Archive for Monday, June 26, 2000

The formerly ‘populist’ Democrats

June 26, 2000


Honest, you could look it up in the history books. There was a real time, not that long ago, when the leadership of the national Democratic Party could strike terror into the haughty hearts of the Powerful and Privileged.

Consider the following. In April 1962, four days after U.S. Steel (which then accounted for one-quarter of American production) and the Steelworkers Union agreed to a contract that was universally praised for avoiding either a steel strike or any increase in steel prices, U.S. Steel announced a price hike. Five major steel companies followed suit identically.

Mark Shields

Its doubtful that oil barons are today shaking in their Bruno Maglis.

The Democratic president, making no effort to conceal his anger, publicly vilified this "wholly unjustifiable and irresponsible defiance of the public interest" by a "tiny handful of steel executives."

But there was power behind his prose. Because the simultaneous and identical increases looked a lot like price fixing, the attorney general dispatched FBI agents who made night-time visits to the powerful men of steel to subpoena personal and company records pertaining to the price increase. President John F. Kennedy remarked, "My father always told me that all businessmen were SOBs, but I never believed him until now."

Three days later, the companies rescinded the price hike. Compare that to this election year when higher prices at the gas pump have made oil companies fat and happy. Texaco's first quarter profits were up 473 percent over 1999. Conoco's profits climbed 371 percent, and BPAmoco's up 296 percent. Exxon-Mobil and Shell joined Conoco and BPAmoco in announcing record profits.

In his Sermon the Mount, Christ proclaimed that the meek would inherit the earth. Maybe so, observes the cynic, but not the mineral rights.

A large part of those mineral rights belong to OPEC, which some will recall just nine years ago was liberated by 550,000 Americans from the threat and reality of invasion and occupation. In recent weeks, OPEC has broken its March pledge to keep the price of a barrel of oil at $28.

Add to this the fact that the only price of a consumer good known by virtually every American above the age of reason is not the cost of a quart of milk or a loaf of bread or even a six-pack of beer. It is the price of a gallon of gas. In Chicago and Milwaukee, that price has climbed to well over $2 a gallon. Lamely, oil apologists blame state taxes and stricter federal environmental standards.

Apparently unaware that the oil-price increase following the 1991 Persian Gulf war produced disastrous economic-political consequences for a Republican president in 1992, the current Democratic president and vice president have been the models of self restraint toward the oil companies and OPEC. Both Bill Clinton and Al Gore have confessed they are "concerned" about the alarming price hikes and disparities. Both leading national Democrats backed a review of possible oil company collusion by the Federal Trade Commission, a move so bold it won the support of Texas Gov. George W. Bush. The FTC, with a history rich in thorough investigations of un-free and unfair business competition, is not to be confused with the Justice Department or the FBI. It's doubtful that oil barons are today shaking in their Bruno Maglis.

This is a major problem of the New Democrat politics of Clinton-Gore: Conflict, especially on thorny economic matters, is devoutly to be avoided. New Democrats love business. What this thinking inevitably leads to -- on economic questions other than labor's right to organize -- is what we have had on big oil: two Republican parties separated only by abortion.

Abundant evidence is found in a national poll that shows among voters of varying income, Gore leading Bush only among voters earning over $100,000 a year and Gore trailing Bush by 15 percent among blue-collar voters. Harry Truman must be turning over in his grave.

Speaking of Truman, just imagine the indictment he would bring today: Big oil is financially backing Bush over Gore by more than 12 to 1. Last year, Bush signed a state law that provided tax breaks to oil and gas interests. According to the Dallas Morning News, by signing that law, Bush gave his supporter and former business partner Richard Rainwater a $1 million tax break.

The political math is unassailable: Oil is produced in five states (does anybody think Gore has a chance in Oklahoma?), and oil is consumed in 50.

If there is a populist pulse in the Democratic leadership, now is the moment for Gore to show whose side he's on.

- Mark Shields is a syndicated columnist with Creators Syndicate.

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