In early January, Harvard economics professor Robert Stavins took to his blog, “An Economic View of the Environment,” to search for hope in the face of President-elect Donald Trump’s increasingly anti-environmental cabinet. What he found instead was Exxon CEO and potential future Secretary of State, Rex Tillerson.
“Remarkably, the least worrisome development in regard to anticipated climate change policy may be the nomination of Rex Tillerson to become U.S. Secretary of State,” Stavins wrote. “Two months ago it would have been inconceivable to me that I would write this about the CEO of Exxon-Mobil taking over the State Department (and hence the international dimensions of U.S. climate change policy).”
Contrary to other potential candidates, Stavins argued, Tillerson was “at least an adult” who had pressed Exxon to recognize the scientific consensus behind climate change and publicly support policies like a price on carbon and the Paris climate agreement.
In the face of outright climate deniers like Trump’s pick for EPA administrator, Oklahoma Attorney General Scott Pruitt, or his nominee for Energy Secretary, former Texas Gov. Rick Perry (R), Tillerson’s public acceptance of the scientific consensus on climate change might seem like a bright spot. But environmentalists argue that focusing on a few public statements made in recent years obscures Tillerson’s long history with a company known for funding climate denial, as well as Tillerson’s own financial and personal conflicts of interest.
“The fact that he has acknowledged the reality of climate science is a pretty low bar.”
“The fact that he has acknowledged the reality of climate science is a pretty low bar,” Lena Moffitt, director of the Sierra Club’s Dirty Fuels campaign, told ThinkProgress. “We don’t take that as encouragement that he would be a suitable Secretary of State, and in fact think that he is a very very dangerous candidate for the job. We are doing everything we can to hopefully block the nomination.”
A record of misinformation
Tillerson, who was appointed CEO of Exxon in 2004, announced in a 2009 speech that the company supported a carbon tax as a means to curb global climate change.
“As a businessman it is hard to speak favorably about any new tax,” Tillerson said. “But a carbon tax strikes me as a more direct… a more transparent… and a more effective approach.”
Two years earlier, Tillerson publicly stated that he accepted the scientific consensus that human activity is contributing to global climate change. But despite his public comments — or Exxon’s public support of a carbon tax — the company has done little to help make climate action a reality; instead, the company has continued its misinformation campaign designed to sow doubt regarding the scientific consensus behind climate change, funding political candidates and organizations that have made climate denial their cornerstone issue.
Despite promising shareholders in 2007 that it would stop funding climate denial, Exxon has continued to spend millions on lawmakers who reject the scientific consensus on climate change, with its political spending in general increasing under Tillerson. As Josh Vorhees pointed out at Slate, the candidates supported by Exxon’s political action committee are the antithesis of climate champions: It has spent roughly $7.25 million on federal candidates, many of whom are some of the most notable climate deniers in Congress, like Sen. Jim Inhofe (R-OK), who quite literally wrote a book on climate denial.
And it’s not just elected officials who might have been influenced by Exxon’s spending; according to a study released last year by Yale sociologist Justin Farrell, private funding over the last two decades from entities like Exxon has successfully — and measurably — driven the polarization of the climate change debate as a topic in the United States.
Farrell looked at funding from two key contrarian entities, the Koch Family Foundations and ExxonMobil, and found that individuals and organizations that received money from the Kochs or Exxon were more likely to have written texts aimed at polarizing the climate change debate. Moreover, those individuals or organizations were especially concerned with falsely characterizing the science on climate change as unsettled.
Among Exxon’s various relationships with outside groups, climate activists are especially troubled by the company’s ties to the American Legislative Exchange Council (ALEC), a Koch-funded nonprofit organization that drafts model state-level legislation meant to further a bevy of conservative causes, from stricter voter identification laws to weaker renewable energy targets.
In October of 2016, two watchdog organizations — the Center for Media Democracy and Common Cause — accused ALEC of abusing its status as a nonprofit charity, detailing how Exxon used ALEC over the last two decades to deliberately advance its own legislative goals on everything from cap-and-trade, which it opposes, to loosening regulations on fracking, which it supports. According to the filing, submitted to the Internal Revenue Service, Exxon and its foundation gave $1.7 million to ALEC’s operations — and then used the organization’s nonprofit status to claim tax deductions for those expenditures.
“For most of the past two decades, Exxon has used ALEC as a key asset in its explicit campaign, spelled out in an industry strategy memo, to sow uncertainty about climate science, undermine international climate treaties, and block any legislation that would impose emission reductions,” Arn Pearson, general counsel for the Center for Media and Democracy, wrote in his letter to the IRS in October.
And it’s not just ALEC — in the last year alone, Exxon gave $860,000 to climate-denying groups like the American Enterprise Institute, National Black Chamber of Commerce, and the Manhattan Institute of Policy Research.
Exxon is currently facing investigations at the state and federal level as a result of its decades of climate denial, tied to allegations made public last year in two investigative pieces by Inside Climate News and the Los Angeles Times. According to the reports, Exxon’s own scientists knew about the dangers of man-made climate change as early as the 1970s, but continued its public denial of the issue and potentially mislead shareholders about the costs of climate change.
In 2016, the Democratic National Committee adopted a resolution in its platform calling for the Department of Justice to investigate Exxon’s record of public climate denial and private climate science.
“This hearing needs to put ExxonMobil’s history of climate denial on trial.”
With Sen. Jeff Sessions (R-AL) poised to lead the Department of Justice, it’s unlikely the agency will choose to pursue an investigation into Exxon’s climate denial. But senators will have a chance to ask Tillerson questions about the issue during his confirmation hearings — something environmentalists hope climate-friendly senators take full advantage of.
“Tillerson deserves a federal investigation, not a cabinet appointment,” Jamie Henn, strategy and communications director for 350.org, told ThinkProgress. “This hearing needs to put ExxonMobil’s history of climate denial on trial. If Senators make a strong push, this could become a Big Tobacco-like moment.”
Conflicting financial interests
As Exxon CEO, Tillerson owned at least $200 million worth of stock in the company, according to a recent Securities and Exchange Commission filing. But as part of a deal reached with Exxon earlier this month, Tillerson — if confirmed — won’t get the two million shares of Exxon stock that he was set to receive when he retired in March. Instead, in an attempt to divest his personal interests from those of the company, he will get an equivalent sum of money, paid out over 10 years by an independently managed trust. To put even more daylight between Tillerson and Exxon, the independently managed trust would be banned from investing money in Exxon — and if Tillerson returned to the oil and gas industry within 10 years, he would forfeit all money in that trust.
Under current federal ethics rules, government officials are allowed to keep their investments as long as they recuse themselves from any work that might influence those investments directly. And as Secretary of State, Tillerson would almost certainly run into issues that directly impact Exxon’s global operations — from approving or denying cross-border permits for pipelines designed to increase the flow of oil from Canada’s tar sands to dealing with sanctions on countries like Russia. That means that he would either have to divest his holdings entirely — as he has pledged to do — or operate in a severely limited capacity.
But the Sierra Club’s Moffitt doubts that even full financial divestment will completely divorce Tillerson from the interests of the company he has worked for his entire life.
“To think that he would now be able to extract himself from that industry and those relationships… is naive.”
“This is a man that has built his entire career building the interests of an oil company above the interests of community or, we think, our country. To think that he would now be able to extract himself from that industry and those relationships and that perspective is naive,” Moffitt said. “There is no way that he is going to be able to fully remove himself from those inherent conflicts.”
And even if Tillerson doesn’t benefit directly from his role as Secretary of State, it’s possible Exxon will benefit from Trump’s cabinet picks: according to a new report released by the Center for American Progress, if Trump’s top picks for EPA, Department of State, Department of the Interior, Department of Energy, and Department of Justice are all confirmed, Exxon could benefit by at least $1 trillion in the coming years.
A cozy relationship with Russia — and state sponsors of terrorism
As CEO of a global oil corporation, Tillerson has conducted business all over the world — sometimes with countries and leaders whose worldview runs directly counter to the interests of the United States.
One primary example is Russia. Tillerson worked early in his career as head of Exxon Neftegas Limited, a subsidiary of Exxon that dealt with the Sakhalin-1 oil and gas project off the coast of Siberia. It was during this time that Tillerson first became acquainted with Russia, but it was far from his last dealing with the country.
In 2011, Tillerson was a crucial component in negations between Exxon and Russia’s state-owned oil company, Rosneft, on a project that would have explored potential oil operations in the Arctic. The deal was a huge one for Russia: Rachel Maddow, on her show, said that it was “expected to change the historical trajectory of Russia.” And it would have been a boon for Exxon as well — but in 2014, the United States hit Russia with multiple rounds of sanctions in response to its aggression in Eastern Europe, effectively putting the project between Exxon and Rosneft on hold and costing Exxon an estimated $1 billion.
As Exxon CEO, Tillerson has criticized U.S. sanctions against Russia, saying at the company’s 2014 annual meeting that it generally does not support sanctions because it doesn’t “find them to be effective unless they are very well implemented comprehensibly.” In late 2016, according to reporting by Politico, Exxon lobbied to defeat a bipartisan Senate sanctions bill that would have made it more difficult for the incoming president to lift the sanctions on Russia — something President-elect Trump has made allusions towards.
But Russia is far from the only country where Exxon’s dealings could run counter to U.S. diplomatic concerns. According to SEC filings reported by USA Today, during Tillerson’s tenure, Exxon did business with Iran, Syria, and Sudan through a European subsidiary. According to the U.S. Department of State, all three countries are designated state sponsors of terrorism — and therefore subject to U.S. sanctions.
In his book Private Empire, New Yorker staff writer Steve Coll explains how Exxon, as a company, sees itself as “an independent, transnational corporate sovereign in the world, a power independent of the American government.” And while that means that Tillerson may have experience negotiating with countries around the world, environmentalists argue he has little experience negotiating in a way that puts the diplomatic interests of the United States above the profits of a global oil corporation.
“[Tillerson] has been at the helm of this company while it has been actively funding climate denial, perpetuating some of the most costly environmental disasters our world has ever seen, and perpetuating human rights violations,” Moffitt said. “At a time when the climate crisis is more clear than ever, the prospect of putting the head of the world’s biggest oil company in charge of our international diplomacy is shocking and takes us in exactly the wrong direction.”