Democrats could count on revving up the crowd in the Pepsi Center this past week by invoking “Big Oil” as the main beneficiary of Republican economic policy. Sens. Joseph Biden Jr., Hillary Clinton and about 20 others hammered this wedge from the convention podium. But Democrats – and Biden in particular – might have an oil problem of their own involving an oil company called Unocal (now merged with Chevron), one of Biden’s closest former staffers, and the military dictatorship in Burma.
The “Big Oil” charge makes a handy weapon for Democrats, in part because Big Oil is close with Republicans. According the Center for Responsive Politics, the oil and gas industry contributed $19.8 million to federal candidates since the 2006 elections, favoring Republicans three-to-one. John McCain pulled in $1.4 million of that total, making him the favorite candidate of the industry’s donors, while Barack Obama pulled in less than $400,000.
Montana Gov. Brian Schweitzer perfectly articulated the Democratic attack in his Tuesday night speech: “After eight years of a White House waiting hand and foot on big oil, John McCain offers more of the same,” Schweitzer said with a garrulous smile. “Now he wants to give the oil companies another $4 billion in tax breaks.”
This charge, repeated by Biden and many others, apparently stems from a study by the Center for American Progress, and is based on the tax savings the five biggest oil companies would accrue under McCain’s plan to cut the corporate tax rate from 35 percent to 25 percent. Contrary to the implication, McCain has no plans that specifically cut taxes for oil companies, and definitely not the “biggest” oil companies.
One of the five biggest oil companies – and therefore a member of “Big Oil” by the Democrats’ definition – is Chevron. And Chevron appears to have just won a far more narrowly tailored favor from the U.S. Senate – and Joe Biden – than they would get from McCain’s tax cut.
Last month, Biden issued a press release celebrating his role “spearhead[ing]” passage of the “Tom Lantos Block Burmese JADE (Junta’s Anti-Democratic Efforts) Act of 2008.” The bill, in retaliation to the military dictatorship’s crackdown last fall, would further restrict gem imports from Burma. The gem industry is run by the government, but so is the oil and gas industry – which is a bigger source of wealth for the Burmese government and for Chevron.
In 1997, just before U.S. sanctions went into place, Unocal announced a new natural gas project in Burma involving a production-sharing agreement with the military dictatorship, which allowed the project to continue even after the sanctions. Since then, the oil company – first Unocal, and now Chevron – has lobbied Washington to protect its arrangement with the junta. One of those lobbying Congress on this score is Alan Hoffman – Biden’s chief of staff from 1988 to 1993, and again from 2006 to 2008. In between, Hoffman was a lobbyist. While working for the top-tier firm Timmons & Co., Hoffman pled Unocal’s case on Burma, among other issues.
When Hoffman returned to Biden’s office in 2006, Foreign Relations Committee Chairman Biden – together with other Democratic senators – stripped out a provision in the House bill that would have forced Chevron to divest its stake in the gas field. While the final bill bore the name of the late Rep. Tom Lantos – and while Biden called it a tribute to Lantos – Lantos’ provision on Chevron did not last. “When the generals run out of cash, change will come to Burma,” Lantos had said.
A New York Sun article in June quoted a source estimating “Chevron’s income from the project at about $100 million for 2007.” And Chevron has given more to Barack Obama’s campaign than to McCain’s
So when Chevron’s and Unocal’s lobbyists defeated the human rights groups and saved their client hundreds of millions of dollars, Biden’s longtime staffer played a role. On the other hand, there are strong arguments for allowing Chevron to remain in Burma: In its absence, another company – perhaps even the Russian government – would step in, Burma’s government would get just as rich, and Chevron’s humanitarian efforts along the pipeline would cease. On the same score, there are very strong arguments for McCain’s cut in the corporate tax rate – dissuading companies from going abroad, possibly boosting wages and productivity, and lowering prices.
But it’s campaign season, and Democrats have no interest in giving McCain a fair shake when they can hit him as a Big Oil stooge. On that charge, however, Joe Biden may be living in a glass house.
Examiner columnist Timothy P. Carney is senior reporter for the Evans-Novak Political Report. His Examiner column appears on Fridays.
