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Reich Warns of UC-BP Deal’s Consequences

By Richard Brenneman
Tuesday March 13, 2007

UC Berkeley professor and former cabinet officer Robert Reich must be feeling prophetic today, since the warning he issued about the use of a university’s good name to greenwash an oil industry giant has just cost Stanford $2.5 million. 

During Thursday’s Academic Senate discussion of the half-billion-dollar planned pact between UC Berkeley and British oil giant BP, Reich cited ads run by Exxon Mobil shortly after it signed a 2002 agreement establishing a $100 million, 10-year research accord with the school across the bay. 

The ads, which ran on the op-ed page of the New York Times, announced Exxon’s alliance “with the best minds at Stanford,” and carried the university’s seal and the signature of the Stanford professor heading up the research. 

“One such ad read, ‘Although climate has varied throughout earth’s history from natural causes, today there is a lively debate about the planet’s response to more greenhouse gasses in the future,’” said Reich, drawing gasps from some in the audience. 

That ongoing ad campaign has just cost the university a $2.5 million donation already pledged by film producer Stephen Bing, a major Democratic contributor. He recently gave $50 million to Proposition 87, the failed November 2006 ballot measure that would have levied a 4 percent tax on oil companies to fund alternative energy research. 

The San Jose Mercury News reported Sunday that Bing killed his pledge in response to the ads. His father, real estate mogul Peter S. Bing, has served on Stanford’s Board of Trustees, and the family has given millions to the university. 

The speakers at Thursday’s discussion either lauded the UC-BP project as the hope for evading an unthinkable future or blasted the eagerness of administrators and academics to surrender to the lure of big corporate bucks at the possible loss of integrity and the sacrifice of alternative research. 

The project’s biggest booster, UC Berkeley Chancellor Robert Birgeneau, scorned those who said the university should reject the half-billion-dollar package, labeling as “abhorrent” and “a violation of the most basic principles of academic freedom” any effort to halt the funding. 

The only cautionary notes among the seven designated speakers Thursday came from Reich and Associate Professor Ignacio Chapela, an outspoken critic of corporate/academic alliances as well as of the genetic tinkering that dominates the winning proposal UC Berkeley sent the oil company. 

While most of the faculty members in the audience applauded the proponents, graduate and undergraduate students and several faculty members from the social sciences had strong criticisms of the proposal that would create the Energy Biosciences Institute (EBI). 

The project would be formalized by a contract between Cal and big oil, with Lawrence Berkeley National laboratory (LBNL) and the University of Illinois at Champagne-Urbana (UI) as subcontractors. 


New details 

A search of the original proposal selected by BP from five competing responses from Berkeley, the Massachusetts Institute of Technology, UC San Diego, Cambridge and the Imperial College, London, reveals no occurrence of the word “waste.” 

Instead, the document focuses on production of ethanol, with the main potential source listed as miscanthus, a tall, perennial grass that would be engineered to be super-prolific with little need for irrigation or fertilizers. 

Yet Jay Keasling, EBI faculty scientist and director of the Physical Biosciences Division of LBNL, told faculty Thursday that waste wood and paper waste from landfills would form a major source of biomass to be converted into fuels. 

He also said that ethanol—the primary fuel cited in the proposal—is expensive to distill, can’t be shipped in pipelines but must be trucked instead and yields low energy concentrations. “Why not produce fuels like we use in our cars right now?” he asked. “Why not produce oil, for instance?” 

While any examination of the human, environmental and social costs of converting land to producing genetically altered crops that may be refined with genetically altered microbes was relegated to last place in the proposal BP accepted, Keasling said during the questioning period that monitoring would be done throughout. 

He also faulted the draft for leaving oversight to the last. 

The proposal, a 93-page document, was drawn up with the assistance of the university’s media relations department. The document only contains one mention of the phrase “genetically modified organisms,” although creating gene-altered species to produce and harvest energy is at the core of the proposal. 

The proposal would also oblige the university’s media handlers to work with their counterparts at the Lawrence Berkeley National Laboratory, the University of Illinois and—most controversially—the oil company itself “to ensure that the EBI maintains national and international visibility as the world’s premier energy research institute.” 


Origin of proposal 

Vice Chancellor for Research Beth Burnside said the proposal began in June of last year when BP announced it would fund an institute to research a “biomass conversion approach to energy conservation.” 

That approach dovetailed with already existing efforts at LBNL, where director Steve Chu was already spearheading efforts to use GMOs to create new fuel sources under the umbrella of the Helios Project, using the research facilities of the lab’s Joint Genome Institute. 

Chu acknowledged that biofuels aren’t the sole answer to climate change, “but if you could have a 10, 15 percent effect on this issue,” it would be “a huge part” of the solution. 

After sending a letter in September to “all deans, chairs and directors,” Burnside said 60 faculty members responded with ideas for proposals, and all were included in the document’s appendix. 

While Burnside said she then began working closely with the Academic Senate’s budget committee, under questioning she revealed that she didn’t consult with the Committee on Academic Planning and Resources Allocation about the seven new full-time hires proposed until after the proposal was submitted Nov. 22, two days after Gov. Arnold Schwarzenegger had pledged $540 million toward a new building if UCSD or UCB won the contract—a sore point with some of the critics. 

“Our objective was to treat this as an ordinary though a little bit oversized industry-sponsored research project,” she said, a remark that led several back-of-the-hall critics to roll their eyes. 

The estimated $50 million a year that would flow from the agreement is more than three times the university’s current annual corporate research funding of $16 million, or 3.1 percent of the $550 million total in external research funding the university received, mostly from the federal government, in 2006. Assuming half the $50 million went to the lab—an affiliate of the university—and UI, the remaining $25 million would raise Berkeley’s corporate total to the 5 percent level, which Burnside said was still well below the 7 percent national average and the 12.1 percent levels of Stanford and MIT. 

Panelist Shankar Shastry, a professor of electrical and bioengineering and director of the university’s Center for Information Technology Research in the Interest of Society (CITRIS), hailed the agreement as the latest in an ongoing series of joint academic/industrial collaborations. 

“That’s what we’re good at in Berkeley. There are few other places that I feel have this magic sauce to be able to put such coalitions together,” he said. 


Corporately responsible? 

Just how responsible a corporation is BP? David Vogel, a professor at Haas School of Business and the Goldman School of Public Policy, said, “On balance, BP is a relatively responsible institution and I’m delighted that it has chosen to associate itself with a relatively responsible university.” 

He cited the company’s adoption of a policy to disclose all payments to governments in developing countries and its efforts to clean up oil spills in Alaska and repair a Texas refinery where 15 people were killed and 200 injured in a 2006 explosion. 

He also cited the retirement benefits given Lord Browne, the CEO during the spills and the era leading up to the Texas disaster. Browne “retired with £5.3 million and an annual pension of £1 million ... this may seem like a lot of money, but his counterpart the same year, the CEO of Exxon Mobil, retired with a retirement package of $400 million. Even if you do the currency, there’s a big difference.”  

Vogel’s list of BP’s corporate sins neglected to cite allegations of murderous relations with repressive regimes in Africa and Latin America. 

Claudia Carr, a professor in the College of Natural Resources who specializes in energy issues in Africa, said the company had an “abysmal reputation” on human rights issues in the Niger Delta and was fully involved in massive human rights violations in Angola and Equatorial Guinea. 

Peace and Conflict Studies student Matthew Taylor faulted the university for dealing with a company which had aided in the CIA-planned overthrow of the democratically elected premier Mohammed Mossadegh of Iran in 1953 after he nationalized the Anglo-Iranian Oil Company, BP’s earlier corporate name. 


Humanists respond 

Reich was the most cautious of the panelists except for Chapela, citing five major areas of concern in joint research agreements. 

The first was the one raised by Birgeneau, “the academic freedom of researchers to contract with whomever they wish in terms of funding,” including the issue of whether Berkeley researchers can take tobacco industry money, an issue “still pending before the regents right now.” 

Second was the question of prior restraints on publication of results of privately funded research, and Berkeley’s approach remains an open question, “a question I hope we have time to discuss,” he said. 

Third on Reich’s list was the ability of funding to distort the research agenda, an issue raised by agroecologist and Professor Miguel Altieri, whose research that he and Chapela do on eco-friendly farming techniques is doomed by corporate funding that looks to patents and rights. 

Reich also cited the $2.9 million Exxon Mobil handed out in 1998 “to researchers who would raise doubts about climate change” and pharmaceutical industry funding designed to “create an intellectual echo chamber of economists” opposed to regulation. 

His fourth issue was the potential impact of funding on hiring and promotion of university staff, and the possibility that critics of corporate funds would be discouraged or not hired at all. “The danger here is potential intimidation,” he said. 

The fifth issue, already cited, was exploitation of the university’s image and reputation on behalf of the corporate sponsor. 

Professor Timothy J. Clark of the university’s History of Art Department said he had “grave misgivings about this deal being struck with British Petroleum,” a name he insisted on using and which slipped into Vogel’s discussion at several points. 

The boardroom wants products and profits, he said, while scientists in the lab want the truth—setting the stage for an ongoing conflict and the need for oversight. 

“The evidence suggest so far that transparency has been notably absent,” he said. 

Burnside disagreed. 

Anthropology Professors Paul Rabinow and Laura Nader offered their own sharp criticisms of the way the proposal had been handled. 

Rabinow, whose specialty is medical anthropology and who has studied genomics extensively, said his main conclusion was “that what was damaged was faculty trust, but there’s not much of that left anyway.” 

Rabinow, who is working jointly on a project with Keasling, said he isn’t opposed to all GMO research and cited LBNL’s development of GMO production of the anti-malarial drug artemisinin as one positive use of the technology. 

Nader said she was “rather shocked by the cavalier attitude of the administration in discussing something as significant” as the commercialization of the university, which would now be devoted “to serving two masters, the bottom line and the truth.” 


Chapela’s statement  

The activist professor, one of the leading critics of Berkeley’s last major corporate partnership (the Novartis agreement), delivered an impassioned address that was ended by moderator Linda Schacht after he went two minutes over the eight-minute limit. 

Blasting the proposal as a document that would lead to the prostitution of the academy, Chapela was the only panelist to remind the audience that GMOs were at the heart of the proposal, while deriding the euphemisms it adopted to describe the highly controversial technology, 

“In the BP-Berkeley spirit, I would suggest we rename ‘science’ what we used to call ‘magic’ in my childhood,” he said. 

Chapela also charged that a Walnut Creek-based company called Mendel Biotechnology is a partner in the deal, a firm which has a $40 million alliance with Monsanto, a multinational corporation which has a vice president on Mendel’s board. 

Two professors included in the agreement are on the board of the firm, he said. 

He echoed Altieri’s concerns that the agreement would end research that focuses on non-patentable technology. 

“If we signed the agreement, can anyone seriously imagine that Berkeley would be in a position to undertake significant research to show the problems with the BP strategy?” Chapela asked. “Can anyone believe that after signing the contract we would be working on alternatives that do not involve patents, immoral profit margins, economies of scale and command-and-control governance?” 

A complete video recording of the senate meeting is available online at