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Oil & Gas

Obama victory a boon to unions, auto industry, could harm oil and gas companies

November 05, 2008
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Barack Obama''s victory in the presidential race will give labor unions and the embattled U.S. auto industry a strong ally in the White House, and likely will put pressure on oil and gas producers and pharmaceutical companie, according to the Associated Press. His election also makes congressional approval of a fresh economic stimulus package -- perhaps as large as $150 billion -- more likely, economists said. His biggest challenge will be to turn around an economy that many analysts already believe is in recession. A stubborn housing slump led to the worst U.S. financial crisis in 70 years, which has caused banks to reduce lending and consumers and businesses to sharply cut back their spending. Obama''s reputation as a conciliator will be sorely tested by the labor-backed Employee Free Choice Act, which would allow workers to form unions by getting a majority of employees to sign a card in support of a union, rather than through a secret ballot election. Business groups such as the U.S. Chamber of Commerce fiercely oppose the measure because they say the elimination of the secret ballot would open up workers to intimidation and harassment. The measure, supported by Obama and most Democrats in Congress, was approved in the House last year but stalled in the Senate. Meanwhile, Obama has promised to help Ford Motor Co., General Motors Corp. and Chrysler LLC by doubling a recently approved loan program to $50 billion to help the auto industry develop more fuel-efficient cars. Oil and gas companies such as Exxon Mobil Corp. and Chevron Corp., however, could face a windfall profits tax, which Obama has promised to impose to pay for a $1,000 "emergency energy rebate" for families. Also on energy, Obama proposes spending $150 billion over 10 years to speed the development of plug-in hybrid cars and "commercial-scale" renewables, such as wind and solar.

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