Oil Industry promoters want to pay Americans not to complain about global warming

Photo of oil derricks, Long Beach CA in 1937
Oil derricks, Long Beach CA in 1937. Image: Lib. Of Congress

Every national government in the world knows that burning fossil fuels is a practice that’s killing us. All 197 UNFCCC member countries have either signed or acceded to the Paris Agreement dealing with greenhouse gas emissions. Yet the production of oil and gas continues unabated. The following table shows the production from the largest producers: the U.S., Russia, and Saudi Arabia. The U.S. alone has increased its production by about 55% since 2008

U.S. EIA chart showing oil and gas production

Global warming is the disease. Stopping fossil fuel production is the cure. Reducing production might at least help the patient survive. So why haven’t the producers acted? Because no legislation exists anywhere to force them to act. Nor is such legislation likely to appear anytime soon; politicians the world over dance to the tune of the fossil fuel industry. In the few countries where setting a price on carbon emissions is being tried, the taxes are set too low for the effects to work back to the producers of the fuel.

The fossil fuel industry’s business model is similar to the one used by the drug trade: push the product; saturate the market; keep the users hooked. Direct or indirect political involvement is a given. The equivalent of the drug kingpins are the guys running or controlling the world’s Oil and Gas companies: Exxon, Gazprom, BP, Aramco, Shell, to name a few. The pushers are all the entities that stand to gain from the industry’s continued existence. They range from nation states and oil companies down to the industry’s bottom feeders: bought politicians; co-opted scientists; paid lobbyists; etc. A formidable array.

American Fossil fuel pushers are easy to spot because their statements are obviously pro industry. Sometimes their ideas sound reasonable at first reading. The Climate Leadership Council (CLC) is an example. Its proposal — called the Baker-Shultz Carbon Dividends Plan (aka: the Climate Consensus Solution) — is presented as a sort of prospectus in its 6 page website. The plan is heavy on promotion, light on specifics. Change a few words in it and the thing could pass as a sales pitch, complete with big-name endorsements, for Florida investment property.

According to its website, the CLC is “an international policy institute founded . . . to promote a carbon dividends framework as the most cost-effective, equitable and politically-viable climate solution.” Its plan, the website says, is backed by “3500+ economists, 27 Nobel laureates, all 4 former Fed Chairs, and 15 former Chairs of the Council of Economic Advisers.” 3500+ economists? That’s what it says. The following image identifies the CLC’s founding members.

Photo list of Climate Leadership Council founding members
Climate Leadership Council founding members. Image from CLC website

The CLC plan proposes that polluting industries pay a carbon tax on CO2 emissions, the money to be collected and given back to the American people in the form of dividend cheques. In exchange, the American people would have to agree to: the elimination of certain EPA emissions regulations; repeal of the clean power rule; and the introduction of a new law that would prohibit lawsuits of the sort that are currently plaguing fossil fuel producers. In other words, while the emitters of CO2 (all industries that burn fossil fuel) would pay a carbon tax, the producers of oil and gas, who refine but don’t burn much of the stuff themselves, would not have to pay much of the carbon tax. Instead, they would get to stick around producing more fossil fuel without having to worry about being sued for causing global warming.

Here’s how the creators of this ‘believe it or not’ scheme sum it all up:

“A sensible carbon tax might begin at $40 a ton and increase steadily over time, sending a powerful signal to businesses and consumers, while generating revenue to reward Americans for decreasing their collective carbon footprint.”

Let’s see how that might work: (1) Industry pays carbon taxes. (2) The tax money is collected and distributed to all Americans as a reward (for agreeing not to sue Oil and Gas companies?) (3) Industry raises its prices to recover the tax cost. (4) Americans use their reward money to cover the extra cost of the stuff they buy from industry. At what point in that Mobius Loop does a reduction in fossil fuel use take place? It doesn’t. The thing is a fantasy. But wait. Isn’t it true that carbon taxes work over time to limit the use of fossil fuels? Yes, but not when the taxing system is designed by fossil fuel pushers as is the case with this CLC plan. This plan is about convincing Americans to shut up about global warming so that the oil and gas companies can get on with the business of making money while the planet burns.

Among the CLC founding members shown in the image above, the five oil and gas companies are doubtless fully supportive of the CLC plan. As for the rest, who knows. My guess is that most of them don’t know exactly what they’ve lent their names to. The CLC pitch is misleading. The website prospectus mentions ‘carbon dividends’ 11 times and ‘climate solution’ 8 times. A dividend-generating Climate Solution sounds good. On the other hand, the words, oil, gas, fossil, or fuel, appear only once or not at all in the prospectus. Those are words that remind people of what causes global warming in the first place.

The Climate Leadership Council is headquartered in Washington DC at 1250 Connecticut Ave. NW.

1250 Connecticut Ave. NW, Washington DC
1250 Connecticut Ave. NW, Washington DC

ExxonMobil: savvy company or a dinosaur with climate-killing instincts?

Photo of ExxonMobil sign

Interviewed on TV March 7, Darren Woods, CEO of ExxonMobiI, was asked how politics and the Green New Deal could affect his approach to running the company. His responses reveal plenty about the vulnerability of his company; more than speeches by industry executives typically deliver.

ExxonMobil is the largest publicly traded oil and gas company in the world. Its operations generate correspondingly large volumes of carbon dioxide, the cause of our global warming crisis. The company’s operations affect every living thing on the planet. That’s why the people who direct those operations must be watched closely. To make Mr. Woods interview responses easier to follow, they’ve been transcribed from spoken to written form and presented within quote marks below. The underlining is mine. Mr. Woods first tackles the part of the interviewer’s question that he’s most comfortable with, the political part:

“Energy is such an important part of people’s daily lives and their standard of living that as you think about these big ideas and as you translate them down to the smaller practical steps you take, people become very cognizant of what the impacts are for individuals, and as that starts to happen, people’s views change as to how far they can go and how quickly they can go.”

See how easily Mr. Woods brushes aside “these big ideas” i.e. the Green New Deal. The Green New Deal is a political idea and Mr. Woods is no stranger to politics. However, the Green New Deal is based on the availability of actual machines that can be seen today producing electricity at lower cost than electricity from fossil fuels. That’s the crux of the matter. Unlike ideas, machines that people can see and touch are impossible to brush aside. Watch as Mr. Woods struggles with that reality in the following paragraph:

Our approach to that is to try to be part of the solution and engage with that. We have a long long history in this industry and a really good perspective on the global energy system, and we’re a company that’s grounded in science and technology, and if you look at the risk of climate change and what people and society are focused on in terms of lower emission energy systems, we’re going to need some technology breakthroughs. The conventional technology set doesn’t address the gaps that are out there today. We think we can play a role in that. In fact that’s where we’re investing some of our technology and our RD dollars to help fill some of those gaps.”

There you have it. As soon as Mr. Woods gets close to the crux of the matter, he backs away. Apparently unwilling to even mention the existence of green technologies, he implies that they don’t exist. Then he asks us to imagine gaps that need filling with “breakthrough technologies.” What Mr. Woods is saying is that the fossil fuel industry Is not equipped to deal with the climate problems it has created. Prompted by the interviewer, Mr. Woods now goes on to tell us how his company is working hard to invent the “lower emission energy systems” that the world needs.

Well, there are lots of different ideas out there. The way we look at it is that its got be be scaleable, it’s got to work at scale, and ultimately it’s got to be economic so that people can afford it, and it’s got to be reliableSo one of the things that we’ve been working on for many years is algae, biodiesel from algaeand the reason for that today is that we don’t have a good solution set for commercial transportation and emissions from commercial transportation, and algae and biodiesel could do that. Carbon capture and storage is another area that has potential but today the economics are very challenging, so finding more economical methods for capturing carbon is another exciting area. We’re looking at how you utilize the carbon you capture; what do you do with it? You can store it underground and you can also turn it into other products. So we’ve got a lot of research in terms of how you might use carbon and turn it into another product that society could use. So there’s a lot of exciting stuff happening in this space and we’re participating pretty broadly in that technology space. We’ve got relationships with eighty universities around the world. We’re working with the National Lab. We’re working with  governments around the world. So we’re trying to stay plugged in to make sure that we’re contributing as we can.

That’s it. The world is threatened by climactic Armageddon and the best ExxonMobil can come with by way of potential fixes are biodiesel and carbon capture. Biodiesel is not a global warming fix; nor is carbon capture. Carbon capture is an economic loser. A fossil fueled machine that’s already economically challenged will become even more uneconomical after another machine is attached to its smokey ass. An eight year old could tell them as much. So what’s going on? Is the idea’s primary purpose to calm the nerves of skittish investors — a line of bull to make the company’s prospects look sound? I suspect it is. ExxonMobil is not a savvy company.

As Mr. Woods correctly points out, energy technologies must work economically and reliably when scaled up to commercial size. That’s exactly what green technologies — photovoltaics, wind turbines, battery storage systems — are doing right now. That’s why Mr. Woods doesn’t mention them; they are an existential threat to the fossil fuel industry and are taken seriously by that industry.

The Green New Deal, however, is not taken seriously by its detractors. Why? Because it’s not a real thing, it’s an abstraction. That’s what makes it difficult to promote successfully. Advice to the Democrats: promote the work the green technologies are doing right now; win the next election; then introduce the Green New Deal.

The following YouTube video shows Mr. Wood’s TV interview of March 7, 2019.  The first two and a half minutes is the part of the video discussed in this post.


How the Oil & Gas Industry gets others to fight for its life

Vice President Mike Pence, speaking at a meeting of the Ohio Oil & Gas Association on March 8, 2019, delivered the following message to the members: “The oil and gas industry, I want to promise you,” he said, “has no greater friend than President Donald Trump. And as the President said, in his words, our administration will not only seek American energy independence but will seek American energy dominance.” (whitehouse.gov –  briefings)

Photo of VP Mike Pence speaking to Ohio Oil & Gas Assoc. March 8, 2019
VP Mike Pence speaks at a meeting of the Ohio Oil & Gas Assoc. March 8, 2019. Image credit: Brooke LaValley/Columbus Dispatch

The oil industry is on the defensive for causing global warming, sea level rise, mega storms, the end of life as we know it. People who want it stopped are protesting in the streets, launching lawsuits. Smart energy technologies such as photovoltaics are showing the industry up for what it is: smelly,  poisonous, obsolete. Is the industry buckling under the weight of these assaults? Not yet. Since science and the facts are on the side of their tormentors, oil industry executives are fighting back with a weapon that can defeat any amount of truth — money.

The industry is wielding its money weapon in three ways: 1. buying politicians; 2. swamping the market; 3. financing climate science deniers.

Politicians are first on the industry’s purchase list. The following chart from a report by OpenSecrets, shows the top Oil Industry contributors to the 2017-2018 election cycle. As the chart makes clear, oil industry contributions go to Republicans by an overwhelming margin. Oil industry executives know where to get the biggest bang for their bucks. They own the Republicans in Congress.

Chart of top Oil Industry contributors to election campaigns, 2017-2018
Top Oil Industry contributors to election campaigns, 2017-2018. Image credit: OpenSecrets.org

The chart shows only direct political donations— money that’s easy to track. The oil and gas industry spends millions more dollars on lobbying and Political Action Committees (PAC’s), money that’s difficult to track.

Do political contributions work? During his talk to the Ohio Oil and Gas Association, the Vice President made sure to tell his listeners how their contributions do indeed work: “We [the Trump administration] approved the Keystone and Dakota pipelines; withdrew the United States from the job-killing Paris Climate Accord; eliminated the hydraulic fracking rule; rolled back methane; we’re ending the Clean Power Plan; scrapped the Stream Protection Rule; and now, under President Donald Trump, the war on coal is over. American energy is booming.” (Applause)

There are two ways to swamp a market. One way is to increase production so as to undercut the competition (cleaner more efficient energy technologies). The second way is to invest heavily in down-stream facilities so as to embed the use of a product more firmly into the economy. The oil and gas industry is lavishing its investors money in both ways. A 2018 study commissioned by the American Petroleum Institute (API) titled ‘U.S. Oil and Gas Infrastructure Investment through 2035’, predicts that the industry will spend at least $1 trillion (a million million dollars – see pie charts below) on new facilities such as pipelines, storage tanks, refineries, export terminals. There’s nothing in the 154 page report about renewable energy technologies or anything related to global warming. For the API and its members, the goal is fossil fuel domination, the planet be damned.

Pie charts showing projected investment in oil and gas infrastructure
From a 2018 study commissioned by the American Petroleum Inst. Image credit: ICF Fairfax VA

Providing financial assistance to individuals and groups willing to spread disinformation about climate science is a big part of the industry’s survival strategy. There are dozens of groups that work to discredit climate science and the impacts of global warming. The Trump administration is packed with individuals drawn from oil companies or from the disinformation mills that live off them. Some of the better known groups include: the American Enterprise Institute; the Manhattan Institute; the Heritage Foundation; the Heartland Institute. Not wishing to become objects of mockery themselves, oil industry executives never publicly express agreement with the absurd views generated by such outfits. Instead they buy clowns and crazies to do it for them. It doesn’t matter how outlandish or mad the stories are. The important thing is that they reach the ears of the millions of people prone to believe them.

President Trump — a faithful servant of the oil and gas industry — is an exemplar of the ‘clowns and crazies’ crowd. He has a talent for delivering climate-science falsehoods to large appreciative audiences in the manner of a standup comic. Speaking at a National Republican Congressional Committee fund raising dinner, April 2, Trump said: “If you have a windmill anywhere near your house, congratulations, your house just went down 75% in value. And they say the noise causes cancer. You tell me (waves his arms while vocalizing sound of rotating windmill).” See 26 second video clip below.

Trump is simply a windbag who puffs out drivel in support of his masters, the oil industry bosses. Those are the guys the Democrats need to bring under control. Until that happens, advancing the objectives of the Paris Climate Accord will be difficult.