Big Oil and the Battle for Our Future

August 1, 2016

Wenonah Hauter, author of Frackopoly: The Battle for the Future of Energy and the Environment explains the history of the oil industry's collusion with the state and how the fate of the planet depends on challenging fracking

Wenonah Hauter, author of Frackopoly: The Battle for the Future of Energy and the Environment explains the history of the oil industry's collusion with the state and how the fate of the planet depends on challenging fracking



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SHARMINI PERIES, EXEC. PRODUCER, TRNN: It’s The Real News Network. I’m Sharmini Peries, coming to you from Baltimore.

ExxonMobil is under investigation in New York and Massachusetts by the state attorney generals for misleading the public and shareholders about what it knew about the link between climate change and fossil fuels some 30 years ago. This week we learned that the oil companies didn’t borrow from the big tobacco’s playbook about misleading the public on scientific data. It was more the other way around: big oil wrote the playbook.

On Wednesday, July 20, the Center for International Environmental Law released a trove of documents that demonstrate proof of collaboration between the tobacco and oil industries as early as 1956.

Our next guest, Wenonah Hauter, author of Frackopoly: The Battle for the Future of Energy and the Environment, says that corruption and collusion of the oil industry and the government against the better interests of the public goes back as far as the beginning of the oil industry, and this continues today. So Wenonah Hauter is also the founder and executive director of Food & Water Watch.

Wenonah, good to have you with us today.

WENONAH HAUTER, EXEC. DIR., FOOD & WATER WATCH: I’m so happy to be here.

PERIES: So, Wenonah, before we dig into the book, let’s actually have a look at the introduction of the book by video, which I love.

Wenonah, so let’s start with when did the industry and the collaboration with multinational corporations and the government all start.

HAUTER: Well, it really started in the very beginning of the oil and gas industry with JD Rockefeller’s Standard Oil. He had rolled up the oil industry by 1890, controlling more than 90 percent of it and having a tremendous amount of influence on government.

PERIES: And give us a better sense of that period. What were the energy demands, and why did this relationship gel the way it did so early on?

HAUTER: Well, one of the things that oil was necessary for was kerosene. Almost everyone lit their home after dark with kerosene. And so the fact that Rockefeller had been able to create a monopoly, fix prices, really dominate the industry, drive his competitors out of business, had a big effect on many Americans. There was a lot of organizing to try to force him to do something about this. And finally, under Teddy Roosevelt, Standard Oil was allowed to write its own plan for being broken up.

So half of the value of the original Standard Oil ended up going into the company that’s Exxon today. And there were six other major oil and gas companies, including–I’m going to use the modern names, not their old names; there’ve been dozens of mergers and acquisitions since then. But Chevron and Mobil, which merged with Exxon in the 1990s, along with Gulf and Texaco, were the American major companies. There were two large European companies, BP and Shell, that still exist today. Those companies that were called the “Seven Sisters” because they operated like the Greek myth around Atlas’s daughters that fought viciously except when one of them was attacked and then they all gathered round, that’s exactly what happened with the oil and gas industry. They conspired through the decades.

PERIES: And how did oil and gas interests manage to undermine antitrust legislations, as we kind of know it today, in terms of also the collaboration between tobacco and the oil and gas industry?

HAUTER: Well, what they did was either conspire to avoid antitrust laws–and they met regularly to fix prices, to create a set of principles by which they would operate. And under Exxon’s leadership, the American Petroleum Institute was formed in 1919 with donations from Exxon–I’m using the latter-day name–Exxon, Chevron, and the other big oil companies of the day.

PERIES: Wenonah, now, fracking today has been linked to many atrocities in our society today that even government commission reports indicate a link between earthquakes and contaminated water, polluted air, methane emissions, higher community cancer rates, and birth defects–and the list goes on and on, as you document in your book. Now, just a week ago even a study from Johns Hopkins University here in Baltimore revealed that people living near fracking wells had a higher risk of asthma attacks. How on earth has this gone on for so long without consequences to these corporations?

HAUTER: Well, it really speaks to the power of the oil and gas industry and how they’ve amassed it through the decades, and even more so since the Reagan administration, when the monopoly laws that were on the books were basically eviscerated–the definition of an antitrust violation was narrowed, the staffs of the Federal Trade Commission and the Department of Justice were reduced, their budgets reduced. And really since that time in the 1980s, antitrust law has not really been pursued by either Democrats or Republicans the way that it should be.

And the result of this is that you end up having a handful of corporations that have so much political power that they dominate all of the rules regarding their industry, legislation and regulation. And that’s exactly what’s happened with fracking.

And, in fact, the technologies used for fracking were really developed largely by our federal tax dollars, taxpayer money. And they have been used to pursue fracking in more than 30 states.

And even under the Obama administration, when we can have expected that some action would be taken to protect communities, to do something about the methane emissions that are threatening our global climate, they have been very friendly to the oil and gas industry.

And we’re going to continue to have a battle to try to protect those sacrifice zones. Today, 15 million Americans live within a mile of a fracking operation or some of the infrastructure that supports it, and that’s a real problem.

PERIES: Wenonah, how much of this has to do with the fact that energy and oil and gas resources are needed for the so-called national security of the United States? Because this gives companies a lot of leverage because of this classification.

HAUTER: Well, you know, it’s pretty interesting. When you look at the history of the oil industry, really from the early 1920s, they have been allowed to run their own foreign policy related to oil and the Middle East. And it’s been all about self-interest and profiteering, not about what is for the good of the nation or the American people.

And, in fact, when you look at fracking–and I want to say that from 2012 until today, 80 percent of fracking has been for oil, even though people are told by the media, the oil and gas industry lead people to believe, that it’s all about natural gas. In the beginning, the oil and gas industry were saying, oh, it’s all about independence, energy independence. Since the fracking has created a glut of oil and gas, they’re now saying, oh, it’s about national security and helping our allies.

The truth of the matter is that the oil industry is a global industry. These major companies operate across the globe. And this is just a cynical way of trying to buy support for an industry that really should have been put to rest a long time ago.

PERIES: And, Wenonah, you devote a chapter of your book to the critique of cap and trade, the emission trading scheme that is in effect now in California and where somebody who is very environmentally friendly, like Governor Jerry Brown, has recently said that he wants to extend it to 2050. And even Canada, the Canadian province of Quebec, and now Ontario, have all embraced this cap and trade agreement. In fact, Justin Trudeau had come down to discuss these terms with President Obama. And it is considered a progressive program. Is that so?

HAUTER: No. And first of all, I have to say that Governor Jerry Brown is resting on a reputation from many years ago. He speaks as if he’s a climate hero, but he has really allowed the oil and gas industry to continue to operate in California and to frack. In fact, oil and gas are the third-largest part of the California economy. Governor Brown has done nothing to stop the really irresponsible fracking that’s going on in the Central Valley of California, the drilling that’s going on in a community of color in Los Angeles, if you can imagine that there’s drilling in L.A. that’s being conducted by Alenco.

And we really see that the cap and trade program is a scheme that’s supported by the financial services industry. So rather than setting a time limit on how long that oil and gas can be used and setting policies that are going to send us into a sustainable energy future, help make the transformation from fossil fuels to renewable energy and energy efficiency, we see schemes like cap and trade, which are really pretty unproven.

And Europe is a very good example where cap and trade has been embraced and going on for several years. It is plagued by fraud. And we don’t see that emissions are really being lowered.

I think our global climate, our communities that are being so seriously impacted, should not have to depend on a financial services scheme for some kind of relief. I don’t think that the financial services industry has proven to be a responsible partner. We can look at how they behave and the things that they did that helped bring on our recent financial disaster in 2008.

So we’re really advocating in the movement to ban fracking that we start initiating the policies that we need for a just transition to renewables and energy efficiency, rather than relying on unproven economic schemes.

PERIES: Right. A fantastic critique in this book on the oil and gas industry and how it all came to be, but you also take on the very important factor of a massive groundswell of grassroots movements across the U.S. and the world against fracking and environmental disaster, which is also great. Give us some highlights in terms of the kinds of things you cover in the book in terms of the more–on a positive note of what’s going on in terms of organizing against all this.

HAUTER: Well, I think that is the exciting news. Even with all of this power and influence, we can see that a huge grassroots movement has risen up around the country, from coast to coast, from top to bottom. We saw a huge coalition come together in New York to ban fracking, which was a very heavy lift. We see even in the heavily fracked state of Pennsylvania people organizing to try to make positive changes in the communities that have suffered so much, try to hold the Democratic governor there, Governor Wolf, accountable, to really help the people who are suffering from water and air pollution, and to stop the irresponsible fracking going on. Really, all across the nation, there are more than 30 states where fracking has been going on and where citizens, people, are really rising up and organizing.

There is a real effort in Colorado now to protect the ballot initiatives that were won in communities like Longmont to stop fracking from moving forward. The Democratic governor there, Governor Hickenlooper, allowed the supreme court, his Supreme Court nominees, to undo these bans. Basically, Hickenlooper sued the communities that had banned fracking. It went to the Supreme Court, where he had nominated the Supreme Court members, and they overturned these bans. So it’s very exciting that communities, that many groups, including mine, Food & Water Watch, have been out collecting signatures. And we’re very close to getting it on the ballot.

Lots of organizing in California, where the Porter Ranch disaster happened–an underground storage facility for natural gas, and there was a blowout very similar to the BP Horizon blowout that took place in the Gulf, only it happened on the land. A tremendous volume of natural gas was released, and Governor Brown did not take action for more than two months. The people are rising up there and demanding that justice be done.

And there’s a new campaign in California as well to stop the use of fracking wastewater for irrigating crops. A lot of the research that’s been done by our community shows that Chevron’s wastewater, and another energy company, millions of gallons of that wastewater has been used to water crops, some of them even organically produced.

So I think what’s exciting is, in the election season, that the debate over who would be the presidential nominee, that fracking was one of the issues that rose to the top. And that really speaks to the power that our movement is building.

And that’s what it’s going to take: expanding our movement. It’s a diverse movement. It’s a broad-based movement. It’s about fracking. It’s about the oil and gas industry and their terrible practices in communities of color for decades, with their refineries and all of their polluting infrastructure. And this is a movement to where we keep fossil fuels in the ground.

PERIES: Yeah. Wenonah, you’ve made a fantastic contribution to the fight-back. Frackopoly: The Battle for the Future of Energy and the Environment. I thank you so much for joining us today, and I encourage everybody to read the book.

HAUTER: Thank you so much for having me on the show.

PERIES: And thank you for joining us on The Real News Network.

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