Politics and Profits: How the Oil Cartel Gets Its Way



While many impoverished American families are shivering in the winter cold for lack of money to pay the oil baron their exorbitant price for home heating oil, ex-oil man, George W. Bush sleeps in a warm White House and relishes his defeat of the Congressional attempt to get rid of $15 billion in unconscionable tax breaks given those same profit-glutted oil companies like ExxonMobil when crude oil was half the price it is today.

This is the same George W. Bush who, calling himself a “compassionate conservative” in October 2000 made this promise to the American people: “First and foremost, we’ve got to make sure we fully fund the Low Income Home Energy Assistance Program (LIHEAP), which is a way to help low-income folks, particularly here in the East, pay for their high, high fuel bills.”

So what did this serial promise-breaker propose this year? Mr. Bush wanted to cut the fuel aid program by $379 million! This entire assistance program is funded at about half of the $5 billion that state governors and lawmakers believe is essential to meet the needs of the six million people eligible to apply for such help this year.

Everyone in Washington knows that the big, coddled, subsidized oil industry has many politicians over a barrel. When it comes to oily Bush and Cheney though, the global melting industry has these two indentured servants marinated in oil.

Look at what ending regulation of natural gas prices has produced: prices up 50 percent since last year. Home heating oil prices are up 30 percent. Bush’s own Energy Department estimates the rise of heating oil costs will impose an average increase of $375 for customers this winter. No way that supply and demand explains this gouge.

If a home dweller is too poor to order more than 100 gallons at a time, they get smacked with an extra surcharge of 60 to 70 cents per gallon for delivery.

Some states set aside some money. New York State will spend $25 million. Joe Kennedy and Citgo sell discounted heating oil, but that Venezuelan program is undergoing a reduction.

Efforts in Congress to impose a windfall-profits tax on the King Kong, record-profit-setting oil companies got nowhere.

Two years ago, efforts by Senator Charles Grassley (Rep. Iowa), then chairman of the Senate Finance Committee, begging the major oil giants to slice off a tiny portion of their profits for charitable contributions toward energy assistance for the poor did not receive even the courtesy of a response.

I’ve asked members of Congress, including the Black Caucus and the Hispanic Caucus in the House of Representatives to take up this cause vigorously and prominently on behalf of their constituents back home. Have you heard any high-visibility demand from these veteran lawmakers? I haven’t.

Even Senator Grassley seems to have despaired.

Please note that ExxonMobil alone made $36 billion in profits last year. That’s one company profiting over seven times the amount of dollars needed for energy assistance. Greed, arrogance, callousness and far too much unaccountable power exists in Big Oil and in its White House.

Enforcing the antitrust laws and prohibiting organized speculators at the Mercantile Exchange from determining the price of an essential product like petroleum will bring prices down. But there is no action in the White House. No demand from the Congress.

Veteran free lance reporter, Lance Tapley has been reporting for The Portland Phoenix newspaper on the price bilking of recipients of energy assistance programs. For thirty years, he writes, the oil dealers have been charging the Maine state housing authority, which administers the LIHEAP program, higher prices than they set for their payment-plan customers, despite the large bulk purchasing by this housing authority.

Tapley severely criticizes the failure of Governor John Baldacci for not standing up for poor Maine people at the same time he promotes large subsidies for business and sells off state-owned assets at bargain-basement prices to corporations.

Mr. Tapley writes: “The heating oil crisis could be a big test in 2008 for Baldacci and the State House Democrats. The picture will not be pretty if elderly poor people freeze in their trailers while rich Republicans and professional-class Democrats snuggle up in their McMansions or old Colonialsbut, with our Democrats, who needs Republicans?” (Contact Lance Tapley at ltapley@adelphia.net)

Some day, the tens of millions of poor people in America, most of them working poor, will be heard from. Until now, they have been exhausted, powerless, despairing, fearful and grasping for whatever crumbs fall off the table. History teaches us that such a subdued human condition does not continue indefinitely.

Call the White House switchboard (202-456-1414) and your member of Congress (Senate Information: 202-224-3121; House Information: 202-225-3121). Tell them not all these low-income Americans have been sent to oil rich Iraq. Many are here mourning their losses of and injuries to loved ones while they shiver in the cold.

Tell them to make those big oil CEOs making as much as $50,000 an hour to ante up.

RALPH NADER is the author of The Seventeen Traditions




Ralph Nader is a consumer advocate, lawyer and author of Only the Super-Rich Can Save Us! 

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