Nobody Likes A Whiner

You know you're trying to bluff with a really bad hand when the AP opens its story with this lede:

President Bush put politics ahead of the facts Tuesday as he sought to blame Congress for high energy prices, saying foreign suppliers are pumping just about all the oil they can and accusing lawmakers of blocking new refineries.

Even I'm embarrassed for Bush trying to pull this switcheroo. But he didn't stop with gas prices, he blamed Congress for the farm bill, stopping nuclear power plants, foreclosures, the economy, and I think Miley Cyrus' photo spread. If Truman said "The buck stops here," then Bush's mantra must be "Who wants this buck?"

It goes without saying that his remedies for the nation's domestic ills are ill-chosen and ridiculous, but the AP went ahead and nicely summarized them.

Bush renewed his call for drilling in an Arctic wildlife refuge, but his own Energy Department says that would have little impact on gasoline prices [...]

Blaming "the lack of refinery capacity" for high energy prices, [Bush] said Congress has rejected his proposal to use shuttered military bases for refinery sites.

FACT: Global oil supplies are tight, in part because OPEC nations including Saudi Arabia are refusing to open their spigots. But Saudi Arabia has considerable additional production capacity. It's pumping a little over 8.5 million barrels a day, compared to about 9.5 million barrels a day two years ago and has acknowledged the ability to produce as much as 11 million barrels a day.

On refineries, Congress has ignored Bush's proposal to use closed military bases. But the oil companies haven't shown much interest in building refineries either and have dismissed suggestions that military bases might be of use [...] When top executives of the country's five largest oil companies earlier this month were asked at a House hearing whether they wanted to build a new refinery, each said no.

And it just got worse from there. I hate to even give these little temper tantrum press conferences even the most minor notice, since they all come down to a series of wild charges with no basis in fact, and the country has tuned this guy out already and can't wait for him to leave, anyway. But the thing is that the Republican Party is desperate to get out from under the impression that they broke the economy, and are starting to raise this whole "Democrats in Congress did it" approach, so it's important to get out in front of the spin.

Now on the farm bill, I don't totally disagree with the President in theory about subsidies, and Congress is responding, though I can't help but think that Bush doesn't really want to stop payments to wealthy farmers so much as to transfer them to agribusiness.

"I believe that there is market manipulation at the refinery level"

That was Assembly Speaker Fabian Nunez today at an event in downtown Los Angeles, in front of a Chevron station (that was selling gas for a low low $3.49, I think the advance man could've found stations 30-40 cents higher without too much trouble), as he announced with Assemblymen Mike Davis, Mike Feuer and Mike Eng a series of bills to combat rising gas prices and the artificial depression of refinery supply. The bills will seek to oversee refinery maintenance, expand regulatory authority, and deal with the "hot fuel" issue. The Speaker said that "During the electricity crisis a few years ago, California adopted similar measures to keep energy companies from using these convenient (refinery) shutdowns to amp up their profits, and today we're going to make sure oil companies can't use Enron-like tactics on California consumers."

This is an object lesson in why now was the exact wrong time for the CDP to accept $50,000 from the prime progenitor of those Enron-style tactics. And it actually came up in the press conference.

Nunez referenced a Wall Street Journal article (behind the wall, sadly) that detailed how refineries are cashing in on high gas prices by artificially lowering their supply through various methods, particularly shutdowns. The three bills work out this way:

1) new oversight committee: Nunez and Eng's bill would create the California Petroleum Refinery Standards Committee, made up of the Attorney General, the State Controller and a couple political appointees, which would develop standards for maintenance and operations at California refineries, would look into shutdowns and would increase mandatory reporting from oil companies regarding them, would take audits and inspections, and would ensure compliance. Penalties for not complying to these standards, would be "very stiff" and would be considered felonies, not misdemeanors.

2) "Hot fuels": temperature varies in fuel, and it impacts the weight of gasoline, which since it's sold by the gallon impacts the price. The suspicion is that oil companies are manipulating temperature variations to give the consumer less for its money. Assemblyman Mike Davis' bill would seek a comprehensive study, cost-benefit analysis, and recommendations on what the national standard for gasoline temperature should be. Right now it's 60 degrees; the concern is that the number should be higher.

3) Petroleum Industry Information Reporting Act: oil companies are not releasing enough data to determine properly the efficacy of inventory levels and profit margins. Assemblyman Mike Feuer's bill would mandate monthly financial reports on oil supply, demand, and price issues. It would also allow that information to be shared with the Attorney General and the Board of Equalization.

These appear to be decent bills that correctly address the issue of artificial refinery supply. However, in the question-and-answer session that followed, there was an example of why it is not smart to play both sides of this fence.

The fact that the backdrop of the press conference was a Chevron statement is telling; after all, they own 25% of the refineries in the state, and they are getting rich off the high gas prices being made by their actions at those refineries. The VERY FIRST QUESTION offered to Speaker Nunez was about his trip to South America paid for in part by Chevron. Nunez replied that the trip was "insignificant," that the trip was taken to learn more about alternative fuels in South America, that he stands for issues that are important to Democrats, and that he resented any attempt to question his ethics. And right after the presser was over, during a sort of press gaggle, he told the radio reporter who asked that question that is was either a "cheap shot" or a "chicken shit" question (I wasn't quite close enough to fully make it out). The reporter replied that the information was out there and she was just giving the Speaker a chance to respond.

Clearly that's a fair question. And clearly it's fair to ask whether, at a time where the Speaker of the Assembly is accusing Chevron of market manipulation and of engaging in "Enron-like tactics," it's the best time for the CDP to be taking a $50,000 contribution from that same corporation. Now more than ever, the message should be united, and the perception here is quite confusing, and more hurtful than the money is helpful. I appreciate these efforts to stop market manipulation, but I do not appreciate giving the opposition another arrow in their quiver through the appearance of impropriety of this donation. I renew and strengthen my call for the Party to return the money and work in more innovative ways to fundraise and grow the party.

CDP: Please Give Chevron Back Their Money

I am fairly surprised that more has not been made in the blogosphere of the unwelcome news that Chevron is doing everything it can to buy off the California Democratic Party and some of its top legislators. Outside of this small item in The Oil Drum, pretty much nobody has said a word about the fact that the CDP accepted a $50,000 check from a company that is attempting to artificially depress capacity and manipulate the energy market in a way that is shockingly similar to how Enron made themselves a fortune during the 2000-2001 energy crisis. You can read the details here.

As a delegate to this party, I feel personally tainted by this donation. I feel like there is a concerted effort to buy my silence. It will not work, and I want to outline why I am respectfully asking this party, of which I am a member and to which I pay dues, to return the money.

I don't think I have to go into how Chevron controls the oil market in California by owning most of the refineries, and that in another era that would rightly be called a trust. I don't need to discuss their record profits or their expenditures of $44 million to defeat ballot propositions like Prop. 87 and Prop. 89 last year, or their consistently greedy profit-taking at a time of record gas prices throughout the state, or how they refuse to increase refining capacity to keep that profit artificially high. And I don't need to explain how corporations aren't in the business of charity, and that every expenditure they make has a stated outcome, whether for public relations purposes or to engender favorable legislation or just to keep government off their backs while they continue to rake in billions. What I can talk about is the poverty of imagination that leads the CDP to take a gift like this.

What bothers me most about taking a fat corporate donation like this, from the very interest group you fought tooth and nail against on Prop. 87 just 6 months ago, is how LAZY it is. There are an unlimited amount of ways to raise $50,000 that not only show no appearance of impropriety or corporate favoritism, but bring people into the process and grow the party, which are the key metrics for politics in the 21st century. If you really needed $50,000 in a state of 37 million people, how about this: ask 50,000 to give a dollar to specifically ensure that the CDP won't be beholden to big corporate money. You can hold dollar parties and write about how giving citizens a stake brings them closer to the party. And in return for that dollar, you could give people prominent space on the CDP website to upload a minute of video about what problems facing California most affect them. Then, once the money is collected, PUBLICLY REBUFF Chevron by telling them that their donation has been paid by the people. Not only would you be seen as populist folk heroes, you would be investing in the party by allowing 50,000 Calfornians get a share and a stake. That's called people power. The new metrics for the Presidential campaigns, for example, are not just money but numbers of donors, because that shows a broad base of support. A party that gets rich off fat $50,000 checks is a mile wide and an inch deep. We already have a party like that in California. It's called the Republican Party.

If that corporate money were even drilled in to infrastructure and party building, that would be something. But typically, it's not. And the party that continues on a traditional model of collecting big corporate checks and running big broadcast ads will be obsolete in a new media environment. Stoller:

We need to figure out new metrics for receiving party support aside from money and polling. Perhaps opt-in email addresses acquired? Friends on MySpace? Newly registered voters (I like this one)? Chatter across blogs using sites such as Blogpulse?

I'm not sure, but the whole landscape of politics is shifting. It's like an entirely new grammar is emerging, but we're not there yet.

A "dollar party" strategy, that could spread virally through social networking sites (is the CDP even on MySpace or Facebook?), that would bind more people to the party in a small way and set up a core of activists for GOTV, that would allow a press release that says "50,000 donors!" instead of hiding the fact that one polluting Big Oil ripoff artist gave you 50,000 dollars... would simply be a forward-thinking way to grow the party and gather attention.

I'm sure that there are a host of conciliators and "my-party-right-or-wrong" types that have a problem with me sharing even a scintilla of disagreement with the state party (there's another guy that believes in the silencing of any alternative voices, he resides at 1600 Penn. Ave, Wash, DC, 20500). First of all, I would have them take a look at the rise of DTS voters and the lack of success in joining the progressive wave in 2006 and ask them where all that brushing aside criticism has gotten them. But the second thing I would ask them is, why are you a Democrat? What do you believe, if anything? And how do you square that belief with the fact that one of the companies most committed to stopping any progress on global warming or reducing dependence on foreign oil just handed you - you! - a wad of money in order to shut you up?

The Speaker's Office claims that these donations won't impact Democrats' ability to take a hard look at what Chevron is attempting to do on refining capacity, and that "tough" legislation is forthcoming. I would hope so. I cannot impact what individual candidates receive in gifts; at least, not until election season. I can have an impact when it's my party. I'm a delegate and a member in good standing. I know for a fact that members of the Party leadership read this site. I'm asking those in charge at the CDP, nicely, to give back the Chevron money. I want to work on innovative fundraising solutions that can simultaneously fund the important work of the party and bring it closer to the people whom it serves. But like any addiction, the first step is admitting you have a problem.

Big Oil Buying Sacramento One Legislator At A Time

Jamie Court and Judy Dugan of the Foundation for Taxpayer and Consumer Rights pen an extremely troubling piece today about Big Oil, particularly Chevron, outright buying our government and its leaders. This is not limited to Republicans, but certainly the Governor is the biggest recipient of this largesse.

Take Gov. Arnold Schwarzenegger, who once claimed that he was so rich he did not need anyone else's money — and who isn't running for another office. Yet as gasoline prices were breaking last year's record of $3.38 a gallon, Schwarzenegger collected a $100,000 check May 1 from Chevron, the West's largest refiner. The company certainly had the cash on hand. Just three days earlier, it reported a $4.7-billion first-quarter profit, up 18% over the same period last year.

The contribution brought Schwarzenegger's take from Chevron to $665,000 (making it his 15th largest donor) since 2003, and his total political tribute from the energy industry is now $4 million. According to a recent Schwarzenegger fundraising solicitation, Chevron's $100,000 buys the company special briefings with the governor, something that beleaguered motorists aren't getting.

In all, oil companies delivered $90 MILLION dollars to political campaigns and parties in 2006, and while a lot of that went to block the corporate tax-for-alternative energy Prop. 87, plenty was spread around to political leaders and parties. And that seed money ensures that there is no investigation into practices like this:

Like power plant owners during California's 2001 electricity crisis, refiners such as Chevron have discovered that they can make more money by producing less gasoline. So they do. They have, over more than 20 years, deliberately reduced their capacity until they can barely meet California's needs under the best of circumstances. Industry spokesmen defend this as efficiency. But there is no slack in the production system, which shorts the market and raises prices.

Any planned or unplanned refinery outage, pipeline break or power failure causes prices to jump.

Take the case of a possum and a raccoon that, in March, bit through power substation lines feeding two refineries in the South Bay. The critters expired, but the outage caused a 7-cent jump in local wholesale gasoline prices. The cost of refining gasoline is stable over time, so these price spikes equal pure profit for Chevron and Co [...]

Chevron refined 22% less oil in the U.S. during the first quarter of this year than in the same quarter of 2006 because of longer "planned maintenance" downtime and accidents. Yet its total profit on U.S. refining increased 66%. Making less gasoline, it made much more money.

Last week, the CDP took $50,000 from Chevron. Court and Dugan also detail a junket that Schwarzenegger chief of staff Susan Kennedy took with Speaker Fabian Nuñez in Rio, a 12-day conference paid for by Chevron and other oil interests.

During the 12-day conference, Chevron's lobbyist got an entire day on the official agenda, which the public knows about only because of our Public Records Act request. Nuñez, who last year was highly critical of oil companies, seems to have nothing to say this year.

The FTCR have a long track record detailing this kind of takeover of our government. And we all know about the inordinate power that corporate interests have in Sacramento. This editorial makes it plain, and it's really shocking to see it so starkly.