Private Empire: ExxonMobil and American Power (11 page)

Rouse oversaw only one lobbyist to watch the entire House of Representatives: Jeanne O. Mitchell, a University of Florida graduate, a cheerful woman who briefed ExxonMobil’s policy and tax PowerPoint slides with genuine enthusiasm. Her counterpart for lobbying the Senate, William “Buford” Lewis, was a balding specialist in gasoline and other transport fueling systems.

Lobbyists and consultants newly hired at the office were instructed that ExxonMobil sought to avoid asking for specific favors, such as earmarks, on Capitol Hill. “We don’t need the government’s help” was the prevailing instruction. “We just want to know the rules of the road.” The line used to indoctrinate new arrivals to the Washington office was that ExxonMobil did not want anything
from
the American government, but it did not want the government to do anything
to
the company, either. Lee Raymond saw his Washington operation as being 180 degrees opposite from, say, General Electric, which ExxonMobil executives regarded as a Washington rent seeker, always trying to bend Congress and the administration to policies that would subsidize or enhance G.E. business divisions. When Raymond saw G.E.’s celebrity chief executive, Jack Welch, he did not hesitate to give him a hard time about his corporation’s favor seeking in Washington. In fact, Raymond was kidding himself. There were many favors, executive orders, lobbying meetings, and laws ExxonMobil sought and obtained from the American government. Yet the above-it-all slogans imparted to newcomers did reflect the corporation’s aversion to back-room deal making on legislation in Congress. ExxonMobil had long had a policy of refusing to give rides to members of Congress on its fleet of corporate jets. The advantage of advertising an official, declared policy of asking for no favors from members of Congress, Raymond explained, was that “when they come and ask us for favors, we can say no.” The corporation’s typical lobbying meeting on the Hill involved briefing and then leaving behind preprinted PowerPoint slides vetted in Irving. When ExxonMobil lobbyists looked for serious help, they more often turned to the executive branch, discreetly.
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A sardonic line among ExxonMobil lobbyists in the Washington office held that the corporation’s number-one issue of concern was taxation; its number-two issue was tax; its number-three issue was tax; and its number-four issue varied from year to year. With gross global revenues well north of $200 billion, even small changes in the U.S. corporate tax code could cost ExxonMobil dearly. Raymond instructed the K Street office not to ask for specific tax earmarks, but to concentrate on preventing unfavorable changes in the code, such as oil industry–specific windfall taxes or changes to depreciation rules that might raise ExxonMobil’s effective tax rates—this lobbying work was often defensive and involved trying to talk industry-friendly coalitions in Congress into blocking unfavorable changes.
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ExxonMobil’s lobbyists operated within the same disciplined, hierarchical corporate system that refinery managers and offshore drilling platform operators did. Their talking points could be mechanical sounding: “This is what the corporation believes is the best course of action.” In the scrum of final conference talks over a particular bill, if Jeanne Mitchell or Buford Lewis was asked for an opinion about an alternative option to the one she or he had briefed, the ExxonMobil lobbyist would simply repeat the talking points and conclude again: “This is what the corporation believes is the best course of action.” A lobbyist for another oil corporation recalled, “You’d think, ‘Why do I feel like I’m talking to a wall?’ Because you are: They can’t move off a position” without permission from headquarters. They were “honest as the day is long,” recalled a former Republican staffer, speaking of the corporation’s Washington staff. “Sometimes blunt.”

ExxonMobil commanded the in-house expertise “to run to ground all the possible technical arguments around a particular policy area,” said an industry advocate. “They have people there who can talk about epidemiological studies down to the parts per billion.” Yet the Washington office’s influence was also limited by its rigidity and perceived arrogance. “They have a terrible reputation and they deserve criticism for having allowed that to develop,” reflected a Republican lobbyist who worked with them. “They very much have the opinion that ‘We are ExxonMobil; we’re right. And we will prevail.’ In Washington, it doesn’t always work that way. Most people don’t understand the economics of energy and ExxonMobil hasn’t explained that very well. They have the money to educate people but they don’t do it very well.”
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E
xxonMobil’s Washington strategists divided the capital’s political population into four broad tiers, in descending order of sympathy for Irving’s agenda. There were those who represented or otherwise had emerged from the oil patch, where many thousands of jobs were at stake—senators and congressmen from Texas, Louisiana, Oklahoma, and Wyoming, some of them industry veterans. This group included, after 2000, President George W. Bush and Vice President Dick Cheney. The second tier consisted of free-market Republicans who didn’t particularly understand the oil and gas industry, but who usually would be supportive of the industry’s positions. The third tier consisted of Democrats or liberal Republicans who tended not to trust ExxonMobil and its ilk, and who regularly voted against the corporation’s interests, but who had been around Washington long enough to become pragmatic about oil industry issues; they were at least open to constructive discussion and might occasionally vote the industry’s way. ExxonMobil’s lobbyists and executives cultivated ties and made generous campaign contributions to all three of these Washington subspecies. Lee Raymond had friendships with industry-leaning Democrats—Representative John Dingell, the longtime automotive industry champion from Michigan, for example.

Then there was tier four: the enemy, as some of the military veterans who manned ExxonMobil’s Washington office did not mind putting it from time to time. These were Democrats and environmental activists who, it seemed to the corporation’s executives, wanted to disenfranchise ExxonMobil and to use the corporation’s unpopularity to galvanize liberal constituents and funders. These activists did not believe in the legitimacy of the profit motive, in the estimation of some ExxonMobil executives. Senators Charles Schumer and Dick Durbin fell into this category; Senator Hillary Clinton, on the other hand, did not. Lee Raymond accepted that there was not much he could do about the company’s permanent opposition in Washington; these people were not going to change their views. Nor should ExxonMobil bend to them. Clifton Garvin’s flirtation with solar investments during the Carter administration was regarded within the corporation as an object lesson in what not to do. Even Raymond accepted that it had made sense for Garvin to explore alternative energy businesses during the oil supply upheavals of the 1970s, but the lesson, he believed, was that alternatives to oil were not economically competitive and would not be for the foreseeable future. The corporation should stick to its core expertise and not chase after fleeting political or policy fashions. “In hindsight it appeared that we were abdicating who we were,” Raymond recalled. “Presidents come and go; Exxon doesn’t come and go.”
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Some of ExxonMobil’s Washington lobbyists also believed that the most extreme anti-oil activists could be contained only by direct counterattack and pressure. There was no sense in pretending otherwise, they argued. The industry’s uncompromising opponents had to be taken on uncompromisingly.

As the Bush administration took office, one issue was rising in Washington that was of far-reaching, even existential importance to the oil industry, an issue that would test ExxonMobil’s lobbying prowess: climate change. As policy debates about global warming intensified, two men, one in government and the other in industry, would increasingly distinguish themselves by their ardent skepticism toward climate scientists and their opposition to all government regulation: Dick Cheney and Lee Raymond.

I
n a large color ad taken out in
Life
magazine in 1962 by ExxonMobil’s precursor Humble Oil, a small, smartly dressed cartoon character saluted a photograph of a majestic glacier. “Each Day Humble Supplies Enough Energy to Melt Seven Million Tons of Glacier!” the ad’s headline declared.

Such was the John F. Kennedy era of scientific optimism, as marketed by Madison Avenue. Four decades later, of course, many scientists regarded the retreat of glaciers and mankind’s unembarrassed capacity to melt them as signs of a slowly unfolding global catastrophe. (Of the 144 glaciers monitored by researchers between 1900 and 1980, 2 advanced and 142 retreated, an indicator of the earth’s warming surface temperature during the twentieth century.)
¹⁰
Climate change became a galvanizing priority of science and public policy in a remarkably short time. It took less than two decades from the time of Humble’s ice-melting ad campaign for Exxon’s executives to recognize that climate change would arrive as a public policy challenge in Washington and other global capitals, and that it might undermine the corporation’s business model. Characteristically, Exxon began to prepare itself well before the phrase “global warming” saturated public consciousness.

The “greenhouse effect” is a natural process in which sunlight is trapped by the planet’s atmosphere; without it, the earth would be very cold. The question that scientists gradually examined during the twentieth century was whether additional gases released by the clearing of forests and the burning of fossil fuels—coal, oil, and natural gas—accelerated the greenhouse effect. It was not until the 1950s and 1960s that a few scientists began to document credibly that human activity was releasing more and more carbon dioxide, a greenhouse gas, and that warming might be the result. Their findings did not immediately stick. The earth’s climate had undulated across millennia. Orbital variations, the intensity of sunlight, and other natural factors had produced alternating ice ages and periods of boiling seas long before the rise of smokestacks and automobiles. Scientists remained divided as late as the 1970s about essential questions such as whether the earth was warming markedly, whether a warming or cooling trend posed the greatest future danger, and how human and industrial activity fit into the picture.

James Hansen, an astrophysicist at the National Aeronautics and Space Administration, was among the first scientists to call attention to the danger that greenhouse gas emissions could produce dramatic warming within a relatively short time. His and other work prompted the first National Academy of Sciences examination in 1979. The academy’s study group found that if man-made CO
₂
emissions—from coal-burning electricity plants, automobile exhaust, truck fumes, airplane exhaust, deforestation, and other sources—continued to grow, there was “no reason to doubt that climate changes will result and no reason to believe that these changes will be negligible,” as the chairman of a study for the National Research Council’s Climate Research Board put it. The findings might be “disturbing to policymakers” because “a wait-and-see policy may mean waiting until it is too late.”
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The National Academy report attracted Exxon’s attention. Any effort to tax, limit, or eliminate carbon dioxide emissions on environmental grounds would have obvious implications for Big Oil. Exxon emitted tens of millions of metric tons of carbon dioxide in the course of its own oil production, refining, chemical manufacturing, and electricity-generating operations. Not only did the corporation burn carbon-laden fuels, it then sold such fuels for profit to other users, who also burned them.

In 1980, just after the publication of the National Academy study, the corporation hired its own astrophysicist, Brian Flannery, who had taught at Harvard University. A few years later Flannery recruited a chemical engineer named Haroon Kheshgi, who had worked at the Lawrence Livermore National Laboratory. Flannery and Kheshgi started to produce, while salaried employees for Exxon, peer-reviewed research for the United Nations’s Intergovernmental Panel on Climate Change, or I.P.C.C. This was a network of many dozens of mostly academic and government scientists established to create definitive assessments, at multiyear intervals, of the scientific evidence about global warming. Exxon’s climate scientists also used corporate funds to support climate-modeling research at the Massachusetts Institute of Technology. They produced internal assessments of the scientific and policy questions for Exxon’s Management Committee. In the early years of this Exxon climate work, constructing an accurate model of future Earth temperatures seemed daunting. When Flannery arranged contracts with the M.I.T. climate modelers, he told them, by his own account, “Embrace the uncertainty in all of this.”
¹²

L
ee Raymond had no particular background in climate science, but as a chemical engineer whose doctoral thesis had concerned mathematical modeling, he considered himself adequately qualified to reach his own judgments on the underlying scientific questions. (He was the first Exxon chief executive to have a doctorate.) At the University of Minnesota, where he had earned his advanced degree on a scholarship, his academic mentor, Neal Amundson, a renowned figure in chemical engineering, had instructed him, “Science is science, and don’t let these damn politicians ever screw you up.”

During the 1980s, when global warming first emerged as a public policy matter, Raymond turned to the scientists in Exxon’s oil exploration department, who by profession studied the history of the planet. The corporation’s scientists told him that climate measurements on Earth were very recent relative to the planet’s longevity, and that this was a reason to be skeptical about extrapolating data.