Kakistocracy: a fine English term going back to 1829 that means government by the worst element of a society, a government by the least qualified or most unprincipled citizens. Forbes writer Michael Lewitt explains its usage: “Corrupt, dishonest and incompetent politicians, regulators and bureaucrats were put in charge by self-absorbed, selfish and ignorant citizens.” Trump cabinet nominees collectively have more wealth than a combined one-third of American households. They are the most conservative, very white, and very male with almost no experience. In addition, they resemble DT—egotistical, megalomaniacal, bumbling liars. The nation’s future government will be a blend of “nepotism, oligarchy, plutocracy, kleptocracy, demagoguery, alt-right values and a disturbing tendency toward fascist white nationalism.” (Quote from Sophia A. McClennen, professor of international affairs and comparative literature at Pennsylvania State University.)
The Electoral College has voted, and Donald Trump (DT) is now the formal president-elect of the United States. In building his kakistocracy, DT has appointed a number of inexperienced oligarchs for his cabinet. A series of postings on this blog will begin with Rex Tillerson, nominee for the Secretary of State.
AP Photo / Manuel Balce
The outrage against Tillerson from both Democrats and Republicans began with the nominee’s extremely close relationship with Vladimir Putin. Exxon missed the U.S. fracking boom and moved to the Russian and Arctic oil fields, perhaps 20 percent of the world’s untapped resource. Toward that end, the company signed deals between 2011 and 2013 with the Russian state-owned oil company, Rosneft, for exploration in the Black Sea, development of shale resources in western Siberia, and drilling in the Arctic. According to Rosneft, these areas could contain more oil than the Gulf of Mexico. The year after Tillerson and Exxon signed the deal with Rosneft, Russian president, Vladimir Putin gave the country’s Order of Friendship medal to Tillerson. (Above: Russia President Vladimir Putin (R) and ExxonMobil CEO Rex Tillerson (L) attend the signing of an agreement between Rosneft and ExxonMobil in the Black Sea port of Tuapse on June 15, 2012. MIKHAIL KLIMENTYEV/AFP/Getty Images)
Exxon is so wealthy and powerful that it’s like a country of its own with its own foreign policy. Its pockets are deep, and it employs such Tillerson advocates as former Secretary of State Condoleezza Rice and former Defense Secretary and CIA Director Robert Gates. President Obama’s sanctions on Russia’s oil industry for its 2014 “participation” in the Ukraine and annexation of Crimea smashed Exxon’s dreams—until DT was elected last November. Russia needs Western expertise to drill in places such as the Arctic, and DT can give it to them.
Tillerson’s connection with Rosneft also connects him with oligarch Igor Ivanovich Sechin, head of the oil company. A close relationship with oligarchs from major world powers puts Tillerson into a position to set up his own U.S. oligarchy and what better place to do it than the White House. He has been open about his goals. Asked in March 2013 what he would do if he worked in the White House, he laughed and said, “My philosophy is to make money. If I can drill and make money, then that’s what I want to do.” His idea of international diplomacy—the Secretary of State’s job—is that it “is an enormous amount of interference with that process of discovery and perfection and improvement.”
Improvement to Tillerson doesn’t mean controlling global warming. Exploitation of the Russian and Arctic resources would vastly increase warming above four degrees, but he doesn’t worry about climate change. He has said, “To say that you’re addicted to oil and natural gas seems to me to say you’re addicted to economic growth.”
For almost the entire four decades of Tillerson’s tenure at Exxon, the company has lied about their awareness of catastrophic effects from climate change and spent millions of dollars to block any bills that address the problem. Forty years ago, the company took the problem of climate change seriously and developed programs to explore the issue. Within a few years, however, Exxon started dismantling its own climate change programs and moved on to suppress evidence, spread doubt about science, and block any action to control greenhouse gases. It also created the misnamed Global Climate Coalition to stop any government action to curb fossil fuel emissions.
By the beginning of the 21st century, Exxon used the American Legislative Exchange Council, a group of corporations that writes measures for U.S. legislators, to block emissions control. Tillerson was CEO for 12 of those 17 years. In addition, Tillerson’s block of Exxon shareholders successfully opposed a measure from the Rockefeller family to expand the company’s investment in alternative energy sources.
Tillerson’s current position on climate change is that it’s merely an “engineering” issue because, he claims, people can adapt to anything. Asked about models of greenhouse gas concentrations, he replies that “models simply are not that good.” He has no answer for what to do if the sea levels surge and freshwater pulses into the ocean from a collapse in the West Antarctica.
Yet Tillerson’s egregious business dealings go much farther than just his pandering to the Russian government which recently arranged for the release of hacked emails in order to get Tillerson’s possible new boss elected to his leadership position of what people like to call the most powerful country in the world.
Many people are unaware that the Securities and Exchange Commission (SEC) is investigating Tillerson and Exxon. Under his leadership, the company failed to accurately value its oil reserves in order to keep stocks high. A correct disclosure of its lower valuations would cost Exxon billions of dollars if the initiation of drilling is more costly from the “price of carbon” or regulations that force reductions to greenhouse gas emissions. With this high cost, Exxon might have to drop projects, and that shrinks its profitability. Even if Tillerson manages to get DT to leave the Paris climate accord, Exxon’s worldwide business may lose money because it does business with other countries that remain in the pact.
The SEC is also investigating the reason that Exxon does not record its reserves values when oil prices drop. The price of a barrel of oil dropped from $115 in 2014 to under $28 by last February, but that the company didn’t include that loss in future calculations. Fabricating future profits not based on fact is an act of securities fraud against investors.
DT as president would greatly benefit Exxon because the investigation could get stymied with Tillerson as Secretary of State. The SEC could also be remade with DT as president. Seven top officials, including chair Mary Jo White, have already resigned, and DT can appoint three new commissioners on the five-member panel. Whether Tillerson becomes Secretary or stays Exxon CEO, the oil company benefits. Last week DT referred to the free market as the “dumb market,” indicating that government should be in control, a total reversal of past GOP philosophy.
Another lawsuit plaguing Tillerson and Exxon accuses the company of discrimination against LGBTQ people in its hiring practices. ExxonMobil is the only corporation in history to get negative ratings on the Human Rights Campaign’s Equality Index for lacking any protections for LGBTQ employees in 2012 and 2013. President Obama’s executive order barring federal contractors from anti-LGBT employment discrimination—probably to be soon revoked by DT—caused the company to adopt an LGBT non-discrimination policy, but the lawsuit is still pending. Exxon has received over $1 billion in federal contracts during the past decade.
Tillerson’s conflicts of interest are overwhelming. He personally owns at least $218 million in Exxon stock and holds a pension worth $70 million. At least he wouldn’t have to pay any taxes if he has to sell them for a Cabinet position because divesting stocks based on a potential conflict interest for this position is tax-free.
In another connection with Russia 20 years ago, Tillerson became a director and then president of Exxon Neftegas, a US-Russian oil firm based in the tax haven of the Bahamas, a country with zero corporate taxes where Exxon has registered at least 67 companies. Exxon reported that Tillerson was no longer a director after he became Exxon’s CEO in 2006, but the secrecy of the nation may cause difficulty in determining Tillerson’s investments. Conflict of interest may be somewhat legal for the president and vice president but definitely not for Cabinet members or other government officials.
Oh yes, and Tillerson has literally no background in diplomacy or public service—just like DT. With pushing from oil oligarchs like Dick Cheney and deep-pocketed campaign donor Robert McNair as well as Gates and Rice, skeptical GOP senators like Marco Rubio are showing signs of falling into DT’s swamp—the one filled with oil.