Trump’s Fossil Fuel Bailout
In July, the FBI charged Larry Householder, Ohio’s Republican Speaker of the House, with a conspiracy to pass a $1.5 billion bailout in return for $61 million in dark money. The racketeering was allegedly orchestrated by Householder and the utility FirstEnergy to kill Ohio’s renewable energy law and prop up aging coal and nuclear power plants.
What’s happening in Ohio is part of a broader story playing out under the Trump Administration. Fossil-fuel companies like FirstEnergy have used their ties to the Trump regime to push massive bailouts for dirty energy. And the pandemic was the perfect opportunity for the industry to grab more money.
In this episode, we’ll detail how these companies are raking in billions of government dollars in the wake of the $2 trillion covid stimulus package — while millions of Americans struggle financially from the pandemic.
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A Matter of Degrees is a production of Post Script Audio
Leah Stokes: We start this week with an FBI arrest.
Katharine Wilkinson: Wooh! You’ve got me hooked. Who is it?
Leah Stokes: One of the most powerful people in Ohio.
US Attorney: We’re here today to announce the arrest of Larry Householder, the Speaker of the House of the state of Ohio, and four other defendants for racketeering in relation to what is likely the largest bribery, money laundering scheme ever perpetrated against the people of the state of Ohio.
Leah Stokes: That’s a US attorney leveling some very serious charges against a very powerful Republican politician from Ohio, Larry Householder. That happened back in July.
US Attorney: The conspiracy was to pass and maintain a $1.5 billion bailout in return for $61 million in dark money that were used for various things.
Leah Stokes: Since the late ’90s, Householder has been in office in Ohio, and he’s used his elected position for corrupt dens. He’s violated campaign finance laws. Back in 2004, he was already under investigation by the FBI for alleged money laundering.
Leah Stokes: But this time the charges are next level. The FBI said they’ve never seen a political bribery plot like this in Ohio’s history. It was the kind of racketeering scheme we normally think would be created by mobsters, not politicians. An FBI agent actually made that comparison himself.
FBI Agent: This is the first time a racketeering charge has been used on a public official in the Southern District of Ohio. RICO charges are reserved for the most egregious conduct. You’ve all probably heard about it in a lot of mob cases. But this case is certainly justified for RICO.
Katharine Wilkinson: Okay. So I’m letting my mind wander to kind of Al Capone territory with this whole mob reference. I mean what was this conspiracy to pass a $1.5 billion bailout all about? Casinos, construction.
Leah Stokes: Oh, no, Katharine. Something much more exciting: power plants.
Katharine Wilkinson: They were going to bailout power plants.
Leah Stokes: Yup, failing power plants. Those power plants were owned in part by FirstEnergy, an Ohio-based utility and one of the strongest opponents of clean energy in the country. The FBI alleges that Larry Householder and four other men conspired with FirstEnergy to funnel millions of dollars into an organization that benefited them personally and politically, all in exchange for a big political favor.
Neil Waggoner: And that was with the passage of House Bill 6, the Ohio legislation which gutted Ohio’s clean energy and energy efficiency standards while also bailing out FirstEnergy’s two nuclear plants, as well as the OVEC coal plants.
Leah Stokes: That’s Neil Waggoner, an advocate with the Sierra Club in Ohio. He watched with horror back in 2019 as Larry Householder, the newly minted Speaker of the House, rushed a bill that gutted Ohio’s renewable energy and energy efficiency goals through the legislature. That bill also propped up coal and nuclear plants that were struggling financially.
Katharine Wilkinson: That’s right. I remember, Leah, that you wrote an article about that for Vox, I guess shortly after the FBI arrest happened. If I remember correctly, you called it the worst energy bill of the 21st century.
Leah Stokes: I sure did. That’s because Republicans killed policies that were saving people money and replaced them with a billion dollars in subsidies for aging power plants. We knew that a lot of dark money was being spent on passing this terrible bill in Ohio, but it was only when the FBI arrested Householder that the allegations got tied to FirstEnergy, and it became clearer where exactly this dark money was coming from.
Neil Waggoner: Yeah. What happened in Ohio is just staggering in the level of corruption and influence and utility capture, and how the amount of money that these utilities have, like FirstEnergy has, can be deployed in our very strategic and aggressive way to provide bailouts to the coal and nuclear plants and to really cheapen and damage our democracy.
Leah Stokes: Can you talk about Householder’s ties to the Trump administration?
Neil Waggoner: When the Trump administration came into power, you see FirstEnergy’s private plane starts making a lot of trips to DC, way more trips than it had the years previous to the election of President Trump. One of those first trips to DC, to President Trump’s inauguration, had no other than Larry Householder on the plane.
Leah Stokes: What’s happening in Ohio, this investigation into corruption, the corporate influence, and the power plant bailouts they’re all part of a broader story playing out under the Trump administration. In this episode, we’re going to tell you that story. We’re going to look at how dirty energy companies are raking in billions of government dollars, thanks to the Trump regime, and it’s all happening at our expense. This is A Matter of Degrees. I’m Dr. Leah Stokes.
Katharine Wilkinson: And I’m Dr. Katharine Wilkinson. Together, we’re telling stories for the climate curious. So, Leah, what exactly do a corruption investigation and utility power plays in Ohio have to do with Trump?
Leah Stokes: We’ll get back there, I promise. But before we return to Ohio, I want to go to a different state, Colorado. That’s where 4% of America’s crude oil is currently being produced, and is primarily coming from fracking. That’s a drilling technique that injects pressurized liquids underground to break up rock and extract fossil fuels. There are 60,000 oil and gas wells operating in Colorado, mostly concentrated in one place.
Antonia Juhasz: So I live in Colorado, and 90% of the oil in the state here is produced in one county, Weld County, that is just down the road from me.
Leah Stokes: That’s Colorado resident and investigative journalist, Antonia Juhasz. She covers the oil industry. She’s written two books on the subject. Earlier this summer, Antonia profiled a woman named Patricia Nelson, who lives in a Latinx community in Weld County.
Antonia Juhasz: Where she lives is just inundated with fracking operations. They’re just everywhere. But what really turned the tide for her was when her son Diego is getting ready to go to a middle school around the corner from where she lives, a fracking company started plans to produce oil literally just on the other side of the fence from the playground at the school. They were setting up for multiple frack sites. They already lived in a neighborhood that was inundated with these operations, but to have to go to school and to experience that every single day, that had been the final straw.
Katharine Wilkinson: What did she do?
Leah Stokes: She started organizing. Patricia is now one of the most outspoken opponents of fracking in the area. She’s been a constant presence in court rooms and local meetings, speaking up for the most vulnerable people who are surrounded by industrial pollution. But then COVID struck, and suddenly she was vulnerable.
Antonia Juhasz: Patricia had had to leave her job before the pandemic for health reasons. So when the pandemic hit, she wasn’t eligible for the unemployment benefits because she had already left her job. Her husband lost his job. They’ve had to deplete their 401k as a result of the pandemic.
Leah Stokes: Like millions of other Americans, Patricia did not get a lot of government help during the pandemic. She’s had to make it on her own, just like a lot of people around this country. But you know who the government has been helping out? Fossil fuel companies in Colorado. They got help from the government. They got millions in pandemic relief. This wasn’t just happening there. Fossil Fuel companies around the country took in billions of dollars in government handouts during the pandemic.
Antonia Juhasz: So while she’s depleting her retirement savings account, the oil companies where she lives have been bailed out. They are part of a national bailout of companies that have received billions of dollars through what would really amount to covert ways of getting money to the oil and gas industry, because the Trump administration and Republicans in Congress had sought overt bailouts for the industry.
Katharine Wilkinson: This honestly makes me so angry, like trying very hard not to curse on this podcast angry. I mean American families are getting absolutely hung out to dry by the current leadership in Washington while fossil fuel companies line their coffers even more than they’re already lined. I mean how in the world did this happen, Leah?
Leah Stokes: This is the kind of maddening story that would get a lot more attention in more normal times. But we’re not living in normal times. We’re living in chaos. That’s part of why this happened. The story goes back to the CARES Act. That was the $2 trillion federal stimulus bill that Congress passed back in March.
Katharine Wilkinson: Right. March was a moment of shock for all of us. We had sudden sweeping lockdowns, unemployment suddenly leapt to historic levels. There was one week in March, I remember, when three million Americans in just one week filed for unemployment benefits.
Leah Stokes: With all that going on, it was a rare moment when lawmakers in Washington, DC actually banded together to pass a bill.
Alexis Goldstein: Everything happens at once. I think that pretty much everybody that watches Washington saw this CARES Act as that opportunity to do it, because all of a sudden Republicans and Democrats had interests that were aligned, and people were all scared. When members of Congress get scared, things can start to happen.
Leah Stokes: That’s Alexis Goldstein, a policy analyst with Americans for Financial Reform. She’s a former insider, a Wall Street financial analyst who defected to become a Wall Street watchdog. Her expertise is in part in climate finance. She keeps an eye on how banks and investors influence politics.
Alexis Goldstein: I really noticed that there was an opportunity for action when I listened to Mitch McConnell’s speech on the Senate floor before the CARES Act passed.
Leah Stokes: That was in mid-March, after a particularly hellish day for the markets.
Alexis Goldstein: He’s basically crying. This is not a guy … I pay attention to him. He’s the Senate majority leader. He’s not someone who typically betrays emotion of any kind. He talks very monotone. He was very upset.
Mitch McConnell: People that are watching this spectacle. I’m told the futures market is down 5%. I’m also told that that’s when trading stopped.
Alexis Goldstein: He was like, “My staff are telling me that the futures have halted trading and the Democrats are messing around. We don’t know what’s going on,” and the markets, the markets, the markets.
Mitch McConnell: And then all of a sudden, the Democratic leader and the Speaker of the House shows up. So we’re fiddling here, fiddling with the emotions of the American people, fiddling with the markets, fiddling with our healthcare.
Alexis Goldstein: That, you’ll notice, is what makes policymakers move, because policymakers are typically millionaires. Your average member of Congress is a millionaire. They really care what happens to the stock market. 47% of us have absolutely no exposure to the stock market at all, not even in a retirement account, not in a pension. But members of Congress care a lot.
Leah Stokes: I think it’s so funny. It’s like what does Mitch McConnell get upset about or cry about? It’s not like people dying from forest fires or hurricanes or the pandemic itself. It’s like the stock market crashing. That is so depressing.
Alexis Goldstein: Yeah. Yeah.
Katharine Wilkinson: It is really depressing. If I think back to how this bill was originally framed, it was supposedly intended to give emergency relief to small businesses and to people who were suddenly out of work. So did it actually do any of that?
Leah Stokes: In part, it did authorize $1200 checks for low and middle-income Americans. It created some additional unemployment benefits, but you probably realize those have long since run out. And it created this new policy called the Paycheck Protection Program. That was meant as a lifeline for small businesses, but as we’ll hear, it ended up morphing into something quite different. People like Alexis were watching that happen, and they quickly realized the stimulus money would mostly go to rich people or corporations, including fossil fuel companies, and that money would have virtually no restrictions on how it was spent.
Leah Stokes: Okay. So then the bill starts getting put together. Were you following what was being put in the bill? What were you thinking in terms of how they designed some of the provisions in that bill?
Alexis Goldstein: Well, I was, but it happened really fast, and everyone felt like they were over the barrel and had to approve of it. I think a lot of us were trying to sound the alarm about putting some accountability measures into it. There were some accountability measures put into it, but only for one industry, which was the airline industry.
Alexis Goldstein: So they did this separate, speaking of bailouts, bailout just for the airline industry. I think they got $25 billion from the CARES Act. They said, “You have to keep your workers on staff until the end of September. You can’t do crazy executive compensation. You can’t buy back your stock,” and I think you can’t pay out dividends. Congress could have put those rules on every other company in the CARES Act, and they didn’t. They only did it for airlines. I personally think that that was a big mistake.
Leah Stokes: That mistake ended up coming back to benefit fossil fuel companies in a big way.
Katharine Wilkinson: Surely there were people in the room trying to create some level of accountability, right?
Leah Stokes: There were. If you think back to the discussions that were happening at that time, there were Democrats who were raising alarm bells and saying, “Hey, we need to push for financial accountability and also environmental accountability in this law.” I spoke to one of those people, Senator Sheldon Whitehouse, a Democratic senator from Rhode Island. Can you just explain to us what some of the ideas that you had were for trying to address climate change during the pandemic?
Sheldon Whitehouse: Well, we had some pretty simple ones like if we’re going to spend billions of dollars bailing out the airlines, maybe they should start cleaning up their act. We got completely stuffed by the airlines on all of that, which was very frustrating.
Leah Stokes: Of course, this simple idea got attacked by Republicans. While Democrats like Senator Whitehouse were frantically trying to write provisions into the bill that would help people and the environment, they didn’t notice that Senate Republicans had already slipped in other language that would do the exact opposite.
Sheldon Whitehouse: It got into the bill at the very beginning, the original draft it was buried in.
Katharine Wilkinson: So the COVID bailouts for frackers that Antonia mentioned earlier, they were hidden in the CARES Act the whole time.
Leah Stokes: Yes. It was a provision that allowed massive tax write-offs for corporations and extremely wealthy people with no strings attached. Most Democrats didn’t even know that that provision was in the bill until it was too late.
Sheldon Whitehouse: As we were adding things, nobody went back and said, “That has to come out.” We were busy trying to get more things in that’ll help people, and a lot of people didn’t even know that was in the bill. In many cases, people found out about it … Because the bill wasn’t produced until the very end. So it’s a combination of us not looking hard enough and fighting hard enough and the other side burying it in the most strategically clever place.
Katharine Wilkinson: A sneaky tax loophole.
Leah Stokes: Yes. According to The Washington Post, that tax loophole resulted in $5 billion going to 133 corporations, many of them fossil fuel pipeline operators, refiners, and frackers. But that’s just the start of the story. There were two more provisions in the COVID stimulus bill that transfer billions of taxpayer dollars into polluting industries. The second major source of that funding was the Paycheck Protection Program.
Antonia Juhasz: This was money that was supposed to help small businesses, and it certainly has supported some small businesses, but companies worth as much as $15 million, with as many as 1500 employees, are eligible for loans of as much as $10 million. To me, that’s not a small mom and pop company. That to me is a fairly large company. A lot of oil companies were able to fit in through that framework.
Leah Stokes: In order to get that money, companies were supposed to keep their workers on payroll. They were supposed to keep people employed. But we’re not even sure if that happened.
Antonia Juhasz: What we found was at least 10% of the oil and gas companies reported either no jobs retained as a result of receiving the loan or they left that question blank. So there’s potentially at least 10% of these funds that went out to oil and gas companies that didn’t result in protecting workers at all, which is what the program is supposed to do.
Katharine Wilkinson: Wow! I mean Paycheck Protection Program seems like it should be a paycheck protection program. I don’t know, call me crazy. I’m almost terrified to ask, Leah, what was the third way that the stimulus bill lined the pockets of fossil fuel companies? Was it just driving up to the doors of CEOs and handing them giant checks with a bunch of balloons?
Leah Stokes: No, it was more like backing up a dump truck full of money with the Federal Reserve logo printed on the side of the truck. If you’re not familiar with it, the Federal Reserve is America’s central bank. It’s also where $75 billion landed as part of the CARES Act. Here’s Alexis explaining that idea.
Alexis Goldstein: I wanted to pay close attention to that. $75 billion of the CARES Act money was specifically a downpayment for the Fed to then go ahead and use that. The Fed, because they are the central bank, can leverage that and essentially print more money to put on top of it, 10 to 1.
Katharine Wilkinson: So what did the Fed do with the money?
Leah Stokes: Well, part of it went into buying the debt of fossil fuel companies. A lot of these fossil fuel companies, fracking companies, oil companies, they’ve been doing pretty poorly financially for years now, way before the pandemic. According to the Institute for Energy Economics and Financial Analysis, US oil and gas companies were saddled with $72 billion of junk-rated debt at the start of 2020, before the pandemic began. That kind of junk-rated debt, that is considered distressed.
Katharine Wilkinson: And so, the Fed used the coronavirus crisis to protect oil and gas companies struggling for nothing to do with the pandemic from having to pay off their debt.
Leah Stokes: Yes. These companies, they made bad decisions before the pandemic, but they stuck us all with the bill. Alexis explained to me how that unfolded. So the Fed is supposed to be independent. What’s been happening to the Federal Reserve under the Trump administration? Have there been indications that it’s really not that independent?
Alexis Goldstein: There have. The Fed is very sensitive to this criticism and will tell you it’s not true. But I think the most solid example we have is one of the emergency programs that the Fed created in response to the pandemic.
Alexis Goldstein: So they created 11, so it’s really hard to keep track of them all. It starts to get to be an alphabet soup. But one of the alphabet soup entities was the Main Street Lending Program. Senator Ted Cruz was very unhappy with the restrictions the Fed put on the Main Street Lending Program because basically he thought it hurt small oil producers. The reason he argued that it hurt them is because it had a ban … If you got a loan through the Main Street Lending Program initially, you were not allowed to use it to pay down other debt or refinance your existing debt.
Alexis Goldstein: So he wrote a letter and, lo and behold, the Fed made the changes that Ted Cruz asked for, that the fossil fuel lobby asked for. If you don’t want to take it from me that they did that, you should take it from the energy secretary, who went on Bloomberg Television and said, “We asked the Fed to make these changes and the Fed made those changes. And thank you very much.”
Katharine Wilkinson: So let me get this straight. When the central bank is buying up the junk debt of these oil and gas companies that are causing climate change, that means we, you, me, our listeners, the American people, we now own that debt, debt that is so worthless we literally call it junk?
Leah Stokes: Exactly. We all now own debt of a bunch of fossil fuel companies.
Alexis Goldstein: In my view, they are really picking winners and losers in a way that I think is not working towards a broader social good. The Federal Reserve, and the public by proxy, are buying debt of fossil fuel companies. I would also say that that’s an implicit bailout.
Katharine Wilkinson: I mean I don’t want this. I do not want fossil fuel debt. I would love a pony, but I do not want some fracker’s bad financial decisions on my books.
Leah Stokes: Well, nobody asked us, Katharine. Nobody asked me or you if we thought this is a good idea to do or not.
Katharine Wilkinson: No, they did not. So, okay, we’ve got this junk debt. What does this all amount to? We’ve got the tax breaks, the paycheck protection funding, the federal reserve buyout. It leaves me wondering exactly how much money has the American taxpayer handed over to the fossil fuel industry.
Leah Stokes: Well, that’s a great question. The thing is we don’t know. We don’t know how much money has gone to the fossil fuel industry under the Trump administration during this pandemic. Alexis hasn’t seen the full accounting, Antonia hasn’t seen one, even Senator Sheldon Whitehouse can’t get a proper answer to that question.
Leah Stokes: So do you have any sense of how much money exactly has gone to bailout the fossil fuel industry as part of the CARES Act?
Sheldon Whitehouse: I don’t. I have not seen a complete review of that or a complete analysis, but I have no doubt that it’s in the hundreds of billions of dollars.
Leah Stokes: This is taxpayer money at the end of the day, and yet we don’t know what it’s being spent on. We don’t know how much is being spent. How come there’s no transparency?
Sheldon Whitehouse: Well, I think part of that is a matter of time. We haven’t had the chance to really dig into it. Part of it is that, at least in the Senate, we don’t have committees that are willing to look into this stuff because the Republican chairman don’t want any part of investigating the fossil fuel industry or creating any discomfort whatsoever in the fossil fuel industry. So they’re not about to ask uncomfortable questions.
Leah Stokes: So we’ve got these huge bailouts, and a lot of the CARES Act was supposed to be for companies that were struggling because of the pandemic, like restaurants that couldn’t open. But we know that a lot of these fossil fuel companies, especially these smaller fracking companies, were doing poorly even before the pandemic. What do you think? Is this money that’s going to ripple out across the economy and keep people employed, or is it really money that’s being lit on fire?
Sheldon Whitehouse: I would say more the latter. I mean when you look at the trajectory of the fossil fuel industry, the coal industry is more or less dead already. Oil is going to be the next to go. Gas will last a little bit longer. But they’re all headed in the same direction because none of them can compete with renewables on price and on convenience, even with a massive subsidy of getting to pollute for free.
Sheldon Whitehouse: So take away that subsidy and they become real zombie companies, dead man walking. So you know where this ends, and throwing money down that rat hole doesn’t seem to be helpful, particularly if you’re not using it to train workers to transition to new fuels, to invest in the new technologies of carbon removal that can help balance our planet’s atmosphere again. All of that would be a far, far better place for the money to have gone than into the fossil fuel rat hole.
Katharine Wilkinson: Zombie companies and rat holes. That is really not where I want our tax dollars going, especially not when, as we talked about in the last episode, there is so much good and important work to do to move climate solutions forward.
Leah Stokes: But to keep telling this story, we need to go back to Ohio.
Katharine Wilkinson: Oh, okay. Right. Back to the alleged mob-style racketeering to save a handful of crappy power plants and the FBI arresting some very powerful men, who, shocker, are at the heart of the shenanigans.
Leah Stokes: Exactly. We’re going back to that story, because the account that we just heard from Senator Whitehouse, that’s not an aberration, that’s not a bug. It’s a feature of the Trump administration. That’s how the Trump administration works. They are in the pockets of fossil fuel companies, and they have been doing their bidding since day one.
Katharine Wilkinson: Yeah. We all remember that one of Trump’s big campaign promises was to bring back the declining coal industry. He was extremely explicit about that over and over and over again.
Leah Stokes: And right after he took office, Trump’s team tried every backdoor maneuver they could think of. It was heavily influenced by two Ohio-based fossil fuel companies, Murray Energy and FirstEnergy. If you haven’t heard of them before, Murray is one of America’s biggest coal mining companies and FirstEnergy, that’s the utility we talked about earlier. They have six million customers and they’re heavily invested in coal.
Katharine Wilkinson: FirstEnergy is the company that allegedly funded House Speaker Larry Householder’s front group. They’re the ones who chartered all those private plane trips to Washington.
Leah Stokes: That corporate jet was just flying back and forth from Ohio to Washington, DC after Trump took office. There were 31 trips in 2017 to 2018. There were a lot of meetings that were happening with very senior Trump administration officials with these coal companies.
Leah Stokes: I asked Sierra Club’s Neil Waggoner to explain the Trump administration’s open door policy for fossil fuel companies.
Neil Waggoner: Right. So when the Trump administration comes in and, as you pointed out, start talking about the need to save coal and how they were going to bring back coal, what you saw is big energy companies, big coal interests from around the country going and starting to lobby them. In Ohio, that was Bob Murray of Murray Energy who went to DC and delivered to Secretary Perry a list of, I believe, 17 different items that Murray Energy thought would be helpful to bring back the coal industry, really just a list of provisions that would weaken environmental protections and increase costs on customers to keep these polluting facilities online.
Neil Waggoner: At the same time, FirstEnergy, which through their supposedly deregulated generation side, was making a bunch of trips to DC and trying to set up meetings with Secretary Perry as well to try to find a way to get bailouts for their coal and their nuclear facilities. They’re really, just like we’ve already seen in Ohio, hitting every angle possible, stoking fears, providing disinformation.
Leah Stokes: These fossil fuel companies and dirty electric utilities, they had full access to the Trump administration. I mean they had them on speed dial. When you look at the highest people in the Trump administration, they have direct ties to the fossil fuel industry.
Leah Stokes: Take Scott Pruitt, for example. If you remember, that was Trump’s first EPA director. He had worked with Bob Murray to fight Obama’s Clean Power rules. The current EPA head, the guy who replaced Scott Pruitt, Andrew Wheeler, that guy was a lobbyist for Murray Energy for nearly a decade.
Katharine Wilkinson: It’s so freaking incestuous, Leah, the way these fossil fuel lobbyists just slither in and out of the halls of power, which are halls that are supposedly serving the American public.
Leah Stokes: Andrew Wheeler, the current EPA head, the guy who replaced Scott Pruitt, he was a lobbyist for Murray Energy for nearly a decade. I mean these guys, they have the Trump administration on speed dial.
Katharine Wilkinson: It’s really bad. I mean the EPA is the entity that is supposed to make sure that our air and our water are clean. The people who benefit the most from polluting industries are holding the reins of what the EPA does. I mean it is just mind-boggling.
Leah Stokes: And it’s not just happening at the EPA. Energy Secretary Rick Perry, his former campaign manager, after he was done working for Rick Perry, he went and became a key lobbyist for FirstEnergy. You can just imagine that he had a relationship with his own boss and he could get a meeting whenever he wanted with the secretary of energy.
Katharine Wilkinson: So with all this access, what did they try to do?
Leah Stokes: Well, they did a bunch of things. Some of them worked and some of them didn’t. They try to change the rules for electricity markets, they tried to create emergency orders to keep old dirty power plants from closing, and they try to push a report within the Department of Energy claiming that a lack of fossil fuels would destabilize the grid. While all of this was happening, FirstEnergy was moving closer and closer to bankruptcy.
Neil Waggoner: This would have been a real fundamental change to how energy markets work in the United States. It would have been just a completely different reality than what we’re actually living with, which is the cost of power going down and our grid cleaning up.
Neil Waggoner: So the fact, though, again, that FirstEnergies of the world, that FirstEnergy itself thought, “We can make this happen. We think we have the political will to get this done,” really says a lot about how much influence they understood and they believe they have over the Trump administration.
Leah Stokes: So literally it’s like a pay-to-play scheme where these companies are giving money to fund the Trump campaign and get Trump into office. Then they’re expecting and gaining access to make their case about here are the 17 steps that we need to save the coal industry.
Neil Waggoner: Yeah, that’s exactly what’s happening, or it has happened. The utilities, these dirty energy interests, they are putting a ton of money, just an, in some cases, unfathomable amount of money into getting the people that they think will give them the policies they need to keep their dirty, uneconomic facilities operating.
Katharine Wilkinson: Now the last I checked, coal plants are closing at record rates and the Trump administration did not in fact save the coal industry.
Leah Stokes: No, it did not. In fact, more coal plants have closed under the Trump administration than under the Obama administration. We’ve seen the fastest decline in coal-powered electricity in any presidential term under Trump. That’s because coal is just not very competitive anymore. It’s really quite expensive to keep these dirty plants open. They require hundreds of millions of dollars of additional ratepayer money.
Neil Waggoner: So when I say these coal plants are uneconomic, what we see is in the energy markets, the coal plants themselves cost more money to produce power than the new resources that are coming online replacing it, again wind, solar, geothermal. These sources are coming online, and they are more competitive than coal.
Katharine Wilkinson: In other words, they need bailouts.
Leah Stokes: They need bailouts. Even with an administration like Trump’s willing to bend laws and get very creative, companies like FirstEnergy still face the reality of this shift across the market to renewable energy.
Neil Waggoner: Then, of course, just in the past couple of years, as the utilities were not getting traction at the Public Utility Commission, as FirstEnergy was not getting traction on the federal level, they start to look to the Ohio legislature. That’s how we ended up with House Bill 6.
Katharine Wilkinson: So, Leah, I feel like we’ve won some and we’ve lost some. The coal bailouts at the federal level didn’t work and the corruption in Ohio was uncovered by law enforcement, but we still have a law on the books in Ohio that destroys the state’s clean energy industry. Nationally, Republicans ended up with an even bigger policy bonanza, the billions of dollars we’ve been talking about, that went to fossil fuel energy companies from that COVID stimulus bill. So some winning, some losing, kind of a big mess. What do we make of this?
Leah Stokes: I think that the Trump administration has presided over a massive fossil fuel bailout, and it’s just sad to me that so few people know what happened in that CARES Act, that the COVID pandemic stimulus that was supposed to be helping everyday Americans get back to work or afford to pay their energy bills or afford to buy groceries, instead so much of that money went to dirty fossil fuel companies. Those companies, like we talked about, they were doing terribly before the pandemic in the first place.
Katharine Wilkinson: I find myself thinking about the alternative path, the different path we could’ve taken back in March, and what that might have looked like for this country. What if things were different? What if a pandemic response had actually happened under a Biden presidency, say, or really under the leadership of anyone who takes the issue of climate change seriously?
Leah Stokes: I feel the same way and had pretty much the same thought. That’s why I wanted to talk with Tamara Toles O’Laughlin, the North American director of 350.org. It’s an organization you might remember from episode one.
Tamara Toles O’Laughlin: What I can tell you is that our current administration has thrown good money after bad, as my grandmother would say. So after closure after closure of coal plant, there have been such flagrant abuses of what would be determined a good business model. Ohio was the recent example.
Leah Stokes: Tamara has been paying very close attention to the terrible things the Trump White House has been doing to the environment and public health. But she’s also helping to imagine a different path, a different world, one that focuses on a just recovery.
Katharine Wilkinson: A just recovery, one that would focus on fairness and taking care of all Americans instead of just lining the pockets of a few already very wealthy, mostly white men.
Leah Stokes: I spoke to her about how we could build a different kind of recovery. But we started first with the sad reality of the current moment and what the Trump administration has been up to. Of course, before the Trump administration, and even today in movements, there’s discussion about trying to turn the course, turn the tide. Right now we’re giving $20 billion a year in direct fossil fuel subsidies. Can you talk a bit about 350’s campaigns to try to change these giveaways to the fossil fuel industry and get us moving in a better direction?
Tamara Toles O’Laughlin: Yeah. So we’ve worked on divestment. This was before it was sexy. We’re not the only ones. But, in general, the idea started with student movements towards moving resources from things that kill us to things that support us. A good function of that work is how we do it in the government, how all of our dollars, our taxpayer dollars, our money that goes into the commons goes into artificially depressing the price of coal, oil, and gas, so fossil fuels.
Tamara Toles O’Laughlin: It’s pretty gross to look at the government being a partner for a long time in artificially subsidizing the worst possible way to deliver energy to communities, to businesses, to institutions, and building our whole government relationship to energy production on this false notion that fossil fuels are cheap.
Tamara Toles O’Laughlin: So at 350, we focus a lot on the financial flows, looking at how we stop money from going to places where it shouldn’t, and reroute it to work that we want to do, because for all of the programs we cannot pay for, we are spending that same money on stuff that we know isn’t working for us.
Leah Stokes: And so, speaking of money, if we hadn’t made the CARES Act into a fossil fuel bailout, what could we have spent the money on instead? There was so much discussion about how expensive the Green New Deal was, and yet we found trillions of dollars in the couch cushions, so to speak. So what could we have spent the money on if we hadn’t made it into a giant fossil fuel bailout?
Tamara Toles O’Laughlin: Well, as a kind of person, I have no choice but to say the obvious truth with the Green New Deal. But underneath that, I mean I think people get stuck on labels, so that’s not a huge surprise. But the Green New Deal is jobs, infrastructure, and human health. The infrastructure in this country is failing. You could literally fall through a bridge in a bunch of places. The roads are in crazy disrepair. Human health is nothing you could skip on because you pay for it whether you’re burying people, housing them, or imprisoning them.
Tamara Toles O’Laughlin: So all of these things that fit into having a good job, which means being able to support yourself in a way that isn’t poisoning you or your community. So jobs, infrastructure, and human health was under the lid on Green New Deal, and we could have spent money on that.
Tamara Toles O’Laughlin: I think there’s quite a bit we could do with money if we weren’t busy buffeting the golden parachutes of evil people who want to burn up the planet. So super excited to get that opportunity in the next year and have an election that could give us the opportunity to make some better investments instead of continuing to invest in stuff that doesn’t work.
Katharine Wilkinson: I mean the great irony of all of this, Leah, is that one of the favorite Republican talking points about why climate solutions won’t work, why renewable electricity isn’t viable is that it will cost too much money. But obviously money is not the issue. There’s plenty of money.
Leah Stokes: No, money is not the problem. We seem to be able to find a lot of money in our couch cushions. When we need to bailout the fossil fuel industry, suddenly we’ve got money for days. But when it comes to climate action, where we’re actually investing in jobs, in industries, in clean air, all these things that will actually pay us back, we’ve got no money for that. So there’s a real lack of fairness really in how we treat the climate problem versus how we treat handouts to the fossil fuel industry.
Katharine Wilkinson: It’s just economically non-sensible, right? I mean climate solutions pay themselves back in public health benefits alone. It’s not just that we’ve been flushing money down the fossil fuel toilet. It is that that money could actually be helping us solve real needs that people have right now. Instead of doing that, we’re just deepening the inequality that already exists in this country. It just feels to me like such an incredibly wasted opportunity.
Katharine Wilkinson: I actually really love that one of the takeaways that the Youth Climate movement has drawn from this whole situation, the pandemic, the bailouts, is that all of the arguments about money are false arguments, and they’re not going to put up with them anymore. So they’re going to insist that all the money we’re able to find for the fossil fuel industry, we find that money to actually build a just and livable future. We make our lives, their lives, everyone’s lives, better in the near term in the process.
Leah Stokes: Because we seem to always have money for the fossil fuel industry. I mean think about fossil fuel subsidies. They are $20 billion a year, and we have them year after year after year for the industry for more than a century. How come we never have money or support for clean energy jobs, for clean energy industries?
Leah Stokes: It just feels like such a waste of that money because these are not the industries of the future. They’re not keeping people employed in good-paying jobs. They’re harming our health, they’re harming our climate stability. These are terrible industries. What if instead of a big fossil fuel bailout, we had a big clean energy investment? That’s what we could be seeing on the agenda in 2021.
Katharine Wilkinson: Well, extremely timely that we have an election around the corner. Millions of people have already voted, sending in their absentee ballots or voting early. This really is a chance to, among other things, vote in climate leadership, which is leadership that we have been wildly lacking and leadership that we really need at this crossroads of peril and possibility where we stand.
Leah Stokes: Yeah, we got an election in just a couple of days now. The thing I really want to ask you, Katharine, before we close this, have you figured out who you’re going to vote for?
Katharine Wilkinson: Well, Leah, that’s probably the easiest question you’re ever going to ask me. I most certainly know who I am ticking the box for. Actually, this will give us something to unpack when we have our post-election special episode of this podcast.
Leah Stokes: Yeah, the next time you hear from us, we’re going to be doing a quick election reaction and talking about what the outcomes will mean for climate action in 2021. After that episode dropping next week, we’ll come back with four more episodes this season. A Matter of Degrees is co-hosted by me, Leah Stokes.
Katharine Wilkinson: And by me, Katharine Wilkinson.
Leah Stokes: We are a production of Post Script Audio.
Katharine Wilkinson: Jaime Kaiser, Sydney, Bartone and Stephen Lacey produced the show.
Leah Stokes: Sean Marquand edited, mixed, and composed our theme song.
Katharine Wilkinson: Additional music came from Blue Dot Sessions.
Leah Stokes: The show art was designed by Karl Spurzem.
Katharine Wilkinson: Our website was designed by Caroline Hadilaksono.
Leah Stokes: A special thanks to the funders and supporters who made this show possible, the Hewlett Foundation, Bloomberg Philanthropies, the 11th Hour Project, UC Santa Barbara, and others.
Katharine Wilkinson: You can subscribe on Spotify, Apple, Google Podcasts, or any other place you get your shows. Or go to our website, degreespod.com.
Leah Stokes: And you can find both of us, the pod, and our production team on Twitter. You’ll find our accounts on the website and in the show notes.
Katharine Wilkinson: And if you’re digging the podcast so far, please share it with your friends, your family, and push it out on social media.
Leah Stokes: And stay with us as we tell more stories for the climate curious.