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Tilting at Windmills

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April 21, 2006
By: Kevin Drum

MEANWHILE, IN THE GAMMA QUADRANT....Really, they have no shame. Lee Raymond, the CEO of Exxon, recently received a retirement payout estimated by experts at $4.3 kazillion, and here's what Dennis Hastert's spokesbot had to say about it:

"The speaker is very concerned about compensation packages given to executives like Raymond at a time when families are facing choices between putting food on the table and filling their car with gasoline," [Ron] Bonjean said. "We met with Exxon Mobil and several companies last fall, and it seems that the message hasn't gotten through."

...."Having a profit is good. We believe in that as Republicans," Bonjean said. "But when you're making this kind of money and American families are being affected, there should be appropriate things done to bring prices down. We're going to be asking them again: What are they doing with their enormous profits?"

Yes indeedy. The Republican party is now deeply concerned about corporate executives making unseemly amounts of money. Wink wink, nudge nudge. Next up: Tom DeLay criticizes corporate lobbyists for spending so much money entertaining members of Congress.

UPDATE: In case you're interested and why wouldn't you be? Exxon Mobil was the largest campaign contributor in the Oil & Gas sector during the 2004 election cycle. 89% of their contributions went to Republicans. I think we can safely expect Speaker Hastert's bark to be considerably more menacing than his bite.

Kevin Drum 11:34 PM Permalink | Trackbacks | Comments (89)

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Comments

And the rich continue to wonder why people eventually turn to Socialism.

Posted by: AluminumKen on April 22, 2006 at 12:12 AM | PERMALINK

I thought capitalism was the cure to all ills.

The free market regulates itself, and all that jazz.

Clearly, this is not the case.

Posted by: chuck on April 22, 2006 at 12:15 AM | PERMALINK

Lee Raymond made for an entertaining discussion at a local internet forum devoted to surfing (2ndlight.com, NSR forum). When people who are into muscle-powered recreation see a photo of Mr. Raymond's enormous double chin, there are reactions. At least Mr. Raymond was with the company for 43 years, and the incredible payout reflects his entire service.

Exxon seems always to have been big enough to be a predator company, not prey--unlike Phillips, an excellent company that got merged. Maybe its a good time for Washingtonians to visit the reopened Phillips Collection and assess this oil millionaire's good taste.

Posted by: Dave on April 22, 2006 at 12:29 AM | PERMALINK

Some historian step up. Didn't we have unfettered capitalism at the turn of the 19th-20th century when democrats were Republicans and republicans were Democrats, and robber barons roamed free?

Posted by: notthere on April 22, 2006 at 12:30 AM | PERMALINK

OK, Mr Raymond, you've really done it now with that obscene retirement package of yours. We've hired a couple of goodfellas to come over and administer, let's just say, a little punishment, OK?

And when they slap you in the wrist, you stay slapped, OK?

Posted by: frankly0 on April 22, 2006 at 1:04 AM | PERMALINK

The Republican party is now deeply concerned about corporate executives making unseemly amounts of money.

But Lee Raymond is NOT making a unseemly amount of money. Suppose Lee Raymond had not worked for Exxon. Then Exxon probably would've made $5 kazillion less amount of dollars than it would have. By hiring Lee Raymond and paying him $4.3 kazillion they made more money. And this doesn't even count the huge amounts of money Lee Raymond would've made for Exxon's competitors if they hired him instead. So his compensation is perfectly fair.

Posted by: Al on April 22, 2006 at 1:18 AM | PERMALINK

But Lee Raymond is NOT making a unseemly amount of money. Suppose Lee Raymond had not worked for Exxon. Then Exxon probably would've made $5 kazillion less amount of dollars than it would have. By hiring Lee Raymond and paying him $4.3 kazillion they made more money. And this doesn't even count the huge amounts of money Lee Raymond would've made for Exxon's competitors if they hired him instead. So his compensation is perfectly fair.

Sucking CEO dick is truly Al's calling.

Posted by: ogmb on April 22, 2006 at 1:27 AM | PERMALINK

"Suppose Lee Raymond had not worked for Exxon. Then Exxon probably would've made $5 kazillion less amount of dollars than it would have."

And you think this because ...?

Posted by: A on April 22, 2006 at 1:38 AM | PERMALINK

Studies have shown that Baseball players' performance is more correlated to salery than CEO's performance. And who do we hear more bitching about? ARod's salery.

Posted by: MobiusKlein on April 22, 2006 at 1:38 AM | PERMALINK

This isn't about doing anything. It's about appealing to midterm voters.

Message: He Cares!

Posted by: Royko on April 22, 2006 at 1:40 AM | PERMALINK


DAVE: At least Mr. Raymond was with the company for 43 years, and the incredible payout reflects his entire service.

Yeah, because it's not like we should expect that he might have saved just a little from his $50 million annual salary to see him through retirement. I mean, sure, he got about a million a week, but I think we all know how easy it is to sometimes run a little short by the end of the week. But did he ask for more? No, sir. So now, for all his sacrifice and for his long service, he can look forward to a retirement when, finally, he won't have to scrimp and scrape to make ends meet.

Besides, after getting along on so little for so long, he's probably used to a frugal lifestyle. So when he dies, he can leave several hundred million to children and grandchildren, all of whom will almost certainly want to buy a few dozen politicians to serve as their pets.

Shows you what hard work can do. That and having god-like talent unlike other mortals. Watching that guy do his CEO thing was like watching Tiger Woods swing a golf club. It gives you goose bumps, I tell you! Even more, it gives Al erections!

Posted by: jayarbee on April 22, 2006 at 1:45 AM | PERMALINK

I say we start a "Guest CEO" program, and hire illegal mexican immigrants to be CEO's.

(and the stockholders rejoiced)

Posted by: osama_been_forgotten on April 22, 2006 at 1:53 AM | PERMALINK

Uhm, other than France, where are people "turning to Socialism" ??

Posted by: BigRiver on April 22, 2006 at 1:58 AM | PERMALINK

....and what they didn't pony out to the GOP they spent in large measure underwriting bogus science which was then fed through the right wing noise machine to claim global warming was not a reality.

See:

http://www.motherjones.com/news/featurex/2005/05/exxon_chart.html

Posted by: dweb on April 22, 2006 at 2:03 AM | PERMALINK

Studies have shown that Baseball players' performance is more correlated to salery than CEO's performance. And who do we hear more bitching about? ARod's salery.
Posted by: MobiusKlein on April 22, 2006 at 1:38 AM | PERMALINK

. . . and not a single one of those studies corrected for illicit steroid abuse.

Posted by: osama_been_forgotten on April 22, 2006 at 2:18 AM | PERMALINK

A few reasons why Raymond just might have been worth $400 million to the company.

Posted by: tbrosz on April 22, 2006 at 2:36 AM | PERMALINK

I seem to detect a sense of jealousy that the Repubs are getting all these contributions from corporate America!

Posted by: pencarrow on April 22, 2006 at 2:41 AM | PERMALINK


OSAMA BEEN FORGOTTEN: . . . and not a single one of those studies corrected for illicit steroid abuse.

Which raises the question: How do we know Raymond, Trump, Welch, Lay, et al haven't been hittin' the 'roids to accomplish their amazing feats of CEOing?


Posted by: jayarbee on April 22, 2006 at 2:42 AM | PERMALINK

Uhm, other than France, where are people "turning to Socialism" ??

Brazil
Bolivia
Russia (again)
Cuba (never stopped)
Argentina
Massachusetts
Chile
Mexico
Italy
Sweden

for a start: and France, where they get five-week vacations, a secure job, high standards of health care, etc. is the fifth largest economy in the world, bigger than California, where we get no vacation, no health care--which means our infant mortality is twice as high as France's, and the jobs as secure as a penny-stock portfolio.

Posted by: jim on April 22, 2006 at 2:43 AM | PERMALINK


TBROSZ: A few reasons why Raymond just might have been worth $400 million to the company.

And here's a few more reasons. Depending on how you look at it, though, they might also be reasons why he was worth shit.


Posted by: jayarbee on April 22, 2006 at 2:55 AM | PERMALINK

Ah France. Where college students riot because an employer might want them to actually prove themselves capable of working before the are entitled to a life time job. France, where the unemplyment is double that of the US. Where the annual GDP growth is a third or less than that of the US. Where major corperations are leaving instead of investing new capital in that country.
I don't know where you work Jim, but my employees get 2 to 3 weeks of vacation a year plus paid holidays. They have health insurance and pension benefits. I do that with a business with only eight employees. And that is in Ca.
Kevin complains how 80% of the oil/gas sector political donations go to Republicans. What percentage of donations from unions go to Democrats?

Posted by: Meatss on April 22, 2006 at 2:59 AM | PERMALINK

Who cares about "unemployment rates," anyway? If one doesn't have a "job" to report to the economic statistician, who cares?

Who cares about "productivity"? Why should one be required to "produce" anything except what one needs?

And why, exactly, does it have to grow? Who cares?

Who cares? Guys like Raymond, that's who, who need for us to "produce" more at our "jobs" so we can fill their pockets with cash to buy yachts and other crap.

"Work less, Live more." What a country! And no, sorry, I'm not leaving; I'm a patriotic American.

Posted by: jim on April 22, 2006 at 3:16 AM | PERMALINK

tbrosz: A few reasons why Raymond just might have been worth $400 million to the company."

You've got to be kidding.

A recent detailed breakdown in Lee Raymond's compensation determined that he was receiving approximately $144,000 a day during his tenure at ExxonMobil.

That's $100 per minute, awake and asleep!

Nobody -- and I mean no-fucking-body -- is worth $100 per minute! I don't care if it's the Queen of England -- who'd have to be controlling the entire Latin American illegal narcotics trade, just like Lyndon LaRouche claims, to be making that kind of dough.

And did you see that photo of Raymond on The Daily Show with Jon Stewart the other night? Grossly overweight and triple-chinned jowls. The guy is the walking embodiment -- or perhaps "motorized embodiment", since he probably couldn't walk a quarter-mile without sitting down to catch his breath -- of several of the seven deadly sins.

The damndest part about this is that people like your corporate Jabba the Hut here are also the type of people who begrudge the working poor any increase in the minimum wage, adequate health care coverage, etc., etc.

Unless piggies like your precious Lee "$100 Minuteman" Raymond begin to show some self-restraint in curbing such monstrously gluttonous appetites, both physical and fiscal, events may well begin to play out that does it for them permanently.

$100 per minute -- Christ, if the Democrats can't turn that kind of avarice and vice into a campaign issue that working people everywhere can relate to, then our country is truly in dire jeopardy.

Posted by: (Comrade) Donald from Hawaii on April 22, 2006 at 3:23 AM | PERMALINK

jim: "Guys like Raymond, that's who, who need for us to 'produce' more at our 'jobs' so we can fill their pockets with cash to buy yachts ..."

Raymond's so huge, he'd probably capsize whatever yacht he was on. He puts new meaning into the term "Fat Cat."

But he could charter one of the three of Norwegian Cruise Lines' ships that currently sail Hawaiian waters.

Or he could charter them all at the same time, just to get in our faces and show off.

Posted by: (Comrade) Donald from Hawaii on April 22, 2006 at 3:38 AM | PERMALINK

Al: "But Lee Raymond is NOT making a unseemly amount of money. ... So his compensation is perfectly fair."

Hey, Al, you could try sticking your head up Mr. Raymond's ass for a change, instead of your own.

Oh, what the Hell, he's so huge that you could probably crawl inside there entirely, and nobody would ever notice that you're missing -- except for me, because then I wouldn't have anyone to pick on.

Nah! On second thought, that probably wouldn't be such a good idea. He'd probably charge you $100 per minute for the privilege.

See, Al, I really do have your best interests at heart.

Posted by: (Comrade) Donald from Hawaii on April 22, 2006 at 3:48 AM | PERMALINK

Donald:

Well, when you start a multi-billion dollar oil company like the ones whose tankers keep your little island lit up with something other than tiki torches, you can pay your CEO a lot less.

A movie star gets paid about $25 million a picture. If they shoot for six months 8 hours a day, seven days a week, what does that come down to per minute? And most of these are raving liberals who get absolutely no grief from any other liberals for this.

I don't begrudge them the money. The studios think the many more millions their pictures earn make the movie stars worth it.

Exxon came to a similar conclusion.

Just to keep things in perspective, this article discusses oil company taxes paid.

Ted Kennedy gets trust fund money for sitting around, sucking in oxygen, and converting it to greenhouse gases. So it goes.

Posted by: tbrosz on April 22, 2006 at 3:57 AM | PERMALINK


France, the U.S., there's not a dime's worth of difference between them; they're both midgets. Yes, the slide down will occur more quickly here than where societal guarantees give some protection against poverty -- until they're inevitably rescinded. Workers throughout the first-world will be told, as they are already, that keeping their jobs depends on competing with Chinese workers earning about a dollar per day. China is the giant we're in the coliseum with. This downward slide is the only possible direction of capitalism. All economists know this beneath their delusions. They are simply hoping we can hold out long enough until a miracle savior arrives: perpetual motion, dark matter, anti-gravity, cold fusion. The bad logic of such pseudo-science is identical to the logic of capitalism. It's competition, people. By definition, that means just a few winners and a world full of losers. In sports, what with union negotiators, team salary caps, TV network pay-outs, and a contrived playoff system, we can artificially inflate the ratio of winners--just as liberal democracies have attempted to do with assorted safety nets. But with a global economy, those are being dismantled, and the U.S. is leading the way. It's not going to be pretty; it's already ugly. The ruling classes will be sending ever more of our young men and women across the globe to kill on their behalf in order to satisfy their greed for growth. They're not called "corporate empires" for nothing. Democrats can't stop it. But maybe, just maybe, just a sliver of a hope, just barely a prayer, they may be able to slow it down long enough for some, I don't know, miracle? fusion? to come riding to our rescue. Nah.


Posted by: jayarbee on April 22, 2006 at 4:34 AM | PERMALINK

notthere: "Some historian step up. Didn't we have unfettered capitalism at the turn of the 19th-20th century when democrats were Republicans and republicans were Democrats, and robber barons roamed free?"

OK, since I'm currently pursuing a Master's degree in Ammerican history, let me put aside the wisecracks temporarily and take a crack at this for you.

The Republican Party was founded by Abraham Lincoln and fellow abolitionists in the early 1850's, having split off the from the libertarian Whigs, who were perfectly content to leave the institution of slavery alone. At the same time, the Democrats had evolved from the populist party of Andrew Jackson into the one that primarily represented the interests of the American business establishment.

The Republicans were probably the more liberal of the two major political parties in America until the watershed event of Abraham Lincoln's assassination in 1865.

Since money almost always gravitates to where its holders perceive the political power to be, the business establishment -- especially the railroad and energy interests -- pretty much co-opted the GOP during Ulysses Grant's two terms in office (1869-77), which lead to the first of the periodic major political scandals involving bribery and malfeasance that rock the White House during Republican administrations every generation or so.

The Democratic Party began gradually moving to the left during this period, and by the period in question that you've cited (late 19th-early 20th centuries) regained its former full-throttled populism, championing the rights of labor and farmers under the nominal leadership of William Jennings Bryan -- who ironically was also a Christian fundamentalist, eventually leading the prosecution in the infamous 1925 "Scopes Monkey Trial" in Tennessee that challenged the teaching of evolution in public school.

Meanwhile, the GOP during this time was in the thralls of imperialism, led by the likes of Benjamin Harrison, who actively encouraged the overthrow of Queen Liliuokalani's constitutional monarchy in Hawaii by American business and military interests in 1893, and William McKinley, who soon after annexed Hawaii for the United States, along with the Philippines, Guam, Samoa, Puerto Rico and Cuba immediately following the successful conclusion of our country's "Splendid Little War" with Spain in 1898.

Democrats during this time were split nationwide, because while the South was under near-complete Democratic Party domination, Southern Democrats were a very socially conservative (even reactionary) faction who pursued their own version of apartheid, cemented into law by the U.S. Supreme Court's infamous 1896 Plessy v. Ferguson ruling, which formally legalized the concept of "separate but equal" racial segregation. This internal party conflict was never resolved until the passage of the 1964 Civil Rights Act and the 1965 Voting Rights Act, which led many Southern "Dixiecrats" to eventually bolt the Democratic Party for the GOP during the Nixon administration. (See Thurmond, Strom, et al.)

One of the great analytical ironies in American history is that Abraham Lincoln and his Confederate counterpart Jefferson Davis (who was a Democrat) would no doubt scarcely recognize their respective parties today. On issues of race and economics, both parties' respective current platforms are almost completely the reverse of what they were in the critically divisive election of 1860, which quickly led to outbreak of the Civil War.

Hope this cursory historical background helps you.

Posted by: Donald from Hawaii on April 22, 2006 at 4:40 AM | PERMALINK

tbrosz: " ... when you start a multi-billion dollar oil company like the ones whose tankers keep your little island lit up with something other than tiki torches ..."

Wow. That's really an incredible statement with overtly racist overtones. Small wonder that you're a Republican (see my 4:40am post for further explanation).

FYI:
-- Honolulu was founded in 1820, making it the third oldest American city west of the Mississippi River (the older cities are St. Louis and Santa Fe);

-- The Kingdom of Hawaii provided nearly 75% of all foodstuffs (including almost all meat) consumed by Americans in California during the Gold Rush era (1849-60), and by the 1890s its plantations accounted for nearly one-third of all sugar consumed by Americans;

-- the Kingdom of Hawaii in the mid-to-late 19th century had the fourth largest merchant marine in the world (mostly engaged in whaling, making it one of the leading energy producers of its day);

-- The Hawaiian people's literacy rate was nearly twice that in the United States during the 19th century;

-- King Kalakaua was the first foreign head of state to travel to the United States (Washington, D.C., to negotiate the Reciprocity Treaty of 1875 with Pres. Grant), and to travel around the world (1878-79); and

-- The island of Oahu in the 1880s had electricity, running water and a state-of-the-art sewage system, and a modern transporation (railroads and streetcars) and telephone communications infrastructure in the 1880s, while most Americans were still compelled to take a shit by candlelight in either an outhouse or the nearest open ditch.

Anyway, regardless of your grossly ignorant display of ethnic bigotry -- Lee Raymond did not found ExxonMobil, he's still a gluttonous pig, and no doubt you two clearly deserve each other.

I stand by everything I said -- nobody is worth $100 per minute, awake or asleep. Period. End of discussion.

Aloha, haole boy -- with an emphasis on boy.

Posted by: Donald from Hawaii on April 22, 2006 at 5:18 AM | PERMALINK

Fine job of troll-whacking there, David!

Posted by: Charles on April 22, 2006 at 5:50 AM | PERMALINK

Donald, I meant Donald.

(Always preview. Always preview.)

Posted by: Charles on April 22, 2006 at 5:52 AM | PERMALINK

Look, it's simple.

By paying out such large compensation packages to Raymond and making the rest of us pay for it with $50 fill-ups, Exxon is doing us all a favor by getting us to drive less in order to slow the process of global warming.

See? Exxon is using prices to save the environment. It's a lot more effective than Republican environmental policy.

C'mon. You just have to let the system work.

Posted by: pj_in_jesusland on April 22, 2006 at 6:58 AM | PERMALINK

Have you notced what the guy looks like? He's just about the ugliest dude. He needs that money to get laid.

Posted by: Aren on April 22, 2006 at 8:41 AM | PERMALINK

Dave -- Just as a correction (since I work at the Phillips Collection) that's not the same Phillips family. That Duncan Phillips made their money through steel in Pittsburgh.

Posted by: DC1974 on April 22, 2006 at 8:43 AM | PERMALINK

I have to say I have trouble with this one. Yes, he is getting an obscene amount of cash, but compared to what?

Oprah makes $200M/year
Mel Gibson made $400M+ on one movie
Keano Reeves made over $200M for the Matrix movies
Letterman makes $31M to do a talk show
Limbaugh makes over $35M for yacking on the redio
Katie Couric is getting about $20M to read for TV
Shaq makes $27M to play basketball

Compared to those is he getting too much?

Posted by: Mark-NC on April 22, 2006 at 8:47 AM | PERMALINK

OK - a re-post.

I have to say I have trouble with this one. Yes, he is getting an obscene amount of cash, but compared to what?

Oprah makes $200M/year
Mel Gibson - $400M+ on one movie
Keano Reeves - over $200M for the Matrix movies
Letterman - $31M/year to do a talk show
Limbaugh - over $35M/year for yacking on the radio
Katie Couric - $20M/year to read for TV
Shaq - $27M/year to play basketball

Compared to those is he getting too much?

Posted by: Mark-NC on April 22, 2006 at 8:50 AM | PERMALINK

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Posted by: phentermine on April 22, 2006 at 8:52 AM | PERMALINK

"We met with Exxon Mobil and several companies last fall, and it seems that the message hasn't gotten through."

Maybe next time they'll put them under oath?

A few reasons why Raymond just might have been worth $400 million to the company.

I swear I'll never understand the motivation that drives some people to rush to the defense of the people on the earth who require defending the least.

Posted by: Paul on April 22, 2006 at 9:01 AM | PERMALINK

Why do you think this is any business of the government?

After all, he's being paid by Exxon's shareholders, not by the taxpayer.

It's government's role to make sure corporate governance works - for example that director elections are run properly - but if those directors appointed by the owners then decide that it makes sense to pay the CEO huge amounts of money isn't that their business?

Look at it another way... let's say that having this guy as CEO increased revenue by .5% compared to a guy who would have done the job for free, decreased costs .5% compared to a guy who would have done the job for free, and increased annual growth by .1% compared to a guy who would have done the job for free.

In that case how much value did he add to the company and what percentage of that is it fair to pay him?

Posted by: Michael Friedman on April 22, 2006 at 9:40 AM | PERMALINK

Does this CEO leave Exxon with a reputation for being a company that respects the environment? A company that has been honest with it's required financial reports? A company that has been honest with the infomation it has supplied the Congress and other public institutions? Hmmm.

I'm no expert, but think I know the answer. So, how justified is the reputation? I'm not sure.

Posted by: little ole jim from red country on April 22, 2006 at 9:42 AM | PERMALINK

Those are interesting questions, but Exxon's CEO is employed by the owners of the company, not Greenpeace or the DNC.

I think their key question is "Does this CEO make us lots of money compared to the risk (regulatory, financial, reputational, etc.) that he exposes us to and without cutting ethical corners that we find personally unacceptable?"

Posted by: Michael Friedman on April 22, 2006 at 9:49 AM | PERMALINK

How about a reason why Raymond might not be worth the 400 million?

His company hasn't been finding enough oil lately. Exxon's production has remained relatively flat in a world of growing demand.

"the bulk of Exxon's failure to grow their supply as they hoped does not come from project delays, but rather than from somewhat underestimating the decline rate in their existing fields. Indeed, for the last eight years, all of the very considerable new capacity that Exxon has bought on at great expense and enormous trouble has only gone to offset declines. They have not managed to grow their production or market share one iota. So when Exxon CEO Lee Raymond says

"When oil's at $60 a barrel, at least $20 of that is speculative and not supported by the fundamentals."

"one has to wonder why he feels so confident when his own company is running with Alice and the Red Queen: going hard at it just to stay in the same place."

"Exxon and the Implications of 8%" Stuart Staniford http://www.theoildrum.com/story/2005/11/16/182053/32

Moreover, unlike BP, Exxon has done little to diversify his company's operations. Frankly, my biggest complaint with the $400 million retirement package is that it is rewarding lackluster performance and an utter failure of vision. That is a problem that is far too typical in board rooms across America.

Posted by: Ron Byers on April 22, 2006 at 9:49 AM | PERMALINK

It's a retirement package. In the real world, you make them look good to get rid of people -- not because they are an invaluable resource that no other company has. In the CEO world you make retirement packages ridiculously good 1) to get a competing CEO to fight for a takeover bid of their company, 2) because the CEO sets their own retirement package, 3) because board members in line to be CEO wants to set a precedent and encourage a rapid succession so they can get their 4.3 kazillion, or 4) to attract the best and brightest school children to be interested in working toward such a thankless job.

BTW tbrosz -- The surrender monkeys at Total have kicked Exxon's ass in in the stock market during Raymond's tenure.

Posted by: toast on April 22, 2006 at 10:03 AM | PERMALINK

Michael Freedman, it's a bit dishonest to say he is being paid by the shareholders and not the taxpayers. With the 10 billion or so in subsidies just passed on to the oil companies by the congress, I am sure Exxon's share of that was over $400,000,000. Therefore this tax break did in a sense get picked up by the taxpayer.

Posted by: trifecta on April 22, 2006 at 10:10 AM | PERMALINK

Has anyone yet correlated Cheney's secret energy policy meetings in 2002 with today's increasing gasoline prices and the resulting soaring energy company profits?

Posted by: Jack Lindahl on April 22, 2006 at 10:12 AM | PERMALINK

jim-

Your infant mortality statistic is just wrong:

Infant Mortality Rates
France: 4.21 (2006 est.) [CIA World Factbook]
California: 5.2 (2003) [California DHS]

Ratio: 1.24

Sources:
CIA World Factbook

http://www.cia.gov/cia/publications/factbook/geos/fr.html
http://www.dhs.ca.gov/chs/OHIR/reports/others/InfantDeath2000.pdf

-Mev

Posted by: Mev on April 22, 2006 at 10:24 AM | PERMALINK

Michael: The questions to me are a lot more that "interesting". There are good reasons to expect corporations to abide by the law and the spirit of the law. I'm very much with you on the idea that profit is needed (most of us buy into that American Dream of "big money"), but it's not a matter of pleasing Greenpeace or the DNC.

I simply want the big guys to abide by the law as I (a little guy with a small company) has to abide by the law. I want them to be responsible corporate "citizens".

Cutting corners can lead to cutting huge corners. A corporation like Exxon can harm a lot of people, thus all of our laws, regulations, and required financial reporting. We do not owe Exxon anything more that what we owe the small company or the guy who owns no part of a company.

Posted by: little ole jim from red country on April 22, 2006 at 10:33 AM | PERMALINK

Donald, mahalo nui loa for taking the boob to task for his remarks and providing those great facts on the wahi pana of Hawai'i.

Posted by: Windhorse on April 22, 2006 at 10:47 AM | PERMALINK

Well, little ole jim, if you have any evidence that Exxon is breaking the law why are you fooling around with blog comments rather than contacting a local or federal prosecutor's office?

Posted by: Michael Friedman on April 22, 2006 at 10:49 AM | PERMALINK

Trifecta says:

Michael Freedman, it's a bit dishonest to say he is being paid by the shareholders and not the taxpayers. With the 10 billion or so in subsidies just passed on to the oil companies by the congress, I am sure Exxon's share of that was over $400,000,000. Therefore this tax break did in a sense get picked up by the taxpayer.

Trifecta, are you suggesting that the tax payers should get a say in the salary of every person who works for an industry that gets tax breaks?

Because if that's so I'd like caps on salaries for all actors and sports stars. In particular, a US$150,000 per year cap for those with masters or doctorates, US$100,000 per year for those just with college degrees, US$75,000 per year for those with just highschool degrees, and US$50,000 per year for highschool dropouts.

I'm not sure to what extent the music industry gets tax breaks but if they get large enough ones to qualify for this treatment then I'd like to apply these rules to musicians and singers as well.

Posted by: Michael Friedman on April 22, 2006 at 10:53 AM | PERMALINK

Michael, I'm making a case for honest financial reporting, not trying to put anybody in jail today. No, I have no hard evidence that I need to turn over to prosecutors. That why I said Im no expert.

People should not take extreme positions, they should not be anti-corporate vs. pro-corporate. Our economic system is largely built around corporations, thus we should make them work, not hinder them unnecessarily. At least thats my view.

I favor honest corporate reporting. That protects against the Enrons and WorldComs of the world. To say nothing of the Harkins/Aloha Petroleums of the world. If a corporation cannot remain competitive with honest reporting there is something wrong with our system.

Posted by: little ole jim from red country on April 22, 2006 at 11:23 AM | PERMALINK

Well, lojfrc, if people are lying on their financial reports that's a crime and they should go to jail. They are cheating the owners and potential purchasers of the companies they manage.

If you have evidence that Exxon or any other listed company has done that you should be reporting it to the SEC.

Posted by: Michael Friedman on April 22, 2006 at 11:25 AM | PERMALINK

Hey Don, before you complete that masters degree crack a book and find out why libertarians would not support slavery or the economic protectionism that was the Whig's unifying issue.

Posted by: Red Mega-Man on April 22, 2006 at 11:26 AM | PERMALINK

The Republican party is now deeply concerned about corporate executives making unseemly amounts of money. Wink wink, nudge nudge.


That's just like when news tv newscharacters, like Sam Donaldson and David Brinkley, used to sit around and have long searching conversations with themselves on whether or not they might be too liberal.

Posted by: cld on April 22, 2006 at 11:34 AM | PERMALINK

You know what? Oprah, Dave and even the big blowhole play by the rule of the market (as do actors and baseball players) and as they aren't coddled by a feeble congress and obscene kickbacks they are entitled to the money they get.

Exxon? Jesus Christ. Americans are getting absolutely gouged by a fixed market controlled by dictatorships, quasi-democratic states and monarchies -- and this is the conservative celebration of the free market?

Hell, the fuckers can pay that pig whatever they want, but let's not fool ourselves into thinking that Exxon is any different than the corrupt 'privatized' criminal enterprises that pass for the free market in Russia. Same people. Same greasy corruption. Zero competition.

If anything, Syriana was too soft on this preposterous scam of the oil bidness.

Posted by: noltf on April 22, 2006 at 11:37 AM | PERMALINK

If it's like that why don't you start an oil company?

Posted by: Michael Friedman on April 22, 2006 at 11:45 AM | PERMALINK

I made my comments for others to respond to, so thanks for that at least.

My strong sense is that Exxon is not known for honest financial reporting or honest give and take with Congress, etc. And, that the CEO bears some responsibility for that reputation.

Have any complaints been made to the SEC? Yes they have, e.g., http://www.winstead.com/articles/articles/Summary%20of%20FCPA%20White%20Paper.pdf

If you goggle SEC complaints and Exxon you are going to be presented with a lot.

But Im not familiar with any details of that, like I am with Harkin.

Posted by: little ole jim from red country on April 22, 2006 at 11:49 AM | PERMALINK

Hook, Line & Sinker...

Posted by: Ben Merc on April 22, 2006 at 11:51 AM | PERMALINK

lojfrc, I think you can find complaints filed about every significant public company.

I've found complaints against IBM, GE, and Coca Cola.

This means nothing.

Posted by: Michael Friedman on April 22, 2006 at 11:56 AM | PERMALINK

What does lojfrc mean? Even Goggle won't tell me that.

Also, if you have a lot of Exxon stock, chill, I'm not hoping to see the company fall on it's sword. Even got relatives and friends who make good money with them.

Posted by: little ole jim from red country on April 22, 2006 at 12:05 PM | PERMALINK

Actually, the more I read about Exxon, the more I think my impression of a corporation with some problems was correct. Look at this.

http://intranet.csreurope.org/news/csr/one-entry?entry_id=113355

Jury penalizing Exxon no less that 10 billion.

Posted by: little ole jim from red country on April 22, 2006 at 12:09 PM | PERMALINK

If you want the government to do something about the price of gas, why aren't you urging them to streamline regulations so more refineries can be built? There hasn't been a new one built in 30 years. If you don't want dependence on Saudi oil, allow for exploration in ANWR and off the Gulf and California coasts. You want Exxon to search for more oil, but you won't let them seach here at home for it.

Posted by: meatss on April 22, 2006 at 12:13 PM | PERMALINK

trifecta,

Here's Exxon's 2005 SEC filing:

http://yahoo.brand.edgar-online.com/fetchFilingFrameset.aspx?dcn=0001193125-06-040951&Type=HTML

Earnings before federal and non-U.S. income taxes
US: $16,098
Non-US: $42,532
Total: $58,630
Theoretical tax: $20,521
Adjustments: ($2,740)
Total US tax: $17,781
Effective US tax rate: 30.3%

A subsidy of $400m are less than 1% of pre-tax earnings, 1.1% of post-tax earnings, and 2.25% of US taxes.

It's not fair to say that taxpayers are paying for Lee Raymond's salary unless you can argue that his salary would have been significantly different without the subsidy.

It's especially unfair to say it's dishonest not to adhere to your personal accounting rule of matching executive salaries with government subsidies.

little ole jim,

Did you expect no one to read the link you posted? It mentioned one incident involving Mobil and none involving Exxon.

Also, you should know better than to let accusations of wrongdoing stand for evidence of wrongdoing, especially when the target is generally unpopular.

If you want to talk about how dishonestly Exxon behaves, you have two choices:

1) Prove that Exxon is behaving dishonestly.
2) Find a group of people who will allow you to assert without proof (or alternatively, using only circumstantial evidence) that Exxon is behaving dishonestly.

I don't think you've done either of these things on this message board.

Posted by: Mev on April 22, 2006 at 12:25 PM | PERMALINK

If you want the government to do something about the price of gas, why aren't you urging them to streamline regulations so more refineries can be built? There hasn't been a new one built in 30 years.

The oil companies don't want to build more refineries, and in fact, some of them colluded to prevent the construction of new refineries to keep prices high.

Posted by: Windhorse on April 22, 2006 at 12:25 PM | PERMALINK

Yeah, if only the oil companies would build new refineries - only they don't build new ones - if only meatss would vote for taxpayer funded refineries for ExxonMobil - cause it's not like they have enough money to fund their own refineries.

Jeebus indeedy.

Posted by: Cheryl on April 22, 2006 at 12:28 PM | PERMALINK

Last line of the article about $10b in damages against ExxonMobil:

"Legal analysts have said that the verdict is likely to be overturned or reduced on appeal."

Posted by: Mev on April 22, 2006 at 12:29 PM | PERMALINK

Windhorse,

The article you cited says no such thing. Collusion is a criminal activity, and people go to jail over it.

The fact that the three companies independently decided to reduce refining capacity in the face of economic pressure to do so does not mean they were colluding.

Posted by: Mev on April 22, 2006 at 12:33 PM | PERMALINK

Mev: you got me confused. Exxon merged with Mobil in 1999. The bribery case was initiated in 2003 against Exxon Mobil. Are you just quibbling?

Also, the other link involved two separate Alabama juries, the first penalized Exxon 3 billion and Exxon got off on appeal to the Supreme Court of Alabama on a technicality. A re-trial jury upped the penalty to 10 billion; with the foreman saying Exxon should not be able to get away with such fraud.

I not interested in being unfair to Exxon

Posted by: little ole jim from red country on April 22, 2006 at 12:39 PM | PERMALINK

Collusion is a criminal activity, and people go to jail over it.

You are correct, and I hesitated over the use of the word. Perhaps it's more correct to say that they "happened to act toward the same goals at the same time with the same self-interest to prevent new refineries from being built," whatever you want to call that.

Posted by: Windhorse on April 22, 2006 at 12:50 PM | PERMALINK

The bribery case was against "a former senior Mobil Oil Corp. executive" who, along with an investment banker, bribed Kazakh officials in 1996. How is Exxon involved?

The reason I'm making this point is that Exxon acquired Mobil, and Exxon's ethics policies are now in place for ExxonMobil, not Mobil's. An Exxon executive would have been unceremoniously terminated and handed over to federal prosecutors. (Of course, I'm just making this assertion without proof. :) )

In any case, I'm just saying that the fact that Mobil has behaved badly in the past is not evidence that ExxonMobil is behaving badly now.

Also, legal analysts still say that the $10b damages award will be reduced or overturned on appeal, no matter how strongly the jury foreman feels about the situation.

Posted by: Mev on April 22, 2006 at 12:50 PM | PERMALINK

Well look, two juries have ruled against Exxon, the second jury seemed to be quite insulted and upped the ante by over 300 percent. That does no bode well for Exxon.

Also, note the the article ended with quotes by Exxon spokesmen, with the very last quote that you cite being unattributed. That may just be Exxon legal folks taling, putting the best face on a loss.

If Exxon is exonerated for a legitimate reason, so be it, perhaps that will be justice. I certainly wouldn't bet on that happening.

Posted by: little ole jim from red country on April 22, 2006 at 12:56 PM | PERMALINK

I guess we're down to opinions at this point. Mine's no better than yours.

If you really believe that verdict will be upheld, though, you'd better tell your friends and family to sell their stock. That's 30% of their 2005 post-tax earnings. :)

Posted by: Mev on April 22, 2006 at 1:11 PM | PERMALINK

A reduced penalty wouldn't surprise me and I have no idea if or how much could be justified.

However, my math tells me that 10 billion is 30% of 33.3 billion. Is that really all what Exxon made after tax? I heard they topped Microsoft for 2005.

Posted by: little ole jim from red country on April 22, 2006 at 1:19 PM | PERMALINK

For those who didn't follow the link and read the memos, here is an excerpt from an internal Mobil memorandum that discusses their efforts at keeping an independent refiner from opening shop and offering gas at lower prices:

Needless to say, we would all like to see [the] Powerine [refinery] stay down. Full court press is warranted in this case and I know Brian and Chuck are working this hard. One thought, if they do start up, depending on circumstances, might be worth buying out their production and marketing ourselves. Especially if they start to market below our incremental cost of production. Last year whey they were dumping RFG at below cost of MTBE, we purchased all their avails and marketed ourselves...if they do start up, seriously consider this tactic.

FYI -- we vigorously opposed the small refiner exemption when it was proposed back in 1993. We also participated in a law suit with the other majors to oppose the exemption.

While the exemption was adopted and the law suit not successful, Chuck Morgan was able to get significant requirements put into the regs that had to be met before the exemption could be granted.

Posted by: Windhorse on April 22, 2006 at 1:22 PM | PERMALINK

"Katie Couric - $20M/year to read for TV
Shaq - $27M/year to play basketball

Compared to those is he getting too much?"

Those people are all paid ridiculous amounts because they are brand names. You are right it is stupid that our system allows them to take home almost all of that and pass it on to thier descendents forever, we ought to be scooping up most of it in taxes to respread the luck. The poorly remembered version of econ101 which is the basis of right wing economic thought is wrong. Oprah isn't a billionaire because she is the perfect media personality and 100 times as good as some other woman who only makes $1 mil a year. She is a very competent person who largely by luck ended up in self reinforcing feedback loop of super-stardom. Many other people did what she did as well as she did, and were more successful than average on their merits, but didn't get the long string of lucky breaks that lead from a sucessful life to being one of the richest people on earth.

CEO pay is somewhat similar, except the self reinforcing loop is not an emergent property of mass media, but an emergent property of mass limited liability corporate ownership and greedy amoral unethical CEO's. Our economic system distributes ownership so widely and to so many people and the rules are set up so that it is very difficult for owners to exhert control over thier property. Because of this top executives, particularly CEO's, have been able to construct a self reinforcing feedback loop in thier compensation system.

The only real difference is that so many (but not all) CEO's are conciously cheating the shareholders they are legally and ethically bound to serve, while entertainers are simply reaping the benefits of consumers irrational valuation of familiar names.

Posted by: jefff on April 22, 2006 at 1:25 PM | PERMALINK

Ok, you were close enough, Exxon made a record 36.1 billion in profit for 2005. I guess that after employees are paid, thus it's profit to be distributed to stock owners. But yeah, a 10 billion penalty would be huge. Don't doubt it will be reduced.

Posted by: little ole jim from red country on April 22, 2006 at 1:32 PM | PERMALINK

Donald:

Anyway, regardless of your grossly ignorant display of ethnic bigotry -- Lee Raymond did not found ExxonMobil, he's still a gluttonous pig, and no doubt you two clearly deserve each other.

I stand by everything I said -- nobody is worth $100 per minute, awake or asleep. Period. End of discussion.

Aloha, haole boy -- with an emphasis on boy.

There's nothing more entertaining than watching someone here load their bazooka and take a killing shot at a target that doesn't exist.

I don't know where you pulled "race" out of my comment, unless it's the standard tendency of liberals to pull "race" out of anything.

My point was that Hawaii is, today, entirely dependent on the evil oil and gas companies (as well as coal) to keep your lifestyle. For that matter, so is Las Vegas, but not being an island, the point is not as obvious. The way the islands formed, there isn't much in the way of fossil fuel resources. This was as true when Oahu had electricity in 1880 as it is today. There are some renewable resources: there is ethanol from sugar cane, and some wind and solar. There is geothermal, and a lot of potential for ocean thermal power, but as yet, what comes out of your plug in the wall is as much a product of Exxon and similar companies as mine is. I'm assuming we're not going back to whale oil any time soon.

Those tankers stop coming out there for more than a few weeks, and life gets bad. Where I live, it would probably be trains that are the lifeline.

I've never lived in Hawaii, but I have been there, and know a bit of their history, too. It wasn't the issue. If I'd put down "candles" instead of "tiki torches," would that have made a difference?

My second point is that a lot of people pull down $100 a minute or more, including some that are the height of political correctness, and never get grief for it.

And so far, in this conversation, only one of us has launched anything approaching an ethnic slur.

Posted by: tbrosz on April 22, 2006 at 2:16 PM | PERMALINK

Speaker Has"turd," "I'm shocked, shocked, that there's excessive compensation to Oil executives going on here!"
"Sir, here are your Exxon campaign contributions..."
"Thank you."

If Has"turd" defending American families isn't irony, then irony is dead.

Posted by: c u n d gulag on April 22, 2006 at 2:23 PM | PERMALINK

Paul:

I swear I'll never understand the motivation that drives some people to rush to the defense of the people on the earth who require defending the least.

Tell me about it. There's a couple of threads here where people spend a lot of time explaining why the president of Iran isn't nearly as bad as all that.

Look, I think it's a lot of money, too. But there's an underlying principle behind the arguments on both sides here. One side thinks that it's the right of the company to pay, or not pay, whatever it wants. The other side, whether they say so or not, wants control of this process.

The thing is, once you have the precedent of killing and eating the "rich," it doesn't take long before the line of "who has too much" drops to where you are. Check out the famous "first tax form." Do some corrections for inflation, and you can see how easy this was to sell to the average member of the public. Things changed.

Reminds me: anybody figure out how much Uncle Sam is getting from this guy?

Now if you want to get into issues of unfair competition in the oil business--some people here have rightfully pointed out difficulties with independent suppliers attempting to undercut prices or build new refineries--you've got my attention. I noticed that when they passed new regulations out here on gas station pollution, the big companies rebuilt their stations at great cost. Little ones went out of business or sold out. Makes you wonder.

Posted by: tbrosz on April 22, 2006 at 2:35 PM | PERMALINK

Why is this an issue for anyone but the people who pay Raymond's salary, the owners of Exxon? If he's being overpaid, they're the suckers, not you or I. And please don't say we've got no choice but to buy from Exxon, because nearly everybody has a choice of more than one gas station. If you think Exxon's products aren't good value for the money, then take your business to Texaco or BP.

Posted by: P.B. Almeida on April 22, 2006 at 2:48 PM | PERMALINK

...just as liberal democracies have attempted to do with assorted safety nets. But with a global economy, those are being dismantled, and the U.S. is leading the way.

Dismantled? The White House floated some extremely modest cutbacks of Social Security and promptly got its clocked cleaned. The one major development with respect to entitlements in the US of late -- the prescription drug plan -- is a vastly expensive extension of the safety net. What planet are you living on? Far from being dismantled, safety nets throughout the rich world are only growing more robust and more costly.

Posted by: P.B. Almeida on April 22, 2006 at 2:57 PM | PERMALINK

"Why is this an issue for anyone but the people who pay Raymond's salary, the owners of Exxon? If he's being overpaid, they're the suckers, not you or I. And please don't say we've got no choice but to buy from Exxon, because nearly everybody has a choice of more than one gas station. If you think Exxon's products aren't good value for the money, then take your business to Texaco or BP."

Well any of us who have retirement plans, or US mutual funds are fairly likely to own a bit of exxon somewhere, so yea he probably is stealing a bit of my money and even a bit of yours.

Posted by: jefff on April 22, 2006 at 3:24 PM | PERMALINK

Has anyone yet correlated Cheney's secret energy policy meetings in 2002 with today's increasing gasoline prices and the resulting soaring energy company profits?
Posted by: Jack Lindahl on April 22, 2006 at 10:12 AM | PERMALINK

Correlated?

PREDICTED!

In 2002, I bought a car that runs on diesel (mostly biodiesel, these days) and gets 46 mpg, because I *knew* the agenda of the secret energy meeting: "we bought you the presidency, now what are you going to do for us?"

Duh. I've been saying so on this blog and others for 5 years that this whole thing has been a war-profiteering scam from day 1.

Posted by: osama_been_forgotten on April 22, 2006 at 3:25 PM | PERMALINK

This isn't about doing anything. It's about appealing to midterm voters.

I believe that the figure was $400,000,000. that's really an embarassment for Republicans and more an insult to the voters than true damage. It's about a penny per gallon of gasoline. Still, the tactlessness, tastelessness, arrogance of the whole thing is just galling. In the whole history of the US there have been tycoons in every generation who received outrageous compensation like that, and I can well understand why it makes some people hate capitalism.

Maybe he'll donate it, like Rockefeller University, Memorial Sloan-Kettering Cancer Center, The Leland Stanford University, or the Howard Hughes Medical Institute.

Posted by: republicrat on April 22, 2006 at 4:02 PM | PERMALINK


P.B. ALMEIDA: Far from being dismantled, safety nets throughout the rich world are only growing more robust and more costly.

I guess you missed hearing about the $10 billion Medicaid cut Bush signed into law in February, two days after submitting his proposed budget for next year which calls for even greater cuts in Medicaid. I guess the billions cut from the student loan program went right over your head also. And somehow the fact has passed you by that there hasn't been a raise in the minimum wage in more than a decade. Also, apparently you haven't heard about the bankruptcy and overtime restrictions signed into law. As for the "vastly expensive" Medicare Part B benefit, it is a safety net only for insurance and pharmaceutical companies.


Posted by: jayarbee on April 22, 2006 at 4:41 PM | PERMALINK

On the other hand, "President" Hastert has a nice ring to it. If Hastert is feeling a need to act as if he cares about obscene CEO pay, it means some of the anger of the electorate is reaching that coddled Republican conscience.

33% approval, heh.

Posted by: PTate in Mn on April 22, 2006 at 5:26 PM | PERMALINK

and what about the oil company executives not having to be sworn in before they testified before a house committee some months ago?

does hastert have an answer for that one?


apparently,


you can buy

the right to lie

if you know the right guy.

that's denny hastert

yes, denny hastert

he's the basdert

who sells favors

in all sorts of flavors

including

the right to lie to the congress and the people.

buy hastert

it's a great brand!

Posted by: orionATL on April 22, 2006 at 9:25 PM | PERMALINK

From The Economist (http://www.economist.com/business/displaystory.cfm?story_id=6838726):

Exxon's ex-boss has been characteristically unapologetic, however. Mr Raymond seems to think that he has actually earned the moneymuch of which is the result of various long-term incentive schemes and hardly counts as the retirement package it was reported to be...What is more, he has a point. Exxon earned more in profit last yearover $36 billionthan any company has ever done before. True, Mr Raymond has had the good fortune to work in an industry that has benefited from the soaring oil price. But even allowing for that, Exxon under Mr Raymond has enjoyed a remarkable record of using its capital to earn high profitsone reason why it has easily outperformed most other large oil companies in terms of total shareholder returns...And it is the shareholders, after all, who pay Mr Raymondand who have done well out of Exxon themselves. The real executive compensation scandals are those cases when bosses do well, while their shareholders do not.

Posted by: P.B. Almeida on April 23, 2006 at 9:38 AM | PERMALINK

DC1974,
Just for the record, sorry about mixing up my Phillips's.

Some of those steel barons were amazingly good at collecting art. Sorry about getting the wrong Phillips. I'm a biologist for the US Fish and Wildlife Service, and have trouble enough dealing with Florida's natural history. Still, as a Penn State product from the days when it was a big deal to get a summer job at a steel mill, I should have known my steel barons.

Posted by: Dave on April 23, 2006 at 6:32 PM | PERMALINK




 

 

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