A PLEA BARGAIN FOR EXXON

A PLEA BARGAIN FOR EXXON—AND HUMANITY ©

By William H. Espinosa

The greatest obstacle to an effective response to climate change is not economic and it’s not technical. It’s political both on a domestic and—the Paris Accord notwithstanding– global scale. In the United States particularly, vested foster fuel interests have confused and propagandized to their advantage to block meaningful measures. If we are to avert disaster, we need to turn our energies and creativity to overcoming political resistance.

We now know that in the 1970’s Exxon’s fleet of tankers plied the oceans trolling measuring devices to sample CO2 levels in the ocean. In the early 1980’s Exxon researchers worked alongside academics and government experts and created their own remarkably accurate climate change predictive models. Measurable but not yet catastrophic effects were expected to appear by the year 2030.  But there was some disagreement among the researchers as to whether irreversible processes would by then be set in motion that would cause catastrophe. No one was pretending that the change wasn’t man made. By positioning itself as a climate science leader, Exxon hoped to better manage its transition from the hydrocarbon fuel age to a new economy.

In the mid to late 1980s as short term greed replaced longer views in America’s corporate ethic, Exxon’s strategy changed. New management was installed, the research staff was decimated and in 1989 the company began a concerted effort to discredit the science that its own researchers had confirmed. Through intense lobbying, Exxon and others assured that the 1997 Kyoto Protocol was never ratified by the US Congress and to this day the company plays a large role in the coalition that fights any meaningful efforts to tackle climate change. Even in its current outlook, the company sees increasing demand for hydrocarbons and hails its exploitation of unconventional gas and oil resources. Ignored is the growing scientific judgment that if catastrophic change is to be averted, 80% of the currently known exploitable hydrocarbons must remain in the ground.

Climate Change and the Law

While efforts have been made at the local, state and national levels to reduce greenhouse emissions (GHGs) and the Paris Accord acknowledges the danger and sets forth a future framework, the world’s governments have been unable to find a firm-target (rather than aspirational) global regime for addressing climate change. Some countries, particularly those formerly dependent on imported fuels, have accelerated developments of alternatives and emphasized energy conservation. Germany is approaching 30% renewable use, Spain’s electric grid is now close to 70% renewable based, Costa Rica’s is above 90% and aims to be carbon neutral by 2021. But admirable as these efforts may be, absent a global agreement with enforceable GHG emission limits, the problem will only get worse. CO2 concentrations have increased more than 10% since the 1992 Rio Declaration where nations pledged to address global warming and the rate of addition is increasing. Mandated GHG reductions do not presently exist.

While Governmental agreements to restrict GHG emissions have proved elusive, the harm mounts and private litigants have sought redress. One of the most ancient precepts of law is the concept of sic utere.[1] Short for a longer Latin phrase, it essentially means that no person has the right to use his property so as to cause foreseeable harm to another. Surprisingly, even though it was recognized in the United States early last century, this fundamental principle has been slow to be applied in the cross-border environmental area. Effective agreements for dealing with claims are few.

Nonetheless, climate change is beginning to draw private litigants, unaided by governmental advocates, into the US court system. Following the devastation of Hurricane Katrina, victims sought recovery for GHG exacerbation of the storm. Not long afterwards an Alaskan native community whose village land was no longer protected by an ice barrier and was eroding into a rising and stormier sea brought a similar suit arguing public nuisance under federal common law. Both lost on jurisdictional grounds.

Other lawsuits have been filed. One in particular[2] did meet with success in compelling the EPA to put forth a plan for regulation of certain GHGs but it did not address liability issues . Insurance companies, fearing huge losses, are suing Chicago and other municipalities for failing to take protective measures against climate change induced storm surges. A complaint has been filed in Oregon alleging that the Federal Government has unconstitutionally deprived the young people of today of their future rights to life, liberty and property by refusing to take effective action.

The scale of damages are immense. The NRDC estimates that absent effective measures, annual GDP losses will be close to two trillion dollars in the United States later this century. These include crop losses, seaside flooding, and increased water and energy costs. The EPA estimates shorter term losses due to water shortages alone at $180 billion. The business backed Risky Business Project postulates a variety of scenarios for different regions and the country as a whole with losses in the hundreds of billions. With numbers like this even the deep pockets and cash hordes of the major energy companies could be consumed by damage claims in no time and the ugly specter of Chapter 11 and demolished shareholding value will loom.

News reports have commented on the similarities in strategy and identity of public relations consultants employed by the energy companies and the tobacco industry. The key to both strategies has been to sow doubt about the strength of the science linking products to harm. In the case of tobacco, the strategy worked for half a century but ultimately failed. A key factor was the discovery that the tobacco companies had known all along of the risks of smoking. This gave rise to a rash of new claims and undergirded the success of lawsuits brought by pubic authorities, including a RICO criminal complaint. Now, in the wake of disclosures of similar deception around climate change, political figures and civil society groups have called for a Justice Department inquiry. Late last year, the New York Attorney General announced an investigation and issued subpoenas.

At the same time, growing public pressure is rising to bring individual executives as well as the corporations they run into civil and criminal court for egregious harm. The Justice Department recently issued new guidelines targeting individuals and the Democratic primary struggle has highlighted the absence of criminal actions against individuals in the financial industry . Beyond RICO, the current trial of a coal company executive based on the death of 20 miners in his employee illustrates the wide range of prosecutorial theories available. These include fraud and making false representations to the Securities and Exchange Commission.

Internationally there is a nascent movement to make ecocide an international crime against peace subject to the International Criminal Court. There is no greater threat to existing ecosystems than rapidly changing weather patterns that do not give time for migration or other adaptation; thousands of species face extinction.

Sooner or later the severity of the harm inflicted on the Earth and humanity by the extraction, promotion and burning of hydrocarbons will bring legal consequences, sic utere. This is particularly true where the harm is foreseen and the risk is fraudulently concealed. It is not improbable that ExxonMobil and other energy giants similarly situated could face staggering claims far in excess of their ability to pay them. Moreover, it is by no means improbable that the executives who knew better and could have prevented such a terrible outcome could personally face claims, indictments and jail sentences as well as opprobrium and shame.

Truth and Reconciliation

But all this makes possible a deal. Truth and Reconciliation Commissions (TRCs) have been successfully used in situations where it is more important to move forward and put conflict behind than it is to seek punishment or extensive reparations for wrongdoing . While mandates vary, TRCs have been effective in easing out dictatorships (Chile, Argentina), transitioning out of apartheid (South Africa) or dealing with the festering abuses of conquered peoples (Canada). Promises of amnesty in return for truth-telling lessen the desperation of power wielders fearing retribution. Processes for uncovering the truth of past abuses permit healing, allowing once polarized societies to move forward into a positive conjoined future.

What might such a process look like in the context of climate change for not only Exxon but other major GHG emitters?

The Emitter would agree:

  1. To make a public announcement that after review of the current state of science, it has concluded that CO2 and other GHGs have reached levels which if current trends were to continue, are likely to destabilize the Earth’s climate and surface temperature, endangering the wellbeing of many human beings and posing a risk of extinction to countless species on land and sea;
  2. To plan its future hydrocarbon production activities in consonance with the “carbon budget” (the total amount of carbon the atmosphere can safely absorb) as such may be estimated from time to time by the Intergovernmental Panel on Climate Change (IPCC) or other agreed upon body.
  3. To devote not less than 30% of its research, exploration and development budget to energy efficiency and conservation, alternative energies and carbon sequestration or carbon-reducing or global cooling programs and technologies.
  4. To open its files and records and to permit its current and former employees and directors to be interviewed by an independent commission and to make these records and transcripts of inte rviews available to historians who are chronicling the world’s response to climate change.

In return, the US Government agrees:

  1. Not to bring a civil or criminal action of any kind against Exxon or Exxon’s executives based on Exxon’s production of hydrocarbons and their effect on the Earth’s climate or based on their past failure to disclose their own climate research findings.
  2. To propose to Congress that all GHG emitters who agree to abide by terms similar to these be immune from suits by any party for damages related to climate change.
  3. To actively seek to shield the emitter from prosecutions or suits brought by foreign persons in foreign or international tribunals.

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If applied to all those who accept the terms, the result may appear to be to deny redress to those most vulnerable and damaged by climate change and related phenomena. But this problem can be solved. Governments could offer compensation or restoration to those populations (paid, for example, out of a carbon tax). The world’s greater interest should be in moving quickly and eliminating the political resistance that large scale GHG emitters and the populations that are dependent on them have created. Tobacco resisted for fifty years. In fifty years—or even in twenty years– we may well set forces in motion that will have catastrophic consequences.

Moreover, looked at in a broader historical context, we need to recognize that over the past two centuries hydrocarbons have fueled the most astonishing period of economic growth in human history and that we are all beneficiaries of its use. We should respect the mentality and character traits that made this possible but like cowboys and carriage builders, oil, gas and coal men have had their day.   It is time to move on to a new era. Retributive behavior and protracted conflict will not help us do so. The model of Truth and Reconciliation can lead us into a plea bargain that saves Exxon Mobil and other GHG emitters from the worst consequences and benefits all of humanity.

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[1] The full phrase is sic utere tuo ut alienum non laedas, so use your own as not to injure another.

[2] Massachusetts v. Environmental Protection Agency, 549 U.S. 497 (2007). The decision was 5-4 with Justice Scalia writing a strong dissent.

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