The Tyranny of OilThe World's Most Powerful Industry-and What We Must Do to Stop It
William MorrowCopyright © 2008 Antonia Juhasz
All right reserved.ISBN: 978-0-06-143450-1
Chapter One Big Oil's Last Stand
Within days of the New Year, 2008 began with three landmark events. Oil reached $100 per barrel for only the second time in history as gasoline prices began an ascent toward the highest prices in a generation. And on January 3, Senator Barack Obama became the first African American to win the Iowa Caucus. Voter turnout broke records as well, with four times more registered Democrats voting than had turned out in 2000. Senator Obama was reserved yet purposeful as he delivered his historic victory speech. He chose to highlight just a handful of policy issues in the fifteen-minute address, making his focus on oil all the more significant. Obama forcefully declared that he would free the United States once and for all from "the tyranny of oil" and then pledged to be the president "who ends the war in Iraq and finally brings our troops home." An already raucous crowd met these pronouncements with thunderous applause and waves of cheers.
"The tyranny of oil" powerfully encapsulates the feelings not only of Americans, but of people the world over. Without viable and accessible alternatives, entire economies suffer when increasing proportions of national budgets must be used to purchase oil. And on an individual level, families, facing the same lack of alternatives, forgo basic necessities when gasoline prices skyrocket. Communities that live where oil is found-from Ecuador to Nigeria to Iraq-experience the tyranny of daily human rights abuses, violence, and war. The tyranny of environmental pollution, public health risks, and climate destruction is created at every stage of oil use, from exploration to production, from transport to refining, from consumption to disposal. And the political tyranny exercised by the masters of the oil industry corrupts democracy and destroys our ability to choose how much we will sacrifice in oil's name.
The masters of the oil industry, the companies known as "Big Oil," exercise their influence throughout this chain of events: through rapidly and ever-increasing oil and gasoline prices, a lack of viable alternatives, the erosion of democracy, environmental destruction, global warming, violence, and war. The American public is fed up with Big Oil. In 2006 Gallup published its annual rating of public perceptions of U.S. industry. The oil industry is always a poor performer, but this time it came in dead last-earning the lowest rating for any industry in the history of the poll.
For a time, it was the rare 2008 presidential candidate who would speak out against the tyrants behind the tyranny of oil. The earliest denunciations came from Democratic senator John Edwards, who came in second and just 8 percentage points behind Obama in the 2008 Iowa Caucus. Edwards repeatedly stated the need to "take on Big Oil," and decried handing the "keys to the corridors of government over to the lobbyists for the big oil companies." Statements such as these quickly earned Edwards the title of the "Populist candidate" for president, as did this one made on January 28, 2008, when Edwards announced that there are "two Americas that exist in this country: there's one for the lobbyists, for the special interests, for the powerful, for the big multinational corporations and there's another one for everybody else. Well I'm here to say that their America is over!" Edwards took his script from Congressman William Jennings Bryan, who represented the Populist and Democratic Parties for president in 1896 and who declared, "On the one side are the allied hosts of monopolies, the money power, great trusts ... who seek the enactment of laws to benefit them and impoverish the people. On the other side are the farmers, laborers, merchants, and all others who produce wealth and bear the burden of taxation."
As the 2008 election progressed, both Obama and his leading Democratic challenger Senator Hillary Clinton went increasingly on the attack against Big Oil, and each was eventually called a "Populist candidate," their words sounding an alarm similar to one made over one hundred years earlier by the Populist movement against corporate trusts generally and Standard Oil in particular, the company from which many of today's oil giants descend.
John D. Rockefeller founded the Standard Oil Company in 1870. By the 1880s, Standard Oil controlled 90 percent of all refining in the United States, 80 percent of the marketing of oil products, a quarter of the country's total crude output, and, in this preautomobile era, produced more than a quarter of the world's total supply of kerosene. Standard Oil was renowned for both the ruthlessness and the illegality of its business methods. Dozens of court cases were brought against the company, and Standard Oil was broken up by three separate state-level injunctions. Its response was to change states, making federal action imperative. In addition to the producers, refiners, and other sellers of oil that Standard Oil bought out, bribed, bullied, or burned down, masses of people across the country were enraged by its exercise of control over their government. Standard Oil was not alone. It had perfected the use of the corporate trust, and hundreds of other trusts soon followed. A trust is a combination of corporations in which a board of trustees holds the stock of each individual company and manages the business of all. While the company operates as one giant conglomerate, the individual companies maintain the legal status-and in many cases, including Standard Oil's, the legal fiction-of independence. At the time, the word trust quickly became synonymous with any large corporation.
A newspaper cartoon from the era depicts the U.S. Senate. Towering above the seated senators, three times their individual size, stand grossly obese men representing the trusts. Each man is dressed in top hat and tails. Standard Oil, the most dominant, is the only company depicted by name among the "copper," "iron," "sugar," "tin," "coal," and "paper bag" trusts. Above them a sign is posted: "This is a Senate of the monopolists, by the monopolists, for the monopolists!" Off in the far left corner is a small sign that reads "People's Entrance," below which is a bolted and barred door marked "closed."