Book: Private Empire: ExxonMobil and American Power

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Three

 

“Is the Earth Really Warming?”

 

On February 8, 2001, nineteen days after George W. Bush’s inauguration as president, ExxonMobil chairman Lee Raymond met with Vice President Dick Cheney in Cheney’s West Wing office at the White House. They knew each other “very well,” as Raymond put it later. Indeed, Raymond had known Cheney for more than two decades, dating back to the period when Cheney was a congressman from Wyoming. They had hunted quail and pheasants together. They were compatible personalities—both reticent, bred on the cold plains of the upper Midwest, and both educated at the University of Wisconsin. They were ardent in their free-market views, inclined to a certain tough bluntness, and not very much worried about what others thought about them, particularly bicoastal media elites and liberal intelligentsia.

During the 1990s, the Cheneys and the Raymonds had lived near one another in the old-line Preston Hollow and Highland Park neighborhoods of Dallas. Cheney served after 1995 as chief executive of Halliburton; his company contracted regularly to provide services to Exxon. (Halliburton did not seek to own and produce oil and gas directly, as ExxonMobil did, but made its money by providing construction and engineering services under contract to oil producers, whether they were government-owned companies or private corporations.) Socially, Raymond’s wife, Charlene, and Cheney’s wife, Lynne, saw each other not only in Dallas, but at retreats and meetings of the American Enterprise Institute for Public Policy Research, a free-market think tank where Raymond served on the board and Lynne served as a senior fellow. When Raymond sat down with Cheney after the latter’s swearing in as vice president, the meeting was best understood as a discussion between like-minded peers and friends who were comparing notes at the cusp of a new project.

“Look,” Raymond told Cheney, as he recalled it later, “my view is this country is going to be an importer [of oil] for as far as the eye can see. If you believe that to be the case, what things can we do?” Raymond answered his own question: “The first thing anybody will tell you is you have to have diversification of supply—you can’t get yourself in the position where you only have one supplier.”

That situation had developed between the United States and the Middle East. To overcome this bottleneck of geopolitical dependency, Raymond said, the United States had to be “engaged every place, every place you can go. . . . Even in the North Slope of Alaska.” Raymond felt that “one of the key issues in foreign policy” was how to manage the challenge of increasing access to new oil supplies. As he recalled it, he told Cheney, “We should be trying to encourage, as a matter of foreign policy, having countries develop their natural resources,” so that the United States could have “as diverse a portfolio of supplies as you can have, so that you don’t get yourself beholden to any one person.”

ExxonMobil had enjoyed easy access to high-ranking government officials during the Clinton administration; when the corporation’s Washington representatives needed a meeting, they almost always got one. Raymond told colleagues that ExxonMobil enjoyed access to the administration that was comparable to the halcyon years of the Reagan presidency. Clinton appointees approved the Exxon and Mobil merger with a minimum of fuss. Al Gore’s candidacy for the White House, however, had attracted considerable resistance from the oil industry, in part because of Gore’s record of environmental activism. Oil and gas companies had donated $34 million to political candidates during the 2000 cycle—more than three fourths of that funding had gone to Republicans.

George W. Bush’s father had made his fortune in the oil patch, and the new president had run a wildcatting firm earlier in his career, less successfully. There was little mystery about how the Bush administration would proceed on energy policy. A few days before his meeting with Raymond, Bush had assigned Cheney to head a cabinet task force to make rapid recommendations. The speed with which the panel planned to issue its findings—just a few months would pass from the panel’s formation to the issuance of a finished report—made the initiative recognizable to Washingtonians as one of those precooked packages where the authors know much of the outcome in advance. The purpose of such a task force is typically not to deliberate over difficult problems, but to create a process whereby Congress, industry, and the incoming cabinet all become invested in a set of recommendations formally endorsed by a new president. These can then be quickly translated into executive orders, new regulations, and proposed laws.

Cheney ordered the task force to work in secret, to protect the prerogatives of the White House, and by doing so he made the group’s work a lightning rod for criticism and conspiracy fears. It took years of litigation to discover through partial document releases what intuition might have suggested at the time: Cheney favored energy deregulation and an aggressive push to open up oil and gas production in the United States, and he identified himself with the priorities of Lee Raymond, among other industry executives.

James J. Rouse, a United States Army veteran educated in Mississippi who ran ExxonMobil’s Washington, D.C., office, attended one of the Cheney panel meetings next door to the White House and presented some of the corporation’s forecasts about future global energy demand. It was rising, he noted, and so more oil and gas production would be required. But ExxonMobil did not require access to a midlevel panel staffed by civil servants to make its points to the Bush White House. Lee Raymond flew to Washington about every other month and met privately with Cheney on some of his visits, perhaps two or three times a year. If he needed to make a request or share an observation more urgently, all he had to do was pick up the telephone.

Cheney had seen for himself at Halliburton how geopolitics, resource nationalism, and the emergence of large state-owned oil companies had pinched Western oil companies as they attempted to replace the equity reserves they pumped and sold each year. One purpose of the preconceived energy task force Cheney led was to prepare for legislation designed to open up Alaska’s Arctic National Wildlife Refuge to oil drilling. Raymond supported Cheney’s plan and railed regularly in public against what he regarded as the self-defeating energy policies of the United States, which restricted access to oil and gas on free-market American territory while exacerbating the country’s dependency on imports from unstable and nationalistic regimes. Compared with other oil majors, however, ExxonMobil was no longer a dominant player inside the United States. Chevron had inherited some of the longest-lived of Standard Oil’s American oil properties, in California, and Chevron and British Petroleum had moved more boldly than Exxon into the Gulf of Mexico when leasing opened during the Clinton administration. Exxon had opportunities to exploit oil and natural gas in Alaska, but held back from some expensive deals because Raymond had learned after the Valdez that the political risks posed by Alaska’s frontier-minded political culture and populist governors were comparable to those in West Africa.

Buoyed by the trust embedded in their long-lived friendship, Raymond and Cheney typically talked less about domestic oil policy issues than about developments overseas in the world’s best-endowed regions. Raymond might report on conversations he had recently had with the president of Kazakhstan or the foreign minister of Saudi Arabia. He might relay to Cheney insights about the Saudi royal court or requests about some problem Saudi leaders were having with the Bush administration. Cheney might share similar notes from his own conversations with foreign leaders. In protocol, power, and habit of mind, Raymond and Cheney were each, in effect, deputy heads of state—when they traveled, they met with kings and presidents, and perhaps ministers or chiefs of national oil companies, but rarely anyone less powerful. When the friends gathered in Washington, their meetings were strictly business. If Raymond needed only ten minutes to make his request about a Kazakh trade issue, for example, and Cheney was quickly satisfied with the ExxonMobil chief’s arguments, Raymond would not waste the vice president’s time any further. In the White House, a one-hour meeting was a lengthy one, and Lee Raymond knew what it was like to have a daily schedule that was oversubscribed.

ExxonMobil’s interests were global, not national. Once, at an industry meeting in Washington, an executive present asked Raymond whether Exxon might build more refineries inside the United States, to help protect the country against potential gasoline shortages.

“Why would I want to do that?” Raymond asked, as the executive recalled it.

“Because the United States needs it . . . for security,” the executive replied.

“I’m not a U.S. company and I don’t make decisions based on what’s good for the U.S.,” Raymond said.

ExxonMobil executives managed the interests of the corporation’s shareholders, employees, and worldwide affiliates that paid taxes in scores of countries. The corporation operated and licensed more gas stations overseas than it did in the United States. It was growing overseas faster than at home. Even so, it seemed stunning that a man in Raymond’s position at the helm of an iconic, century-old American oil company, a man who was a political conservative friendly with many ardently patriotic officeholders, could “be so bold, so brazen.” Raymond saw no contradiction; he did indeed regard himself as a very patriotic American and a political conservative, but he also was fully prepared to state publicly that he had fiduciary responsibilities. Raymond found it frustrating that so many people—particularly politicians in Washington—could not grasp or would not take the time to think through ExxonMobil’s multinational dimensions, and what the corporation’s global sprawl implied about its relationship with the United States government of the day.

After the merger, ExxonMobil moved its Washington, D.C., office from Pennsylvania Avenue to K Street, in the heart of the capital’s lobbying district. The office occupied one high floor of a new complex constructed from pink granite and concrete. A turret, topped by an American flag, distinguished the building from the LEGOLAND of downtown Washington. Landscape paintings lined the walls of ExxonMobil’s suite; antique Mobil oilcans and Esso signs decorated the shelves of its conference rooms. The furniture and dark cherry wood paneling created a formal and professional atmosphere, but the office eschewed the garish luxuries of the capital’s big law firms and the D.C. outposts of Wall Street investment banks.

By the time of the merger with Mobil, the office’s director, James Rouse, had been with the company for thirty-seven years. The résumés of the lobbyists he hired spoke of technical competence and stolidity. ExxonMobil’s strategy was not so much to dazzle or manipulate Washington as to manage and outlast it.

The Washington office functioned not only as a liaison to the White House and Congress, and to industry associations such as the American Petroleum Institute, but also as a kind of embassy, to deepen ExxonMobil’s influence and connections in the foreign countries where it did the most business. International issues managers developed contacts with ambassadors and commercial representatives of foreign embassies. As this international group in the K Street office expanded, Robert Haines, a West Point graduate and Vietnam veteran, handled Asian embassies; Sim Moats, a former State Department diplomat, handled Africa; and Oliver Zandona, a Mobil career manager, watched the Middle East. They also worked the American bureaucracy, particularly the State Department and the National Security Council, to influence and understand U.S. policy. They maintained some contacts at the Central Intelligence Agency and other federal intelligence departments as well. The C.I.A. ran a station in Houston, where oil industry executives who traveled globally occasionally stopped by for informal exchanges about leaders and events abroad, but in Washington the corporation’s lobbyists tried to keep their distance from Langley, site of the C.I.A.’s headquarters, for fear that host governments where the corporation produced oil might mistake ExxonMobil as some sort of wing of the spy agency.

ExxonMobil relied mainly on lifelong career employees for much of its Washington lobbying. Lee Raymond kept the number of full-time lobbying staff relatively modest, partly to avoid attracting unfavorable attention from journalists or opponents in the environmental lobbies. Where possible, the corporation lobbied as part of an industry coalition, principally through the American Petroleum Institute. Yet Raymond maintained a strong core of ExxonMobil staff to work Capitol Hill, the White House, and regulatory agencies. Many of the corporation’s employee-lobbyists rotated into Washington from other corporate disciplines, with little or no prior experience of government affairs. “I think we did it in-house so we could get it done right,” said Joseph A. Gillan, who worked on environmental issues in the office around the time of the Mobil merger. “Exxon’s culture was, ‘Let’s do it ourselves.’”

The corporation did retain Washington law firms and outside lobbying shops as consultants, although relatively few during the first Bush term. But these hired guns dispensed advice to ExxonMobil on contracts and were not typically relied upon to deliver access—some of the outside retainers were even forbidden from attending meetings with public officials. Some of the key outsiders on retainer—former oil-friendly senators such as Don Nickles of Oklahoma and J. Bennett Johnston of Louisiana—attended a weekly meeting at ExxonMobil’s office to exchange intelligence and analysis about legislation, electoral politics, and energy issues. The meetings sometimes had an air of jockeying and showboating as the lobbyists competed to show how much inside knowledge they possessed (and therefore how much value their retainer contracts generated for the oil corporation). The corporation spent heavily on its Washington operation, but the great majority of its costs involved salaries and benefits for career employees. In 2001, ExxonMobil spent $6 million on its lobbying operation, but only $300,000 on outsiders. The next year, it spent $8.3 million in total, but only another $300,000 on contractors.

Rouse oversaw only one lobbyist to watch the entire House of Representatives: Jeanne O. Mitchell, a University of Florida graduate, a cheerful woman who briefed ExxonMobil’s policy and tax PowerPoint slides with genuine enthusiasm. Her counterpart for lobbying the Senate, William “Buford” Lewis, was a balding specialist in gasoline and other transport fueling systems.

Lobbyists and consultants newly hired at the office were instructed that ExxonMobil sought to avoid asking for specific favors, such as earmarks, on Capitol Hill. “We don’t need the government’s help” was the prevailing instruction. “We just want to know the rules of the road.” The line used to indoctrinate new arrivals to the Washington office was that ExxonMobil did not want anything from the American government, but it did not want the government to do anything to the company, either. Lee Raymond saw his Washington operation as being 180 degrees opposite from, say, General Electric, which ExxonMobil executives regarded as a Washington rent seeker, always trying to bend Congress and the administration to policies that would subsidize or enhance G.E. business divisions. When Raymond saw G.E.’s celebrity chief executive, Jack Welch, he did not hesitate to give him a hard time about his corporation’s favor seeking in Washington. In fact, Raymond was kidding himself. There were many favors, executive orders, lobbying meetings, and laws ExxonMobil sought and obtained from the American government. Yet the above-it-all slogans imparted to newcomers did reflect the corporation’s aversion to back-room deal making on legislation in Congress. ExxonMobil had long had a policy of refusing to give rides to members of Congress on its fleet of corporate jets. The advantage of advertising an official, declared policy of asking for no favors from members of Congress, Raymond explained, was that “when they come and ask us for favors, we can say no.” The corporation’s typical lobbying meeting on the Hill involved briefing and then leaving behind preprinted PowerPoint slides vetted in Irving. When ExxonMobil lobbyists looked for serious help, they more often turned to the executive branch, discreetly.

A sardonic line among ExxonMobil lobbyists in the Washington office held that the corporation’s number-one issue of concern was taxation; its number-two issue was tax; its number-three issue was tax; and its number-four issue varied from year to year. With gross global revenues well north of $200 billion, even small changes in the U.S. corporate tax code could cost ExxonMobil dearly. Raymond instructed the K Street office not to ask for specific tax earmarks, but to concentrate on preventing unfavorable changes in the code, such as oil industry–specific windfall taxes or changes to depreciation rules that might raise ExxonMobil’s effective tax rates—this lobbying work was often defensive and involved trying to talk industry-friendly coalitions in Congress into blocking unfavorable changes.

ExxonMobil’s lobbyists operated within the same disciplined, hierarchical corporate system that refinery managers and offshore drilling platform operators did. Their talking points could be mechanical sounding: “This is what the corporation believes is the best course of action.” In the scrum of final conference talks over a particular bill, if Jeanne Mitchell or Buford Lewis was asked for an opinion about an alternative option to the one she or he had briefed, the ExxonMobil lobbyist would simply repeat the talking points and conclude again: “This is what the corporation believes is the best course of action.” A lobbyist for another oil corporation recalled, “You’d think, ‘Why do I feel like I’m talking to a wall?’ Because you are: They can’t move off a position” without permission from headquarters. They were “honest as the day is long,” recalled a former Republican staffer, speaking of the corporation’s Washington staff. “Sometimes blunt.”

ExxonMobil commanded the in-house expertise “to run to ground all the possible technical arguments around a particular policy area,” said an industry advocate. “They have people there who can talk about epidemiological studies down to the parts per billion.” Yet the Washington office’s influence was also limited by its rigidity and perceived arrogance. “They have a terrible reputation and they deserve criticism for having allowed that to develop,” reflected a Republican lobbyist who worked with them. “They very much have the opinion that ‘We are ExxonMobil; we’re right. And we will prevail.’ In Washington, it doesn’t always work that way. Most people don’t understand the economics of energy and ExxonMobil hasn’t explained that very well. They have the money to educate people but they don’t do it very well.”

ExxonMobil’s Washington strategists divided the capital’s political population into four broad tiers, in descending order of sympathy for Irving’s agenda. There were those who represented or otherwise had emerged from the oil patch, where many thousands of jobs were at stake—senators and congressmen from Texas, Louisiana, Oklahoma, and Wyoming, some of them industry veterans. This group included, after 2000, President George W. Bush and Vice President Dick Cheney. The second tier consisted of free-market Republicans who didn’t particularly understand the oil and gas industry, but who usually would be supportive of the industry’s positions. The third tier consisted of Democrats or liberal Republicans who tended not to trust ExxonMobil and its ilk, and who regularly voted against the corporation’s interests, but who had been around Washington long enough to become pragmatic about oil industry issues; they were at least open to constructive discussion and might occasionally vote the industry’s way. ExxonMobil’s lobbyists and executives cultivated ties and made generous campaign contributions to all three of these Washington subspecies. Lee Raymond had friendships with industry-leaning Democrats—Representative John Dingell, the longtime automotive industry champion from Michigan, for example.

Then there was tier four: the enemy, as some of the military veterans who manned ExxonMobil’s Washington office did not mind putting it from time to time. These were Democrats and environmental activists who, it seemed to the corporation’s executives, wanted to disenfranchise ExxonMobil and to use the corporation’s unpopularity to galvanize liberal constituents and funders. These activists did not believe in the legitimacy of the profit motive, in the estimation of some ExxonMobil executives. Senators Charles Schumer and Dick Durbin fell into this category; Senator Hillary Clinton, on the other hand, did not. Lee Raymond accepted that there was not much he could do about the company’s permanent opposition in Washington; these people were not going to change their views. Nor should ExxonMobil bend to them. Clifton Garvin’s flirtation with solar investments during the Carter administration was regarded within the corporation as an object lesson in what not to do. Even Raymond accepted that it had made sense for Garvin to explore alternative energy businesses during the oil supply upheavals of the 1970s, but the lesson, he believed, was that alternatives to oil were not economically competitive and would not be for the foreseeable future. The corporation should stick to its core expertise and not chase after fleeting political or policy fashions. “In hindsight it appeared that we were abdicating who we were,” Raymond recalled. “Presidents come and go; Exxon doesn’t come and go.”

Some of ExxonMobil’s Washington lobbyists also believed that the most extreme anti-oil activists could be contained only by direct counterattack and pressure. There was no sense in pretending otherwise, they argued. The industry’s uncompromising opponents had to be taken on uncompromisingly.

As the Bush administration took office, one issue was rising in Washington that was of far-reaching, even existential importance to the oil industry, an issue that would test ExxonMobil’s lobbying prowess: climate change. As policy debates about global warming intensified, two men, one in government and the other in industry, would increasingly distinguish themselves by their ardent skepticism toward climate scientists and their opposition to all government regulation: Dick Cheney and Lee Raymond.

In a large color ad taken out in Life magazine in 1962 by ExxonMobil’s precursor Humble Oil, a small, smartly dressed cartoon character saluted a photograph of a majestic glacier. “Each Day Humble Supplies Enough Energy to Melt Seven Million Tons of Glacier!” the ad’s headline declared.

Such was the John F. Kennedy era of scientific optimism, as marketed by Madison Avenue. Four decades later, of course, many scientists regarded the retreat of glaciers and mankind’s unembarrassed capacity to melt them as signs of a slowly unfolding global catastrophe. (Of the 144 glaciers monitored by researchers between 1900 and 1980, 2 advanced and 142 retreated, an indicator of the earth’s warming surface temperature during the twentieth century.) Climate change became a galvanizing priority of science and public policy in a remarkably short time. It took less than two decades from the time of Humble’s ice-melting ad campaign for Exxon’s executives to recognize that climate change would arrive as a public policy challenge in Washington and other global capitals, and that it might undermine the corporation’s business model. Characteristically, Exxon began to prepare itself well before the phrase “global warming” saturated public consciousness.

The “greenhouse effect” is a natural process in which sunlight is trapped by the planet’s atmosphere; without it, the earth would be very cold. The question that scientists gradually examined during the twentieth century was whether additional gases released by the clearing of forests and the burning of fossil fuels—coal, oil, and natural gas—accelerated the greenhouse effect. It was not until the 1950s and 1960s that a few scientists began to document credibly that human activity was releasing more and more carbon dioxide, a greenhouse gas, and that warming might be the result. Their findings did not immediately stick. The earth’s climate had undulated across millennia. Orbital variations, the intensity of sunlight, and other natural factors had produced alternating ice ages and periods of boiling seas long before the rise of smokestacks and automobiles. Scientists remained divided as late as the 1970s about essential questions such as whether the earth was warming markedly, whether a warming or cooling trend posed the greatest future danger, and how human and industrial activity fit into the picture.

James Hansen, an astrophysicist at the National Aeronautics and Space Administration, was among the first scientists to call attention to the danger that greenhouse gas emissions could produce dramatic warming within a relatively short time. His and other work prompted the first National Academy of Sciences examination in 1979. The academy’s study group found that if man-made CO2 emissions—from coal-burning electricity plants, automobile exhaust, truck fumes, airplane exhaust, deforestation, and other sources—continued to grow, there was “no reason to doubt that climate changes will result and no reason to believe that these changes will be negligible,” as the chairman of a study for the National Research Council’s Climate Research Board put it. The findings might be “disturbing to policymakers” because “a wait-and-see policy may mean waiting until it is too late.”

The National Academy report attracted Exxon’s attention. Any effort to tax, limit, or eliminate carbon dioxide emissions on environmental grounds would have obvious implications for Big Oil. Exxon emitted tens of millions of metric tons of carbon dioxide in the course of its own oil production, refining, chemical manufacturing, and electricity-generating operations. Not only did the corporation burn carbon-laden fuels, it then sold such fuels for profit to other users, who also burned them.

In 1980, just after the publication of the National Academy study, the corporation hired its own astrophysicist, Brian Flannery, who had taught at Harvard University. A few years later Flannery recruited a chemical engineer named Haroon Kheshgi, who had worked at the Lawrence Livermore National Laboratory. Flannery and Kheshgi started to produce, while salaried employees for Exxon, peer-reviewed research for the United Nations’s Intergovernmental Panel on Climate Change, or I.P.C.C. This was a network of many dozens of mostly academic and government scientists established to create definitive assessments, at multiyear intervals, of the scientific evidence about global warming. Exxon’s climate scientists also used corporate funds to support climate-modeling research at the Massachusetts Institute of Technology. They produced internal assessments of the scientific and policy questions for Exxon’s Management Committee. In the early years of this Exxon climate work, constructing an accurate model of future Earth temperatures seemed daunting. When Flannery arranged contracts with the M.I.T. climate modelers, he told them, by his own account, “Embrace the uncertainty in all of this.”

Lee Raymond had no particular background in climate science, but as a chemical engineer whose doctoral thesis had concerned mathematical modeling, he considered himself adequately qualified to reach his own judgments on the underlying scientific questions. (He was the first Exxon chief executive to have a doctorate.) At the University of Minnesota, where he had earned his advanced degree on a scholarship, his academic mentor, Neal Amundson, a renowned figure in chemical engineering, had instructed him, “Science is science, and don’t let these damn politicians ever screw you up.”

During the 1980s, when global warming first emerged as a public policy matter, Raymond turned to the scientists in Exxon’s oil exploration department, who by profession studied the history of the planet. The corporation’s scientists told him that climate measurements on Earth were very recent relative to the planet’s longevity, and that this was a reason to be skeptical about extrapolating data.

Raymond also entered the incipient climate debate with deep skepticism about nonpolluting alternatives to oil and gas such as solar and wind power, which were relatively costly but might seem more attractive if climate change was a concern. “I’ve been there and done that,” Raymond would say of his history with green technologies. He was referring to successive management assignments he undertook during the late 1970s and early 1980s. In one, he served as second-in-command at New York–based Exxon Enterprises, which housed alternative energy initiatives, including solar power. The division had been conceived during the 1960s as a kind of in-house venture capital arm that might incubate new and profitable businesses outside of oil and gas. The embargoes and oil price shocks of the 1970s made this goal seem all the more appealing. Exxon went into the office equipment business, selling electronic typewriters, fax machines, ink-jet printers, flat-panel displays, voice recognition hardware, home computers, and computer chips. The corporation studied the possibility of merging with Bristol-Myers, the drug maker; Colgate-Palmolive, the consumer products giant; and Hewlett-Packard, the computer company. In retrospect, such diversification looked like folly to oil industry strategists, but at the time, it was a corporate fashion.

Raymond’s contribution to Exxon’s experimental thrust was to recommend that it be shut down. He dumped the corporation’s solar investments. Any business that required government subsidies to be viable was not for Exxon, he declared.

In the summer of 1988, amid a record-breaking heat wave, James Hansen testified before Congress about the findings of a paper he had coauthored with six other N.A.S.A. scientists. Using three different forecasts of releases of CO2 into the atmosphere during the century to come, Hansen and his colleagues predicted that even in the best case, future temperature changes would be “sufficiently large to have major impacts on people and other parts of the biosphere.”

His work fortified the first attempt by governments to regulate greenhouse gases. Delegates to the 1992 Rio Earth Summit negotiated a treaty, the United Nations Framework Convention on Climate Change. President George H. W. Bush signed the agreement, and the United States Senate ratified it. The treaty divided the world’s governments into categories, distinguishing between wealthy industrialized countries and poorer, industrializing ones. It embraced the principle that wealthy countries should pay the greenhouse gas reduction costs of poorer countries, on the grounds that the privileged nations had created much of the problem in the first place and could afford to fix it, whereas it would be unfair to penalize or restrain the industrial growth of poor countries as they tried to lift their citizens out of poverty. The convention exacted no binding commitments from any of its parties. However, the governments and leaders of industrialized countries, including President George H. W. Bush, pledged to adopt national policies that would “aim” to reduce their overall greenhouse gas emissions to 1990 levels by the year 2000.

Three years later, the United Nations’s assessment group, the I.P.C.C., reported that most of the observed warming on Earth’s surface since 1950 was likely to have been caused by human and industrial activity. “The balance of evidence . . . suggests a discernible human influence on global climate,” its summary report stated.

Lee Raymond publicly rejected even the qualified formulations of the 1995 assessment. In October 1997 (which would prove to be the fifth-warmest year on the planet, to that point, since the mid-nineteenth century), he flew to Beijing to deliver a speech to the Fifteenth World Petroleum Congress, an event hosted by the People’s Republic of China. At the time, the Clinton administration was in the last round of international negotiations that would produce the Kyoto Protocol, an enhancement of the 1992 Framework Convention, with commitments that would require rich governments to reduce their emissions. Raymond’s purpose in Beijing was to denounce the Clinton administration’s negotiating position. He devoted thirty-three paragraphs of his seventy-eight-paragraph speech to the argument that evidence about man-made climate change was an illusion and that a binding agreement to reduce greenhouse gas emissions was therefore unnecessary:

 

Is the Earth really warming? Does burning fossil fuels cause global warming? And do we now have a reasonable scientific basis for predicting future temperature?

In answer to the first question, we know that natural fluctuations in the Earth’s temperature have occurred throughout history—with wide temperature swings. The ice ages are a good example.

In fact, one period of cooling occurred from 1940 to 1975. In the 1970s, some of today’s prophets of doom from global warming were predicting the coming of a new ice age. . . . The Earth is cooler today than it was twenty years ago.

We also have to keep in mind that most of the greenhouse effect comes from natural sources. . . . Only four percent of the carbon dioxide entering the atmosphere is due to human activities—96 percent comes from nature.

Leaping to radically cut this tiny sliver of the greenhouse pie on the premise that it will affect climate defies common sense and lacks foundation in our current understanding of the climate system. . . . It is highly unlikely that the temperature in the middle of the next century will be affected whether policies are enacted now or 20 years from now.

 

He went further: He urged poor, rapidly industrializing countries such as China to defy the United States and Europe by blocking any agreement in Kyoto that would result in “slower economic growth, lost jobs, and a profound and unpleasant impact on the way we live.” China and other developing nations might be exempted from the treaty’s direct economic costs, but this “will not prevent them from being hurt. Their exports will suffer as the economies of industrialized nations slow. So all of us would suffer from these proposals.” Moreover, China and other poorer countries had an obligation, on behalf of their impoverished citizens, to ignore the fears of environmentalists comfortably ensconced in the wealthy West, Raymond argued:

 

The most pressing environmental problems of the developing nations are related to poverty, not global climate change. Addressing these problems will require economic growth, and that will necessitate increasing, not curtailing, the use of fossil fuels.

 

It was extraordinary for the chief executive of a U.S.-headquartered multinational to lobby against a treaty he disliked by appealing to a Chinese Communist government, among others, to adopt a negotiating position opposed to a sitting American president.

Raymond believed, however, that his obligation as Exxon’s chief executive was not primarily to support American diplomacy—and certainly not when he disagreed with its assumptions so profoundly. The Beijing address was “seminal,” recalled Frank Sprow, a senior Exxon executive who worked closely with Raymond on the climate issue.

Exxon’s message was that governments should avoid steps that would curtail economic growth. Raymond adamantly believed that Kyoto was both an impractical and an unjust economic agreement—impractical because it would require the United States to make sacrifices in its national way of life that its people would never undertake, and unfair because it laid too much of the climate policy burden on developing economies whose governments had an urgent moral duty to lift their people out of poverty, which required, in his estimation, burning fossil fuels.

Exxon might withstand the financial and business burdens that would likely follow from treaty-imposed limits on greenhouse gas emissions, but Raymond feared that the global economy would slow markedly and the knock-on effects of reduced growth would hurt the oil industry and the country. He also viscerally resented what he regarded as the fear-mongering of the environmentalist movement. Only by hyping the threat could they justify immediate, even drastic policy intervention: “Just give me a break!” Raymond told his colleagues.

“They had come to the conclusion that the whole debate around global warming was kind of a hoax,” said an executive who had direct access to Raymond. “Nobody inside Exxon dared question that.”

China and scores of other poor countries ignored Raymond’s pleadings and signed the Kyoto Protocol, along with the United States, in December 1997. Thirty-seven industrialized nations, including America, accepted binding targets (although without any enforcement mechanism) that between 2008 and 2012, they would reduce their emissions 5 percent below 1990 levels. For the first time—almost two decades after the first National Academy of Sciences study had suggested that climate change might be “disturbing to policymakers”—a regime to control greenhouse gas emissions threatened to impose real costs on industrial corporations like Exxon.

Arthur G. “Randy” Randol III, who served as ExxonMobil’s senior environmental adviser in Washington at the time, led climate lobbying for the corporation’s K Street team. Randol had earned his doctoral degree in nuclear engineering at the University of Florida in Gainesville. During the 1990s, he had immersed himself in the issues around climate change. A large man, he could be blunt in argument. He was “brilliant,” an admiring colleague said, but he had “a reputation for being pretty aggressive. Lots of people in Washington are very polite in meetings, and Randy is a bull in a china shop.” He could “talk about climate studies and carbon technology projects the way other people I know talk about the 1986 Red Sox outfield,” another colleague recalled.

For political cover, Exxon increasingly worked the climate account through the American Petroleum Institute, the industry trade and advocacy group. Randol provided technical expertise, while Raymond offered authority and funds. During the late 1990s, with emphatic support from Exxon, climate became the “eight-hundred-pound gorilla” within the institute, a “really, really big issue—bigger than anything else,” a former executive recalled. The oil industry did not want “to risk a reduced reliance on petroleum based upon provisional science, emerging science, or based upon harmful public policies,” as Philip Cooney, an A.P.I. attorney who worked on climate policy at the time, put it. Lee Raymond took the lead within A.P.I., strengthened by the expertise of Exxon’s in-house astrophysicist, Brian Flannery.

They recognized that if they oiled the opposition to Kyoto in Washington—if they allowed environmental groups to frame the issue as one pitting greedy oil corporations against planet Earth—they would undermine their own interests. To evade direct assaults by environmentalists, Exxon and other A.P.I. members joined a newly invented and more broadly based group, the Global Climate Coalition, with influential members from every part of the country and many different industries. Exxon and Royal Dutch Shell joined, but so did the Aluminum Association, General Motors, Ford, and DaimlerChrysler. They won endorsements from autoworkers concerned that Kyoto would lead to American job losses. During the last years of the Clinton administration, the coalition became “the most effective industry association I’ve ever seen at working to block progress on climate change,” Kert Davies, the research director for Greenpeace, said later. Under Raymond’s spur, A.P.I. also poured money into independent think tanks and advocacy groups that were predisposed to attack Kyoto, or were invented for the purpose by individual anti-Kyoto campaigners aligned with industry. Their strategies emphasized “the promotion of free-market principles,” as the institute’s lawyer, Phil Cooney, later put it.

Greenpeace launched its own well-funded campaign to strengthen Kyoto. In the United Kingdom it attacked British Petroleum. In the United States it focused its efforts on the Global Climate Coalition’s most unpopular member: Exxon.

From Greenpeace’s Washington, D.C. office, the group’s highly committed activist cadres scoured the capital for evidence that might discredit their oil-funded opponents. An allied group, the National Environmental Trust, dug up an A.P.I. document suggesting that the oil industry association had decided to rerun the tactics of the tobacco industry. Between the 1960s and 1980s, that industry had spent millions of dollars to fund dissident scientists and think tanks willing to challenge scientific evidence about smoking’s dangers.

The document was an “Action Plan” drafted by the American Petroleum Institute’s Global Climate Science Team that called for up to $7.9 million in spending to influence public opinion about Kyoto. It declared that “victory” would be achieved when:

 

Average citizens “understand” (recognize) uncertainties in climate science;

Recognition of uncertainties becomes part of the “conventional wisdom”;

Media “understands” (recognizes) uncertainties in climate science;

Media coverage reflects balance on climate science and recognition of the validity of viewpoints challenging the current “conventional wisdom”; . . .

Those promoting the Kyoto treaty on the basis of extant science appear to be out of touch with reality.

 

The document also recommended that A.P.I. “identify, recruit, and train” a team of scientists “who do not have a long history of visibility and/or participation in the climate change debate” and fund them to “add their voices to those recognized scientists who already are vocal.”

This, increasingly, was the underlying structure of Washington policy debates: a kaleidoscope of overlapping and competing influence campaigns, some open, some conducted by front organizations, and some entirely clandestine. Strategists created layers of disguise, subtlety, and subterfuge—corporate-funded “grassroots” programs and purpose-built think tanks, as fingerprint-free as possible. In such an opaque and untrustworthy atmosphere, the ultimate advantage lay with any lobbyist whose goal was to manufacture confusion and perpetual controversy. On climate, this happened to be the oil industry’s position.

Raymond’s public affairs chief, Kenneth P. Cohen, directed a network of allies and grantees in Washington who created havoc in the climate science debate. Walt Buchholtz, like Cohen a veteran of Exxon’s Chemical Company, served as a policy adviser to The Heartland Institute, a Chicago-based free-market group that frequently published tracts challenging the scientific basis for global warming fears. The Competitive Enterprise Institute, on L Street, received hundreds of thousands of dollars from Cohen’s department; its free-market advocates filed lawsuits challenging the implementation of climate reviews by the Clinton administration, on the grounds that the scientific data relied upon was unreliable. Exxon provided $373,500 in 1998 and 1999 to the Annapolis Center for Science-Based Public Policy, a nonprofit that backed some of the most prominent scientists skeptical of mainstream science on climate; the center would eventually honor Oklahoma senator James Inhofe, the Congress’s most ardent doubter of global warming, for his work in promoting “science-based public policy.” The individuals writing and lobbying in the network Exxon funded described themselves as honest, libertarian skeptics who had the courage to challenge conventional scientific wisdom. They did not feel polluted by the receipt of Exxon money any more than liberal-minded campaigners might feel polluted by the receipt of grant funding from, say, the George Soros–backed, left-leaning philanthropy, the Open Society Institute. Relatively few of the thinkers in the network aligned with Exxon’s views were climate scientists, however. They typically concentrated on economics and public policy matters. The books authored by members of this movement included titles such as Red Hot Lies: How Global Warming Alarmists Use Threats, Fraud, and Deception to Keep You Misinformed and The Global-Warming Deception: How a Secret Elite Plans to Bankrupt America and Steal Your Freedom. Inside ExxonMobil’s K Street office, the sense among some of the lobbying staff was that a lot of this provocative activity was being stoked by the public affairs department in Irving with the idea that it would please the boss, Raymond, whose views on climate policy were well known; a few worried that the fringe campaigners might ultimately endanger shareholders by creating litigation or regulatory risk for the corporation.

The A.P.I. internal documents rooted out by investigators for environmental groups did not contain the kind of smoking-gun evidence about climate science that was earlier unearthed from the tobacco companies. The tobacco industry’s documents made clear that corporate scientists knew that smoking was harmful, but nonetheless buried the facts and published misleading studies. In the case of the emerging controversies over climate, there was no evidence that A.P.I. or Exxon maliciously distorted in-house scientific research. The corporation’s advocacy campaigners were now inching toward dangerous legal territory, but in the main, the “Action Plan” documented a subtle strategy involving the use of money to advance corporate interests by exploiting the uncertainties and argumentation that can be innate to science.

On May 31, 2000, in Dallas, six months after the Mobil merger, Lee Raymond stood before the first annual meeting of ExxonMobil shareholders—an unruly gathering of religious leaders, environmentalists, and other dissidents who regularly used the meeting, which was required by law, to pressure Raymond over his corporation’s public policies, particularly on the environment, alternative energy, and climate. One such activist had just accused Raymond of ridiculing those in the audience who disagreed with him.

“I’m not ridiculing anybody,” Raymond answered. “And I resent the assertion that I am. We have a difference of view. This is a democracy. . . . And frankly, I’m not interested in being ridiculed. . . .”

Another speaker demanded “a long-term solution to global warming”; applause erupted.

Raymond possessed no impulse to restrain himself on this subject. “If the data were compelling, I would change my view,” he once said. “Ninety percent of the people thought the world was flat. No?”

Now, Raymond went further than he had ever gone in locating his corporation’s place in the global warming debate.

“Mark, would you provide me a slide on the seventeen thousand scientists?” Raymond asked an aide.

A slide duly flashed on a wide screen. It depicted a petition organized by anti-Kyoto campaigners and signed by thousands of scientists. The idea was to demonstrate that many respectable scientists doubted key aspects of the I.P.C.C. consensus about the likelihood of human contributions to global warming. The petition’s credibility had already been undermined by testimony presented to Congress demonstrating that its signatures included those of pop musicians such as the Spice Girls and James Brown. If Raymond knew about these problems, he did not care.

“This is a petition signed by seventeen thousand scientists. . . . ‘There is no convincing scientific evidence that any release of carbon dioxide, methane, or other greenhouse gases is causing or will in the foreseeable future cause catastrophic heating of the earth’s atmosphere and disruption of the earth’s climate.’ So, contrary to the assertion that has just been made that everybody agrees, it looks like at least seventeen thousand scientists don’t agree. My point is not that these seventeen thousand are right and you’re wrong. Your point is you’re right and I’m wrong. I’m not saying you’re wrong. What I am saying is there is a substantial difference of view in the scientific community as to what exactly is going on. . . . We’re not going to follow what is politically correct. . . .”

He went on. “Mark, would you first give me the three-thousand-year slide?”

Another image flashed on the screen. It showed lines undulating on a graph.

“That’s the earth’s temperature as best these scientists are able to estimate what it was for the past three thousand years,” Raymond continued. “It’s been a long time since I went to graduate school. But if you just eyeball that, you could make a case statistically that, in fact, the temperature is going down.

“I’m not asserting that. Similarly, I reject the assertion that it’s going up.”

The 2000 presidential campaign was a dead heat to the finish. Al Gore, concerned about winning coal states, muted his views about the dangers of global warming. The handful of quotations and policy statements George W. Bush offered on climate were rife with contradictions. Asked about global warming during a debate with Gore, he said that “it’s an issue that needs to be taken very seriously,” but he also suggested that some climate scientists were “changing their opinion a little bit,” without explaining himself further. Bush denounced the Kyoto Protocol as too harmful to industrialized countries like the United States, but his campaign also issued a policy document urging mandatory reductions of four major pollutants, including carbon dioxide. Bush’s decision to name CO2 as a pollutant suggested that he might accept Kyoto’s broad goals.

After his inauguration, in addition to Vice President Cheney’s energy policy task force, the president named a less-publicized cabinet-level working group to review climate change science and policy. The members included Secretary of State Colin Powell, Treasury Secretary Paul O’Neill, Commerce Secretary Don Evans, Energy Secretary Spencer Abraham, and Christine Todd Whitman, head of the Environmental Protection Agency. Cheney also took part. John Bridgeland, director of the White House’s Domestic Policy Council, and Gary Edson, a deputy national security adviser, organized the work. They recruited a half dozen career climate scientists working in federal departments to move temporarily to the Eisenhower Executive Office Building, next to the White House. There they organized climate science and policy briefings for the new cabinet members.

“It was a heady time,” recalled one of the participating scientists, Aristides Patrinos. “The potential was so great.” He and other career scientists summoned to the White House had concluded, on the basis of the evidence from the campaign and the transition, that Bush shared their sense of urgency about the need to control greenhouse gases. Because the president was a Republican with a background in the oil industry, Patrinos thought, “This was like when [Richard] Nixon went to China—Bush could really be the one who would do something with respect to climate change.”

Patrinos and his colleagues delivered science lectures to the cabinet group at rotating sites—one time at State, the next at Agriculture, and so on. James Hansen of N.A.S.A. delivered one private lecture; James Edmonds of the Pacific Northwest National Laboratory gave another concerning the mix of policies and technologies that might be required to stabilize greenhouse gas concentrations. During these sessions, which were unpublicized and closed to all but senior staff, Patrinos was impressed at how open-minded some of the cabinet members, such as Colin Powell and Don Evans, seemed to be. As the lectures went on, however, he also became concerned about the demeanor of Vice President Cheney.

The scientists laid out vivid, illustrated accounts of the damage global warming could bring in the future: melting glaciers, rising sea levels, droughts, and severe storms. They offered specific forecasts about the impact global warming could have on public health and on the economy. One of the lecturing government scientists described the possibility of rising sea levels in “lowland areas in Miami, south Florida,” as Patrinos recalled it.

Hearing this, Cheney shifted uncomfortably, Patrinos remembered. He looked like a “raging bull. . . . He got up, paced back and forth, then stood next to me, and I could sense that he was not a happy camper.” Cheney remained silent.

The vice president soon preempted the climate task force’s work. Haley Barbour, a former chairman of the Republican National Committee who had become a lobbyist for a utility firm that stood to lose if greenhouse gases were regulated, urged Cheney in a March 1 memo to persuade Bush not to align with the “eco-extremism” of those who saw carbon dioxide as a pollutant. Two weeks after Barbour’s memo landed, Cheney arranged for Bush to sign a letter to Congress repudiating his campaign position about CO2—without so much as informing Christine Whitman, the new Environmental Protection Agency (E.P.A.) chief, in advance.

Whitman called Treasury Secretary O’Neill. “Energy production is all that matters,” she said. “[Cheney] couldn’t have been clearer.”

“We just gave away the environment,” O’Neill replied.

A few weeks later, ExxonMobil’s climate policy specialist Randy Randol sought a meeting with Under Secretary of State Paula Dobriansky, the administration’s lead diplomat on global warming issues. One of Dobriansky’s senior aides, career foreign service officer Ken Brill, prepared a briefing memo. It noted: “Mr. Randol has asked for this meeting at the suggestion of our Ambassador-designate to Sweden, Charles Heimbold, who served on the board of ExxonMobil.” Heimbold, the former chief executive of the drug maker Bristol-Myers Squibb, felt that “we should hear from Exxon/Mobil scientists who have perspectives on the climate change debate that are not consistent with the science that has supported our climate policy until now.” Brill suggested some talking points for the under secretary that might assuage the corporation’s lobbyist:

 

Understand Exxon/Mobil’s position that there should be no precipitous policy decisions if scientific uncertainties remain. . . . Administration will continue to oppose the Protocol, but must move forward on improving our scientific understanding. . . . We will, however, continue to rely on input from industry and other friends as to what constitutes a realistic market-based approach.

 
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