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"Chubb has the potential to lead the industry and raise the bar for AIG and Liberty Mutual to follow suit," said one campaigner.
Climate, environmental, and Indigenous rights defenders on Tuesday welcomed news that global insurance giant Chubb dropped out of a highly controversial methane gas project on the Texas Gulf Coast after months of grassroots community pressure.
The Sunrise Project published an insurance certificate obtained via a public information act request showing that Chubb is no longer insuring the Rio Grande liquefied natural gas (LNG) terminal in Brownsville. Houston-based NextDecade—which touts itself as a "sustainable LNG" company—says Phase I of Rio Grande LNG is currently under construction and that the 984-acre site "will be the largest privately funded infrastructure project in Texas."
In addition to exacerbating the climate emergency, Rio Grande LNG threatens land and sites sacred to the Carrizo/Comecrudo Tribe, which opposes the project.
"When you do the due diligence and understand Indigenous rights, this project is a no-go," Carrizo/Comecrudo Tribe of Texas Chair Juan Mancias said in a statement. "Investors and major banks have dropped Rio Grande LNG, and now insurers are following suit because the claims of the fossil fuel companies can't be trusted—here, or anywhere in Texas."
According to the Sunrise Project:
This is the latest setback for the not-yet-built project that would harm the coastal landscape of the Rio Grande Valley as one of the last pristine areas of the Texas coastline—a haven for wildlife, fishing, tourism, and recreation and home to Latine and Indigenous communities—into an industrial methane export hub. Years of campaigning was a likely factor in the insurer backing away. Five banks—SMBC, Société Générale, Credit Suisse, and privately, two additional banks—committed to not financing the project after pressure from community leaders.
Community members voiced the impacts that the methane terminal's gas storage tanks, flare stacks, pipelines, and explosion risks pose to the Port of Brownsville, including the city of Brownsville and those known as the "Laguna Madre": Port Isabel, South Padre Island, Laguna Vista, Long Island Village, and Laguna Heights. The cumulative impacts on soils, air and water quality, community health, vegetation, wildlife, threatened and endangered species, tourism, commercial fisheries, and noise would be significant.
"We tell companies the truth about these projects that would be an environmental disaster for our South Texas community. It feels good to be heard," said Bekah Hinojosa of the South Texas Environmental Network. "I expect other insurers like AIG and Sompo to drop next because the LNG facility, the pipeline, the company—they're losers with a dangerous project."
In June, hundreds of Gulf Coast residents traveled to Chubb's New York office to protest the company's insurance of fossil fuel projects including Rio Grande LNG, Texas LNG, Freeport LNG, and Cameron LNG. Six activists were arrested for blocking the main entrance to Chubb's building. The protest—one of several targeting fossil fuel funders and insurers—was part of the Summer of Heat, a civil disobedience campaign aimed at getting Wall Street to stop funding planet-heating oil, gas, and coal projects.
Ethan Nuss of Rainforest Action Network (RAN) asserted that "Chubb is showing some promising leadership by pulling out of Rio Grande LNG."
"Now Chubb must take the next step of becoming a true climate leader and stop insuring all methane," Nuss added. "Now Chubb must take the next step of becoming a true climate leader and stop insuring all methane. Chubb has the potential to lead the industry and raise the bar for AIG and Liberty Mutual to follow suit."
In February, RAN and the consumer advocacy group Public Citizen published a report revealing that at least 35 different insurance companies were underwriting Rio Grande LNG. The report named Chubb and AIG as the world's two most prolific insurers of fossil fuel projects.
"AIG has tripped over itself to insure Rio Grande LNG in the wake of Chubb's exit," Public Citizen insurance campaigner Rick Morris said on Tuesday.
"This move is the latest in a long pattern of insuring and investing in fossil fuels that shows AIG's climate and human rights commitments aren't worth the paper they're written on," he added. "We have one message for AIG: We won't stop fighting until you drop these disastrous projects."
"We will continue to stand in solidarity and fight together with our African comrades to stop EACOP, to stop the plunder of our homelands, to stop the displacement of our peoples, and to stop imperialist climate destruction."
The "Summer of Heat" continues—both in terms of record-breaking temperatures driven by fossil fuels and a series of nonviolent direct actions targeting Wall Street for its contributions to the climate emergency.
After protests last month calling out Citibank for "financing the arsonists," climate campaigners on Friday set their sights on finance and insurance giant AIG for "stubbornly" refusing to join over two dozen other insurers that won't cover the East African Crude Oil Pipeline (EACOP).
EACOP is set to run nearly 900 miles from Uganda's Lake Albert oilfields to the port of Tanga in Tanzania. Rights groups have sounded the alarm about how the project has devastated the lives and livelihoods of people in its path as well as violence endured by African activists, who have been "kidnapped, arbitrarily arrested, detained, or subjected to different forms of harassment."
Ugandan climate activist Hillary Taylor Seguya declared Friday that "EACOP is a carbon bomb being built in my backyard."
"Thousands of communities in Uganda are being displaced because of corporate greed," added the campaigner, who is affiliated with StopEACOP. "Today, as Ugandans, as Tanzanians, as Africans, we want to be loud and clear that we shall not allow any pipeline to put oil in our backyards."
Friday's demonstration targeting AIG's office in New York City was organized by activists from the Ugandan diaspora and groups including 350.org, the Black Hive, and Desis Rising Up and Moving (DRUM).
"I am here to ask AIG to refuse to insure EACOP, and to insure our future instead," said Joseph Senyonjo, a Ugandan diaspora activist. "AIG is one of the biggest insurance companies in the world, and they still haven't ruled out insuring EACOP. So we are here to say: We don't want carbon bombs, we don't want fossil fuels. We want renewable energy. Insure our futures instead."
Protesters held signs and banners with messaging that included: "AIG = Climate Crimes," "Protect Our Land," "People Not Profits," "Stop Funding Our Destruction," "Stop Insuring Climate Chaos," and "The People Say: Stop EACOP!"
Demonstrators hold banner that says, "Global South Diaspora for Reparations + Repair," while protesting AIG and EACOP in New York City on July 26, 2024. (Photo: 350.org)
"From the pipeline's path in East Africa, to the corporate offices here, to our government institutions, we need to make our message clear: Stop EACOP!" said Evan Bell of 350 Mass. "I am willing to do what it takes to make sure AIG does not insure EACOP."
Bell noted that he is afraid of the New York Police Department, "especially after their brutal response to campus protesters peacefully demonstrating for an end to genocide in Gaza."
"But I am more afraid of runaway climate change," he added. "I'm more concerned about the current human rights abuses in Uganda and Tanzania. But we are more determined than we are scared."
Molly Ornati of 350 Brooklyn emphasized that "the EACOP pipeline is a doubly destructive disaster—for the people of Uganda and Tanzania, and the planet. The construction of the 900-mile pipeline will disrupt and destroy the homes, land, and livelihood of 100,000 people along the route, as well as the surrounding water and ecosystems."
"Once built, it will be a carbon bomb for humanity," Ornati warned. "In the climate crisis there are no borders, and we are a global movement, united in support of frontline communities, fighting to stop the greed of fossil fuel finance."
DRUM's Mohiba Ahmed delivered a similar message of unity, saying that "we add our communities' voices to the growing international demand 'Stop EACOP!' because we know that our struggles are one and interconnected."
"Our peoples in Bangladesh, Pakistan, Nepal, Guyana, and Trinidad are similarly harmed by foreign domination, imperialism, and capitalist projects that reduce our lives to investments, profit margins, and coins," she stressed.
"Our people and homelands contribute the least to the human-caused climate crisis but disproportionately suffer the most," she added, "and that is why we will continue to stand in solidarity and fight together with our African comrades to stop EACOP, to stop the plunder of our homelands, to stop the displacement of our peoples, and to stop imperialist climate destruction."
Opponents of EACOP block AIG's office with a banner in New York City on July 26, 2024. (Photo: 350.org)
Beth Yirga of the Black Hive—part of the Movement for Black Lives—highlighted the frontline resistance to the pipeline, declaring that "we stand with Ugandans and Tanzanians, whose bravery and stories of resistance to stop EACOP are inspiring."
"The climate crisis we are facing exacerbates the oppressive systems designed to extract the most from our planet and global majority community, and unites us that are most impacted," she said. "From Cancer Alley on the riverbanks of the Mississippi River to the lead in Flint, Michigan's water, to the attempts of crude oil extraction in Western Uganda, to the ongoing cobalt mining crisis in Congo, the destructive practices of environmental racism on Black communities is collectively held and felt across the world."
"As we fight to stop climate injustices globally," Yirga added, "we also collaborate to imagine and build a world free of the capitalistic pillaging of Mother Earth."
Until this self-reinforcing cycle is broken, we’ll have a corporate tax and compensation system that works for top executives—and no one else.
In his State of the Union address, President Joe Biden called out “massive executive pay” and vowed to “make big corporations and the very wealthy finally pay their share” of taxes.
Corporate tax dodging and CEO pay have gotten so out of control that many major U.S. companies are paying their top executives more than they’re paying Uncle Sam.
Tesla is perhaps the most dramatic example. Over the period 2018-2022, the electric car maker raked in $4.4 billion in profits but paid no federal income taxes. Meanwhile, Tesla CEO Elon Musk became one of the world’s richest men.
When it comes to fleecing taxpayers while overpaying executives, Tesla is hardly alone. A new report we co-authored for the Institute for Policy Studies and Americans for Tax Fairness analyzes executive pay data for some of the country’s most notorious corporate tax dodgers.
Congress can tackle the entwined problems of inadequate corporate tax payments and excess executive pay on several fronts.
What did we find? In addition to Tesla, 34 other large and profitable U.S. firms—including household names like Ford, Netflix, and T-Mobile—paid less in federal income taxes between 2018 and 2022 than they paid their top five executives.
Another 29 profitable corporations paid their top executives more than they paid Uncle Sam in at least two of the five years of the study period.
One company on our list stands out for the infamous role its executives played in the 2008 financial crisis: American International Group. Back then, the insurance giant ignited a firestorm by pocketing a $180 billion taxpayer bailout and then announcing plans to hand out $165 million in bonuses to the very same executives responsible for pushing the company—and the nation—to the brink of collapse.
Today, AIG is playing the same greedy game of overpaying its top brass and sticking taxpayers with the bill. Between 2018 and 2022, the company paid its top five executives more than it paid in federal income taxes, despite collecting $17.7 billion in U.S. profits. In 2022, CEO Peter Zaffino alone made $75 million.
Lavish executive compensation packages and skimpy corporate tax payments are not unrelated. Executives have a huge personal incentive to hire armies of lobbyists to push for corporate tax cuts because the windfalls from these cuts often wind up in their own pockets.
The 2017 Republican tax law slashed the corporate tax rate from 35% to 21% and failed to close loopholes that whittle down IRS bills even further. Many large, profitable corporations ended up paying no federal taxes at all.
Corporations took the savings from those tax cuts and spent a record-breaking $1 trillion on stock buybacks, a financial maneuver that artificially inflates the value of executives’ stock-based pay.
Wealthy executives became even wealthier while the nation lost billions of dollars in corporate revenue that could have been used to lower costs and improve services for ordinary people. Until this self-reinforcing cycle is broken, we’ll have a corporate tax and compensation system that works for top executives—and no one else.
What can we do to break this cycle?
Congress can tackle the entwined problems of inadequate corporate tax payments and excess executive pay on several fronts. Raising the corporate tax rate to 28% (just halfway back to Obama-era levels) would generate $1.3 trillion in new revenue over the next decade.
Congress must also close loopholes and eliminate wasteful tax breaks, for instance by removing the incentives for American firms to shift profits and production offshore.
Policymakers also have a wealth of tools to curb excessive executive pay, from tax and contracting reforms to stronger regulations to rein in stock buybacks and banker bonuses.
We know we need change when corporations are rewarding a handful of top executives more than they are contributing to the cost of public services needed for our economy to thrive.