Big Oil, Exxon Not Guilty as Charged (a rebuttal in six parts)

“Imagine if the media was reversed on the climate/energy issue, supporting and promoting a free market, classical liberal position. They could look at my boxes of files from the Enron days (1990s) and produce an expose, Enron Knew.”

Back at Enron Corp., I had “email wars” with the company’s climate lobbyist, John Palmisano, the author of the infamous “This agreement will be good for Enron stock” Kyoto Protocol memo. Enron had at least a half-dozen profit centers that stood to benefit from CO2 restrictions, inspiring Jeremy Leggett [The Carbon War (Penguin: 1999), p. 204] to identify Enron as “the company most responsible for sparking off the greenhouse civil war in the hydrocarbon business.”

The Palmisano/Bradley exchanges concerned regulating and pricing carbon dioxide. I was against; Palmisano for. I argued that it was intellectually unjustified and bad public policy–one that would come back to haunt Enron. Palmisano argued that his job was to make the corporation money, not argue about climate science and “good” public policy. John won, of course, but I got my licks in–with lots of cc’s and on the record. [1]

Imagine if the media was reversed on the climate/energy issue, supporting and promoting a free market, classical liberal position. They could look at my boxes of files from the Enron days (1990s) and produce an expose, “Enron Knew.”

The point is that different individuals within the same company can have different views–and passionately disseminate them. But the bosses and upper management make the decisions, often welcoming a vigorous exchange of opinions. It evidently happened at Exxon, and it happened at Enron. And both were short of a sinister conspiracy with “smoking guns”.

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Enron Knew awaits. But there is a cottage industry re Exxon Knew. Intellectuals, the media, and the climate lobby have pounced on old Exxon (ExxonMobil) memos and interviewed former employees. Their verdict: the company knew that carbon dioxide would warm the planet and create major problems. They were warned by their own scientists.

Well, Enron Knew and had warning from its director of public policy analysis (me, a 16-year mainstay). And my fears are playing out in real time with the worst still ahead.

This is but one argument of many against the simplistic, biased Exxon Knew narrative (and campaign). Add historical context, examine the state of the debate today (from physical science to public policy), and present the rest of the story … and a different picture emerges.

Richard Fulmer has taken a deep dive into the issues with six essays rebutting the narrative presented by Inside Climate News, the British Broadcasting Corporation, and academics such as Harvard’s Naomi Oreskes. [2] The articles (some in conjunction with me) are:

More needs to be written on the subject to further supplement the above and rebuttals from Robert Papier (here) and ExxonMobil (here). One is hard-pressed to disagree with the company’s statement:

ExxonKnew is a coordinated campaign perpetuated by activist groups with the aim of stigmatizing ExxonMobil. Funders of the “#ExxonKnew” campaign have placed “pay to play” news stories, released flawed academic reports and coordinated with public officials to launch investigations and litigation, creating the false appearance that ExxonMobil has misrepresented its company research and investor disclosures on climate change to the public.

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The problem with ExxonMobil is not what they said about climate change in decades past. It is what they are saying and doing about climate change now, a story that includes money-losing biofuels and a greenwashing/tax-credit play with carbon capture and storage. (ExxonMobil touts CCS as potentially a $4 trillion market by 2050, which might inspire a new-generation Exxon Knew investigation.)

ExxonMobil’s endorsement of a tax on carbon dioxide (even with big caveats) makes me long for former CEO Lee Raymond, whose realistic views on climate and energy remain defensible long after he said them. [3] Value creator, straight talker. Politically incorrect, but economically correct.

Message to ExxonMobil. It is past time to heed Alex Epstein and play offense, not defense. Trying to appease the enemy is futile. Employees, investors, board members who view oil (and gas) as destructive should not be part of the company.

Consumers, taxpayers, and free men/women of the world unite!

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[1] For memos from my Enron experience in the public domain, see here. The exchanges stopped when our boss, Steve Kean, now head of Kinder Morgan, told us to use the phone instead.

[2] Naomi Oreskes is Henry Charles Lea Professor of the History of Science at Harvard University. This title and academic venue imply expertise and scholarship, not one-sided agenda-driven research. Does she understand economics, political economy, management theory, or business history? Is she open minded? Does she respect the scholarly method of Harvard’s first female professor, business historian Henrietta Larson, who said:

What we have done is … to put business in its broader political and cultural setting…. We are not out to defend business, but to try to do an impartial, scholarly investigation of an important American institution.

[3] “We in the petroleum industry are not dismissing the global climate change issue. But I don’t believe anyone should have the moral authority to deny people the opportunity to improve their way in life by arbitrarily depriving them of the means…. I hope that the governments of this region will work with us to resist policies that could strangle economic growth.”

– Lee Raymond (CEO, ExxonMobil). Quoted in Kevin Mooney, “BP’s Fall from Grace: Disgraced Oil Giant Was Once Favored by Green Groups,” Capital Research Center, December 2010.

The post Big Oil, Exxon Not Guilty as Charged (a rebuttal in six parts) appeared first on Master Resource.

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September 22, 2022 at 01:24AM

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