Drilling For Influence

By J.R. Pegg, Environment News Service. Posted July 20, 2004.

The oil and gas industry has pumped some $440 million into federal political campaigns and lobbying activities during the past six years, according to a new report released by the Center for Public Integrity.

The study gives added fuel to critics who believe the industry has bought undue influence throughout the federal government, in particular within the offices of Bush administration officials.

Republican candidates and organizations received more than 70 percent of the $67 million the industry has given in federal campaign contributions since 1998 – with President George W. Bush leading the way.

The former Texas oilman turned President received some $1.7 million in industry contributions, more than three times the amount given to any other beneficiary of the industry's support.

The study, "The Politics of Oil," is the first of a series by the nonprofit research group that aims to identify the size and scope of the international oil and gas industry and measure its influence in the halls of government worldwide.

Charles Lewis, executive director of the nonpartisan Center for Public Integrity, said the group has no axe to grind with President Bush, but the close ties between the industry and the administration hardly came as a surprise.

"No industry in the history of the Republic has had former company executives sitting in the White House as President and Vice President, along with other very senior leadership positions," Lewis said.

Including Bush, Vice President Dick Cheney, National Security Advisor Condoleezza Rice and Commerce Secretary Donald Evans, more than 40 members of the Bush administration have worked directly for or with the oil and gas industry.

The report does not hone in on specific policies that may have been affected by the oil and gas industry's influence, but Lewis told reporters "it is rather apparent what the influence has been able to achieve."

The administration has pushed a host of industry proposals, including an national energy policy laden with subsidies for oil and gas development and several regulations to relax federal rules for drilling on federal lands.

The White House has also resisted calls to raise fuel economy standards or to cut fossil fuel use in order to combat global warming.

The Bush campaign did not comment on the report.

Second and third on the list of politicians who have received the most support from the industry are Texas Republicans Joe Barton, who chairs the House Energy and Commerce Committee, and House Majority Leader Tom Delay.

Barton has collected $574,000 from the oil and gas industry since 1998; Delay has received just under $500,000 in campaign cash from the industry.

The only Democrat in the top 10 is Louisiana Senator Mary Landrieu, who has been given $343,924 in campaign contributions by oil and gas companies since 1998.

The report lists ChevronTexaco as the leading contributor to recent federal campaigns. The oil giant has given some $2 million to the Republican Party and $45,600 to the Bush campaign in the past six years, along with some $790,000 to the Democratic Party.

ExxonMobil is the industry's leader in lobbying expenditures, spending some $55 million, followed by ChevronTexaco at $32 million.

It is not hard to see why the industry is making such an investment – it has a clear case for wanting to sustain the nation's thirst for oil and gas. In 2003, the United States guzzled more than 25 percent of the world's total oil and gas production.

The Center for Public Integrity report says the industry exerts its influence in "other, less obvious ways" and cites the role of the National Petroleum Council and conservative, nonprofit organizations.

Formed by President Harry Truman after World War II, the National Petroleum Council was designed to provide the government with the industry's expertise on oil and gas issues.

The recommendations of the council during the past six years have closely mirrored the requests of industry lobbyists, according to the report, and at least 10 members of the council are Bush Pioneers – individuals who have raised more than $100,000 for the President's election campaigns.

Few oil companies can match the influence wielded by Koch Industries, according to the Center for Public Integrity. With $40 billion in annual revenues, the privately held conglomerate is the leading campaign contributor for 2004 and the fourth biggest oil and gas industry giver since 1998.

Koch's influence is reflected in its support of some of the nation's most prominent conservative and libertarian think tanks and advocacy groups. These organizations, including the Cato Institute, the Reason Foundation, Citizens for a Sound Economy, and the Federalist Society, have become Washington mainstays and vocal advocates for the deregulation and minimal regulation favored by oil and gas companies.

Lewis said one surprising finding in the report was the extent to which U.S. oil and gas companies have re-incorporated in tax haven countries. The study uncovered more than 882 subsidiaries of U.S. oil and gas companies located in tax havens including the Cayman Islands, Bermuda, Panama, the British Virgin Islands and Liechtenstein.

"The entire rest of the world had just 311 such subsidiaries," Lewis said.

At present, about 84 percent of the Federal oil and gas revenues are produced from leases located on the Outer Continental Shelf.

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