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| Rachel Maddow Takes On the Oil Industry | |
| (3 days later) | |
| BLOWOUTCorrupted Democracy, Rogue State Russia, and the Richest, Most Destructive Industry on EarthBy Rachel Maddow | BLOWOUTCorrupted Democracy, Rogue State Russia, and the Richest, Most Destructive Industry on EarthBy Rachel Maddow |
| For those who have watched Rachel Maddow’s television show, the opening scene of her book will feel familiar in its eye for a compelling anecdote. She tells the 2003 story of a small new business in Manhattan’s Chelsea neighborhood that is about to be inaugurated by a head of state, in fact, “one of the most powerful men on the planet.” We’re intrigued. It turns out the business is a gas station. What’s going on? Four paragraphs later, we learn that the mystery man is Vladimir Putin, who is publicizing one of a string of American gas stations acquired by the Russian oil giant Lukoil. Having piqued your interest, Maddow now broadens her narrative and explains why this anecdote is an apt illustration of the book’s larger point — the centrality and influence of the oil and gas industry. | For those who have watched Rachel Maddow’s television show, the opening scene of her book will feel familiar in its eye for a compelling anecdote. She tells the 2003 story of a small new business in Manhattan’s Chelsea neighborhood that is about to be inaugurated by a head of state, in fact, “one of the most powerful men on the planet.” We’re intrigued. It turns out the business is a gas station. What’s going on? Four paragraphs later, we learn that the mystery man is Vladimir Putin, who is publicizing one of a string of American gas stations acquired by the Russian oil giant Lukoil. Having piqued your interest, Maddow now broadens her narrative and explains why this anecdote is an apt illustration of the book’s larger point — the centrality and influence of the oil and gas industry. |
| “Blowout” is a rollickingly well-written book, filled with fascinating, exciting and alarming stories about the impact of the oil and gas industry on the world today. While she is clearly animated by a concern about climate change, Maddow mostly describes the political consequences of an industry that has empowered some of the strangest people in the United States and the most unsavory ones abroad. It is “essentially a big casino,” she writes, “that can produce both power and triumphant great gobs of cash, often with little regard for merit.” | “Blowout” is a rollickingly well-written book, filled with fascinating, exciting and alarming stories about the impact of the oil and gas industry on the world today. While she is clearly animated by a concern about climate change, Maddow mostly describes the political consequences of an industry that has empowered some of the strangest people in the United States and the most unsavory ones abroad. It is “essentially a big casino,” she writes, “that can produce both power and triumphant great gobs of cash, often with little regard for merit.” |
| How much cash? Maddow tells the incredible, depressing story of Teodoro Nguema Obiang Mangue, the son of the long-serving dictator of Equatorial Guinea, a country that saw its oil revenues grow from $2.1 million in 1993 to a staggering $3.9 billion in 2007. Despite these billions pouring into state coffers, an NGO observed in 2009, “77 percent of the population lives in poverty, 35 percent die before the age of 40 and 57 percent lack access to safe water.” | How much cash? Maddow tells the incredible, depressing story of Teodoro Nguema Obiang Mangue, the son of the long-serving dictator of Equatorial Guinea, a country that saw its oil revenues grow from $2.1 million in 1993 to a staggering $3.9 billion in 2007. Despite these billions pouring into state coffers, an NGO observed in 2009, “77 percent of the population lives in poverty, 35 percent die before the age of 40 and 57 percent lack access to safe water.” |
| But life at that time is good for Teodoro, who owns a $100 million house in Paris, a $30 million beach house in Malibu, a $7 million vacation home in South Africa, one of the world’s largest yachts and dozens of racecars. When his drivers take one of Teodoro’s many girlfriends shopping, they are given a shoe box filled with up to $80,000 in cash for a single outing. His bill for one spree at an auction house in 2010, Maddow notes, would have paid the entire annual wages of 3,300 of his countrymen, since three-quarters of them live on $2 a day. (Teodoro does now face international investigations and pressure on various fronts.) | But life at that time is good for Teodoro, who owns a $100 million house in Paris, a $30 million beach house in Malibu, a $7 million vacation home in South Africa, one of the world’s largest yachts and dozens of racecars. When his drivers take one of Teodoro’s many girlfriends shopping, they are given a shoe box filled with up to $80,000 in cash for a single outing. His bill for one spree at an auction house in 2010, Maddow notes, would have paid the entire annual wages of 3,300 of his countrymen, since three-quarters of them live on $2 a day. (Teodoro does now face international investigations and pressure on various fronts.) |
| While there are many colorful tales about villains, scoundrels and adventurers, the through-line of this book is the story of the rise of Vladimir Putin. The most important geopolitical consequence of the oil and gas boom of the last 20 years has been Russia’s development into a full-blown petrostate, Putin’s consolidation of power and his determination to use this capacity to protect himself and disrupt the West. | While there are many colorful tales about villains, scoundrels and adventurers, the through-line of this book is the story of the rise of Vladimir Putin. The most important geopolitical consequence of the oil and gas boom of the last 20 years has been Russia’s development into a full-blown petrostate, Putin’s consolidation of power and his determination to use this capacity to protect himself and disrupt the West. |
| Maddow carefully takes us through the manner in which Putin asserted greater and greater control over Russia’s vast oil and gas resources. The key move was the takeover of what was then Russia’s largest oil company, Yukos, run by a brilliant entrepreneur, Mikhail Khodorkovsky. By 2003, Khodorkovsky had built Yukos into a $36 billion company, providing an estimated 5 percent of the total tax revenues of the Russian government, and was planning to acquire a competitor, Sibneft, which would make the conglomerate the world’s fourth largest oil producer. | Maddow carefully takes us through the manner in which Putin asserted greater and greater control over Russia’s vast oil and gas resources. The key move was the takeover of what was then Russia’s largest oil company, Yukos, run by a brilliant entrepreneur, Mikhail Khodorkovsky. By 2003, Khodorkovsky had built Yukos into a $36 billion company, providing an estimated 5 percent of the total tax revenues of the Russian government, and was planning to acquire a competitor, Sibneft, which would make the conglomerate the world’s fourth largest oil producer. |
| This was not to be. By the end of 2003, Khodorkovsky had been jailed for tax evasion, fraud and embezzlement. The Russian government charged that Yukos owed $27.5 billion in taxes and penalties. In 2004, the company was sold in an auction that lasted six minutes. The winning bid — at the firesale price of $9.3 billion — was from an unknown company with an initial capitalization of $300. That company quickly sold Yukos to the state-owned oil giant, Rosneft, at cost. Putin now controlled some of Russia’s largest and most productive oil assets. | This was not to be. By the end of 2003, Khodorkovsky had been jailed for tax evasion, fraud and embezzlement. The Russian government charged that Yukos owed $27.5 billion in taxes and penalties. In 2004, the company was sold in an auction that lasted six minutes. The winning bid — at the firesale price of $9.3 billion — was from an unknown company with an initial capitalization of $300. That company quickly sold Yukos to the state-owned oil giant, Rosneft, at cost. Putin now controlled some of Russia’s largest and most productive oil assets. |
| As oil prices rose, so did Putin’s ambitions, which reached a symbolic height with his decision to host the 2014 Winter Olympic Games in Sochi, a Russian resort town with little snow and lousy facilities. No matter, that seemed part of the plan, because what ensued was an orgy of construction and corruption. In a detailed, thorough analysis of the project, the Russian opposition leader Boris Nemtsov concluded that the Sochi Olympics had cost more than the previous 21 Winter Olympics combined, because Putin’s favored builders had lined their pockets with $25-$30 billion. A year later, Nemtsov was dead, assassinated just outside the Kremlin’s walls. | As oil prices rose, so did Putin’s ambitions, which reached a symbolic height with his decision to host the 2014 Winter Olympic Games in Sochi, a Russian resort town with little snow and lousy facilities. No matter, that seemed part of the plan, because what ensued was an orgy of construction and corruption. In a detailed, thorough analysis of the project, the Russian opposition leader Boris Nemtsov concluded that the Sochi Olympics had cost more than the previous 21 Winter Olympics combined, because Putin’s favored builders had lined their pockets with $25-$30 billion. A year later, Nemtsov was dead, assassinated just outside the Kremlin’s walls. |
| One of the book’s themes is the degree to which Western capitalists — bankers and oilmen — abetted Putin’s rise to power, cheered on his capture of resources and partnered with him no matter what he was doing to Russia’s democratic and capitalist experiment. Chief among them was Exxon’s C.E.O. Rex Tillerson (later the secretary of state), who was so cooperative that in 2013 Putin awarded him the Order of Friendship, one of the country’s highest honors bestowed on a foreigner. And Tillerson was a fast friend indeed. Maddow quotes from a 2016 conversation in which Tillerson explained that after Putin’s invasion of Ukraine and annexation of Crimea, he visited Russia and was surprised by his interactions with Putin and his aides. “The first question they asked me was … ‘Are you O.K.?’ And I said, ‘Well, yeah, I’m fine. Why do you ask?’ They said, ‘Well, we just wondered whether your government was coming after you because you’ve been doing business with us.’” Tillerson marveled that “they were more worried about me.” What amazing concern and consideration! For him, Putin’s aggression seemed far less noteworthy than his empathy. | One of the book’s themes is the degree to which Western capitalists — bankers and oilmen — abetted Putin’s rise to power, cheered on his capture of resources and partnered with him no matter what he was doing to Russia’s democratic and capitalist experiment. Chief among them was Exxon’s C.E.O. Rex Tillerson (later the secretary of state), who was so cooperative that in 2013 Putin awarded him the Order of Friendship, one of the country’s highest honors bestowed on a foreigner. And Tillerson was a fast friend indeed. Maddow quotes from a 2016 conversation in which Tillerson explained that after Putin’s invasion of Ukraine and annexation of Crimea, he visited Russia and was surprised by his interactions with Putin and his aides. “The first question they asked me was … ‘Are you O.K.?’ And I said, ‘Well, yeah, I’m fine. Why do you ask?’ They said, ‘Well, we just wondered whether your government was coming after you because you’ve been doing business with us.’” Tillerson marveled that “they were more worried about me.” What amazing concern and consideration! For him, Putin’s aggression seemed far less noteworthy than his empathy. |
| Ukraine features prominently in Maddow’s account because it has become the central struggle between Putin and the West, and America in particular. She describes how Putin was outraged by American support for the ouster of the corrupt and pro-Russian Ukrainian leader, Viktor Yanukovych, which happened in the midst of his triumphant Sochi Olympics. Putin was already deeply hostile toward the Obama administration, and Hillary Clinton in particular, for having given verbal support to pro—democracy protests in Moscow. For Putin, Western efforts at regime change could only be countered by his own attacks on Western democracies. | Ukraine features prominently in Maddow’s account because it has become the central struggle between Putin and the West, and America in particular. She describes how Putin was outraged by American support for the ouster of the corrupt and pro-Russian Ukrainian leader, Viktor Yanukovych, which happened in the midst of his triumphant Sochi Olympics. Putin was already deeply hostile toward the Obama administration, and Hillary Clinton in particular, for having given verbal support to pro—democracy protests in Moscow. For Putin, Western efforts at regime change could only be countered by his own attacks on Western democracies. |
| Maddow’s book is rich with other stories, from fracking in Oklahoma to the BP oil spill in the Gulf of Mexico. But while the tone throughout is one of shock, amazement and condemnation, the book is not as radical in its conclusions as readers might have anticipated. Maddow advocates more stringent rules on Western companies aiding foreign corruption. And she argues for an end to subsidies for the oil and gas industry, urging that it “pay for what it does.” I assume that means a carbon tax. | Maddow’s book is rich with other stories, from fracking in Oklahoma to the BP oil spill in the Gulf of Mexico. But while the tone throughout is one of shock, amazement and condemnation, the book is not as radical in its conclusions as readers might have anticipated. Maddow advocates more stringent rules on Western companies aiding foreign corruption. And she argues for an end to subsidies for the oil and gas industry, urging that it “pay for what it does.” I assume that means a carbon tax. |
| The caution is perhaps because Maddow knows that, whatever we might say about the oil and gas business, we are all eagerly consuming its products — charging our phones, flying on planes and using plastics. Around 80 percent of the world’s energy supply comes from fossil fuels, just about the same as 25 years ago. “I like driving a pickup and heating my house as much as the next person,” Maddow writes, “and the through-line between energy and economic growth and development is as clear to me as an electric streetlight piercing the black night.” In 2018, renewables made up just 11 percent of United States energy consumption. Without fossil fuels today, the lights would go out in much of the country. | The caution is perhaps because Maddow knows that, whatever we might say about the oil and gas business, we are all eagerly consuming its products — charging our phones, flying on planes and using plastics. Around 80 percent of the world’s energy supply comes from fossil fuels, just about the same as 25 years ago. “I like driving a pickup and heating my house as much as the next person,” Maddow writes, “and the through-line between energy and economic growth and development is as clear to me as an electric streetlight piercing the black night.” In 2018, renewables made up just 11 percent of United States energy consumption. Without fossil fuels today, the lights would go out in much of the country. |
| “Blowout” is a brilliant description of many of the problems caused by our reliance on fossil fuels. But it does not provide a path out of the darkness. | “Blowout” is a brilliant description of many of the problems caused by our reliance on fossil fuels. But it does not provide a path out of the darkness. |
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