Control produces confidence. Unchecked, confidence metastasizes into overconfidence and smugness, which opens the door to challengers, which starts the process all over again. This is a succinct history of American business, or what capitalist theoreticians call creative destruction, and, to some extent, American politics as well.
It is the risk Colorado’s oil and gas industry runs today. Having used its cash and political might to lock up all three branches of state government, having foreclosed even citizen initiatives at the ballot box, it grew fat and happy. It grew smug. It took to lecturing the people of Colorado who dared to question the presence of dangerous industrial operations in residential neighborhoods. It filled the airwaves with propaganda so transparent it carried echoes of Orwell.
And then it blew up a house in Firestone and killed two people.
Still, it could not bring itself to give an inch. Republican lawmakers indebted to oil giant Anadarko Petroleum’s campaign cash filibustered a bill in the legislature designed to provide transparency about the location of oil and gas pipelines like the one investigators blame for blowing up that house in Firestone. And last week, when even a governor who worked in the industry thought it might be time to back off a bit, a Republican attorney general even deeper in the industry’s pocket pushed on with the battle to make every Colorado community subservient to oil and gas interests.
Charlie Munger, the 93-year-old vice chairman of Berkshire Hathaway, a Republican, and Warren Buffett’s business partner for the last 50 years, famously said this about the power of incentives in a speech at the Harvard Business School in 1995:
“I think I’ve been in the top 5 percent of my age cohort all my life in understanding the power of incentives, and all my life I’ve underestimated it. And never a year passes but I get some surprise that pushes my limit a little farther.”
Anadarko’s chief incentive is to make money. This is not a moral judgment, it is a statement of fiduciary fact. The officers of publicly traded corporations have a legal duty to do their best to make as much money for their shareholders as possible. So even as Anadarko issued pious statements about the deaths in Firestone, it continued the process it and the industry have pursued for years — delegitimizing all opposition, all dissent.
Similarly, the incentive of most Colorado politicians is to ingratiate themselves with an industry capable of and willing to finance their political campaigns. That is the corruption of our campaign finance system and of our politics. It is how the corporate state came to be.
The Colorado Oil and Gas Association, the industry mouthpiece, regularly laments the angry rhetoric of its critics. “Let’s talk,” it urges, plaintively. But who, exactly, are critics supposed to talk to? Responsible representatives of other interests tried to talk to the industry within the governor’s Oil and Gas Task Force but found every meaningful reform — even those with majority support — blocked by industry representatives.
Boulder County legislators regularly introduce bills to rein in the industry, from increased setbacks between oil wells, homes and schools, to the aforementioned attempt to map the maze of pipelines snaking beneath quiet residential neighborhoods. Republicans whose campaigns are financed by the industry kill these bills as if swatting flies. The governor scratches the industry’s back and it scratches his. The courts dutifully follow the industry apologists in the legislative and executive branches.
Last year, the state Supreme Court ruled that local bans and moratoria on fracking were invalid, that the corporate state trumped them all. The industry poured money into the campaign for a constitutional amendment to block citizen-sponsored constitutional amendments. It looked like checkmate. The industry had done its job too well. It had foreclosed all legal avenues of opposition, leaving only the anger and frustration it laments.
And then, impossibly, a ray of light flickered faintly through the gloomy, dystopian haze. A three-judge panel of the Colorado Court of Appeals sided with a group of Boulder teenagers who argued that the state had been misinterpreting state law in favor of the industry for years, insisting public health and safety should come before oil drilling, not be “balanced” against it. Sensing that the oil and gas tide might be going out in the wake of Firestone, the governor rationalized last week that this position represented no change — public health and safety have always come first, don’t you know — and therefore the state did not need to appeal the ruling.
The attorney general said nonsense and filed an appeal over the governor’s objection. Imagine that: a state official arguing against prioritizing public health and safety to continue feeding the insatiable industry that helps to fund her campaigns.
So, once more, it is up to the Supreme Court. Will it side again with the cash that greases the wheels of Colorado politics? Or will it follow the path laid out by the appellate court? Will it side with a group of teenagers naïve enough to believe that government exists to serve the people and not the powerful special interests?
The odds are long. The oil and gas industry has controlled the politics of Colorado for many years. But there are signs in the wake of Firestone that public sentiment is turning, signs that Anadarko might have overplayed its hand. Causing two fatalities and then killing legislation to provide transparency reflects a level of brazen entitlement breathtaking even for the oil and gas industry.
Will Colorado remain subservient to the industry? Is that our purpose, to serve the shareholders of a Texas-based oil giant? Once more, we await word from the Supreme Court.