Big Oil Can’t Be Trusted to Define the Terms of A Carbon Tax Solution

Steve Rushton
5 min readDec 14, 2017

Big oil companies are proposing a carbon tax to tackle climate change. The idea sounds reasonable, but it masks sinister intentions.

Companies maximize profits, usually by externalizing whatever costs they can get away with. Corporations have a long history of decimating communities and the environment, exploiting labour, even using slaves. Big Oil is no exception. Recent news about slave auctions exposed in Libya sent shockwaves around the world.

But look at the global oil industry and you can see modern-day slavery on oil rigs operating from the United Kingdom to Australian waters. The destruction the oil majors have caused to peoples’ lives and land in Nigeria alone show the degree to which profits not only come first — but ultimately are all that matter.

This is crucial to bear in mind considering that some of the world’s biggest oil majors are now backing a tax on oil — a tool that could be effective in the fight against climate change, if implemented properly.

The move suggests that on some level, Big Oil knows the game is up. Nonetheless, they still want to manage the process, to slow down the green transformation and limit its impact on their profits. It’s only slightly incredible to think that oil corporations may now be choosing to put Planet Earth first. This, at least, is the message they are spreading through corporate media. “Exxon, BP and Shell back carbon tax proposal to curb emissions” is just one of the recent headlines explaining the aims of the Climate Leadership Council.

The coalition of oil majors, other major corporations and neoliberal politicians are joined by the self-proclaimed environmentalists Nature Conservancy. That organization in fact drilled for oil on land it had acquired under the pretext of saving local wildlife against oil drilling.

Beware of False Solutions

The Climate Leadership Council defines itself as the “Republican solution to climate change”. It seeks a $40 per tonne tax on carbon as a “free-market, limited government” way to deal with climate change. The CLC is meanwhile sneaking in other anti-climate justice proposals, including dismantling mainstay environmental protections like the Clean Air Act.

This is an extremely dangerous path to go down. Corporations already sue governments for infringing on their profits. If environmental regulations were swapped for a climate tax, it would only take one corporate court case, or one Senate vote, to dismantle the tax. Even if the tax survives, corporations will no doubt habitually be dodging it.

The CLC’s second core anti-environment attack is its call for legal immunity for those who caused the most climate damage — namely, the oil majors themselves. Climate damage in the last decade has cost the U.S. government $350 billion alone. Scale this up so it covers society as a whole, then expand it for the entire world, and factor in the intensifying changes to the climate, and the price tag becomes astronomical.

Even if the oil majors didn’t evade their proposed $40/per tonne tax on carbon, they would benefit if they could protect historic profits against historical damages. That Big Oil wants to cut regulations or not pay for climate change damage is no surprise.

What is remarkable is that their public relations campaign is being swallowed so easily. Any journalist should hear alarm bells ringing when s/he reads a press release stating that Exxon, BP and Shell want to take a leadership role dealing with climate change. Documents show that by the 1960s, the oil industry had conclusive evidence of the links between carbon emissions and a brewing climate crisis. As early as the 1940s, in fact, those companies had already begun to sponsor climate skepticism.

The long campaign to discredit climate science compares with Big Tobacco’s attacks on health science, a battle the industry eventually lost. Similarly, despite oil-sponsored climate science denial, the case for tackling climate change is winning, mainly because the impacts of our warming planet have become unmistakable for everyone to see.

Leading the tax charge

Now, around the world there is growing momentum for a no-strings-attached carbon tax, with leading plans coming from the top of the North American continent. Canada’s government has announced that all provinces must tax carbon in 2018 by $10/tonne [$8US], rising to $50/tonne in 2022 [$40US], or create an equivalent cap-and-trade system.

Since 2007, Quebec has taxed carbon and reinvested the money in energy efficiency and public transport. It was followed by British Columbia in 2008. Different provinces have implemented or will put in place different schemes. In British Columbia, the revenue is given directly to low- and middle-income families. Other provinces, like Ontario, plan to use the money generated from the carbon tax to reduce other taxes.

The takeaway is this: Carbon taxes can both reduce emissions and have a redistributive impact on the economy. Their effectiveness is perhaps best shown in the opposition they are facing from Saskatchewan and Manitoba. Both are provinces with large oil industries currently fighting the government’s carbon tax. Canada wants to implement the tax to hit the country’s Nationally Determined Contributions — details to be agreed upon in 2019, turning promises made in the 2015 Paris Agreement at COP21 into reality.

The potential of carbon taxes to help countries meet their forthcoming round of climate targets is a big reason oil majors are trying to create their own favorable schemes. A large component of climate negotiations is redistribute justice — making those who have earned billions by causing climate change compensate the people most impacted from its effects, namely countries in the Global South. The fact is, 63 percent of cumulative global emissions can be traced to 90 oil majors and other carbon intense corporations.

Think about that: 90 corporations responsible for nearly two-thirds of the planet’s heat-trapping greenhouse gas emissions.

Under this context, it’s no wonder these companies want immunity against court cases suing them for climate change. As reported earlier this year, there is a growing surge of climate litigation across the globe. Research by the London School of Economics substantiates these cases, showing that a 20-fold increase in laws to protect the environment have assisted the process of taking Big Oil to court. In 25 countries, the research finds that around two-thirds of climate court cases have served to actually reinforce or strengthen current climate laws.

It makes sense, given their desperate situation, that oil majors are now trying to protect their historic profits with an offer that could impact their future profits. Clearly the planet need substantial carbon taxes. But in order to genuinely tackle climate change, we also need to protect and strengthen environmental laws as corporations continue to make money at any social and environmental cost. For real and historic climate justice, climate litigation needs to make those who profited from pollution pay — with no strings attached.

Originally published at on December 14, 2017.



Steve Rushton

Freelance journalist focused on political alternatives, universal rights and ecological survival