1928, a vicious hurricane forced a disastrous volume of Florida's Lake Okeechobee through a flimsy dike, killing 2,500, mostly poor African-Americans trapped in the floodplain. America's first Katrina.

That's when the Army Corps of Engineers got down to business in South Florida. Starting in the '30s, it built the massive Herbert Hoover Dike around the lake, making it possible to grow sugar and raise kids in towns such as Belle Glade and Clewiston. By the 1980's the Corps had completed 2,000 miles of levees and canals, making the area "safe" for roughly 7 million more residents and millions of annual tourists – and eliminating half the Everglades.

Now the dike leaks. Last April an independent engineering report said it poses "a grave and imminent danger to the people and the environment of south Florida," with a one-in-six chance of failure in any given year – an existential roll of the dice for 40,000 residents in its shadow and millions more in the floodplain. "It's a scary situation," says the report's lead author, Les Bromwell.

The Corps initially dismissed the report as "sensationalism." But a new Florida Corps commander, Colonel Paul Grosskruger, has made fixing the dike his top priority, a process that could cost billions. For now, the Corps blasts water out of the lake when it gets high, injuring or killing dolphins, manatees, and oysters in the estuaries that ring the peninsula. And they pray that next hurricane season (which begins in June), the dice will roll their way.