steve cole reports on exxon mobil's influence in foreign affairs. we bring you the program in light of trump's recent nomination of exxon mobil chairman and ceo rex tillotson to be secretary of state. >> hello. thank you for joining us at afterwards today and congratulations on your achievement. i really enjoyed the book. it read like a novel. it read like nonfiction and places which i'm sure you have encountered some of that feeling as well. i know as a reporter who dealt with exxon mobil a good chunk of her career, how difficult it was to probe this company. let's start there. why exxon mobil? how did you come to the subject? why this company and how did it

differ from some of the other subjects like the bin laden's? >> guest: to me it was an interesting journey. i started out as a business business reporter on law street and that i went abroad i work tomorrow and international subjects. after 9/11 i wrote about the origins of 9/11 attacks in 20 years of american policy in afghanistan in this book and then after that i thought i wanted to keep writing about america and the world after 9/11. . .

not interesting. when i finish the project i wanted to write about oil and american power in the post-9/11 context so i started out the project didn't begin is a book about exxon mobil. it began as a book about oil in geopolitics. i wanted to take the prize, the book that inspired me as a young man a long time ago and upgrade it. i thought of the prize as a great work of nonfiction about the era of oil that was an era of expansion and discovery and write a book about global oil in the era of limits and strengths and the rest of it. i started out on that open framework and got six or eight month into the research and

thought to myself i really need a subject here. i need a company. once i came to that conclusion, for an american audience i thought exxon mobil was the only choice. i didn't quite realize what i was getting into. it was forced upon me in my thinking is a subject. i didn't know how closed they were or difficult to report on. i thought they would be a normal corporation and also didn't understand that much about their distinctive internal culture so a lot of the three years were about discovering what exxon mobil really is. >> host: during the course of this the bp horizon still. were you thinking that i picked the wrong hump any? >> mixed feelings. my journalist friends, there must be a word in german that describes what journalists feel when other people suffer but you get an end to your book. the catastrophe of an environmental disaster on that scale even though it wasn't

exxon mobil's response ability did provide a contextual book, which is an origin story for modern exxon mobil. they tell themselves the story they were scared straight by the exxon valdez, reform themselves and a lot of who they are, trace the reforms that started with that accident so the horizon, deepwater horizon accent -- accident could be a book ends. i was wrestling how to make the book more specific, i considered a dual narrative of exxon mobil and bp. my regret was deepwater horizon, maybe i shouldn't of done that but looking back on it it would be too much recording, never would have gotten under the surface. >> host: starting the book with exxon valdez and making it new made it new. and ending with the deepwater horizon disaster on the gulf of mexico in april 2010.

as a person that delved into the but as you a lot of transcripts from the exxon valdez incident did you see any parallels? i did a little bit. i did cover deepwater horizon and your description and exxon's response to what i did see -- seemed like bp took a page out of their playbook. did you see that at all as you were seeing coverage of bp? >> there were definitely parallels. could list more than what comes to my mind. in the decade running up to valdez there were warning signs that exxon was not operating in a consistent manner, in a way that would give the highest possible reassurance that would

not take place. exxon cut 80,000 out of 100,000 employees, reorganized their safety department, obviously the fact the tanker captain with a drinking problem, was in his job making more than $100,000 a year, and that is not what you expect today. there were a series of warning signs that culminated, the same was true of bp. bp's record as a weak operator, the osha record, the fact that they basically had a culture and a strategy that emphasized financial engineering at the expense of operating discipline was pretty well known in the industry and i came to the conclusion after talking to people that if you call the people in the oil industry on the morning of deepwater horizon

and said to them the following thing has happened, who do you think is operating the platform, that you would get a strong majority for bp at that point. the second parallel was preparation for mitigating the disaster. in both cases there were a lot of paper plans saying we could handle this in the reality was they were not equipped to do so. then the kind of public relations narrative on learning how to deal with the communities and traumas, bp had the benefit of 20 years of corporate crisis management that exxon in those days this whole philosophy of how you communicate and go up on television telling people you are going to make things right as if that wasn't as well developed a strategy in exxon's day. anyway. >> host: the aftermath strikes

me more than what happened before in terms of as a reporter after deepwater horizon bp gobbled up every expert -- to save your life. the control that emanates from this book emanated after bp, controlling the message and access to people about what happened and very technical again. you go everywhere in this book. you globetrotting, and you tackle numerous issues from global warming to other things, leaky underground storage tanks, in tbe which i covered in my early career in new york.

and controlled oil from cradle to grave. how did you pick up anecdotes, or oil days, there is a treasure trove and as a reporter i know it is difficult, what will you pick? how did you pick the anecdotes for this book? >> i started with a map. once i chose exxon mobil as a subject i looked at the map of where they own oil and gas and asked myself as a reporter what kind of world is this? why are they there? i became interested in traveling across that map. as you point out earlier they are a closed subject, they were not excited to learn i was doing this book. they didn't volunteer, they handled this in a professional

way. they say relative to some project that cooperated more than usual, from the perspective of the ambition of the book, it was helpful but everything they offered was limited. i had to go outside in. once i started with the outside in process i started with the map. the first year i traveled into the field where they operated, tried to understand the role in the world, their sense of themselves as independent sovereign. how they operate on the ground, why are they in the united countries, learning about their challenges, learning why equity oil in week states, involved in their portfolio and so on. and i came back to the united states and i thought i have a good first draft sense of how they operate abroad but i need to concentrate on their washington strategy and lobbying and political strategy. i then turned to the tools you use as a reporter to go outside in which is lawsuits and

disclosures, the freedom of information wracked requests and to get an american subject basically looked at all their lobbying and mapped those out. what are they lobbying about. that is an example of what popped out of that. in the summer of 2008, they were all over that subject. it was the data that said there has to be something here. to finish on the lawsuit they get sued over everything. it is a great tool reporting to look at civil litigation because in those tapes, records and testimony are produced, even if exxon mobil's policy is never to give interviews their executives have to testify in these cases if they choose to contest them. i was looking for cases the told structural deep stories that were points of entry into the corporation and one i found, the gasoline still in maryland where i realized searching the

litigation record started with mtv and fought my way down and finally realized there was a huge trial record around what had been one of the largest gasoline spills in an area that depended on fresh ground water supplies through aquifers. a particularly dangerous bill and it had gone to trial and the trial was over and there was a massive record of testimony by exxon mobil executives plus documents that had been produced and it was a gift. i went straight to the retailing and downstream to the vision of exxon mobil through this trial effort in a way i could never have done. opportunistic is the short answer for how you choose these subjects. you just keep looking on the map and you see a way to tell the story. >> host: despite how broad they are in terms of geography and subject matter, the lesson is the same over and over again which is comports with the

public perception of exxon, which is this company that is origineded, all-powerful that you don't want to mess with to put it colloquially. anything you came across surprise you forfeit outside that narrative? it seems to me all the stories that come back to that in different ways. sum of its parts, it comports with what everybody in their gut feels. >> guest: they are who they are and that is true, the same kind of decisionmaking and culture and insularity, rigidity, focus, consistency, that is present in indonesia and equatorial guinea in suburban maryland and the washington offices because they

have constructed a global system and global policies that are so unified and codified and distributed down all their channels of operation that more than any corporation i ever encountered as a journalist, everyone who works there gets up in the morning and is reading off of the same playbook, like a military operation or a sports team that is exceptionally well organized around the same playbook and they are self-conscious about that military metaphor. unusual among corporations, anyone at the top grew up together. if you took the top 100 publicly traded corporation to the united states and chose the top 40 jobs in each of those corporations and match who the people were, you would find a significant number of people who came from a competing company laterally, late in their career, they moved over or came from another industry as a marketing specialist, came in with

reforming ideas and most corporations are informed at the top by some outside perspective. at exxon mobil everyone comes up from college graduate school. if you were selected for management you grow up together over 30 or 40 years. it is like the marine corps. you don't have a marine corps general have a successful career at ibm, you grow up together and share a common view of the world. what you observe as a reader of the book, whether it is a lawsuit in venezuela or civil war in indonesia or gasoline still in maryland the stories all end the same way. there's a reason for that. >> host: late in the book, as a person who covered energy and environment as long as i have this surprised me. you get into hydraulic fracturing which is all over the news, it will put out rules for

fracking on public land. forgive me if i am wrong but you make the case the corporate philosophy gave him a blind spot when it came to hydraulic fracturing. making an amazing point, this is -- rex tiller's and as a young engineer at the company using the technique. do you think in that one case in the fracking case the corporate philosophy, make sure we get a return on what we do, hinder them from tapping into what is now this huge economic opportunity with natural gas? >> they were slow and then decisive once they decide they want to go in a direction. then they buy their way in. that is the pattern. they never had a great

reputation as the world's greatest work -- oil and gas discoveries. i'm sure they had some stories to tell about their successes and exploration but they have but by and large their strength is financial. they have more cash than anyone else, more discipline about using opportunities and generally if they fail to discover something for themselves they can buy it. that is what they do with fracking. they have been trying to develop a natural gas strategy is conventional gas emerged after 2005, looking like a real opportunity and they were going out and doing the land gains and buying up leases and trying to build something. they needed to come in big, one thing that is interesting to me.

>> then they control it. and it is analogous to the strategic challenge they face where they dealt with resistance to their investments, thinking with an aggressive strategy. fracking is not just a business challenge, not just the geographical challenger engineering challenge but a political challenge. an enormous amount of anxiety building up in the country about some of these techniques and their environmental consequences, the unknowns, how to induce earthquakes in places that don't have them. if exxon mobil is the poster child of the rigid, corporate,

stiff and profit driven approach to these challenges they may strategically have a problem over time can they adapt themselves to the kind of trust building and political coalition building that will prove durable or will they take the systems approach our way or the highway and end up defeating it in some respect? they could end up with a tougher public response to fracking than they would otherwise get. >> host: will they align themselves with other companies are doing this? they are the odd man out. they are pursuing what they want to pursue and doing it their way and taking no punches and made no excuses for it which i had a conversation with jeffrey's, you know the name well who spoke

with exxon mobil, i want to get reaction to his reaction from you which you will find it very exxon -- he basically said how we see the book is telling the story of exxon mobil's commitment to safety and community. not a popular, fashionable comedies conservative approaches. it is how we are and take it. numerous people, exxon mobil poured through this book. what is your response to that? >> guest: he is dealing with it in a professional way, journalists, political opposition, environmental groups, they basically stayed in their channel and that is what

he is doing. we are who we are. that is essentially their strategic position. sometimes we are who we are feels like a sense of crowds getting to the fracking question. can you really be -- the strengths of the operating system which are considerable. they are safety driven, focused on operating excellence and have a pretty good reputation in business as project operators. if you and i were the dictators and wanted someone to develop our oil and wanted the project to come in on time and on budget and get paid early, we would definitely entertain their power point presentation because they have a record of project management that is good. where they get into trouble is where they extrapolate these operating systems, this rigidity into political affairs, the human factor. of the 19 things that aren't -- >> guest: things that are made of community, social change and

their own record as a social entity, as a corporation on the promotion of women, diversity, responding to the kind of world we live in, it is not great. these conservative values are out of fashion, we think they are powerful, that is fine if you are talking about safety at the workplace but can they succeed with this strategy in a world where they are so closed to the changing social make up. who was the educated workforce in the united states? mostly women, it is more and more divers. if you work at exxon mobil and go home to your family thanksgiving dinner and say i work at exxon mobil, they suck in their breath in disdain or worry. that is not a winning strategy over 30 years either. something has got to give.

i am not sure they think that. >> host: that is one of my questions. it seems to me that we are who we are a take it or leave it for we don't care what anybody thinks of that, has that backfired on them? it seems that could have been a force to cultivate more distrust and distaste and help make them as you say in the book public enemy number one at points in their history. >> it is a great question and a complicated one. one of my goals as a reporter is to understand as best i could and think about what is it like to be so unpopular? does it matter? their default view is it doesn't matter just like the statement that we are who we are. in truth i think there are consequences was part of it is talent recruitment and retention in the real world, the world of the arab spring generation, you can't get away with being disdained by everybody and hold your scientific and a lot of --

ordinary independent-minded people may be willing to adapt to the economic rewards of a career in a place like exxon mobil but not if it doesn't feel like an open and changing place. if you only have one way of living in the world and problems and risk management are getting more diverse, you can't afford to go into communities that already have a presumption you are evil. it shows up at jury trials. they can appeal these billion dollar verdicts and knock them down to 0 but do you want to go into every jury setting and know that you have to overcome a presumption that you are evil. there are consequences. the problem from their perspective is let's think of a way out of this box. one of the things they did was

they said let's go back to history. is there a golden age of oil industry popularity we could model as a basis for a more winning strategy? the answer is no. the basic question if we are who we are, is there a way to communicate about that that will change anybody's mind? is that putting lipstick on the pig as they say in the pr business? should we be straightforward and have a strategy that says we are who we are again and again and hope that that allows enough people to engage with us to realize our interests? that is what they have done. >> host: john fahey in new york is an excellent energy writer. i said any questions for him? apple is more valuable than exxon mobil.

it is also secretive and thin-skinned. apple is cool. everybody likes apple. >> everyone is going to cry. >> what a difference that was. a questionable circle which it is a two partner which is do you think exxon mobil strategy has tarnished the rest of the oil business? people appreciate big exxon and everybody in big oil is bad. other companies or the case of apple, seems to be thin-skinned, controlled, secretive and still hip and cool and people can like you. >> one of the things i went back and looked at the top 5 corporations in the united states from 1949 to the present and exxon is always on the list. the companies around -- companies in the 50s that were number one or 2, us steel, the don't exist anymore, look today at apple and exxon mobil, one and 2, 10 years ago it was exxon mobil and walmart, microsoft was always in the mix and 50 years earlier which one is more likely

to still be around? exxon mobil or apple? that is one question. i read the jobs biography by walter isaacson and it is striking how completely different and similar apple is to exxon mobil. i walked away thinking what a country. only the united states could produce apple and exxon mobil. apple is a completely california bread -- in the book, steve jobs went into interviews and asked furious job candidate if they had evident lsd in the hope the answer would be yes. at exxon mobil -- please take this cup and provide a drug test. >> host: report your paper cuts. >> guest: they are very different. they are both the command management and driven by a desire to control their

environment. steve jobs desperately wanted to control every element of the customer's experience, every element of the design, and both were good partners, they didn't believe in partnership. they believed in the advantages of total control and that makes them secretive. it is the secrecy that follows the desire for control, not secrecy is an end in itself. the other point about exxon mobil and its unpopularity, most big industrialized democracies because of the nature of energy economy have big oil companies. mexico, bp, and the industrialized west most of those states have inked to them, bp, partially stayed down as recently as the 1980s. only in america, exxon mobil, they are much more coherent expression of our national the policy than anything the federal

government does. and maybe even more so. and only in america do we have a state oil company that lives in opposition to the state in which you reside. rex tillerson said his favorite book is "atlas shrugged," that is a touchstone for libertarians and an attitude of skepticism, let's say generously, toward the government. it is peculiar. the equipment company in france or italy or britain, would have gone to the same universities, they would be buddies, there would be an interim sense of worldview and maybe even work arm in arm with the french government abroad to secure interests and so forth but this country, we are skeptical of our

government. the last iron he is we are skeptical of concentrated power. here in exxon mobil, an institution with enormous concentrated power, the chief executive reads a book that is about the dangers of concentrated power and celebrates it. we are a funny country. >> one of the things that came up that went to what you said about their influence on washington, really fascinating because out of one side of their mouth they don't want to play ball and yet they are playing ball harder than others in some cases with a direct line to dick cheney, call on washington when it helps them to get another geopolitical conflict. what i found interesting is you talk about politicians getting it wrong. it is even more apt today.

this quote from tillerson, energy provides effective means of achieving us energy security. it is a matter of where you get oil from as long as you get more oil and put it in the bathtub and have more supply. the nationality of the resources have little relevance. energy made in america is as important as energy made where it is most economic. yet exxon mobil has carried that message for a long time. it goes back to raymond, tillerson communicating it to a lot of the republican allies where lobbying is heavily skewed to republicans out of the party, yet that is not the message you are hearing from politicians you are hearing almost a resource nationalism as opposed to us domestic energy production. >> exxon mobil is not too embarrassed to join in that. >> it is shocking to me.

how can this all-powerful company with huge influence not have changed the political discourse to make it more adhere to the facts of how the oil market works? you also engage in it. >> guest: there's the influence of elites educating, carried out this education campaign to bring informed government around government and media into the conversation how the global oil markets work. most politicians don't have time or interest to study in depth these complexities. and the world leaders who understood best how global oil markets are integrated, nationalism can be relevant, is not what it seems, energy

independence with tony blair, he said you are one of the few people who runs the government who understand how the oil markets work. is embedded shame? blair said something like you wouldn't want the other politicians to wake up because they think they can do something about it. >> host: one that sticks in my mind, as is happening in washington, in both parties, both parties are trying to get a handle and show that they are reacting to gasoline prices when in effect they have very little power over gasoline prices. >> guest: the question of what are the benefits of energy independence or what does energy independence mean, even the way it is used in political campaigns is frustrating because it is so divorced from the subject matter. there is a real subject that is important and interesting and changing and axon mobile's position in the quest of energy independence is also changing. basically while it is true that

being a net exporter or net importer of oil is not the right way to think about energy security because everybody -- doesn't matter if you are selling or buying, the price is a global price. that is not true of natural gas which is more regionally priced. there has been some evolution toward global integrated gas market but we are not there yet. so in the united states if we have onshore natural gas for a long time, that could make a big difference in the economy because we have manufacturing, it could change the energy mix in a way that is favorable in response to climate change and while being a net importer or net exporter may not matter in the way politicians talk about it, it does matter to the amount of dollars we send to unfriendly regimes or those we keep at home.

if we do shift toward more energy independence, whether we call it nationalistic or economic language there will be advantages. just not the advantages politicians talk about. >> host: one of the current events i was thinking about was going back to lee raymond. shunned alternatives for good reason. this is oil. they don't want to hear about hydrogen for cars, electric cars or what have you, excellent point, the energy report, how people miss the electricity side of energy production. i couldn't help think there are places in the book, alan greenspan is on the hill and --

on solyndra, the solar company the grabbed headlines and failed. if big oil is behind that given their animosity towards renewables and the subsidies renewables require. have you seen evidence of that? >> making it alone. >> host: not a bad loan but fanning the flames of criticism in the long run. >> guest: the american petroleum institute in washington is a spun up communication machine seizes every opportunity and political allies do the same thing. i think the underlying question about alternatives in exxon mobil is they are a corporation that can pursue whatever business strategy they want. the question is as a country do we want to create subsidies and incentives for a shift to alternatives that endeded up

what solyndra provided and why would we? we are talking about how everybody shares an interest in the lowest-cost energy possible consistent with a sustainable environment. that is the dilemma. you want the lowest-cost energy but you want to achieve your environmental goals. we may not define these goals the same way but if you talk about a rapid shift and costly shift from cheap coal and oil and gas to more expensive but cleaner renewables you better have a good reason to do that. the reason that is the most compelling in the world we live in today's climate. if you believe, as i do, i find 97% of mainstream climate scientists, their warnings and findings entirely convincing. if you believe that, you have a reason to indoor short-term costs for long-term gain but if you want to convince the public there is no risk, it gets much

harder which is why exxon mobil's resistance to the basic findings of climate science after kyoto was so pernicious and so damaging there is residue of doubt about the validity of climate science and the climate threat. scientists tell us there shouldn't be such doubt. why is there? these interested parties funded a campaign, a communication campaign to put that down. the american people are entitled to their own opinion but that campaign -- >> host: that was an interesting part of the book. i don't want to put words in your mouth but to me it read as exxon invented the strategy, axon was the company that was in the business of planting scientific doubt, funding research, i love the part with the noah scientist on the beaches of prince william sound

12 years after the spill being tagged by a yacht of exxon mobil hired scientists who want to know what they are up to and criticize their methods, showing the oil was still there after all the years. that tactic now seems rampant in our political culture. as a reporter that pays attention closely, you are seeing where the science of climate change, by many people a valid theory, now we are seeing in areas that were almost rocksolid. politicians on the floor talking about the link between smog and asthma. people questioning the cost benefit analysis of the epa when it drops regulations. do you look at exxon and exxon is responsible for that kind of

tactic that seems it is a very common one. that is the trouble with regulations. >> guest: they have a responsibility for that. they were a distinctive investor in that specific strategy after kyoto. when the kyoto accords were signed, there was a lot of opposition in the united states and the industrialized world on economic grounds, fairness grounds. some of it, is the science that urgent that we need to impose these costs on ourselves? there were a lot of different groups that opposed kyoto for economic and fairness reasons. exxon mobil was very unusual in my judgment in the aggression they brought to the science part of the campaign. really funding groups whose principal activity was to communicate as nonscientists a narrative of doubt about what

was emerging as mainstream climate science. that was, i am afraid, a tactic that is more and more present were science and public policy intersect. it is dangerous because our whole progress, in industrialized democracy depends on honest arguments about science and the public good. if we are going to having these fractured media times a completely polluted argument where the public, even the public trying to act in good faith isn't sure who to believe about what, we are going to end up damaging our society. >> host: this book makes clear that exxon is almost an impenetrable fortress as a company but when you get to climate change, i am biased because i am a climate junkie, it seems this really scares them. until then there was only one

unexpected development, one lacks one intervention that could shift the curb of rising global oil demand which exxon enjoys. those are my words. a decision by governments to limit greenhouse gas emissions by heavily taxing or tapping the use of carbon-based fuels. is that a fair estimation? that issue because of what it could do to oil is what really kind of has them shaking in their boots. >> it got their attention. it is a combination of how it was a rare existential threat. the reason we were talking about before. they overcame the previous systematic threat to oil production which were stills and environmental damage, seepage of oil into water and drinking supplies and air pollution and all of that was more or less brought into a sustainable

compact of regulator and regulated. they have themselves adopted, accepted the validity of these environmental goals when it comes to stills and air pollution and adapted themselves, impose costs on themselves to build sustainable compact. just at the moment they had cruising speed on all the other environmental issues that arose in the first three or four decades in the oil world comes this other existential or abstract global challenge to the primacy of fossil fuels in our system. that was one factor. lee raymond personally is a trained chemical engineer, very direct determined chief executive decided to say what he thought and use exxon mobil resources, most corporate chief executives even if they have that personal conviction would not have acted as aggressively as he did but that is what he was. that was the second factor. i interviewed -- asked at one

point, surely you could have handled the costs of legislation. look at the cash flow. you have adapted to air pollution regulations, adapted to spill regulations, pride yourself on your compliance with regulatory regimes that impose costs on you for making the oil industry sustainable in a political environment. why not just adapt to these regulations. i found his answer not convincing. the costs on the whole economy are too great for economic progress and so forth. there was a visceral reaction to kyoto that exxon mobil had that was out of line with her business interests which i could understand if you were a coal company and you see kyoto coming, this really could be existential but the oil industry because of the mix of gas which

is a lower footprint, they had an opportunity to adapt to this in a more forward leaning way and the european companies saw that and the public, they moved -- >> host: the other -- you are not hearing it at all in washington. regulating gasoline prices, how we all want the lights on and how we regulate that. it got out of control and prices soared. why aren't we hearing that more when it comes to gas, should we be hearing it more as a solution to what the government could do.

>> guest: the reason is political arguments in the campaign season about gas prices i just theater. the point you make is important, you flip a switch in this room and generate power and the company profits from that use of power. that company is the utility that is regulated by public interest standard in every state or jurisdiction separately but the public standard is fair and that is our history with the provision of electricity. we think it is so fundamental and inescapable that we require the profitable companies that provided to meet certain public interest standard and be accountable to the public for their performance and we tapped their profits. in exxon mobil's case, they are a global company out discovering oil under ice and so forth, nobody is going to regulate them in the public interest in that scenario but in the provision of gasoline, it is a similar utility function and if you were

a commuting construction worker, 60 miles a day in your pickup truck to adopt -- a job site you got no choice, you put in whatever price is there and you can't understand why you have no accountability and no control over that trap you are in and it is an accident of history that we treat the provision of gasoline as entirely a free-market function without any service site. and environmental regulations. we treat electricity as a public utility. and many other countries they organize things differently. there's no easy way to fix this but exxon mobil recognizes the problem because their unpopularity arises from the fact that their brand name is stuck on these pumps where people are angry. no business deliberately tried to put its customers in a position of pain while staring at their brand. >> host: you made the point that is the only way they are visible. otherwise people don't

understand the oil process. people watch exxon mobil billing is drilling holes in the ground or the offshore, equatorial guinea as you travel in the book and all you see of them is the tiger in the tank and their brand name. >> guest: a board meeting, at the end of his career he said to the board, for all the reasons you listed, why don't we take our signs off and be like dupont? no one says dupont is evil but dupont is a huge industrial corporation whatever its strengths and weaknesses, invisible by comparison. >> host: one of the other points you make later in the book in reference to the discussion of energy policy and lack of us energy policy. exxon is the us energy policy. politicians fiddle with that because at the end of the day it requires the public to make some

sacrifices. they really don't want to step there. they don't want to go there. once you go there people start to say i don't want to do that. every paulette the associated press on energy always says we want to reduce the risk of climate change and we want clean air but we don't want to have our electricity bills go up to do that. which is a consequence of any kind of market change and also a consequence of the carbon tax. it forces the consumer to change habits. turning the tables a little bit, it seems to me our inability as the public to make sacrifices makes us more beholden to the companies we don't like. >> guest: there is truth in that. i was trying to think about this question of the price people would have to pay to address

climate change in particular. no public in any era wants to volunteer for higher prices in their household expenditures. our politics show where the public saw a threat to living generation, they thought their children were more likely to get asthma or develop respiratory disease because of air pollution or their children were likely -- more likely to be exposed to cancer as a result of pollution in the water supply, people were willing to pay a price whatever the price was to protect their living generations from the danger. the promise with climate is over the horizon and the dangers are serious but abstractly you may be motivated to think like jean i don't want my grandchildren in the world where it is 3°c higher than it is now and rising seas but it is not the same. the cost-benefit of ratios is part of the problem. the other thing about what you

observe, there is an to government in the world where politicians don't want to make gasoline as cheap as possible. it is like bread and circuses. two chickens. most of the world, governments over subsidize gasoline, don't have to deal with public anger what the gasoline costs. here we let market prices will up to a point and add a bunch of taxes for remediating the environmental costs and try to reduce driving so it is expensive already so you go to politicians and you say i have a plan to make gasoline even more expensive, you are not going to find a big lineup. >> host: that quote from obama in california where he says as a result of cap and trade gasoline prices don't necessarily skyrocket. that has been recycled. he was being honest, they have to go up if you put a price on carbon but that his come back to

bite us over and over again. on subsidies let's talk about subsidizing gasoline. lee raymond has a disdain, it is clear in the book, for the crutch renewables need to be economic and exxon mobil -- >> guest: they pull them out of the closet. >> host: a huge debate in congress, the president is pushing to end tax breaks that oil companies have enjoyed and make these enormous profits, why should they continue to have them. did that come up in your conversation with raymond? it is not in the book very much. it is pointing out a little bit of hypocrisy. >> the subsidies question, seems like i don't know what to think about it. i don't know what you think about it. basically there are some tax breaks oil companies alone get

through, appeals about how the oil industry in specific terms is located but most of these allowances are manufacturing allowances, happen to be manufacturing gasoline as opposed to tractors or something else. let's discriminate against the oil industry because they are making so much, let's eliminate those subsidies, the rebate of drivers who drive to work, that is a reasonable public policy but to just say these are subsidies only for the oil industry, i am not sure that is correct. i don't know -- i know it is -- i don't know why this keeps having. it is great politics for both sides, no danger of these laws passing. it is a serious question how to restructure american energy policy, imposing greater costs on exxon mobil. able to be delighted to hear

that and they should be doing more to facilitate a national energy policy goal of addressing serious risks of global warming by moving as rapidly and economically as possible to a new energy mix but i don't think stripping out manufacturing subsidies and not repurposing those funds is very persuasive. first thing to do is put a price on carbon and put it in a substantial and predictable way so all companies can respond to it and we can get moving in the direction we need to go. >> host: i have to get to canada. i found the canadian section in the book interesting in light of modern events. very clear from what you write that prior to keystone xl, exxon was infuriated with the us approach to imports.

the tar sands as we know, energy intensive to extract huge amounts of greenhouse gas emissions in the extraction process. but now, after the book was written, it was to the heart of that. obama rejects the keystone pipeline, environmentalists are furious because of the climate change issues. i am assuming you would conclude that exxon as furious as it was back then. >> they don't know what to do about the politics of the keystone pipeline because in their book it is so irrational, they almost can't overcome their own indignity about how disconnected the politics of the pipeline is from underlying

questions of climate change regulation, tar sands or oilsands and their role in that and the global oil market. the keystone pipeline is a continuation of things described in the book. basically trying to attack the problem. even the environmentalists would admit i am sure that if they could an act a universal price on carbon is the basis for addressing climate change they would. but they failed to do that. couldn't get a bill through congress so they are looking understandably to keep their issue alive by looking for opportunities to call attention to the problem, keep challenging the status quo so they have chosen the oil sands because it is available, not because it is their preferred solution to global warming. it is an example. they are trying to leverage the unpopularity of pipelines in general, not in my backyard politics that are common in the united states to keep this issue

moving. from canada's perspective i am sure it is aggravating. from the oil industry's perspective it is definitely aggravating because a pipeline that would otherwise make economic sense is being published -- punished for campaign reason not because of a policy framework overall. the truth is if keystone isn't built and it will be built, as soon as this election is over either president obama is going to reverse the judgment he made to get himself through this campaign in one way or another or the romney administration will build the pipeline. $3 will get you a cup of coffee at starbucks but that is my prediction. even if keystone weren't built the canadians would export it to china. it is not that big a deal. >> the greenhouse atmosphere will have any the way. >> less canada changes its policies, the same. >> thank you, i really enjoyed

the conversation and congratulations on the book. >> c-span, where history unfolds daily. in 1979 c-span was created as a public service by america's cable television company that is brought to you today by your cable or satellite provider. >> a ton of things happening constantly that are affecting our politics and the ways things get changed in this country, there are many ways things get changed. my favorite example is in new york everybody is familiar with governor andrew cuomo and how hard andrew cuomo fought against raising the minimum wage up to the moment he decided he wanted to take credit for it. >> it wasn't his idea? >> it