Why Texas Leaders are Going to Bat for Exxon: An Explainer. (We Hope.)
Texas Congressman Lamar Smith and Attorney General Ken Paxton claim fraud investigations infringe on Exxon’s First Amendment rights.
Earlier this week, U.S. Congressman Lamar Smith and other House Science Committee members announced that they would subpoena the New York and Massachusetts attorneys general and eight environmental and advocacy groups for communications related to a string of inquiries into ExxonMobil’s record on climate change.
“It is regrettable that two state attorneys general and several organizations continue to threaten legitimate scientific debate about climate change,” Smith said at a press conference.
The unprecedented move by Smith is an apparent tit-for-tat in a long and convoluted battle among Exxon, environmental groups, Democratic attorneys general and Republican politicians. Smith first sent a letter in May to the New York attorney general and 16 other attorneys general alleging that their offices were colluding with environmental and advocacy groups and trial lawyers to “demonize the fossil fuel industry.” He demanded that the attorneys general and green groups hand over records of communication between them concerning inquiries about climate change.
When the attorneys general refused, Smith issued a warning on July 6th and then issued subpoenas on Wednesday.
Back up. Tell me how this got started?
Last year two news organizations uncovered a trove of documents that laid out Exxon’s climate research in the 1970s and 1980s. They found that the oil-and-gas giant had spent a considerable amount of time and money studying the effects of carbon emissions on global temperatures. The company’s scientists had warned upper management of both the potential danger to the planet as well as to Exxon’s bottomline. But publicly, Exxon made little mention of its findings or climate change more broadly till the early 2000s.
Those revelations led 17 attorneys general — led by New York attorney general Eric Schneiderman — to begin investigations into the company. Of the subpoenas filed by three attorneys general, Exxon has managed to quash one and is fighting another. The company is cooperating with Schneiderman’s subpoena and has turned over 10,000 pages of documents.
What are the attorneys general looking for?
The attorneys general are looking for evidence that Exxon violated their state’s anti-racketeering and securities law. Each state has its own version of the federal Racketeer Influenced and Corrupt Organizations Act (RICO) that protects consumers from fraud. In the 1990s, the law was used to prosecute tobacco companies that had misled consumers about the health risks associated with smoking.
Now attorneys general are looking for similar evidence that Exxon understood the threat that carbon emissions posed on the planet and did not inform the public or its shareholders. Attorney General Schneiderman, for instance, has requested documents that Exxon prepared about climate change for industry groups, records relating to Exxon’s funding of advocacy groups, and press releases and advertising that Exxon published about climate change.
An analysis of those records will likely help Schneiderman’s office track how Exxon discussed climate change internally and with other groups in the industry versus how it portrayed the issue to shareholders. By law, companies are required to disclose material information — content that can affect a company’s share price — to its shareholders. Exxon, by not informing shareholders about the risks of climate change, may have failed its legal obligations.
So why is Lamar Smith getting involved?
Smith is claiming that the attorneys general investigations infringe on Exxon’s right to free speech. He says that Exxon, by voicing its opinions about climate change, was taking part in a debate about the issue.
“The attorneys general are pursuing a political agenda at the expense of scientists’ right to free speech,” Smith said. “It is necessary for the committee to issue subpoenas in order for the American people to understand the negative impacts of the actions of the attorneys general.”
That argument holds water depending on how you define what is up for debate on climate change. Did the vast majority of scientists in the 1980s agree that manmade carbon emissions were causing a rapid increase in global temperatures?
Yes, they did. Even in the 1980s climate scientists were sounding the alarm on the rapid increase in carbon pollution and its deleterious effects on the planet.
What they disagreed about was how much temperatures would rise and how soon the effects of climate change would be felt. Within the scientific community at least, that is where the debate lay.
Exxon did publish its research in scientific journals, but critics of the company contend that it did not publicize information that was incompatible with its position on climate change. Meanwhile, for more than two decades after its top climate researcher told Exxon’s executives about the looming catastrophe, the company funded deniers. Also, the company didn’t report the repercussions of climate change on its business in filings to financial regulators till 2001.
Has Smith filed other subpoenas recently?
Yes, he has. Smith has filed six subpoenas — not including the Exxon-related subpoena — in his three years as the head of the House Science Committee, more than those issued in the committee’s 54-year history.
Most recently, Smith issued a subpoena to the head of the National Oceanic and Atmospheric Administration (NOAA) demanding she turn over communications among NOAA scientists as well as a massive amount of satellite data and the methodologies the agency uses to analyze it. He alleged that the agency had altered temperature data.
The agency has complied with Smith’s request.
What does Smith stand to gain from defending Exxon?
Smith has received close to $700,000 from the oil and gas industry during his career. The environmental groups that he has subpoenaed claim that money is motivating Smith to protect Exxon.
But Smith is also a well-known climate change denier and his defense of Exxon and other fossil fuel companies is at least in part ideological. A conservative Republican, Smith has previously railed against the Obama administration’s policies on immigration and the environment. He views the investigations into Exxon as state attorneys general overstepping their authority to further what he believes is a political agenda on climate change.