What President Joe Biden Should Say to the Oil-igarchs
How the sky people can offer the ground people a truce...
I have a lot of friends (and some family) who read this newsletter and I send me private emails. I love hearing from all of them. I love hearing from you, too, dear reader. While it may not seem this way, I actually publish only a tenth or so of what I write. Most of it sits, lurking and smirking, in the drafts. I am an intellectual pack rat. I fear the poisoned cheese of opportunities I don’t quite pursue, ideas I don’t quite want out there. At least not yet. All of which is to say that I really enjoy it when I get vivid responses to my writing. A friend of mine writes me: He and I have only recently become friends but we are in business together now. He and I have all the promise that comes from being from an eminent family and not quite making your mark. At least not totally. He knows the frustration that comes with promise and the joy that comes with knowledge that time and initiative may yet give you your moment.
Three stories got my attention recently and got me thinking.
The first was about a study that found which that electric cars are good for your health. (“Aptera is good for your asthma!” one friend noted.)
The second was about how differently the world would look if every parking spot was, instead, a photovoltaic cell. (Are you listening Aptera?)
The third was about how, freed from commutes, American families were controlling their environment and having more kids. (You need a bigger car, Aptera!)
I’ve been thinking a lot about what a post-oil world might look like. That’s the future.
Now what about the past? I’ve spelunked a lot in my personal family history to see if I might find a way out of the politics of oil. I wasn’t always a sky person. My roots are decidedly ground people. I am the descendant of an oil man. I am, in fact, named for an oil man.
Here are all the patents to prove it:
Charles C. Carlisle’s first patent was filed in 1901 and his last was mere months before he died in 1962.
That’s right. That’s my namesake and great-grandfather, who wrote an autobiography, which I have read. Carlisle settled Washington Territory and then Wyoming where “he is the only engineer in the state making a specialty of water works, sewers and electric lights.”
Charles Carlisle "successfully passed the examination for and secured civil engineer's licenses in all five grades to practice engineering in Wyoming; also under the revised laws he holds a senior engineer's license. His ‘hobby” is scientific research and electric phenomena along which lines, during his spare moments, he is studying. He is fond of hunting and is an expert with rifle or revolver.”
The engineers of the past had a certain Wild western quality to them as evinced by my great grandfather.
He wasn’t siloed to one particular field. He was anything but a specialist. The engineers of this day were jacks of all trade who were “republican” in their politics. They tamed the West because they wanted to build America. So, too, do I want to tame technology so that America might endure.
We need to recapture some of that spirit if we want to tame the excesses of Big Oil, gushing as it is with profits.
Let’s consider this:
just as the petrostates want to bump each other off until they are the last nation standing, so too do the Big Oil producers.
The vegetarian and the meat packer both want a high price of meat and the oil man and the environmentalist want a high price of oil.
How might an American president usher in the beginnings of a post-oil world?
My friend proposes the following (which I have lightly edited): Biden should do a Putin to the oil guys.
Pro-post oil doesn’t mean anti-oil because with the backing of the oil people the energy transition can happen in two decades instead of five decades of war and fighting.
When the oligarchs got Putin into power, they thought they could control him. A year into his term he called a meeting of all the oligarchs and he said “OK guys.”
“Now the times have changed. Whatever you made you keep but please know that going forward you are out of politics.”
80 percent listened and concurred.
Khodorkhovsky and Berezovsky said “Fuck you” and things did not turn out so good for them.
Eventually — and in the same way — Biden needs to call the ten largest oil guys into a room and empathize with them.
And go like, “Alright gentlemen. Here is what I think, you guys are all American heroes in my eyes. You made our country the strongest nation in the world by taking us from 7 million barrels a day to 17 million barrels a day and made us fully independent to the extent that we have the luxury of being able to ignore everybody else. We don’t have to kiss the ring of any petrostate potentate and this is all due to your extraordinary efforts.
Now gentlemen, I am all aware you have shareholders. You have boards. You have people you are answerable to and I am aware of all of that.
For me you are all American heroes and all of you deserve Presidential Medal of Freedom for the independence you have given us. However I want America to be the number one nation in everything we do. If someone else makes 5th generation planes, I want us to be making 7th generation planes. If someone is running cars on gasoline, I want us to have flying cars. We are Americans and we need to the greatest at whatever we do. Or the whole thing implodes.
Gentlemen, my concern is not primarily the environment, important thought it is. My concern is us being number one in every advancement humanity makes. Human civilization cannot exist without energy and the masters of the energy business I want you all to be the masters of energy in the future as well. Producing energy in a big plant and shipping it over thousands of miles of cables and losing that precious energy during the transportation of it doesn’t make sense. Using hydrocarbons to lose 75% of the energy in heat loss compared to 75% transfer to the tire doesn’t make sense.
We need to move beyond hydrocarbons to and become the first post oil nation and use our abundant resources to export and make sure that we dominate in the post oil world as well. We are not eliminating the fossil fuel industry. I want you to be the leaders of the next generation of fuel as we transition to new energy sources.
Jack — do you like kissing the ass of this petro dictator?
Bob — do you like caring about the Middle East? No, I don’t think so.
Let’s all go post oil, own the entire supply chain and I will do everything in my power to give you the right incentives to make this happen.
So what do you say gentlemen?
Eighty percent will say “Let’s explore it, Mr. President.”
Twenty percent will go Chisraeli and object. Those guys can be taken behind the shed and shot metaphorically speaking. Everyone else will fall in line.
Democrats have to shed their anti-big oil, anti-hydrocarbon image and instead adopt the stance of Democrats are all about post-oil.
Let’s make America post-oil. That doesn’t mean killing oil or gas. On the contrary, we need you to be at the forefront of the transition and as a reward, you will repeat the benefits of your early investments.
No one else has the resources or the incentive.
Uncle Joe needs to control the narrative. He needs to say, “By all means, drill, baby, drill! Export all day — but only if the profits go into post-oil investing”
If I am the Exxon CEO and now I have way out of the trap I am in I will jump.
They need to be turned.
And they need to be turned in a way that will portray them as American national champions. They need to be paraded around America and cheered on like how Eisenhower was welcomed back into New York after the Second World War.
The Big Oil guys need to be cherished and portrayed like some sort of football star or super hero. But just in case they don’t behave — well, they need to be shown the baseball bat at the same time.
Just as the mobster’s son needs to be given a way out, so, too, does the oil man.
I should know. America’s a place for second chances, second businesses, and second acts.
In a future post we may well talk about how many of the very same people who were involved in the whaling industry ultimately ended up running the venture capital industry. See generally Tom Nicholas’s book, VC: An American History (2019). I’ve seen much the same thing with America’s oil families. See generally Byran Burrough’s The Big Rich: The Rise and Fall of the Greatest Texas Oil Fortunes (2009). Maybe there are families of investors who really run the world. I know this is a seditious thought but it may actually be true.
All of this starts with imagining.
Imagine a post-oil world. You may say I’m a dreamer but I’m not the only one.