After sixteen years, ExxonMobil has still not compensated Alaska fishermen five billion dollars for damages caused by the eleven million gallons of crude oil dumped in Prince William Sound during the 1989 tanker spill.
ExxonMobil was ordered to pay the five billion dollars in a 1994 lawsuit. Since then, the company has been appealing the case in the Ninth Court Of Appeals.
More than 700 miles of coastline, used as the primary source of income for Alaska’s fishing and boating industries, were affected by the spill. Greenpeace sent out press releases yesterday to call on Exxon to compensate the fishermen.
ExxonMobil reported record high 75 per cent profit growth to almost ten billion dollars in the latest earnings quarter. ExxonMobil CEO, Lee Raymond, and other oil executives face questions on Capitol Hill today to explain high profits and suspicions of price gouging.
I certainly remember the environmental tragedy that ensued after that tanker spill. It was all so unrecoverable. It's disgraceful that Exxon has not stepped up to compensate those whom they have harmed.
As if we needed more reasons.
In wanting to contribute to this effort, I have a smallish article on the history of the power of the boycott and then a modern-day example that is occurring even as I type this.
Surprisingly, the concept of a boycott is relatively new. The term was adopted in 1880 and named after Capt. Charles Cunningham Boycott. Capt. Boycott was a rather ruthless landlord in Ireland whose heavy-handed eviction methods caused his employees to refuse to cooperate with either Capt. Boycott or any member of his family. (Source)
Although the origin of the word "boycott" is traced to 1880, the practice of boycotting existed successfully well before the term was coined. In fact, it was a boycott that was integral in bringing about the American Revolution. In 1764, the British Sugar and Currency Acts created such economic difficulty in the American colonies that soon-to-be Americans boycotted British goods in protest. From this effort arose the slogan "no taxation without representation". (Source)
Nations have also boycotted to express their displeasure at the policies and practices of other nations. In 1980, then President Jimmy Carter ordered a boycott of the 1980 summer Olympics in Moscow to protest the invasion of Afghanistan. The Soviet Union, in turn, boycotted the 1984 Los Angeles summer Olympics and compelled the participation of 14 other eastern bloc countries. (Source)
Another political boycott was undertaken by Arab countries to protest Israel and all countries who traded with Isreal. In 1973, these countries undertook a massive oil embargo which denied oil to Israel and its Western allies. The ensuing gas crisis in the United States created shortages and long lines and is widely believed to have changed the American auto industry for the worse, enabling the manufacturers of small, fuel efficient cars (primarily in Japan) to gain a foothold with frustrated consumers. (Source)
Perhaps the most famous boycott in American history (and one that has been in the news due to the recent death of Rosa Parks) was the Montgomery, Alabama bus boycott. In 1955, Rosa Parks, an African American woman, refused to give up her seat on the bus to a white man. The move was emblematic of a larger struggle against racial segregation. Civil rights leaders, among them Martin Luther King, Jr., knew that a boycott of the bus system by Montgomery african americans had the potential to bring the city to its knees financially. The key was ensuring that african americans did not break ranks and ride the bus. After nearly a year, Montgomery, Alabama relented. The Montgomery bus boycott marked the beginning of the modern American civil rights movement. (Source)
A high-level overview of the keys to a successful organized boycott are as follows, from Conscientious Consuming:
- A Clear Issue - Monroe Friedman, writing in the Journal of Social Issues, states "successful boycotts tended to be cognitively simple and emotionally appealing." This is perhaps best illustrated in the case of the boycott of canned tuna. The premise is simple and emotional: why do fishermen need to kill dolphins to make canned tuna?
- A Visible Target - Companies that sell consumer products are very sensitive to their corporate image. The negative publicity associated with a boycott (or threat of a boycott) can effect a company’s image in addition to its sales.
- Clear Alternatives to the Boycotted Product - In the Burger King case consumers had clear alternatives – McDonald’s, Wendy’s, etc. Boycott organizers are wise to make sure that the companies being boycotted know that consumers are not just boycotting them, but also supporting their competitors!
- Visibility of Violations - Because successful boycotts rely on damaging both the sales and image of the offending company, the visibility of violations is important. The more visible violations and violators are, the more public pressure can be applied.
- An Organized Effort - It is not uncommon for a boycott to take years to be successful. In many cases like-minded individuals have created nonprofit organizations to further their causes. This can make it easier to gather funding, create educational materials, receive publicity and promote their cause. Today, the Internet and this web site give consumers additional opportunities to organize.
- Why Boycotts Work - The bottom line is that companies survive on consumer dollars. The power consumers have is their dollars and the influence they exert comes from their consumer choices. If a company realizes that their conduct or actions are costing them dollars in sales or profits, they will change them.
Exxon meets all of these criteria. Today, the most visible issue is their excessive profits while consumers suffer, but one could also make the case for their environmental, social and business pratices as additional reasons to boycott. Exxon is definitively visible, and has clear alternatives from which consumers can choose. This blog is an effort to organize, to use our consumer leverage against Exxon to damage both their image and their sales.
Finally, let me relate a small story I saw this morning on CNN about a boycott that is happening right now. Sponsored by the Women and Girls Foundation of Western Pennsylvania, a group of 23 girls have initiated a "girl-cott" against T-shirts being sold by popular teen retailer Abercrombie and Fitch. The girls find these T-shirts offensive and I have to say that I agree. A few slogans on the front of the shirts:
The girls decided that they are demeaning and offensive and the girls started their "girl-cott". Their effort caught the attention of NBC's Today Show and the media onslaught began - MSNBC, CNN, and all the other major televised news outlets picked up the story. This past Friday, Abercrombie and Fitch announced that it would stop selling some of these offensive T-shirts. Chalk one up for a visible coalition of 23 principled girls and some media attention.
There's a lesson in this for each of us who look at a corporate giant like Exxon and wonder what kind of impact we can have. With the right combination of pressure and exposure, we can accomplish more than we might even imagine.
Using tactics perfected by tobacco companies, Esso has confused the public and policy makers in the US about climate change and sapped the political will to address it.
Esso ran advertising campaigns in the US press condemning the Kyoto Protocol and dismissing climate change. It has also funded think-tanks and lobby groups to the tune of $12 million since 1997. These groups are involved both in lobbying governments directly and appearing in the media as 'independent experts' who question the reality of climate change and oppose efforts to address it. Groups funded by Esso include:
The Competitive Enterprise Institute (CEI)
The CEI has argued that climate change would create a "milder, greener, more prosperous world" and that "Kyoto was a power grab based on deception and fear." In 2004 one of the CEI's directors, Myron Ebell appeared on Radio 4's Today programme claiming climate change is a myth cooked up by the EU to 'hamper American competitiveness.' He went on to attack the UK government's respected chief scientist, Sir David King, saying that King is an "alarmist" who is "promoting this ridiculous claim." Ebell was billed on the programme as 'an advisor to President Bush'.
American Petroleum Institute (API)
Esso is a financial supporter and sits on the board of the API. In 1998, Esso helped plan a $7million API public relations offensive to undermine scientific consensus on the threat of climate change. The plan stated that "victory will be achieved when those promoting the Kyoto treaty on the basis of extant science appear to be out of touch with reality." Among other tactics, API planned to recruit and train "independent scientists" without any track record of participation in the climate debate to undertake media work against established climate science and the Kyoto Protocol.
The Frontiers of Freedom Foundation
The Frontiers of Freedom Foundation was founded to fight environmental regulations and calls itself the "antithesis" of the green movement. It has promoted the view that climate change isn't real, saying, "Climate has always varied, often with large swings...These dramatic climatic ebbs and flows are naturally occurring events."
Gas prices are impacting every American and even foreign countries. The oil Companies and Banks are taking in record profits and the public is
suffering. Let's do something about it. Boycotting the Oil Companies will
not work. We all need gas and petroleum products are in most of the products that we use. Let's boycott the economy for a few days in order that we may have a better economy for years to come. STOP SHOPPING. That is the answer. Do not buy cars, clothes, furniture, appliances, etc.. for about 10 days and demand that gas prices drop to $1.75 per gal. This price is at a level that the consumer has become accustomed to and clearly is a level at which the oil companies can make a fair profit based upon 2004 oil company profit statements. Let's organize for a better economy which will create a better work environment. For more information read an article titled "America, they are betting against you" at Prosperous10000.iblogs.com
SO, EXXON MOBIL broke corporate records last week, posting a $9 billion profit on $100 billion in revenue in the third quarter. Right on cue, Democrats demanded that Washington confiscate some of those profits. Are they predictable or what?
Actually, Democrats already were demanding a “windfall profits tax” from oil companies. Exxon Mobil’s profit news just made them demand it more loudly in front of more microphones. While they’re trying to reach their hands into the back pockets of oil company executives and shareholders, let’s consider that $9 billion.
Nine billion dollars netted on revenue of $100 billion is a profit of 9 percent. That’s below the average profit margin for the telecommunications, software, pharmaceutical, medical equipment, accounting and computer hardware industries, to name a few. So take a deep breath before demanding that Washington pass legislation to loot oil company profits. If 9 percent is a profit margin so obscene that it demands confiscation, then a lot of small businesses in America are going to have to open their tills to Uncle Sam too. Or open them even further, that is.
Want to know who is making a bigger windfall than oil companies are making from the prices paid by the poor gasoline consumer? It’s good old Uncle Sam and his 51 little brothers.
Refining costs and profits combined make up about 15 percent of the cost of a gallon of gasoline, according to the U.S. Energy Department. State and local taxes make up almost double that, about 27 percent. (New Hampshire’s 18 cents per gallon fuel tax accounted for 7.2 percent of last week’s average gas price of $2.49 a gallon.)
State and local gas tax collections exceed oil industry profits by a large margin, according to a Tax Foundation study released last week. Since 1977, consumers have paid $1.34 trillion in gas taxes — more than twice the profits of all major U.S. oil companies combined during that same period. Last year, state and federal gas taxes took in $58.4 billion. Major U.S. oil company profits last year totaled $42.6 billion.
Want to make an immediate dent in gas prices? Cut gas taxes. Call it a windfall gas-tax tax. Sure, that would mean less money for road construction and maintenance. But when Washington is building bridges to nowhere, a little less revenue might force better spending decisions. And reducing the federal gas tax would instantly drop gas prices, whereas further taxing oil company profits would not. In fact, a windfall profits tax would discourage investment in new refinery capacity by depressing the potential profit from such investment. Less refinery output would cause prices to stay the same or even rise, not drop.
The windfall profits tax would accomplish nothing beneficial, while almost certainly making matters worse. It is yet another economically foolish, opportunistic ploy by Democrats to squeeze money from an industry whose popularity suddenly has plummeted.
"A surplus of supply is not good for the industry," Shell Oil Co. president John Hofmeister said in an interview on Friday. "Just as a surplus of demand is not good for industry. We strive for balance." (AP)Hofmeister's remarks is further proof that the oil industry is placing economic hardships on regular Americans to the benefit of a small amount of large shareholders.
"Gasoline prices are impacted by many factors, including changes in the price of crude oil and the supply and demand balance, global finished petroleum product trading, government regulations and taxes, transportation costs, and competitive market conditions. Actual or perceived changes in these fundamentals, such as those caused by geopolitical uncertainty, can have an impact on commodity markets."
"This includes support for access to areas that will allow the U.S. to increase domestic crude production, and focused efforts to reduce the complexities and limitations that are creeping into our refinery and logistics systems due to the proliferation of specialty fuels."Any company with $25 billion dollar profits can improve their logistics system & refineries with that type of money. They prefer the easy way of buying lobbyist & influencing Congress. In the media and elsewhere you'll start to see spin such as, "these profits are from investments made years ago".