Last week, Republican lawmakers got mad at banks for not funding Arctic oil exploration, calling it “discrimination” and sending a whiny letter about it to the Trump administration. It appears the administration got the message and, in typical Trump fashion, cranked it to 11.
In an interview with Axios, Energy Secretary Dan Brouillette inexplicably compared banks no longer loaning money to multinational oil corporations worth billions of dollars to redlining, a racist practice of the not-so-distant past where banks refused to loan money in communities of color. Like. Dude. No.
The backstory here is that five of the biggest banks in the U.S. have announced they will no longer fund oil and gas exploration in the Arctic. It started late last year with Goldman Sachs. It was followed by JPMorgan Chase, Citi, Wells Fargo, and Morgan Stanley. Massive investment firm BlackRock has also agreed to start cleaning up its portfolio. Hell, even oil and gas companies have said that oil and gas projects in the Arctic are risky investments and shuttered projects. This is largely a function of economics—with the side effect of slowing the turning of the biosphere into a charred husk of its former self.
With that in mind, I would now like to present Brouillette’s full quote from Axios:
“For years and years and years, banks would not lend money, insurance companies would not write policies in minority areas in the country. Redlining is the term used all throughout those debates. We didn’t want banks redlining certain parts of the country. We don’t want that here. I do not think banks should be redlining our oil and gas investment across the country.”
First, there is no debate about redlining. It’s the legacy of New Deal-era policies that identified some neighborhoods as “risky” investments. Those neighborhoods just so happened to be predominantly black. Banks used the maps created by the federal government as a reason to not loan money for homes or businesses in those communities, creating a cycle of disinvestment and poverty. The whole thing is very real, and the impacts of redlining are still felt in communities of color today. Communities that were redlined have poorer air quality, notable health problems, and a host of other maladies outlined in full by the Root.
It’s truly the most Trump administration way to bring up redlining, casting doubt on it actually existing before using it to stand up for the real victims: multinational corporations.
It should not need to be said, but just to be clear, fossil fuel companies are not people. And they sure as hell haven’t faced anything remotely close to state-sanctioned, institutionalized discrimination.
The fossil fuel industry enjoys trillions of dollars in direct and indirect subsidies. It operates with relative impunity despite decades of muddying the waters on climate and gets a free pass for using the atmosphere as a toxic waste dump. Though they’re weaker now than they have been in the past, fossil fuel companies are some of the richest, most powerful entities on the planet.
These companies have had basically unfettered access to capital for more than a century, building the fortunes of a small number of largely white guys. The American fracking industry is built on this very foundation despite the fact that the loans major fracking companies received were based on smoke-and-mirrors accounting.
The practice of redlining was straight-up racism. The practice of not investing in Arctic oil and gas exploration is straight-up logic. Drilling there would completely screw fragile ecosystems and indigenous groups that rely on them for subsistence hunting. It would also completely upend the climate. If anything, banks aren’t doing enough to identify risky fossil fuel investments—and they’re all risky.
The Trump administration has done everything it can to prop up the fossil fuel industry, and this is perhaps the most transparently terrible effort to do it yet. But the reality is for all the whining and casual racism, nothing can ultimately save the industry.