Posted by: greeningwashington | March 9, 2009

We love to hate them

A friend of mine recently sent me a link to an article that illustrates an often-misrepresented assumption about environmentalists.

The following is the opening of the article and the author’s punch line:

Last week, as a friend of mine and I were discussing the energy business, an acquaintance of ours came into the room. When told the topic of discussion, she immediately denounced Exxon Mobil. She’d just heard on the radio that the energy giant had had a record $45.2 billion profit in 2008. She was clearly hoping that we would join in her disgust.

I asked, “So are you suggesting that Exxon should not make money?” I went on, “Would you prefer that Exxon be like AIG, or Citigroup, or one of the big Wall Street outfits that’s now asking for a government bailout?” That quieted her down. But I couldn’t help myself. I asked, “Did you know that 52 percent of Exxon is owned by mutual funds, index funds, and pension funds?” No. Nor did she know that about 2 million individuals own Exxon stock or that company insiders hold less than 1 percent of the company.

The facts above are not meant to belittle my acquaintance. Rather, it’s to illustrate an all-too-common problem in America: Voters have been conditioned to hate the energy business in general and Big Oil in particular. Americans love their gasoline, they love their cars, but they hate the oil companies. While it’s unlikely that the general public’s attitude toward Big Oil will ever be changed, the public should recognize that Exxon’s profits have come along with an enormous tax bill and that those tax payments are helping governments all over the world stay solvent.

In response to the writer’s not-so-new revelation, I have the following to interject. First, I would not prefer for Exxon or any Big Oil company to be bailed out by Washington. In fact, I do not believe that AIG or Citigroup should receive any additional funds. Instead, we should invest the billions upon billions of funds set aside for businesses that engage in poor practices in either small businesses, or in industries that could create millions of new jobs, green or not. Secondly, since I have family who work in the oil industry, I realize that Big Oil is taxed heavily, but the real question that should be asked is what is their tax bill in proportion to their profits? Also, most companies are publicly owned that is not surprising, but most companies like Exxon retain stock-option benefits for their top executives.

I also feel the need to clarify the misrepresentation that all environmentalists hate Big Oil. I do not hate Big Oil, and I do not believe the environmentalist’s argument has ever been so simplistic. The issues they have are with the structures in place, whether governmental or market-based, that inhibit the growth of alternatives to Big Oil or Big Coal or Nuclear. I can already anticipate the counter-argument: economics, free-market, etc., but what environmentalists argue for transcends economics. Just because something is, doesn’t make it right.

The structures are too rigid: government is slow and often ineffective, but unfettered free-market capitalism does not account for social or cultural values simply for the sake of those values. Sure, the market often ends up providing for (i) the regulation of chemicals in toddler toys or (ii) more “green computers,” but it is arguable that these results are more likely a product of profit incentives or consumer pandering rather than morality. If you don’t ‘clean up’ your toys, you will lose customers and their cash. Similarly, if you do not clean up your filth-infested peanut plant, causing an outbreak of salmonella that kills several, you are shut down and fined at best.

The argument was never about hating Big Oil for the sake of it or because they make too much money. Instead, the argument has always been against hegemonic power — the oil lobbyists who influence and payoff their cronies in Congress, the corrupt agency executives who stray from the mission of their department, the past four presidents who have done either too little or sought to reverse meaningful environmental legislation and regulations. The arguments have been against the deregulation of the energy sector, which leads to increased pollutants and irresponsible short-cuts. Environmentalists recognize that the CEO of a Big Oil company is there to make profits for his/her company and shareholders. But they also recognize that history offers up  a spotted record of pollution and environmental degradation. Environmentalists seek to restore a balance between industry growth and environmental use. The alternative of course, is the rise of green energy technologies that would provide energy at a lower cost to the environment.

Since polluters are not usually willing to voluntarily clean up their processes, governmental regulations are essential. When President Bush called for voluntary environmental regulations in 2004, he was met with anything but willing participants.

However, we never claimed that government intervention was perfect or always efficient; look no further than no-bid government contracts, wasteful bailouts, medicare expenditures due to a poor healthcare system, or big spending on private defense contractors in Iraq.  In fact, the government is usually slow to respond to environmental disasters.

Besides grassroots organization, lobbying polluters, and community involvement, the government has the best tools and resources available to ensure the safety of public goods — clean air, clean water, oil free beaches, pristine national parks, etc.

Let’s face it: government is hard to influence and lobbying costs money. Nothing is free.

On the issue of tax, I think Big Oil and other industries should be taxed heavily. I also think that their tax revenues should be put to good use, not wasted on Wall Street bailouts. Why not implement the windfall tax for the energy industry when the time is right? We should even consider increasing the gasoline tax.

The conflict is decades old. The arguments from both sides are expected. Why inhibit economic growth? Our economic potential is not at full capacity if you set arbitrary regulations. Why should we sacrifice environmental integrity at the expense of extreme economic wealth? Who says material wealth is morally superior to environmental regulation and protection? Why are they even at odds?  

Perhaps the author was right, we do love our cars just like we love our cheap gas prices. But we also value our health, clean-water, national parks and forests, and breathable air. 

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