Barack Obama: An Oiled President

It was a cold, dreary day. Right after I heard the articulate, fiery man speak to a crowd of about fifty for over an hour, I went up the stairs to get my book signed. That fiery man was Chris Hedges, a vocal participant in the Occupy movement and anti-corporate activist. When I got my chance, I asked Mr. Hedges if he had expected President Obama to voice approval of the southern leg of the Keystone XL pipeline after he had previously rejected it. Hedges said that he did expect Obama to voice his approval for the project because of what was said when the pipeline was rejected. Sure enough, those activists that cheered at the rejection of the pipeline missed these telling words:

The Secretary of State has recommended that the application [for the pipeline] be denied…I agree…This announcement is not a judgment on the merits of the pipeline, but [on] the arbitrary nature of a deadline.

Obama even hinted at his future support of the pipeline: “[there may be] development of an oil pipeline from Cushing, Oklahoma to the Gulf of Mexico.” These deceptive words used by the President made me think:  Is the president heavily influenced by Big Oil or is the statement he made in the 2008 campaign, “I don’t take money from oil companies” true?

The election campaign of 2008 was a hard-fought campaign on all sides, mostly which involved lots of corporate sponsors since all the “frontrunners” were awash with money. Then-Senator Barack Obama raised $745 million dollars and spent $730 million dollars. $916,162 of those dollars came from the Oil and Gas industry according to OpenSecrets. A post continued this message, nine months before the Presidential election was held, noting that Obama received over $66,000 dollars from employees at ExxonMobil, Hess, Shell, ConocoPhillips, and British Petroleum (BP). In addition, the post noted that “two oil industry executives…bundl[ed] money for Obama” one of which was a multi-billionaire. A Reuters article in May 2008 noted that BP contributed more to Obama’s campaign than it had contributed to federal candidates since the late 1980s. Even with these contributions, one may be unsure of Big Oil’s real impact on Barack Obama.

Steve Coll’s new book, Private Empire: ExxonMobil and American Empire, sheds light on part of that impact, especially on ExxonMobil’s role in the election. According to Coll, in the 2008 Presidential campaign, Obama “spoke most pointedly about ExxonMobil…[and] offered none of the nuanced support he had voiced to Chad’s dictator Idriss Deby [in 2006]” about the inviolability of international oil contracts.  Even with this aggressive tact, he seemed to exploit the unpopularity of ExxonMobil for his own benefit. He pushed the idea of American ‘energy independence’ even though, according to Coll, it is “not achievable [or] desirable.” In addition, every time he used the word “ExxonMobil” it seemed to work in his favor. But, according to the Washington Independent, individual Exxon, Chevron and BP contributors preferred Barack Obama. At the same time, he boldly declared that “we must end the age of oil in our time.” Still, the Washington Post wrote in January 2008 that “one of Obama’s foreign policy advisers on the Middle East [Daniel Shapiro]… registered to lobby for several corporate clients…including…the American Petroleum Institute.” Also, three political aides on the Obama’s campaign payroll were lobbyists for corporations such as BP. Still, after his victory over John McCain in the Presidential election, ExxonMobil changed its approach to the political arena.

As Obama was entering the Presidency, Eric Foner, of The Nation Magazine, called him “Our Lincoln” and Time Magazine named him “Person of the Year.” Just like the online game, Oiligarchy, made by Mollenindustria, President Obama became “oiled,” and would work in the interest of Big Oil due to its campaign contributions to his presidential election campaign.

In May 2009, Obama appointed Steve Koonin, the former Chief Scientist of BP, to be second Undersecretary for Science in the Department of Energy (he was confirmed shortly after by the U.S. Senate). The next year, Koonin became a member of the US National Academy of Sciences.  Also, the former contact employee for Goldman Sachs, Rahm Emanuel, who was Obama’s Chief of Staff for 21 months, lived for five years in a “rent-free…D.C. apartment of…Rep. Rosa DeLauro…and her husband, Stanley Greenberg,” whose firm was the creator of “BP’s…green…slogan “Beyond Petroleum.”” At the same time, Goldman Sachs had a huge investment in BP, which it sold in early 2010 for an unknown reason, pocketing “slightly more than $266 million” according to Raw Story, an independent news site. Currently the company owns about 2% of BP’s stock.

This connection of Obama to Big Oil is not based around stocks, rather around policy that has been enacted or pushed. In the early days of his administration, a cap-and-trade bill failed in Congress. According to an online site about cap-and-trade this policy has its problems. Ralph Nader says it would cause a war “between interest groups seeking billions in carbon credit handouts and the regulator[s].” The Institute of Energy Research states it will hurt jobs, “make Canadian oil more expensive than oil from the Middle East…[and] create…incentives to import more oil from the Middle East.” The political magazine, Corporate Knights continues this criticism. They remark that “the President has not stood up to the climate-denial machine” and has been increasingly silent on the issue of a changing climate. At the same time, they wonder why Obama is not doing “far more to defend the science” of global warming.

In November 2009 the pro-Big Oil policy was evident once again. According to AlterNet, Obama and “his administration [were]…vocal and active proponents” of an Iraqi law that permitted new oil contracts in the country, which are also called protection sharing agreements (PSAs). The law offered oil companies “a 75 percent stake” in oil development, “reduced the amount the foreign companies pay in taxes…allow[ed]…them to use private security forces to protect their facilities” and let foreign companies to “hire and train [non]Iraqi workers and…transfer…needed technology.” At the same time, the law made companies pay “reimbursement fees for capital and operational expenses…[and] den[ied foreign] companies [from]…book[ing] reserves.”  Under this agreement, different corporations were given the ability to drill in Iraqi oil fields: BP, ExxonMobil and Shell Oil Company got sweet deals in Iraq, drilling in areas with 4-18 billion barrels of oil. Other foreign oil companies won out as well, but these American companies were some the big bread winners and the Obama Administration’s support of the law is no coincidence.

The next year, the international environmental NGO, the Bellona Foundation, noted a Presidential decision that missed the headlines. President Obama, one month before the explosion of the BP-leased Deepwater Horizon oil rig reversed a “20 year moratorium…open[ed much of]… the Atlantic coast line, the eastern Gulf of Mexico and the north coast of Alaska to oil and natural gas drilling…[and] at the same time [he] reject[ed]…some sites that had been propose[d in]…Alaska, California and Oregon.” Then less than thirty days later, the Deepwater Horizon Oil spill began. The aftermath showed the collusion of policy with Big Oil. Even, Sarah Palin, roundly denounced by “liberals” for her seemingly crazy statements told a Fox News show, “I don’t know why the question isn’t asked…if there’s any connection with the contributions made to President Obama and his administration and the support by the oil companies to the administration.” Recently, others have even suggested that “the Obama administration went easy on BP before the 2010 oil spill in return for a pledge to support cap-and-trade legislation.” Two years later, Black Agenda Report came out with an article attacking Obama’s inaction: “Barack Obama and his Democrats passed no new laws, promulgated no new executive decisions to regulate Big Oil…the damages recoverable from BP’s holdings [were restricted to]…its Gulf revenues [not revenues on other continents]… [which] ensur[ed]…BP’s reckless operations in the gulf of Mexico [would]…continue.”

After the spill occurred, President Obama and his administration quickly worked to clean up the oil in the Gulf of Mexico. In that process, a dispersant named Corexit was poured into Gulf, 2 million gallons by mid-June 2011, with the green light from Obama and his administration. But everyone didn’t follow the administration line. According to Democracy Now!, “many lawmakers and advocacy groups sa[id]…the Obama administration [was]…not being candid about the lethal effects of dispersants.” At the same time, residents on the Gulf Coast were outraged that Kenneth Feinburg’s “$20 billion government-administered claim fund [would]…subtract money cleanup workers earn by working for the cleanup effort.” Also this claim fund was seen as an “effort to limit the number of lawsuits against BP.” Hugh Kaufman, a senior policy analyst of the EPA’s Office of Solid Waste and Emergency Response at the time, boldly said the government was “sock puppets for BP in this cover-up…by hiding the amount of spill [which]…sav[ed] [BP] hundreds of millions, if not billions, of dollars in fines.” In addition to this corruption, many numbers of EPA and OSHA Administrators said the chemical was safe, but it was not. Kaufman went even further saying that the company, BlackRock is run by Larry Fink who has connections to “Mr. Geithner, Mr. Summers and others in the administration.” He concluded that the go ahead to disperse Corexit was part of a cover-up to hide BP’s use of “the volume of oil that has been released” into the Gulf from the American public.

The string of pro-Big Oil policy continued despite the “biggest investment in stimulating a green economy in history,” the creation of more green jobs, tax credits for wind energy, money for environmental maintenance, and greening federal buildings in the stimulus bill according to TreeHugger. For one, no one in BP has been criminally charged for the Deepwater Horizon oil spill in 2010. A community fund to pay victims of the spill was set up, but there was no real damage to BP’s profits. Even a prosecution has started against BP but the trial was delayed by Judge Barbier until January 14, 2013, conveniently after the November presidential elections. In mid-2011, when the debt-ceiling crisis was occurring, the “Obama administration gave $12.4 million in research grants to oil and gas companies…to help the industry improve the way it drills for oil and gas” according to Daily Beast Contributor Daniel Stone. At the same time, Democrats in Congress were decrying a deal which would not cut subsidies for oil companies (about a year later, Obama would support gutting those subsidies). As the year continued, his policy was still deeply connected to Big Oil despite what was said in the articles of “clean capitalist” magazines like Corporate Knights.

Earlier that year in March 2011, President Obama began a war in Libya. Officially its purpose  was to “assist an international effort authorized by the United Nations…Security Council…to prevent a humanitarian catastrophe…[and stop] all attacks against civilians…[by] target[ing]…air defense systems, command and control structures…of Gaddafi’s armed forces.” As a result, this war was advertised by the Obama Administration as a humanitarian war. But the real reason for war was not humanitarian reasons, it was oil. lays it out clearly. In 2008, Gaddafi threatened the oil companies in Libya and then made an agreement that promised billions of barrels of oil with tough conditions to American oil companies. At the same time, the U.S. government plotted to stop the Russian oil company Gazprom from gaining Libyan oil. When the Libyan revolution began, Gaddafi refused to step down.  The 2008 agreement and the plot to stop the Russian oil company, connected to Vladimir Putin, was threatened. In addition, University of London Professor Gilbert Achar noted that a huge massacre in Libya would cause an “embargo on Libyan oil” which would hurt the volatile oil markets. This revealed the real reason for entering a war into Libya: Oil. Representative Ed Markey at the time also said the war was because of oil.

The connections of the war to oil are different depending on what source the information comes from. Black Star News in an April 2011 post echoed the positions of and Gilbert Achar. They argued that the war occurred because “America wants to control Africa’s oil supply…[and protect] U.S. oil companies and others are presently invested in Libya; these companies include Marathon, Hess, Conoco, Gulf, Occidental, British Petroleum (BP).” The post finally gets to the punch: “This [war] is about oil and power, not saving people.  It’s about maximizing profits.” Robert Dreyfuss of The Nation had a different analysis. He noted that “Libya’s new leaders…plan to favor their NATO backers [one of which is the United States] when handing out access to Libya’s oil.” Peter Dale Scott goes even farther, saying that the war was about protecting the declining “global petrodollar economy” which Gaddafi threatened just like Saddam Hussein did before the Iraq invasion in 2003. Whatever the reason, it is clear that the war was about oil (it cost over $1.1 billion dollars, according to Politifact) and was in Big Oil’s interest.

In the month of the Libya war beginning, March 2011, President Obama made a speech at Georgetown University officially about “America’s energy security.” In the speech, Obama touted the use of alternative energy, nuclear power, coal, natural gas and oil all together, later called the “all-of-the above” strategy. More importantly, he announced a goal to cut America’s dependence on oil by one-third through his “all-of-the above” energy plan. However, he noted that to achieve this plan, America’s oil supply would have to be increased through expediting drilling permits for oil companies. Yet again, the President was on the side of Big Oil. He remarked casually that after new supposedly “higher standards” had been put in place, the government had “approved 39 new shallow-water permits…seven deepwater permits…two permits last year for every new well that the industry started to drill” offshore. The influence of Big Oil in government was apparent once again as the discussion switched back to the aftermath of the Gulf Oil Spill. In the speech, Obama revealed that Secretary of Energy Steven Chu was sent by him down to “the BP offices [where]…he essentially designed the cap” that supposedly stopped the oil from leaking into the Gulf. If this doesn’t sound like collusion between BP and the national government, I don’t know what is.

A few months later in June 2011, President Obama made a rash decision. He decided to release 30 million barrels of oil from the Strategic Petroleum Reserve. One news outlet, the Cable News Network (CNN) considered this an “economic stimulus…[in a time of] a looming supply  shortage…a wake up call to OPEC…[or] a warning shot to speculators in the oil market.” Other times in his administration he has tapped the national reserve, especially in times of “crisis”. This reserve was about 695.9 million barrels as of February 2012, which is about 36 days of oil consumption. Even though this is true, the releasing of oil just keeps America’s addiction on oil, which doesn’t solve any problems. It just keeps things at the status quo.

In late 2011 the policy of helping Big Oil continued. The infamous Keystone XL pipeline was proposed by TransCanada. It would be a pipeline that would snake across the western United States and would consist of drilling in dirty tar sands and overtopping the largest aquifer in the world, the Ogallala Aquifer. Environmental activists and other politicians opposed the action while others stood their ground, saying the pipeline would create jobs. An opinion posted on the Qatari-based news service, Al Jaazera, by a Tar Sands activist Bill McKibben expresses his frustration with the Obama Administration four months before the project was rejected. In his opinion, there were numerous “indication[s] from this administration…that it is prepared to grant the necessary permission for [this] project…[even] the State Department, at the recommendation of Keystone XL pipeline builder TransCanada, hired a second company to carry out the environmental review [which]…considered itself a “major client” of TransCanada.” This collusion of business and government to McKibben was “simply corrupt [and] potentially the biggest scandal of the Obama years,” an ongoing crime that President Obama didn’t even try to stop.

The Keystone XL pipeline’s rejection seemed a lapse in pro-Big Oil policy. But the pipeline was not delayed in January 2012 because of environmental considerations, but due to “the arbitrary nature of the deadline.” Even though there was a review done, it occurred with the help of one of TransCanada’s major clients. However, this was not a powerful pro-Big Oil development.  The powerful move was the renewed support of the “All of the Above” energy policy which was touted back in March 2011. In the 2008 Presidential campaign, Obama touted the same energy policy based in the nationalist idea of “energy independence.” In February 2012, Dan Pfeiffer, the White House Communications Director, justified such a policy by numerous statistics one would expect under a Republican administration:

Since 2008, U.S. oil and natural gases production has increased each year…[and] imports of foreign oil have decreased…[and] the Obama Administration put in standards that ensured that [oil] drilling continued [after] the Deepwater Horizon oil spill.

These were not the only justifications for this new energy policy. After the BP oil spill in the Gulf, hundreds of drilling permits for the region were approved by the Obama Administration. These numbers were higher than what Obama spoke of in March 2011. 308 permits were approved for “deep water drilling activities…and…113 permits for shallow water wells in the Gulf of Mexico.” More evidence of government collusion with Big Oil is the permitting of oil drilling “at levels seen before the Deepwater Horizon oil spill” on land and in the water. This resulted in “more oil produced [in 2011] in this country…since 2003.” This was conveniently made possible because America has more “oil…rigs at work in the field than the rest of the world.” While this seems like an overstatement, this phenomenon led the government to another conclusion. Obama allowed the “further exploration in the Arctic” and he established “an interagency Alaska working group…[to] review…Shells proposed exploration…in the Arctic.” For many environmentalists, this may be a betrayal of the initiatives in his administration that have helped the planet (pushing solar, wind, biofuels a little bit). Arctic exploration is not the only place the President pledges his support. Obama has allowed the building of dozens of pipelines in his term of office and has pledged to work with “TransCanada…to expedite the necessary federal permits” for the Keystone XL pipeline.

The next month, those permits were expedited. Obama signed an Executive Order on March 22nd, 2012 titled “Improving Performance of Federal Permitting and Review of Infrastructure Projects”. The Executive Order told all Federal Agencies and departments to “significantly reduce the…time required to make decisions [on]…permitting and review of [Federal government] infrastructure projects.” Also it mandated that all steps be taken “to execute Federal permitting and review processes with maximum efficiency and effectiveness, ensuring the health, safety, and security of communities and the environment while supporting vital economic growth.”  Even though there is talk of a safe community and the environment, this was meant to expedite the Keystone XL pipeline and future pipelines.

How can a full analysis occur if time is limited and “economic growth” is promoted? In the speeches he made the same day, March 22, his support of the pipeline is evident. He told a crowd, mostly of his supporters, in Maljamar, New Mexico that “we’ve announced our support for more [pipelines] including” the Keystone XL pipeline.  He repeated the same message at Ohio State University and in Cushing, Oklahoma. Cushing is where the President explained his justification for approving this leg of the pipeline, echoing the themes of his executive order:

There’s a bottleneck…here because we can’t get enough…oil to our refineries fast enough… TransCanada has applied to build a new pipeline to speed more oil from Cushing to…refineries down on the Gulf Coast.  And today, I’m directing my administration to cut through the red tape…and make this project a priority, to go ahead and get it done…So the southern leg of it [is] a [government] priority…The northern portion…[is] going to…[be] review[ed] properly…if [the government approves this pipeline]…we going to see jobs and growth…all across the country.

The following month, after the pro-pipeline speeches, Obama tried to act all tough against the oil and gas industry. According to an April 18th CNN Article, he required “drillers to capture emissions of certain air pollutants from new wells.” But under his direction, the Environmental Protection Agency allowed companies to “burn the pollutants [in question]…until the start of 2015” in a “nod to industry concerns [that the]…rules were being enacted too quickly.” This is not only a pro-Big Oil move, but it shows he weighs the concerns of the common American lower than that of Big Oil.

This month, the Obama Administration made what the independent blog site, Firedoglake, called “a deeply corrupt move.” Companies that used hydraulic fracturing (fracking) only needed to “disclose what chemicals they use after the well has been drilled.” This was giving in to Big Oil, thanks to meetings at the White House after the original rule was proposed three months earlier. Lobbyists representing those interests helped change the rule to their liking. As Firedoglake put it, the decision “to side with big oil over the American people and basic common sense” is pathetic. This decision is a further sign that Obama is an “oiled” president.

This corrupted nature comes back again when you look at Obama’s stance on speculation. His response has been weak-handed. He has said that should be investigated by Attorney General Eric Holder, “but nothing [really] has happened [because]… he seems to kind of accept the logic [that] we need to produce more domestic oil…and alternative energy sources” according to Paul Jay of the Real News Network.  In addition, Jay notes that Obama “doesn’t…talk…about the issue of speculation, about position limits [or about] the financialization [of oil].” Fidelity Investments continues this idea saying that “Obama would like to crack down…but he doesn’t talk about it often…or have enough friends in Congress [and that]…Obama’s attack on oil speculators…[is] doomed to join his legislative Wish List to Nowhere.” But this is not an issue isolated to Obama. The lack of action on these issues goes from the President to the Commodity Futures Trading Commission (CFTC) and lack of a meeting of the CFTC’s Energy and Environmental Markets Advisory Committee, created by the Dodd-Frank Act, since 2009. Then Fidelity gets to the punch: “Obama can’t keep his eye on the crude [oil] bubble for very long.”

As a result of all of these connections to Big Oil, it wouldn’t be a surprise that the President gets money from them. Even though this is true, Republicans receive most of the money from them resulting in ThinkProgress’s derogatory name: the “Grand Oil Party.” But, the facts are undeniable: Big Oil has given to the Obama reelection campaign. The ExxonMobil Corporation has already given Obama $14,914 and Chevron Corporation has given him $9,750; still both corporations favor Mitt Romney for President in terms of money. In addition, Koch Industries, which is usually considered a Tea Party financier, is also an oil refining company, has given Obama a measly $1,000. Not surprisingly, after the administration’s response to the Gulf Oil Spill, BP favors Obama’s reelection. More money was given to him than contributions to Eric Cantor and John Boehner combined. Overall, OpenSecrets details that President Obama is the 12th biggest recipient of money, out of the top 20 recipients in the oil and gas industry.  He has received $181,957 in his campaign coffers. This comes at a time after Obama supposedly led the effort to end Big Oil’s big tax breaks, which was defeated in the Senate due to their influence. In recent times, however, especially in the past year, it has become evident that Obama is on the side of Big Oil, more than ever.

Big Oil (the “supermajors”) is the world’s five or sometimes six biggest publicly-owned oil & gas companies including American-based Chevron, ExxonMobil and ConocoPhillips Company British-based Royal Dutch Shell and BP and French-based Total S.A. Of the American companies, Obama seems to be on their side completely and overall on Big Oil’s side. George W. Bush and Dick Cheney’s eight years in office was much more on the side of the oil companies, but Obama still has a significant stake. What benefits the powerful oil corporations in America will, in turn, benefit the other world players. If such companies have headquarters in the United States like BP and Royal Dutch Shell, this is firmly the case. President Obama is on the side of Big Oil and is subsequently an “oiled” President. Until the President admits that he is more on the side of the world’s large oil corporations than the middle class, he will continue rhetoric that seems to speak for all Americans.

Burkely Hermann is an activist who wants to change the world for the better by imagining alternatives to the status quo of neoliberal global capitalism. In order to illuminate these alternatives and outline the status quo, he runs numerous online blogs, writes numerous articles, and uses his tech savvy skills to fight for social justice. Read other articles by Burkely.