Standard Oil Heiress Wages War on Oil Industry

In one of the great ironies of our times, the heirs to John D. Rockefeller’s Standard Oil fortune are now using their inheritance to wage lawfare against the oil and gas industry – a crusade that, if successful, will ultimately leave everyday consumers paying the price.

As the Wall Street Journal recently reported, Miranda Kaiser, the great-great granddaughter of John D. Rockefeller, Sr., has taken over her late brother’s campaign to sue Exxon Mobil, the corporate descendent of Standard Oil.

Since her brother’s death, the Journal details, Kaiser hasn’t merely worked to fulfill his “dying wish,” but has “escalated” it – despite a New York State court’s 2019 dismissal of the charge that Exxon had “misled investors about the impact of climate regulation on its business.” That ruling followed a 2018 decision by a federal judge in San Francisco who observed that courts – as distinguished from legislatures – aren’t the appropriate place to resolve climate disputes, which are essentially disagreements over matters of fact rather than law.

The more than 30 lawsuits launched by Rockefeller’s heirs against the industry that built their generational wealth have been funded and enabled by the family’s powerful charities, led by the Rockefeller Family Fund (RFF). Kaiser, trained as an attorney, serves as the RFF’s president. Kaiser is also a board member of the larger Rockefeller Brothers Fund, which pledged in 2022 to spend $100 million over the following decade to address climate change.

Even though Exxon executives regard the suits as meritless, they fear that “juries in blue states might eagerly hand down penalties” against the company. Moreover, the costs of continuing litigation resulting from the lawsuits initiated by Rockefeller nonprofits, regardless of how frequently the suits are dismissed, are sure to add up to many millions – not counting the fees paid to consultants for helping to defend energy companies in the public eye. RFF has also brought shareholder resolutions demanding changes in Exxon policies regarding climate change, none of which passed.

In essence, Kaiser appears to be hoping to bury fossil fuels companies in an endless sea of paperwork and legal fees.

Beyond the RFF’s lawsuits against oil companies in localities as disparate as Chicago and Bucks County, Pennsylvania, for allegedly deceiving citizens about climate change, the Journal reports that the organization’s staffers “have lobbied state and federal lawmakers to pass ‘climate superfund’ bills that would force the companies to pay damages” for their emissions, one of which recently passed the Vermont legislature.

Additionally, as far back as 2015, the Rockefeller foundations “quietly” spent over $500,000 to fund a series of stories that ran in the Los Angeles Times and Columbia Journalism Review that alleged that Exxon had for decades “modeled” the possibility of major climate change caused by fossil fuels, without publicly disclosing the results. (Talk about unbiased journalism!)

As a matter of law, the Rockefellers’ suits against oil companies indeed appear meritless.

First of all, the suits disregard the fact that the question of the extent or effect of human-caused climate change is still, to quote the title of a book by former Obama undersecretary for science Steven Koonin, “Unsettled,” or that “climate change panic,” in the words of distinguished climate scientist Bjorn Lomborg, is a “false alarm” that costs the world “trillions, hurts the poor, and fails to fix the planet.”

Second, the customary rules of tort law require a plaintiff or group of plaintiffs to demonstrate that they themselves have suffered damage from alleged misconduct – not merely that some corporate or individual conduct might harm them or other people (perhaps a half-century or more into the future). Again, as the San Francisco judge observed, such matters as climate policy are properly a matter for resolution by elected representatives and executives, whose task is to balancepotential benefits and costs of proposed actions and prohibitions.

Finally, modeling possible futures, as the RFF alleges Exxon has done, in no way commits an organization to believe in the likelihood, let alone inevitability, of those outcomes. If all such research were required to be made public, the organization might not have engaged in it to begin with.

In the short term, at least, we know that the war on fossil fuels will damage the well-being of people throughout the globe, simply by making energy more expensive to them.

Americans will first notice this effect at the gas pump and in their home heating bills, and then gradually in the cost of consumer items that rise in proportion to energy costs that industries must bear, along with rising taxes to cover government subsidies for unpopular products like electric cars. But the consequences will be much more dire for poorer countries, whose development will be seriously obstructed. (That’s why China, despite professing allegiance to the goal of reducing CO2 emissions, keeps building coal-fueled power plants by the hundreds.)

But whatever the cost of the war on fossil fuels, we can be confident that the Rockefeller family won’t suffer from them. (At the family’s annual meetings, the Journal reports, over 200 members typically attend. While not all attendees agree on the family foundations’ anti-fossil-fuel campaign, all enjoy meeting at the family’s 3,000-plus acre family estate at Pocantico Hills in upstate New York, which features two bowling alleys and indoor tennis and squash courts, along with oak-paneled rooms adorned with rugs given to the family by King Hassan II of Morocco.) The overall wealth of the extended family is estimated at more than $10 billion. (Although part of the estate is owned by the National Trust for Historic Preservation, the family leases it back for its gatherings.)

At the root of Kaiser’s war on climate change, as her interview with the Journal reveals, is a sense of shame she inherited from her mother. Whereas her mother felt “guilt over having money when so many people didn’t” (of course, she could have rectified that feeling by simply giving her wealth away), Kaiser has set out to alleviate her guilt by combating the oil companies – from which all of the family’s inherited wealth ultimately derives. While Kaiser may believe this effort will ease her conscience, it will hurt the wallets of everyone else.

Despite John D. Rockefeller’s popular reputation as a tightwad and monopolist, the Rockefeller Foundation, which he established “in perpetuity” in 1913, gave away some $540 million in charity (equal to over $10 billion today) to such causes as combating yellow fever and creating academic institutions around the country. Given the source of his wealth, it is unlikely that he could have foreseen, or would have approved of, the uses to which the politicized foundations established by his heirs are now being put.

While the website of the original Rockefeller Foundation indicates that it still supports worthy causes like combating disease and promoting development in less-developed countries, the claim that it “act[s] to fight against economic disparities that impact marginalized communities” and “support[s] fair and equitable tax policies” suggests a partisan tilt that is on full display in Kaiser’s war on fossil fuels.

The case of the two foundations established by Rockefeller’s heirs, the Rockefeller Brothers Foundation and the Rockefeller Family Foundation, shows a much more egregious renunciation of the family patriarch’s intentions.

As Martin Morse Wooster argued in a January 2005 report for Foundation Watch titled “The Rockefeller Brothers Fund and the Rockefeller Family Fund: How a Great Capitalist’s Fortune Came to Fund Anti-Capitalist Causes,” the Rockefeller Brothers Fund, established in 1940, gradually moved from nonpartisan charitable activities toward a left-leaning orientation after the original founders passed from the scene. Its successor, the RFF (established by members of the next generation in 1967), as noted by Peter Collier and David Horowitz in their book The Rockefellers, became a “consistently leftist funding vehicle” from the outset, with the cousins who founded it donating hundreds of thousands of dollars to causes like Ramparts magazine and the (Castro-controlled) Venceremos Brigade even earlier out of their own pockets.

As Collier and Horowitz observe, “thanks to trusts that John D. Rockefeller, Jr., created for his grandchildren in 1952, the cousins of that generation never had to look for work” and thus were liberated to pursue whatever political causes attracted them.

The Rockefeller case is far from the only one in which the heirs to a large foundation, charged with administering the money, wound up turning against the very source of the foundation’s wealth. Notably, in 1977, Henry Ford II resigned as a trustee of the Ford Foundation, lamenting that the foundation’s staff often pursued policies that “failed to appreciate the capitalist system that provided the money” that it was now theirs to dispense. The Ford Foundation subsequently announced that it would “direct all of its money and influence to curbing financial, racial, gender, and other inequities” – in other words, a purely leftist political agenda.

The risk that a charitable foundation will wind up contradicting or outright betraying its founder’s intentions has led an increasing number of such founders to arrange that their foundations be “sunsetted,” that is, spend down their assets over a given period until they close down by a set date. This practice began with one of the earliest major foundations, the Julius Rosenwald Foundation (funded by the founder of Sears, Roebuck), which shut down in 1948 after having helped fund education for African Americans in the South.

However, the trend has increased in recent decades, as noted in a 2017 report by Howard Husock for the Manhattan Institute titled “When Policy-Oriented Foundations Sunset.” Drawing on two other studies, Husock found that while “some 20 major foundations established in the 30 years between 1948 and 1978 chose to sunset,” 42 more did so from 1978 to 2017.

But the risk of establishing a foundation in perpetuity is not only that a founder’s intent may be violated. The opposite problem, noted by Heather Higgins, head of the Randolph Foundation (cited by Husock), is that a donor’s “dead hand” may become irrelevant to a world of changed needs.

There are good reasons for philanthropists to sunset the foundations they establish – even if (especially if the deadline is too short) many worthy causes are cut off from their support. But sunsetting in itself would not have solved the problem posed by Miranda Kaiser’s war on the resource from which her wealth ultimately derived, since (as noted) the newer of the foundations that finances her activities has had a strongly partisan orientation from the start.

The only remedy in a case like that of the KFF is sunshine: laying bare to the public at large how this woman of privilege, having no apparent need to earn a living thanks to her inheritance, and evidently having taken no care to learn the facts on both sides of the climate change issue, is using her position to salve her (unwarranted) sense of guilt.

Think of how much more good Kaiser might have accomplished had she emulated her ancestor’s genuine works of charity.

David Lewis Schaefer is a Professor Emeritus of Political Science at College of the Holy Cross.