BP Oil Spill: Politicians and Lobbyists Cash In

Even as more tar balls wash up, Congress is on pace to break its record on oil industry contributions. Samuel P. Jacobs on why no one can stop the most uncappable cash spill in politics.

Patrick Semansky / AP Photo

President Obama was so upset about the BP oil spill he announced he was looking for “whose ass to kick.” Rep. Bart Stupak (D-MI) was moved to ask whether companies with bad safety records should be banned altogether. Even oil-industry friendly Sen. Richard Shelby (R-AL) called for BP executive Tony Hayward to get his yacht down to the Gulf to help clean up oil.

The air in Washington is full of hostility toward the oil industry these days, the result of the Deepwater Horizon explosion nearly 80 days ago—and BP’s continuing failure to plug the resulting leak. So you’d think all those politicians might be a bit sheepish about collecting campaign checks from the beleaguered industry right about now.

“It’s definitely been challenging at times,” says IPAA’s Dan Naatz. But, he adds, “We haven’t seen anybody walk away from us.”

You’d be wrong. At the moment, oil and gas companies are on track to shatter their record of total contributions from the last non-presidential election cycle, in 2006—despite the lingering effects of the economic downturn. Halfway through the election calendar, the industry is on pace to spend more than $27 million—the most ever in a campaign year not involving the White House. With the stakes in Congress so high—from health care to financial regulation—the jump in spending is mirrored in other industries as well. Oil still lags behind 13 other industries in its Washington largesse.

When BP executive Tony Hayward went to Capitol Hill for a grilling last month, a list of the amount of money that members of the House Energy and Commerce Committee accepted from oil and gas companies made its way around the Internet. The ever-apologetic Rep. Joe Barton (R-TX) had pocketed $100,470 from industry groups and employees since the beginning of 2009. He was outdone by Rep. Roy Blunt, the Missouri Republican who is in a tough race for Senate back home. Blunt’s haul totaled $133,000. Even one of BP’s fiercest critics, Rep. Henry Waxman (D-CA), pocketed $6,000 from industry supporters.

The political action committee for the Independent Petroleum Association of America, known as the Wildcatters Fund, has sprinkled donations into the pockets of candidates and officeholders throughout the country. After the oil spill, Barton, Shelby, Utah Republican Rep. Jason Chaffetz, and Republicans candidates for Congress, including Pennsylvania’s Tim Burns, New Mexico’s Steve Pearce, and Ohio’s Rob Portman, have all accepted donations from IPAA’s PAC.

Republicans aren’t the only ones fueling up on the industry’s largesse. Among the top 10 recipients of oil and gas money this election cycle are Democrats Sen. Blanche Lincoln of Arkansas, Rep. Dan Boren of Oklahoma, Sen. Arlen Specter of Pennsylvania, and Rep. Chet Edwards of Texas. According the Center for Responsive Politics’ Dave Levinthal, Democrats’ share of the industry pie hasn’t been this large since 1994.

So how does it feel to be both reviled and courted at the same time?

“It’s definitely been challenging at times,” says Dan Naatz, IPAA’s vice president for federal resources, of the current climate in Washington. But Naatz says his group hasn’t lost any supporters over spilled oil. “The people who we have supported in the past have been willing to work with us and talk with us,” he says. “We haven’t seen anybody walk away from us.”

Naatz says his group isn’t just preaching to the choir. IPAA staffers have met with staffers in the office of Sen. Robert Menendez, Democrat of New Jersey, who has been a vocal critic of offshore drilling. The senator declined to join the meeting, but Naatz says Menendez’s staff was receptive to IPAA’s take on energy policy. Naatz says he knows the industry needs better regulation but worries that a rush to pass legislation by the August recess or by the November midterms will lead to wrongheaded policy.

Martin Durbin, the American Petroleum Institute’s executive vice president of government affairs, says his group knows that officials are particularly sensitive to the bad feelings directed toward the oil industry at the moment.

“There are times when people will rather have a phone call than a meeting,” Durbin says.

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But he added that with investigations going on throughout Congress, API’s number is being called more than ever. “It’s not that we’ve got people blackballing us,” Durbin says.

One key to surviving the fallout from BP: distancing the group’s members from the guilty party in the Gulf of Mexico. The IPAA represents energy heavyweights like Devon Energy and Anadarko Petroleum, but Naatz’s pitch to policymakers is to focus on what he calls the “small businesses” that make up many of the 5,000 companies belonging to his group.

“We get painted with a broad brush as Big Oil,” Naatz says.

He makes a populist argument against the Obama administration’s moratorium on deepwater offshore drilling; ending offshore exploration hurts not only multinational corporations but people who “shop at the same supermarkets as you do.”

But Durbin of the American Petroleum Institute, which counts BP as a member, calls that strategy into question—arguing that no one in the industry benefits from painting British Petroleum in a bad light.

“This is no longer an issue about one company,” Durbin says. “The entire industry has to show that it is committed to safety and reliability.”

Still, he shares Naatz’s tendency to play down the yachting execs, and play up the jobs at stake.

“My concern is people are going to use what is a tragic accident in a way that, in the end, could be very harmful for our energy, security, and economy. The industry’s jobs support 9.2 million employees. We understand the things have to change. We can do this safely and reliably. But are we going to turn around and make things even harder on the economy?”

Samuel P. Jacobs is a staff reporter at The Daily Beast. He has also written for The Boston Globe, The New York Observer, and The New Republic Online.