By Diana Lee
September 1, 2005
As one notorious example of selling out public interest to the oil industry, the Senate has passed the Energy Bill that favors corporate interests by increasing gas prices and enacting toothless policies on oil demand, production and imports. At the heart of the fight in this bill is to allow oil drilling in the Alaskan sanctuary, the Arctic National Wildlife Refuge (ANWR). However, the House of Representatives can reject it by using a deceptive budget maneuver to thwart the Senate’s tacit authorization for Arctic Refuge drilling. Votes are expected within weeks when Congress convenes in September.
In carrying out the legacy of Dwight Eisenhower who designated ANWR as a pristine zone in the United States, Jimmy Carter signed Alaska National Interest Lands Conservation Act (ANILCA) into law in December 1980, establishing more than 100 million acres of national parks, wildlife refuges and forests in Alaska. Since 2001, the Bush administration has been eyeing the sacred domain of ANWR to tap what is believed to be at least 10 billion barrels of oil. In fact, the House energy bill nearly failed to block drilling in the Arctic Refuge last year. More significantly, the majority of Americans, who understand the importance of preserving this unique natural heritage, have continuously opposed opening ANWR for oil exploitation. Even three major oil firms, including ConocoPhillips, the largest oil company in Alaska, have dropped out of the Arctic drilling lobby group. Nevertheless, the Republican-controlled Senate, backing the Bush administration, has been willing to sell the American frontier for a short-term oil gain, despite the foreseen permanent damages to wildlife, nature, and the surrounding environment.
According to the Natural Resources Defense Council (NRDC), the Bush administration has recast hundreds of environmental rules for industrial pollution — 150 destructive policy actions over the past year alone. In fact, Vice President Dick Cheney held Energy Task Force meetings with energy industry leaders whose help shaped the administration’s national energy policy. By enacting ineffective policies to reduce pollution, legalizing the dumping of untreated sewage, and relaxing environmental regulations to explore oil and gas drilling on public lands as well as to allow logging in national forests, this administration in just a few years not only has caused detrimental harm to the lives of people and animals but also irreparable destruction to the environment — poisoning the air we breathe, contaminating the water we drink, and destroying the natural environment we live in.
While Americans, some of them struggling to make ends meet, have been watching the gas pump prices skyrocketing, 24 major U.S. energy companies reported overall net income of $16.7 billion on revenues of $213 billion during the second quarter of 2004 (67 percent increase compared to 2003). According to the “Financial News for Independent Energy Companies,” a jump of 75 percent in net income was also reported for independent oil and natural gas producers, oil field companies and refiner/ marketers. U.S. Energy Information Administration (EIA) claimed that the high net income profit was due to price hikes of natural gas and crude oil, an increase in refining margins of 49 percent year-over-year, and corporate mergers.
How is it that the oil companies could reap enormous profits on dwindling amount of oil supply, as the government had claimed?
The answer lies behind closed doors in Washington, D.C.
According to a report by the Center for Public Integrity, the oil industry has poured more than $440 million over the past six years on politicians, political parties and lobbyists to protect its interests. Since 1998, the oil companies have doled out in total more than $381 million on lobbying activities and more than $67 million in campaign contributions. Evidently, about 73 percent of the industry's campaign donations have ended up in the pockets of Republican candidates and organizations.
The oil corporations wouldn’t mind spending millions to persuade Washington officials in order to make billions in profits. The Center for Public Integrity listed the lobbying expenditures of five largest oil companies over the past six years: ExxonMobil, the world’s largest oil company, has spent $55 million; Chevron Texaco ($32 million); Marathon Oil ($29 million); British oil giant BP ($28 million); and British/Dutch behemoth Royal Dutch/Shell Group ($27 million).
As the top recipient from the oil and gas industry, President Bush took in $1.7 million in cash for campaign contributions — three times the sum given to the next biggest recipient, House Energy and Commerce Committee Chairman Joe Barton, who received $574,000. The overall campaign contributions from the oil firms in the 2002 and 2004 election cycles, largely to Republican candidates, amounted to $29 million.
Although the U.S. holds 5 percent of the world’s population, it annually consumes nearly 25 percent of all the oil produced in the world. According to the EIA report, during the first ten months of 2004, Americans consumed about 20.4 million bbl/d of oil a day — 40 percent was used by passenger vehicles, 24 percent by industry, 12 percent by commercial and freight trucks, 7 percent by aircraft, and 6 percent in residential and commercial buildings. Oil imports, about 12 million barrels per day, accounted for approximately 57 percent of domestic consumption. According to the Oil and Gas Journal, the U.S. placed eleventh in the world, as of January 1, 2005, for proved oil reserves of 21.9 billion barrels stored mainly in four states: Texas, Louisiana, Alaska and California.
Why does the U.S. government continue to import oil instead of tapping the huge domestic oil reserves to ease gas pump skyrocketing prices?
The answer lies behind closed doors in Washington, D.C.
Besides the oil industry on the domestic front lobbying millions of dollars, countries on U.S. oil purchases have been pumping money into Washington to ensure their footing in the lucrative oil market. Since December 2003, OPEC has spent $13.3 million on federal lobbying, $6.6 million of which came from Saudi Arabia. Undoubtedly, Washington has been the hot seat for wheeling and dealing in money politics where avaricious special interest groups and self-serving politicians have much to benefit at the expense of the American public.
With ample data showing that oilfields do ultimately peak and then begin to decline, it’s inevitable that the U.S. crude oil production decreases while oil imports increase to sate Americans’ growing oil consumption. Furthermore, global oil consumption outpaces new oil discoveries, enlarging the gap between supply and demand. At the high rate of increasing oil consumption in wealthy and emerging developing nations worldwide, the precious “black gold” will eventually be depleted. Moreover, the global warming phenomenon, mostly due to fossil fuel pollution trapped in the atmosphere, has already caused weather catastrophes all over the world. The only sensible solution left is to use renewable energy sources.
As a nation that has always touted its NASA program in space exploration, breakthrough in medical and scientific technologies, creative and ingenuous innovations, one would think that the U.S be leading the world in inventing a vehicle that uses renewable energy source. Instead, Japan has put forth the first hydrogen-powered fuel cell car, the Honda FCX, for mass production.
Now, why is the American auto industry so far behind in coming forth with a renewable energy powered vehicle?
And the answer lies behind closed doors in Washington, D.C.