Rep. Richard Pombo (R-CA) proposed a protectionist amendment to energy legislation that is designed to derail CNOOC Ltd’s acquisition of Unocal. Pombo’s proposal “would require the Energy Department to identify all of the energy assets China has sought to invest in [and] review whether China’s investments in energy assets have been done on market-based terms free of government subsidies…” The purpose of this probe is to portray China an unfair trader that does not play on a level playing field with U.S. firms.
Well, one asset CNOOC has sought to invest in is Unocal, the recipient of $400 million in loans and guarantees from the U.S. government. The subsidies went to Unocal and its partner, the Indonesian state oil and gas company, to develop the West Seno offshore crude oil and natural gas fields. Production from these projects is destined for Asian petroleum markets, so U.S. subsidies are helping China and other Asian countries acquire energy at below-market rates.
The U.S. government is second to none in the game of creating an un-level playing field. As Charles Featherstone has pointed out, Pombo and other congressmen have received significant and timely campaign contributions from rival Unocal suitor Chevron.
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An interesting post.
Do you consider contributions of $1,000 and $2,000 to represent “significant” contributions for Members of Congress?
Obviously, all Members of Congress are foolish to accept any campaign contributions from Chevron at this time.
As well, Chevron shouldn’t be offering such contributions at this time. It’s an amateur move.
Similarly, do you consider Chevron’s contributions to its U.S. district representative to represent “significant” contributions based on $21,500 since 1989? That amount averages out to represent a corporate contribution of $1,343.75 per year. Hardly in the range of “significant” contributions for Members of Congress.
In fairness, if you were to dig for the information, you may find similar contributions from CNOOC or its political lobbyist firm to CNOOC supporters. You might start with tracking the revenue flows from the Texas-based lobbyist firm CNOOC is employing via its D.C. operation.
With all due respect, I believe that you have overstated the “significance” of the meager contributions involved. Those levels of contributions only represent lunch and dinner money for a few people based on D.C. prices.
These amounts may seem to be a minor amount of grease palming at first glance. I suspect this is only the tip of the iceberg. The timing and coordination of the donations suggests a broader strategy to manipulate the outcome in favor of Chevron, using the coercive powers of the U.S government. Mickey Kantor and Bush administration cronies were also paid hefty fees to influence-peddle on behalf of Chevron.
I do not approve of influence-peddling by CNOOC or any other party, but in this case CNOOC is certainly out-gunned. CNOOC is probably familiar with bribery and corruption in its own backyard. Nonetheless, it is lamentable that the U.S. political class preaches free markets to emerging markets like China, but practices big business socialism.
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