This move by the US Congress is good for Exxon, bad for everyone
One of President Trump’s best tools to “drain the swamp” is under threat from his own side. A mere four days after he took office, Republican Congress members began attacking a key piece of anti-corruption legislation.
This rule, the Cardin-Lugar provision (also known as Section 1504 of the Dodd-Frank Act), was a bipartisan effort to shield US citizens and shareholders from millions of their dollars vanishing to foreign oligarchs in the oil, gas and mining sector, which is particularly vulnerable to corruption. The “swamp” — a handful of lobbyists, executives and contractors who feed off such business ties — has attacked it for years.
When the provision was born in 2010 it set an international movement in motion. United States leadership inspired similar legislation in the EU, oil-rich Norway, Canada and beyond. In total, governments enacted similar provisions in over 30 countries.
Today these measures apply to 80 percent of the world’s largest publicly listed oil, gas and mining companies, including state-owned companies from Russia, China and Brazil. This is a win-win for resource-rich countries too: citizens from Indonesia to Zimbabwe are using these transparency laws to keep track of the funds their governments receive and ensure that oil, gas and mining revenues don’t simply vanish into private accounts held offshore, but rather contribute to shared economic growth.
But to those in Washington D.C. the most spectacular part of the provision was its bipartisanship, at a time when such feats seemed almost impossible. Later, laws in Canada drew the full support of the mining sector. Yet a handful of oil companies seeking to keep their business dealings secret continued to oppose the law. Leading this opposition was one company, Exxon Mobil, hiding behind an oil lobbying group called the American Petroleum Institute (API).
First API opposed the law in Congress. When that failed, they tried to water down the regulations. After that, they sued the Securities and Exchange Commission, an agency of the US Federal government, resulting in the regulation being sent back for revision, on technicalities.This delayed implementation by years — until a new rule was released in June 2016.
Next week, Republicans in Congress plan to use an obscure law called the Congressional Review Act (CRA), in an attempt to void the implementing rule for the Cardin-Lugar provision. Despite the Cardin-Lugar provision’s long legislative history, and two robust rulemakings, the delays caused by API’s litigation makes it vulnerable to the CRA.
In the early rush of a new administration, members of Congress are moving as quickly as they can to damage anti-corruption standards, a move which only benefit lobbyists and corporate bottom lines. The greatest damage, however, will be to the communities around the world who currently fail to benefit from their natural resources because of the conduct of the likes of ExxonMobil.
To US citizens and the rest of the world, this offensive threatens a return to the dark days of unhinged economic and environmental crime. It means vanished millions of dollars that shareholders,
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