It’s a Well-Oiled Machine That Keeps Bush Running

As gasoline prices spike, electricity supplies sputter and energy issues spill into the presidential race, Republican nominee George W. Bush is fielding a campaign team as petro-saturated as the rich layered limestone and sandstone of his home state of Texas.

In addition to the candidate and his running mate--tagged by some as the “Houston Oilers” for their industry backgrounds--several Bush policy advisors have extensive ties to the energy business, notably in oil but also in natural gas and electricity. Deeply familiar with the companies’ perspective on a wide range of topics, they not only are important architects of the campaign’s core positions, but some are likely to follow Bush into the highest reaches of government if he is elected.

Condoleezza Rice, Bush’s chief foreign policy advisor during the campaign, has served since 1991 on the board of Chevron Corp. Chevron even named a 150,000-ton tanker in her honor; the Condoleezza Rice plies the company’s global trade routes. Former Secretary of State George P. Shultz, who also counsels Bush concerning foreign affairs, previously served on the Chevron board.

Michael J. Boskin, an economist advising Bush, has been a director of Exxon Mobil Corp. since 1996. And the campaign’s chief economic advisor, Lawrence B. Lindsey, is on a panel of consultants to the Enron Corp., a Houston-based natural-gas and electricity marketing firm that has close bonds with Bush and is one of his biggest financial backers.

The industry has rallied behind its own: Energy executives and companies are contributing as never before to the Republican’s run for the White House.

Oil and gas interests, which gave $2.36 to the Republicans four years ago for every $1 they gave to the Democrats, have boosted that ratio during this campaign to nearly 4 to 1, according to an analysis for The Times by the Campaign Study Group of Springfield, Va.

The flow of oil and gas money to the Republican National Committee increased by 24% by the end of June over the same 18-month period in 1996, while the industry’s donations to the Democratic National Committee declined by about the same amount.

As of June 30, the RNC had taken in $7.5 million from energy interests, its third-largest benefactor after financial services and real estate.

Bush’s Figures Dwarf Gore’s

Bush raised an additional $1.4 million from the oil and gas industries for his presidential campaign--17 times the figure for Democratic nominee Al Gore. (Altogether, Bush has raised twice as much money as the vice president.)

Also, one of every eight of Bush’s 212 Pioneers--fund-raisers who brought in at least $100,000 apiece--works in oil or natural resources, according to the nonpartisan Texans for Public Justice.

Of course, Bush would not be the first president from a particular industry. Ronald Reagan had a long career in entertainment, for example, and Jimmy Carter had been a farmer. But seldom has a presidential campaign had so many candidates and advisors with ties to a single industry--and that industry hopes for a payoff.

Christine Toretti, chief executive officer of SW Jack Drilling, a natural-gas drilling company in Indiana, Pa., says that is why SW gave $145,000 to the RNC this year--up from $10,500 in 1996--and not a dime to the DNC.

“I am putting all my eggs in one basket, but I have spent eight years trying to keep my people employed,” Toretti said. “We need to be opening up Alaska and the North Carolina coast. . . . Obviously, it’s not Gore’s priority. If you haven’t done it by now, the heck with you.” Gore hopes the connection will backfire. Linking his opponent to the increase in oil prices, Gore has branded the Republican ticket as “of Big Oil, by Big Oil and for Big Oil.”

Gore has his own oil connection: Occidental Petroleum has long been a major supporter of Gore and his father, former Sen. Albert Gore of Tennessee. A family trust holds considerable stock in the company.

But Gore, seeking to shore up his populist image and distance himself from soaring oil prices, has been blasting big petroleum firms for profiteering.

Former Energy Secretary James R. Schlesinger said Gore’s attacks have helped trigger the oil industry’s largess to the Republicans. “It’s more of a protect-yourself-against-Al-Gore move,” he said.

Bush, like his father, former President Bush, is a veteran of the Texas oil fields, working in the industry from 1975 to 1986. His running mate, former Defense Secretary Dick Cheney, was chief executive officer of the Dallas-based energy services giant Halliburton Co. when Bush asked him to fill out the ticket.

“I think Americans will appreciate the insight and expertise” that the Republican team of Bush, Cheney and other advisors brings to “this complicated issue,” campaign spokesman Dan Bartlett said. “Gov. Bush is going to make policy and sign legislation based on how it best helps America and not any particular industry.”

Yet the Bush camp certainly doesn’t trumpet its industry links. Nor does Bush list energy on his official Web site among the 22 issues he highlights, spelling out detailed positions. Gore, by contrast, does post an energy policy on his campaign Web site.

Wall Street Feels Effects of Oil Prices

This week, the candidates traded broadsides about how to handle the energy problems that likely will immediately confront the new president. The skyrocketing cost of crude oil already has unsettled the stock market, and by Inauguration Day, experts forecast, low inventories of home heating oil, propane and natural gas will send prices soaring in cold-weather regions. President Clinton on Friday authorized the release of 30 million barrels of oil over the next month from the nation’s Strategic Petroleum Reserve to combat soaring prices.

Both campaigns acknowledge that the U.S. needs a new long-term strategy. Bartlett blamed the current problems on what he called the Clinton-Gore administration’s “lack of an energy policy for the past eight years.” Gore issues director Cheryl Sullivan said, “Today’s high prices demonstrate the need to rethink America’s energy security.”

Gore emphasizes conserving fuel and resorting to alternative energy sources, from natural gas to solar power.

Bush concentrates on increasing supplies. He wants to open the Arctic National Wildlife Refuge to “environmentally responsible, regulated” exploratory drilling, Bartlett said. He wants to “level the playing field” for nuclear energy plants. He wants to scrap the Kyoto, Japan, protocol--a treaty to reduce greenhouse emissions that Gore helped broker--and work for a market-oriented agreement that includes key developing countries such as China and India.

Not surprisingly, Bush’s stands concerning drilling and deregulation closely mirror the industry’s wish list. “He understands the nature of the business,” said Red Cavaney, president of the American Petroleum Institute in Washington.

Bush once ran his own oil company, selling it in 1986 to Harken Oil and Gas Inc., a small exploration firm. That landed him a seat on the Harken board, where he got firsthand experience with corporate tactics related to price and supply. In 1987, Harken purchased E-Z Serve Inc., which operated more than 900 gas stations in California and other Sun Belt states. The acquisition was an attempt to capitalize on an anticipated gasoline shortage, the Dallas-Fort Worth Business Journal reported at the time. The shortage did not materialize.

“This was a company that was trying to predict where the market was going and what was the best place for that company to be,” Bartlett said of Harken. “It doesn’t reflect anyone’s desire that there be higher gas prices.”

Cheney headed Halliburton for five years before joining the Bush ticket. His severance package, worth $34 million, has been a campaign issue because it contained stock options that could not be exercised until after the election. This month, Cheney announced that, if he becomes vice president, he will give up $3.6 million in stock options “to avoid even the appearance of a conflict of interest.”

In October, while still a private-sector executive addressing his private-sector peers at the Louisiana Gulf Coast Oil Exposition, Cheney was quoted as saying: “I think we’ve got a hell of a story to tell, and there’s no better time to tell it than campaign time.”

The Advocate, a Baton Rouge newspaper, reported that Cheney told the gathering: “Jump in with your money--no matter what side--and help tell the country.” Gore’s views, Cheney added, “well, are stupid.”

Although the oil-patch history of the Republican ticket is well known, the full extent of its senior policy advisors’ connections has not been reported.

Thomas E. Mann, a senior fellow at the Brookings Institution think tank who specializes in U.S. politics, said the Bush advisors’ links to energy companies should be viewed in context.

“On the one hand, it’s not a bad thing that people serving in government have some good feel for industries that are going to be central to major policy challenges over the next decade,” Mann said. “What you’d like is to have a good mix of experience.”

As a Chevron director for nine years, Rice--a potential national security advisor or even secretary of State--has helped oversee a drilling, exploration, refining and retailing company that does business from the U.S. to Kazakhstan, from Nigeria to China. She was the top White House Sovietologist during President Bush’s administration.

“I really love learning about oil,” she said. Her time at Chevron, Rice said, has taught her that energy security is a top foreign policy priority--”geopolitics with a capital G”--and that domestic exploration is a pressing need. But she said she also has spoken out at Chevron meetings in favor of continued sanctions against Iran--an unpopular stance at the company.

Boskin, a Stanford University professor who was chief economic advisor to the elder Bush, said that, when Exxon Mobil approached him about becoming a director, “one reason I said yes was an opportunity to learn about the industry.”

Boskin said he came to realize that oil companies “have a hard time with red tape and regulation, and a lot [of potential oil field territory] is kept off-limits.”

Lindsey, a former Federal Reserve Board member who is expected to take on the White House role Boskin held if Bush wins election, spent several days at Enron headquarters two weeks ago for a meeting of its economic advisory board. The company matches buyers and sellers of natural gas and electric power, and includes an oil exploration component.

The advisory board, formed about 18 months ago, spends “75% of the time talking about economic trends around the world,” Enron spokesman Mark Palmer said. “And 25% of the time, we talk about Enron.”

Bush needs no introduction to Enron: With headquarters in Houston, it is run by his close friend and major contributor Kenneth L. Lay. As Texas governor, he has received voluminous correspondence from Lay and other Enron executives.

The letters, obtained by The Times under the Texas Open Records Act, ranged from recommending appointees to state boards to thanking Bush for calling Pennsylvania Gov. Thomas J. Ridge at Enron’s behest to support open competition in electricity markets there.

Enron’s major policy goal is utility deregulation. “We want to make sure that our voice is heard, and we want to make sure it’s known what we stand for,” Palmer said. “We want to be involved in the political process at every point, and so far [the strategy] has worked pretty well.”

Critics Point to Bush’s Texas Record

Oil and natural gas--major players in the Texas economy--comprised the single largest industry donor group to Bush’s two gubernatorial campaigns. Three of his top four individual donors, including Lay, work in the field.

Environmentalists have criticized Bush’s energy record in Texas.

“I don’t consider him to be vehemently anti-environmentalist. He just doesn’t care very much about the issue or to get educated on it,” said Peter Altman, executive director of the Sustainable Energy and Economic Development Coalition, a Texas clean-air advocacy group. “So he relies on the input of his peer group, which is the oil industry and other big business.”

*

Times researcher John Beckham in Chicago contributed to this story.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

The Gap Widens

Chart shows contributions by the energy industry to the two major political parties through June 30, 1996, in the last presidential election cycle, and through June 30, 2000 in the current cycle. Figures include all contributions of $200 or more.