Think it's a matter of chance that we don't have a meaningful national energy policy? Wondering why oil and gas companies don't pay higher royalties to the Treasury now that oil is over $55 a barrel? Amazed that Washington loves to talk about energy research with promise 15 years down the road but won't put significant money into alternative technologies that could reduce energy consumption now?
For answers to all those questions and more, just follow the money. Nothing about U.S. energy policy should be a surprise if you know where the money's been going and which legislators have taken the biggest payouts from the energy industry. So don't miss your only chance in the next two years -- the Nov. 7 election -- to tell Congress what you think of its sellout to the energy companies.
It has become increasingly expensive to run for national office, and any politician who wants to win has to raise big bucks these days. In the 2006 election cycle, according to the Federal Election Commission, as of Oct. 20, challengers and incumbents running for the House of Representatives had raised $713 million for their campaigns. Those for Senate had raised $452 million.
And these figures don't include any of the money raised by "independent" organizations, so-called 527 groups such as Emily's List on the left ($9.6 million raised) or Club for Growth on the right ($6.2 million raised).
Lawyers Top the List
Corporations and affiliated individuals have coughed up a big chunk of that money. By industry, the top honor on the giving roll goes to lawyers and law firms, with $89 million contributed, according to Federal Election Commission data compiled by the Center for Responsive Politics, which describes itself as nonpartisan and nonprofit. As the Republicans have said in campaign after campaign, the bulk of that -- 69% to 30% -- has gone to Democrats.
But the Republicans don't need to worry; there's plenty of money coming into their till from other industries.
Second place goes to the retirement industry with $86 million (54% goes to Republicans). Third place? The real estate industry with $53 million (57% goes to Republicans).
The oil and gas industry comes in at No. 15 with $14 million in contributions. The top five contributors were
, according to the Center for Responsive Politics.
That $14 million puts the oil and gas industry in the company of such heavyweights as electric utilities (at $12 million) and the pharmaceutical industry (at $14 million).
Energy Money Goes GOP
The oil and gas industry's giving is highly, highly focused.
Oil and gas executives seem to feel that with the Republicans in solid control of Congress, there's no need to give to anybody but Republicans, since they're the folks who can get things done.
There's none of the fence-straddling of the securities industry, which has divided its $46 million in contributions almost evenly between Republicans (47%) and Democrats (51%).
A whopping 83% of oil and gas money has gone to Republicans in this election cycle.
To find similar imbalance, you have to look at such Democratic bulwarks as the public-sector unions, 84% Democratic in their giving, and the building trades unions, at 83% Democratic.
So who did this concentrated dose of cash go to? Here are the top 10 -- all Republicans -- as complied by the Center for Responsive Politics:
You've got to hand it to the oil and gas industry. They know how to support their favorite sons and daughters, of course: Texans Kay Bailey Hutchison and John Cornyn, after all, are both senators from a big oil state.
But the industry keeps its eye on the prize. If you want to keep oil and gas royalties low, if you'd like to drill in environmentally sensitive areas, if you want to keep the government from admitting that global warming might exist, if you want to make sure that money flows to research in alternative energy technologies for the future but not to commercialize alternative technologies today, then you give to the key people who can get those jobs done.
So you contribute to the campaign of California Republican Rep. Richard Pombo, chairman of the House Resources Committee in charge of deciding how the oil and gas industries (and others) can use government land and how much they'll pay for that use. Pombo has been a point man in the House in efforts to open the Arctic National Wildlife Refuge to oil and gas drilling.
(The committee's jurisdiction also extends to gambling on Indian lands. Pombo and his personal political action committee, known as Rich PAC, reportedly are being investigated in the Jack Abramoff lobbying scandal. Indian tribes paid Abramoff and his lobbying firm big fees in exchange for promises he would get favorable rulings from lawmakers and members of the executive branch on their casino plans.)
Pombo is also involved in my favorite bit of election-year irony. He has been criticized for lobbying then-Interior Secretary Gale Norton to suspend regulations opposed by the wind-power industry, because his parents collect sizable royalties from windmills on their ranch. Pombo, his critics have noted, has a personal interest in the ranch. So who should Pombo face in the 2006 election? Democrat Jerry McNerney, a wind-power engineer and CEO of a start-up wind-turbine manufacturer.
The oil and gas industry also gives heavily to Texas Rep. Joe Barton, chairman of the House Energy and Commerce Committee; to Sens. James Talent of Missouri, Conrad Burns of Montana and George Allen of Virginia, all of whom sit on the Senate Energy and Natural Resources Committee; to Illinois' Dennis Hastert, speaker of the House, who plays a huge role in deciding what legislation moves to the floor for a vote and what doesn't; and to Pennsylvania's Rick Santorum, head of the Senate Republican Conference and announced candidate for Republican whip in 2006 if he wins re-election.
Up in the Air
Among the top 10 recipients of oil and gas money, Pombo, Talent, Burns and Santorum face stiff races for re-election this year. That, plus the possibility of a shift in control of one or both houses of Congress from Republican to Democratic, creates some interesting angles for investors interested in playing potential changes in U.S. energy policy as the biases of Republican incumbents yield to the biases of Democratic replacements.
Sometimes it's hard to tell exactly what the effect might be. So. for example, a shift in control of the House of Representatives would be likely to unseat Barton as chairman of the House Energy and Commerce Committee. (Barton is a lock in his re-election. The incumbent has raised $2.7 million to Democratic challenger David Harris' $22,000. Harris had $932 in his campaign treasury as of Oct. 20.)
Barton has been one of the fiercest congressional critics of global-warming theories. At a recent congressional hearing, he said, "As long as I am chairman,
regulating the gases that produce global warming is off the table indefinitely. I don't want there to be any uncertainty about that." But Barton's likely replacement would be John Dingell (D., Mich.), a fierce advocate for the U.S. automobile industry.
In other cases, the effect of the change is easier to extrapolate. Pombo's likely replacement as chairman of the House Resources Committee would be Nick Rahall (D., W.Va.). Can you say "coal," boys and girls?
Money and Politics
No matter how the elections turn out this year, of course, the connection between money and politicians will survive. Incumbents of both parties know that taking the money out of politics -- I mean, really taking it out -- would destroy one of most effective tools they have for assuring their own re-election. Taking the money out of campaigns is less likely than the Easter Bunny passing out eggs in January.
So vote your convictions. Throw this year's bums out. They certainly deserve it. Then watch to see which newly elected politicians start quickly to work to become next year's bums.
And always remember the great American humorist Finley Peter Dunne's advice: "Trust everybody, but cut the cards."
At the time of publication, Jubak did not own or control any of the equities mentioned in this column. He does not own short positions in any stock mentioned in this column.
Jim Jubak is senior markets editor for MSN Money. He is a former senior financial editor at Worth magazine and editor of Venture magazine. Jubak was a Bagehot Business Journalism Fellow at Columbia University and has written two books: "The Worth Guide to Electronic Investing" and "In the Image of the Brain: Breaking the Barrier Between the Human Mind and Intelligent Machines." As an investor, he says he believes the conventional wisdom is always wrong -- but that he will nonetheless go with the herd if he believes there's a profit to be made. He lives in New York. While Jubak cannot provide personalized investment advice or recommendations, he appreciates your feedback;
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