WSJ Attacks Exxon for Not Losing Money on New Energy Sources
Article looks down on free market success and leaves out scientists on the other side of the global warming debate.
When The Wall Street Journal isnt happy
with profitable business practices, something is amiss.
Jeffrey Balls front-page article on June 14, 2005, took ExxonMobil Corp. to task for putting money into cleaning up fossil fuel energy rather than investing in alternative sources such as wind power. Ball highlighted Exxons competitors, BP and Royal Dutch/Shell, saying that they accept a growing scientific consensus that fossil fuels are a main contributor to the problem and they endorse the Kyoto Protocol, the 1997 accord regulating gas emissions.
Ball extensively quoted Exxon CEO Lee Raymond and included scientists who have done research for Exxon, but he left out independent scientific opposition to Kyoto and global warming theory in general. Ball claimed that a consensus of scientists believe its clear by now that fossil-fuel emissions are warming the earth and leading to dangerous consequences. Outside of Exxons payroll, there are many scientists he could have consulted, including more than 17,000 who signed a petition stating that the Kyoto Protocol was based on faulty assumptions.
Ball said Exxons approach to global warming typifies the bottom-line focus of its entire business, as if that were a bad focus for a corporation. The article continued that spending shareholders money to diversify into businesses that arent yet profitable and that aim to solve a problem his scientists believe may not be significant strikes the Exxon chief as a sloppy way to run a company.
Exxon is a for-profit corporation answering to shareholders, and its primary business is oil. As Ball points out, it does this better than any other oil company in the world due to its bottom-line focus. The reporter did not include Exxon shareholders who were pleased with the companys performance.
About halfway through the article, Ball explained that Exxon did, in fact, invest in research and development of alternative energy sources beginning in the 1970s. But the ventures werent profitable. As early as 1980, eight years before the United Nations put together a scientists panel on greenhouse gases, Exxons own scientists were studying theories of global warming. Their research turned up doubts that mankind is responsible for any warming trend there might be, Ball reported.
Citing one of the growing chorus of critics who say Exxons strategy is short-sighted, Ball quoted environmental advocate Andrew Logans view that there are two possible scenarios. One was that there is no climate change; the other was that there is, and humans are causing it. The Exxon scientists offered a third option: that there could be a warming trend, but man is not responsible for it meaning no man-made regulatory scheme could affect the planets climate in a significant way.
Ball stated that Exxon believes cleaner energy solutions must be cost-effective for other nations to develop them. Accounting for the cost of cleaning up energy is not something the media do well, as the Business & Media Institute has documented. Ball continued that trend, failing to cite the cost of the Kyoto accord for the United States, which the Energy Information Administration estimated would be upwards of $400 billion per year.
He also belittled Exxons $100 million investment in Stanford University energy research, saying that it represents less than two days of Exxons earnings. However, he emphasized Exxons contributions to the anti-regulation Competitive Enterprise Institute, which amounted to a mere $465,000 in 2003 less than 10 minutes of Exxons earnings, using the same calculation.
Overall, the Journals story came out lopsided, with Exxon on one side and the rest of the world against it. Implying that Exxon should abandon the traditional free market methods that have yielded a profit, the article stacked the deck against the corporation and failed to portray the global warming debate accurately.