Government must help people, not polluters

Industry and their cronies in Washington DC must not use our national crisis as an excuse for a corporate bailout

The COVID crisis demands a federal response unprecedented since World War II. That response must be focused on helping people, not polluters.

Our national response to this crisis should not worsen another crisis: the persistent threat to the air, water, health, and well being of people living on the frontlines of extractive industries. 

Yet the Trump Administration and some in Congress are more interested in bailing out the oil and gas industry than helping the American people when so many are in desperate need of basic necessities.  Already Trump’s Environmental Protection Agency has moved to suspend some rules and reporting requirements for industry.

The federal government should instead provide direct assistance to people, small businesses, health care and the nonprofit organizations (think food banks) that provide so many essential public services.  In addition, Congress should swiftly invest taxpayer dollars toward a just transition and a more resilient and sustainable clean energy economy. 

A Shale bubble: Oil and gas investment was financially unsound before COVID

A federal bailout for oil and gas operations would be a reward for failure. 

Oil and gas extraction was financially unsound long before COVID-19 and the OPEC/Russia economic battle caused oil prices to dive towards $20/barrel with no bottom in sight. A recent analysis found that “27 major fracking companies began the year ‘in the red’ with negative free cashflow and…$26 billion in Total Current Liabilities due in 2020.”

For years, it’s been known that shale oil and gas wells (those enabled by fracking) play out faster than they pay out. Between extremely fast well depletion rates (relative to conventional wells) and high operational costs, market forces require oil and gas companies to seek more capital investment to fund production because cash flow — payment for the produced oil and gas — cannot. 

This cycle of taking on new debt to continue drilling new wells in order to pay older debt sounds like a pyramid scheme because it is. Its nickname is the ‘shale bubble‘. And like all bubbles, its pop was inevitable.

Health & climate pay the bill for the shale bubble

The shale bubble isn’t just about investors paying the price for bad investments, though. Public health, clean drinking water, and the global climate are paying too thanks to weak environmental oversight.

In Texas, for example, the costs have been especially high. An Earthworks’ certified thermographer has documented the use of venting and flaring natural gas--that’s just releasing climate pollution directly into our atmosphere–in order to get to the more highly valued oil underneath it.  Repeated complaints to the state regulatory agency, the Texas Commission on Environmental Quality, have been met with shrugs and excuses.

Perhaps the most egregious example was when we filed a complaint about a polluting facility on behalf of a family living nearby, regulators inspected the facility and found pollution so harmful they immediately evacuated their inspectors, but never informed the family. 

Across the country, we’ve witnessed the industry’s failed attempts–or lack of attempts entirely–to contain widespread methane pollution and the release of other air toxics that threaten our climate and put the health of communities living near oil and gas development at risk. We’ve watched the industry try to downplay the mismanagement of millions of tons of potentially radioactive oil and gas waste that has been proven to negatively impact the health of their workers in parts of the country. 

And now, the oil and gas industry proposes to prop up its failing business model with new petrochemical facilities, spreading across Appalachia and the Gulf Coast. If oil and gas prices prove unreliable, industry plans to hedge its bets by flooding the world with cheap plastics made from the byproducts of oil and gas extraction. 

Meanwhile, public opinion is beginning to shift and the industry’s social license in the United States is no longer guaranteed.


The response to one crisis must not fuel another.

In short, the movement away from fossil fuels toward clean energy has begun.  Any dollar the federal government spends propping up the oil and gas industry doesn’t just reward its climate pollution and harm to communities, it is a dollar we steal from a sustainable future

No relief package should become synonymous with big giveaways to corporations taking advantage of a national emergency–especially the oil and gas industry whose unsustainable business model created large debts long before COVID. 

The safer, better investment is to direct assistance to workers and communities in the oil and gas fields to help the transition toward a more just and renewable energy economy. 

Take Action: Tell Congress to put people before polluters and keep fossil fuel bailouts out of COVID-19 relief!


Earthworks is grateful to partners who are worth following if you oppose government bailout of oil and gas and advancing solutions.

ARO Watch (Asset Retirement Obligation)

Break Free From Plastic

Center for International Environmental Law

Environmental Defense Fund

Environmental Integrity Project

Institute for Energy Economic and Financial Analysis (IEEFA)

Post Carbon Institute 

Oil Change International

The Solutions Project