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Oil war, Part 3: Another pro-Obama video lashes Romney and ‘Big Oil’

at 01:30 PM ET, 04/03/2012

Who’s behind this ad smearing President Obama? Big Oil, that’s who. The money they make from high gas prices is going right into Mitt Romney’s campaign. Big Oil executives have pledged $200 million to help him, and Romney’s pledged to protect their record profits, and their billions in special tax breaks, too. These guys all profit, you pay the price.” — Narration from pro-Obama Priorities USA Action super PAC

Here we go again: Another group that supports President Obama is suggesting that the oil industry somehow bought GOP frontrunner Mitt Romney to do its bidding.

This all started late last week, when the Democratic National Committee responded to a $3.6 million ad campaign from the anti-Obama American Energy Alliance denouncing the president’s energy policies. Both the DNC and the alliance earned three Pinocchios in previous columns for shaky and sometimes unfounded claims.

Now the pro-Obama super PAC Priorities USA Action has taken a turn, with of its own with a video titled “Romney’s Big Oil Trail.” Let’s see whether this group’s ad holds up to scrutiny any better than the others we reviewed.

The Facts

The message from the Priorities USA video boils down to this: Romney has deep ties to the oil industry, which is behind the anti-Obama ad, and “Big Oil” has pledged $200 million to the Republican candidate so he’ll support its tax breaks. We’ll examine those claims one by one.

First, we should note that there is no consensus definition of “Big Oil.” A Google search of the term referred us first to the “supermajors,” a group of the top five or so integrated oil companies -- those that drill, refine and sell oil altogether.

The billionaire Koch brothers, who are widely thought to be bankrolling the American Energy Alliance and whom Priorities USA claims to be largely responsible for the anti-Obama ad, don’t own any of the integrated oil giants. Their empire, Koch Industries, consists of oil pipelines and refineries, as well as a host of big-name companies that have nothing to do with petroleum, such as Brawny paper towels, Stainmaster carpet, and Georgia-Pacific lumber. Forbes rated Koch Industries as the second largest private company in the U.S. in 2010. It’s a large and wealthy conglomerate, but it’s hardly the biggest player in the oil business.

More than supporting Romney, the Koch brothers have proven themselves to be determined to oust Obama. And it doesn’t take a political genius to realize from polling data that criticizing the president over gas prices will hurt him more than just about anything else right now — whether it’s warranted or not.

It’s quite possible that the brothers also have a bone to pick with the Obama administration over its decision to reject the proposed Keystone XL pipeline, although they refused to send representatives to testify on behalf of the project, for whatever reason.

(Update: The next four paragraphs contain new information and revised analysis)

Calling the Koch brothers “Big Oil” is a stretch. Beyond that, they seem to have no direct financial ties to the Romney campaign. William Koch is widely thought to be a bundler for the the Romney-supporting super PAC Restore Our Future, and he contributed a combined $1 million to the group both personally and through his Oxbow Carbon LLC. But the former governor has no control over how that super PAC spends its money.

(CORRECTION: A previous version of this column said that David Koch had contributed $2,000 to the official Romney campaign, but that money came from a different David Koch than the one whose family founded Koch Industries.)

In addition, the ad from the American Energy Alliance didn’t endorse or even mention Romney, so it’s a stretch for Priorities USA to drag him into its fight with the Koch brothers.  

How about Romney and the oil and gas industry in general? The GOP frontrunner has received $598,000 from that sector during this election cycle, representing less than 1 percent of his overall contributions. In contrast, Texas Gov. Rick Perry took in $834,000 from the industry before dropping out of the Republican nomination race earlier this year. (These totals comes from opensecrets.org, the Web site of the Center for Responsive Politics.)

Let’s take a look at a few of the supermajors. Exxon has contributed $28, 250 to Romney’s campaign compared to $13,014 for Obama. But BP has given $11,900 to the president’s campaign — he’s the company’s top recipient — compared to just $1,500 for the former Massachusetts governor.

Romney may be the best bet for Republicans to replace Obama, but he’s hardly the darling of Big Oil, at least judging from the industry’s contributions to him. And the former governor’s status as the GOP frontrunner doesn’t prove a deep connection either.

The only references we found to a $200 million pledge of any kind from the Koch brothers came from a news article that provided no attribution for the information, and a fundraising letter from the Obama campaign that accused the Kochs of “jacking up prices at the pump” and committing as much as $200 million to defeating Obama’s reelection. Even then, the money was supposed to go to conservative groups in general, not to Romney. (For all we know, this entire assumption may have come from the Obama campaign, but we would welcome more definitive and better-sourced information.)

The Priorities USA ad said Romney “pledged to protect their profits,” referring to oil companies. We found no proof of that. Romney supported the House Republican budget of 2011 that would have kept the oil-industry tax deductions in place, but that’s far from having “pledged” to keep such breaks in place should he become president, in some sort of deal with oil barons.

Priorities USA defended its targeting of Romney by noting that he is the presumptive Republican nominee, and that the anti-Obama ads can’t help but benefit him. “The timing of the [American Energy Alliance] ads matters, as does the political landscape when they are airing,” said Bill Burton, the group’s chief analyst and co-founder.

Still, that’s no excuse for suggesting that the Koch brothers pledged $200 million to help Romney in particular. To the best of our knowledge, they’ve never endorsed the former governor.

Priorities USA correctly pointed out that Romney supports the tax deductions that allow oil companies to recover the cost of doing business. But Republicans hardly need donor incentives to rail against tax hikes. It’s part of their general platform.

Burton sent us this statement in response to our fact check: “The Koch Brothers and other big oil barons have one top priority in 2012: electing Mitt Romney. The profits they earn from high gas prices are supporting Governor Romney’s campaign through direct contributions and negative ads against President Obama. Romney has promised to keep big oil’s tax breaks and the big oil baron Koch Brothers have pledged to spend over $200 million to tear down President Obama, benefiting Romney.”

The Pinocchio Test

Priorities USA has tied Romney to groups that the former governor doesn’t control, primarily the Romney-supporting super PAC Restore Our Future and a few groups that are reportedly controlled by the Koch brothers. But Romney is prohibited from coordinating with those groups on how they spend their money.

The bottom line is that these groups are no more tied to Romney than they are with any other candidate who opposes Obama. We don’t doubt that the former governor is happy to see them attacking the president, but that doesn’t mean he’s promised them favors in exchange for money.

The ad further stretches the facts by claiming that Koch Industries is part of “Big Oil,” which is generally is reserved for the major integrated oil companies.

Priorities USA can speculate about backroom deals all it wants, but that’s no more factual or fair than suggesting that the president has given sweetheart deals to the labor unions that funnel cash into his own super PAC support group. The latest salvo in this oil war also earns three Pinocchios.

Three Pinocchios

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This post has been updated since it was first published.

 
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    About the Blogger

    Glenn Kessler has covered foreign policy, economic policy, the White House, Congress, politics, airline safety and Wall Street.

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