Money to Burn

Article excerpt


WHEN BARACK OBAMA VISITED Ohio in mid-March during one of his many swings through the crucial battleground state,John Kasich, the state's Republican governor, made a point of pulling the president aside to put in a good word about a topic of growing importance in Ohio: natural gas fracking.

"I was telling him that what we're doing in Ohio is, we're setting standards so that we can have a safe environment and at the same time have economic development," Governor Kasich recounted telling the president during a NCAA basketball game in Dayton.

This sort of advocacy isn't free. In the past four years the oil and gas industry has given more than $200,000 to Kasich, making him the state's top recipient of campaign contributions from oil and gas companies. Since 2001, Kasich received more than twice as much money from fossil fuel interests as any other state office holder.

For the industry, this is money well spent. Soon after taking office in January 2011, Kasich opened 200,000 acres in Ohio's state parks for drilling and appointed a former oil and gas executive to run the state's Department of Natural Resources. Even after the industry's statehouse allies annoyed the governor by blocking his modest plans to impose a small severance tax on drilling, Kasich's loyalty remained firm. In May, the governor approved new fracking rules for the state that will, among other things, prohibit Ohio citizens or local governments from appealing any drilling permits, prevent doctors from disclosing whether patients' ailments might be related to drilling, and allow for well casings to be set within 50 feet of groundwater aquifers--half the distance recommended by the American Petroleum Institute. EcoWatch has called the legislation, parts of which were written by the gas industry and its lobbyists, "one of the worst fracking laws in the nation."

As a political swing state on the cusp of a drilling boom, Ohio is at the cutting edge of the nation's debate over how to meet our energy needs. The statehouse wrangling over gas regulations--along with the huge amounts of money being spent there to influence voters ahead of the fall election provides a window into how the fossil fuel industry plays an outsized role in shaping politics and policy.

The American energy industry is at a pivotal moment. New technologies like horizontal drilling and hydraulic fracturing (or fracking) have opened vast deposits of petroleum and methane that were previously inaccessible. While the glut of natural gas has helped to drive coal's share of US electricity generation to an all-time low (and, in the process, has flattened out the country's carbon dioxide emissions), it has also put drilling companies in a financial squeeze. Caught between low gas prices and the high costs of shale gas extraction, many companies are looking for ways to either cut corners or increase prices via a rise in demand. Natural gas producers are pressing hard for gas exports, increased reliance on natural gas for electricity generation, and subsidies for trucks and busses that run on natural gas. Oil companies, meanwhile, are demanding more shale drilling on public lands. And environmentalists, of course, are pushing back against these efforts, arguing that the drilling rush is endangering water quality and wildlife habitat and reducing the market incentives for creating the kind of renewable energy system that will further reduce C[O.sub.2] emissions.

The high stakes translate into a political battle royale as the fossil fuel industry commits to spending whatever it takes to influence voters and elect politicians who are sympathetic to its interests.

The oil and gas industry has been a political juggernaut since the days of John D. Rockefeller and Standard Oil, and few sectors of society can match the industry's influence in Washington. Since the 1970's, when the nation's cornerstone environmental laws were set in place, the oil and gas industry has again and again won major exclusions from environmental laws like the Clean Air Act, the Clean Water Act, and the Safe Drinking Water Act. …