Editor’s Note: Robert Weissman is the president of Public Citizen, a nonprofit organization that champions the interests of citizens before Congress. The opinions expressed in this commentary are his.
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Robert Weissman says the confirmation hearing for Rex Tillerson should put Exxon's actions under a microscope
Tillerson negotiated a deal with Russia that was upended by sanctions over Putin's invasion of Crimea, he notes
Candidate Donald Trump’s promise to “end the special interest monopoly” in Washington is already the stuff of “Saturday Night Live” parody. Unfortunately, the nomination of ExxonMobil CEO Rex Tillerson to be secretary of state is no laughing matter, more a tragedy than comedy in the making. This is precisely why members of the Senate Foreign Services Committee should treat his hearing this week as a public trial rather than a mere formality.
The purportedly anti-establishment candidate seems bent on rescuing the progeny of the Standard Oil Trust from existential threats only to risk the very future of the planet.
Tillerson’s signature achievement at Exxon was to secure one of the largest deals in Exxon’s history, a strategic partnership with Russia’s national oil company, Rosneft, that anticipated tens of billions of dollars in investments by both corporations. The 2011 Rosneft deal gave Exxon access to Russia’s vast, untapped oil and gas reserves in exchange for some of Exxon’s global assets and teaching its new partners to frack. The arrangement also cemented Tillerson’s personal relationship with then-Russian Prime Minister Vladimir Putin.
Just two years into the deal, however, Putin’s decision to annex Crimea upended the entire project. Sanctions set in place by the United States and the European Union banned American companies like Exxon from doing business with the Russian oil sector. In 2014, Exxon reported the sanctions cost the corporation as much as $1 billion.
Revisiting the sanctions policy is fair game, but one thing’s for sure: Decisions shouldn’t be made based on what’s best for Exxon.
The Russian sanctions are only one of Exxon’s manifold problems. In the past year alone, serious questions have been raised regarding ExxonMobil’s financial health. Recent analysis indicates the company is hemorrhaging revenue, forcing Exxon to grow increasingly reliant on long-term debt in order to keep shareholder dividends flowing and maintain end-of-year cash balances.
At the same time, the company is under investigation by the Securities and Exchange Commission and the state attorney generals in New York and Massachusetts amid allegations that it misled investors about climate change and the impact efforts to stop it would have on the company’s valuation.
Internal documents reveal the company had a sophisticated understanding of the impact burning fossil fuels was having on the planet even as early as the late-1970s. By the late-1980s, Exxon concluded – along with the rest of the scientific community – that climate change would pose a catastrophic threat to the planet.
Rather than sound the alarm, ExxonMobil took a page out of the denial playbook written by Big Tobacco. Through front groups like the Competitive Enterprise Institute – well represented on President-elect Trump’s transition team – the company bankrolled pseudo-science designed to create uncertainty in the public’s mind.
The President-elect, however, might just disappear many of Exxon’s most pressing problems. Removing the Russian sanctions would put rigs in the North Sea (redesigned, by the way, by Exxon to account for rising sea levels brought on by climate change).
Meanwhile, there’s virtually no chance of a Trump administration investigating Exxon’s decadeslong climate deceit. So, too, are odds against any stepped up federal action to address climate change by facilitating a shift away from fossil fuels. Trump transition team documents signal an impending witch hunt against government scientists and civil servants who have worked on climate change plans.
Furthermore, the President-elect’s other Cabinet nominations form something akin to the four horsemen of the apocalypse. Trump’s pick to run the Environmental Protection Agency, Oklahoma State Attorney General Scott Pruitt, is actually suing the agency to stop it from implementing President Obama’s very modest Clean Power Plan and co-signed a letter urging his counterparts in other states to drop their investigation into Exxon. Former Texas Gov. Rick Perry – who turned the Republican Governors Association into an industry-friendly machine for companies like Tillerson’s – may soon head the Department of Energy, the very agency he couldn’t remember wanting to dissolve. And Trump’s attorney general nominee, Sen. Jeff Sessions, called on the Obama administration to stop the Department of Justice from even looking into the question of whether ExxonMobil violated the law.
In other words, decades after launching a $30 million campaign to foment doubt about climate change and obstruct any action to address it, Exxon may see the largest return on its investment yet.
Unfortunately, a resurgent Exxon means a planet in peril. The company’s plans for the next two decades are business-as-usual, despite the fact that scientists say in order to avoid catastrophic damage to our planet, emissions must reach net zero by 2050.
Candidate Trump was right that special interest control of government has profoundly harmful consequences. Unfortunately, President-elect Trump seems intent on handing control of the reins of government to precisely those interests. In the case of Exxon and Big Oil, whether we the people permit that to happen may literally affect the fate of humanity.