November 20, 2019

Time to Wake Up: Corruption Scheme

As-prepared for delivery

For this 259th climate speech, I’m going back to the theme of corruption. 

Before diving into the “how,” let’s start with the “why,” because the scale and the remorselessness of the scheme of corruption the fossil fuel industry has run is hard to comprehend without understanding “why.”

Here’s the “why.”  The fossil fuel industry reaps the biggest subsidy in the history of the planet.  The IMF estimates the global subsidy in the trillions every year.  That’s globally. 

In the United States alone, the fossil fuel industry got a $650 billion dollar subsidy in 2015, according to the most recent report from the IMF.  That’s about $2000 from every woman, man and child in the United States.  Here’s the IMF report.  Read it and weep.

Stop and understand this subsidy.  Some of it is favorable tax deals and other direct subsidies that pour public taxpayer money into this polluting industry.  In recent years, that’s been estimated at more than $20 billion annually. 

The vast bulk of this $650 billion?  It’s people getting hurt; it’s the cost of people suffering economic harms. 

It’s the cost of your home burned in a wildfire, or swept away in a storm by rising seas. 

It’s the cost of farms withered with unprecedented droughts, or crops drowned in unprecedented flooding.  It’s the cost of fisheries lost or moved away, as oceans warm and acidify. 

It’s the lost day of work with your kid in the emergency room waiting out a climate-related asthma attack on the ER’s nebulizer.  It’s the cost of tick-borne and mosquito-borne illnesses that didn’t used to be where you live. 

It’s the cost to dive tours of tourists seeing dead white bleached coral reefs instead of vibrant undersea gardens.  It’s the cost to snowmobile moose tours of going through mud instead of snow, and seeing emaciated moose calves with thousands of ticks slowly killing them. 

It’s the cost of American military deployments to conflicts caused by resource scarcity or climate migration.  It’s the cost of relocating Naval Station Norfolk when the community around it floods out. 

It’s the cost of Glacier Park with no glacier.  It’s the cost of trout streams with no trout.  It’s the cost of millions of acres of healthy forest killed off by pine beetle infestation.  It’s the cost to Phoenix of staffing up emergency services when it’s not safe to work outside, or lost airline flights when the airport tarmac melted. 

It’s the myriad costs of basic operating systems of the natural world gone haywire.

All this pain, all this loss, all this suffering, has a bloodless economic name: “externalities” — the social costs that are imposed on others by the use of a product.  Pollution is an obvious example. 

In economic theory, those social costs should be baked into the price of that product.  That’s why courts and companies and countries around the world apply a social cost of carbon calculation. 

But destroying the basic operating systems of the planet is a high-priced externality — $650 billion in 2015, just in the United States.  And because so much of this harm is hard to price, this is a lowball estimate.  We can estimate the loss to the dive shop of the coral reef dying, but is that really the full cost of the dead reef?  So the externality is probably well over $650 billion.

By comparison, the five major oil companies earned somewhat more than $80 billion in profits last year around the world.  Just five companies, $80 billion, globally, versus $650 billion in destruction and harm, just in the U.S.   Make them follow the rules of market economics, and their business is in a $570 billion hole. 

That’s why the fossil fuel industry is so corrupt.  It knows it needs to break the laws of market economics to survive, and it knows it needs political help to do that.  Fortunately for the fossil fuel industry, up against that $650 billion subsidy, politicians come cheap.  They could put $650 million into politics every single year and earn a 1000-1 return on that political investment protecting this $650 billion subsidy.

So that’s the “why” of fossil fuel corruption:  it pays.  Simple as that.  They are corrupt because it pays. 

Now let’s look at the “how.” 

First, they have some expertise.  They operate in the crookedest countries in the world.  But how about here in the United States?  What happened here?

The big change came when five Republican Supreme Court justices gave them big new political artillery, in the disgraceful Citizens United decision that let unlimited special interest money into our elections — and there’s no special interest more unlimited than fossil fuel. 

Fossil fuel front groups were all over that case, by the way, signaling to the five Republicans what they wanted them to do — and sue enough they did it. 

Of course it takes some of the fun out of spending unlimited money if people know who you are.  And in theory, we were supposed to know.  To get to the outcome the fossil fuel industry wanted, the five Republican justices had to pretend as a legal matter that all this spending was going to be transparent; that we’d know who was behind it.

But that transparency was not going to work well for Exxon, or Koch Industries, or Marathon Petroleum.  So they cooked up all sorts of schemes to hide behind. Tax-deductible 501c4s appeared that can hide their donors.  Trade groups like the U.S. Chamber of Commerce got taken over.  Disposable shell corporations turned up behind political donations.  An enterprise called Donors Trust was established, whose sole purpose is to launder the identity of donors. 

By the way, the five Republican justices would have to be idiots not to see this apparatus of phony front groups mocking their assurances of transparency, assurances at the heart of their Citizens United decision; but the justices have studiously ignored this flagrantly obvious flaw, and have made zero effort to clean up their unlimited-spending, dark-money mess.

We have called this flotilla of propped-up, dark-money front groups the “Web of Denial.” Academics studying these groups have documented well over 100 of them in the last decade alone. 

Sounds like a lot, right?  But remember there’s $650 billion a year riding on this, and it’s a big help if you can pretend you’re ‘Americans for Peace and Puppies and Prosperity’ instead of Exxon, or the Kochs, or Marathon Petroleum.  People tend to get the joke when the ad says, brought to you by ExxonMobil.

So there you have the motive, and the means, to spend millions of dollars, and do so from hiding. 

How much do they spend?  Well, that’s hard to tell because the whole purpose is to hide.  Responsible watchdogs won’t even venture a guess as to how much dark money is sloshing through the system, but total dark money spending on federal elections is at least $700 million since the Citizens United decision, according to the Center for Responsive Politics.  The lion’s share is probably from fossil fuels, because nobody else has the corrupt motive on the scale of fossil fuel; plus, when you look at the spending, it’s usually groups that can be connected to fossil fuel; for most, the activity is climate denial and obstruction, so it’s fossil fuel work being done. 

For those of you who weren’t here before 2010, things were different then.  In 2007, 2008 and 2009, my first three years here, lots of bipartisan climate bills were kicking around the Senate — real ones, that would have headed off the crisis we’re rocketing into right now.  In 2008, the Republican nominee for President ran on a strong climate platform. 

After the Citizens United decision in January of 2010, all that was snuffed out.  An oily iron curtain of denial fell around the Republican Party as the fossil fuel industry brought its new political weapons to bear.  The before and after comparison is as plain as day, and it has cost us a decade of inaction when time was of the essence.  

It has been a high cost.

Except, of course, for the fossil fuel industry, whose lying and denying, whose front groups and dark money, whose political obstruction and threats, still remain fully dedicated to protecting that $650 billion annual subsidy. 

Do the math.  At $650 billion a year, from January of 2010 until now, Citizens United let the fossil fuel industry protect nearly $6 trillion in subsidy — $6 trillion in losses to our constituents; $6 trillion that they dodged the laws of market economics to foist on everyone else.  And you wonder why they want to take over the courts . . . .

It is likely the biggest and most corrupt scheme in human history, and it is still operating today, right now, as I speak.  It’s oily tides pollute our public debate with deliberate falsehoods and nonsense, grease our press to steer away from this subject, slosh slimily through the hallways of this very building, and grip the Supreme Court in a web of oily dark-money influence. 

We’re like people who’ve lived in the shadows so long we’ve forgotten what sunlight, what free debate, what laws based on facts, can look like. 

The fossil fuel industry has polluted our American democracy on as massive a scale as it has polluted our atmosphere and oceans.  For those in our history who gave up their lives, who died in the service of our democracy, looking down on us now — that pollution of the democracy they died defending must be the bitterest spectacle of all.

As a boy, there was an ominous hymn we often sang in chapel, about how

“Once to every man and nation comes a moment to decide,

In the strife of truth with falsehood, for the good or evil side.”

Truth, the hymn went on, is “forever on the scaffold, wrong forever on the throne.”

But, “though the cause of evil prosper, yet ‘tis truth alone is strong.”

Now’s our moment to decide:  do we bring down fossil fuel’s false Babylon of corruption?  Or, in the strife of truth with falsehood, do we keep protecting the evil side?