By Sabrina Kessler
Far-reaching allegations about how a climate-sinning American multinational could shamelessly lie to the public about its wrongdoing mobilized a small group of New York students on a cold November morning. They stood in front of New York's Supreme Court last week to follow the unprecedented lawsuit against ExxonMobil.
The case is not about the damage to the planet the energy giant has caused. Instead, ExxonMobil is being forced to answer allegations that it played down the consequences of climate change to consumers and investors for decades.
What looked like a clear victory for the Attorney General's Office, however, now threatens to turn into a damp squib. The prosecution quickly admitted it had failed to prove that the company deliberately deceived shareholders and a few days ago, Assistant Attorney General Jonathan Zweig dropped one of the main allegations — investor fraud.
The state of New York had wanted to prove that the Texas-based oil giant knowingly misled shareholders. ExxonMobil is said to have built a "long-standing fraudulent system" to cover up the true impact of climate change. All this to push up the stock price. Similar allegations were once made against the tobacco industry, which publicly denied the risk of cancer, even though it knew better. What followed were penalties in the billions.
Allegations 'False'
ExxonMobil did not respond to a request from DW. The Group's website contains a statement from last month in which the company promised it would be exonerated in court: "The allegations of the New York Attorney General are false," it said.
The student protest is one of several held outside the New York Supreme Court during the trial.
Investors had been informed through regular announcements about how the company responds with climate-related risks, the company added. "The New York attorney general's case is misleading and deliberately misrepresents a process we use to ensure company investments take into account the impact of current and potential climate-related regulations."
However, this remaining lawsuit is not just against any company, but one built by the man once considered to be the richest American of all time. ExxonMobil's roots go back to John D. Rockefeller, the U.S. oil magnate who built one of the country's first oil refineries in 1863. His company, the Standard Oil Company, grew so powerful that within a few decades the U.S. Supreme Court ordered it to be broken up into more than 30 companies, two of which grew into today's ExxonMobil.
This company, in turn, rebuilt itself into one of the largest in the world: the oil multinational recorded sales of $279 billion (€253 billion) last year alone. By way of comparison, Apple achieved $266 billion in 2018.
Former U.S. Secretary of State Rex Tillerson previously had a decade-long tenure as Exxon Mobil's chair and CEO.
Impact Known for Years
Success does, however, have its negatives. ExxonMobil is one of the largest global climate sinners. Not only are forests being cleared and waters and soils polluted to unearth more than 4 million barrels a day of black gold, the oil giant also contributes almost 2% to global carbon dioxide (CO2) emissions, according to calculations from the UK-based Carbon Disclosure Project. Over the last 50 years, it has created 42 billion tons of CO2.
The oil companies know only too well how much they endanger the climate. Exxon Mobil, for example, is said to have known since the 1970s about the impact the oil business was having on the planet. However, these findings never reached the outside world. "Exxon Mobil is a climate criminal," alleges 350.org, a nonprofit environmental organization that supports students in their protests.
Despite this, the state of New York has not yet been able to prove ExxonMobil's culpability. Not a single shareholder who testified in court claimed to have been deceived. The prosecution now has to prove that the oil giant was wrong to assure its investors that it was adequately preparing its own business for a decarbonized future. A ruling is expected in the coming weeks.
ExxonMobil's biggest challenge, however, is a different one. A glance at Wall Street data reveals that the energy sector is increasingly losing its standing. Today, the industry represents less than 5% of the total market value of all companies indexed in the S&P 500. Five years ago, it was still over 15%.
Oil Price Remains Low
ExxonMobil is struggling with its greed for profits. Since its all-time high five years ago, the stock price has collapsed by a third. It has long been clear that coal, gas and oil can no longer earn as much as they used to. Coal, for example, is increasingly being replaced by natural gas, which is much cheaper. Oil is also being fractured in such quantities that the market is literally flooded. Not even the military attacks on Saudi Arabia's oil fields in September caused a lasting rise in the price of oil. It has lost 20% since January.
Exxon Mobil has the 14th-largest oil and gas reserves and is the largest refiner in the world.
For analysts, one thing is clear: ExxonMobil needs new ways to revive itself. "The Stone Age didn't end because the stones ran out," analyst Stewart Glickman of CFRA Research told DW. In other words, it will not be the lack of oil that will put a spoke in the wheel for the oil giants, but the lack of profitability. Competitors like Royal Dutch Shell have long been experimenting with renewable energies in order to do justice to the zeitgeist. ExxonMobil is years behind.
The company's future strategy is still heavily reliant on fossil fuels. This includes the production of shale oil (fracking) in the West as well as natural gas plants in Papua New Guinea, oil wells in South American Guyana and the development of new fields in Brazil and Mozambique.
The Group intends to invest $230 billion in these projects in the coming years. However, only a fraction of this is for environmentally friendly technologies. The oil giant has committed just $10 billion to these types of projects — in the last twenty years.
Reposted with permission from DW.
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In a new study, my colleagues Anisha Patel, Francesca Weaks and I estimate that approximately 61.4 million people in the U.S. did not drink their tap water as of 2017-2018. Our research, which was released in preprint format on April 8, 2021, and has not yet been peer reviewed, found that this number has grown sharply in the past several years.
Other research has shown that about 2 million Americans don't have access to clean water. Taking that into account, our findings suggest that about 59 million people have tap water access from either their municipality or private wells or cisterns, but don't drink it. While some may have contaminated water, others may be avoiding water that's actually safe.
Water insecurity is an underrecognized but growing problem in the U.S. Tap water distrust is part of the problem. And it's critical to understand what drives it, because people who don't trust their tap water shift to more expensive and often less healthy options, like bottled water or sugary drinks.
I'm a human biologist and have studied water and health for the past decade in places as diverse as Lowland Bolivia and northern Kenya. Now I run the Water, Health, and Nutrition Laboratory at Pennsylvania State University. To understand water issues, I talk to people and use large datasets to see whether a problem is unique or widespread, and stable or growing.
An Epidemic of Distrust
According to our research, there's a growing epidemic of tap water distrust and disuse in the U.S. In a 2020 study, anthropologist Sera Young and I found that tap water avoidance was declining before the Flint water crisis that began in 2014. In 2015-2016, however, it started to increase again for children.
Our new study found that in 2017-2018, the number of Americans who didn't drink tap water increased at an alarmingly high rate, particularly for Black and Hispanic adults and children. Since 2013-2014 – just before the Flint water crisis began – the prevalence of adults who do not drink their tap water has increased by 40%. Among children, not consuming tap has risen by 63%.
To calculate this change, we used data from the National Health and Nutrition Examination Survey, a nationally representative survey that releases data in two-year cycles. Sampling weights that use demographic characteristics ensure that the people being sampled are representative of the broader U.S. population.
Racial Disparities in Tap Water Consumption
Communities of color have long experienced environmental injustice across the U.S. Black, Hispanic and Native American residents are more likely to live in environmentally disadvantaged neighborhoods, with exposure to water that violates quality standards.
Our findings reflect these experiences. We calculated that Black and Hispanic children and adults are two to three times more likely to report not drinking their tap water than members of white households. In 2017-2018, roughly 3 out of 10 Black adults and children and nearly 4 of 10 Hispanic adults and children didn't drink their tap water. Approximately 2 of 10 Asian Americans didn't drink from their tap, while only 1 of 10 white Americans didn't drink their tap water.
When children don't drink any water on a given day, research shows that they consume twice as many calories from sugary drinks as children who drink water. Higher sugary drink consumption increases risk of cavities, obesity and cardiometabolic diseases. Drinking tap water provides fluoride, which lowers the risk of cavities. Relying on water alternatives is also much more expensive than drinking tap water.
A4: Choosing to drink fluoridated tap water over sugar-sweetened beverages to quench thirst is vital to protecting… https://t.co/3tm8wuWjeZ— Oral Health Watch (@Oral Health Watch)1600795750.0
What Erodes Trust
News reports – particularly high-visibility events like advisories to boil water – lead people to distrust their tap water even after the problem is fixed. For example, a 2019 study showed that water quality violations across the U.S. between 2006 and 2015 led to increases in bottled water purchases in affected counties as a way to avoid tap water, and purchase rates remained elevated after the violation.
The Flint water crisis drew national attention to water insecurity, even though state and federal regulators were slow to respond to residents' complaints there. Soon afterward, lead contamination was found in the water supply of Newark, New Jersey; the city is currently replacing all lead service lines under a legal settlement. Elsewhere, media outlets and advocacy groups have reported finding tap water samples contaminated with industrial chemicals, lead, arsenic and other contaminants.
Many other factors can cause people to distrust their water supply, including smell, taste and appearance, as well as lower income levels. Location is also an issue: Older U.S. cities with aging infrastructure are more prone to water shutoffs and water quality problems.
It's important not to blame people for distrusting what comes out of their tap, because those fears are rooted in history. In my view, addressing water insecurity requires a two-part strategy: ensuring that everyone has access to clean water, and increasing trust so people who have safe water will use it.
Chart: The Conversation / CC BY-ND. Source: AWWA / Morning Consult. Get the data
Building Confidence
As part of his proposed infrastructure plan, President Joe Biden is asking Congress for $111 billion to improve water delivery systems, replace lead pipelines and tackle other contaminants. The plan also proposes improvements for small water systems and underserved communities.
These are critical steps to rebuild trust. Yet, in my view, the U.S. Environmental Protection Agency should also provide better public education about water quality testing and targeted interventions for vulnerable populations, such as children and underserved communities. Initiatives to simplify and improve water quality reports can help people understand what's in their water and what they can do if they think something is wrong with it.
Chart: The Conversation / CC BY-ND. Source: AWWA / Morning Consult. Get the data
Who delivers those messages is important. In areas like Flint, where former government officials have been indicted on charges including negligence and perjury in connection with the water crisis, the government's word alone won't rebuild trust. Instead, community members can fill this critical role.
Another priority is the 13%-15% of Americans who rely on private well water, which is not regulated under the Safe Drinking Water Act. These households are responsible for their own water quality testing. Public funding would help them test it regularly and address any problems.
Public distrust of tap water in the U.S. reflects decades of policies that have reduced access to reliable, safe drinking water in communities of color. Fixing water lines is important, but so is giving people confidence to turn on the tap.
Asher Rosinger is an assistant professor of biobehavioral health, anthropology, and demography and director of the Water, Health, and Nutrition Laboratory at Penn State University.
Disclosure statement: Asher Rosinger receives funding from the National Science Foundation on an unrelated project. This work was supported by the Ann Atherton Hertzler Early Career Professorship funds, and the Penn State Population Research Institute (NICHD P2CHD041025). The funders had no role in the research or interpretation of results.
Reposted with permission from The Conversation.
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