The Texaco Shake-down
Jude Wanniski
November 20, 1996


\Memo To: Kweisi Mfume
From: Jude Wanniski
Re: The Texaco Case

It is extremely discouraging to see Jesse Jackson playing the race card as crudely as he is in this high visibility news event. I find myself in agreement with the New York Post, which refers to the Rev. Jackson and Al Sharpton, "his Sancho Panza," as "racial ambulance chasers." The white community expects this from Al Sharpton, who will lead any lynch mob he can find, and I suppose there has to be a Sharpton to explore any possibility to exploit racial opportunities. But when Jesse becomes an enthusiast in this shakedown, a variation on the Mafia's protection racket of yore, it chills me to think of where race relations are headed in America. There is no point in my writing to Jesse Jackson. He has been shameless in announcing that it really does not matter if Texaco is guilty of racial discrimination, as long as he knows it is going on somewhere in corporate America. Why not string up Texaco to make an example of it? How many white lynch mobs strung up how many innocent black men to make an example of them? I can hear him saying to you: Let's get even, Kweisi.

This is the new affirmative action, isn't it? If the people of California decide to end reverse racial discrimination by government because it is only damaging race relations, then let us have vigilante justice. Is this to be the new battlecry of the NAACP? How is it possibly going to help the millions of ordinary men and women of color to have the most respected leaders of the African-American community engage in open, public, racial terrorism? Isn't it enough to have all the civil-rights laws you can possibly wish on the books? Do you believe the federal courts are so warped in their racism that they will undermine genuine civil suits such as the one brought against Texaco? Quite the opposite is more likely to be the case, with federal prosecutors turning into Orwellian racist police, squeezing the Texaco whistleblower with an obstruction-of-justice indictment until they can force him to tell them enough to indict everyone on the top floor for shredding any papers that might refer to black jelly beans.

What scares me is that there are no black leaders willing to step forward and denounce Jesse for whipping up a boycott against Texaco, after the $175 million shakedown. You seem to be right behind him with a rope of your own. What is your goal now, to have corporate America go beyond the efforts of Texaco, which by all accounts has gone overboard in kicking people upstairs? Do you want private set-asides and quotas, enforced through this protection racket, to advance black executives even during the kind of downsizing Texaco has been through in the last decade? Are these the kind of public relations fights you want to win? Does this mean the NAACP is going to pass the hat among the Fortune 500 for voluntary contributions? Is your goal now to have International Octopus forced to promote black executives who make $75,000 a year into jobs paying $100,000? Do they have to have corner offices with windows? Stock options? Do we have to have hidden microphones in all rooms with white males, to make sure none of them use the "n" word? What I'm trying to say, old friend, is: Have you guys seriously thought through the implications of these goings-on?

You know how hard Jack Kemp and I have been working to bring about a reconciliation between the Nation of Islam and the Jewish community. It is not a popular cause we are fighting and it doesn't get any more popular when the racial waters are poisoned by this kind of demagoguery. God knows I have defended Jesse to the point where I'm subjected to ridicule myself, but I do it because I've always been able to put myself in his shoes and see his point of view, and find at least a semblance of a just cause. Not this time. All I see in him is blind hatred, a lust for vengeance, a chance to get even.

How impressed the white community was with the Million Man March. No matter what they might have said publicly about Farrakhan, the leaders of the white community were mightily impressed with what he set out to do and what he achieved. Here were a million black men, standing up and asserting their manhood, pledging to do what they could to help themselves and their women and their communities instead of playing the victimization game, whining and crying to the Nanny state of the federal government for handouts. Now this. How I would love to hear what Louis Farrakhan really thinks about this newest game in town. It makes me sick to think of how quickly every small gain in race relations can be washed away when there is no leadership or only these crude, racist vigilante attempts at retribution.

In case you did not see it, I append the New York Post editorial. It's practically the only place I see where there is still a voice of sanity. All the other courageous editorial writers are hunkered down, scared to death they might say something that might forever brand them as racist.

November 17, 1996
The New York Post
Texaco sends the wrong message

Texaco's abrupt decision to pony up more than $175 million to settle a race-discrimination lawsuit — and terminate a brutal pounding in the court of public opinion — is testimony to corporate America's moral cowardice. The company settled in the face of a threat by Jesse Jackson and his Sancho Panza, Al Sharpton, to initiate a boycott of Texaco.

Not surprisingly, Jackson and Sharpton have not called off their boycott. Obviously, they're interested in squeezing more out of a firm that seems eager to pay protection money.

On Friday, Texaco agreed to make a $115 million cash payment to plaintiffs in the class-action suit — nearly $100,000 per plaintiff— and to set aside $26 million for raises to be given to black employees. The company also earmarked $35 million for corporate-wide "diversity, sensitivity and mentoring" programs.

The settlement came a scant 11 days after it was disclosed that company executives were secretly taped as they allegedly belittled black Texaco employees.

Subsequent transcripts of the barely audible tapes reveal that, actually, no racial epithets were uttered.

In an instance touted widely as an example of racism, executives used the term "black jelly beans" to characterize African-American employees. But a transcript made from enhanced tapes demonstrates that the executives referred — by color — to all employees as "jelly beans." The term was developed by a black management consultant charged with leading New Age-style seminars.

Also clear now — contrary to early reports that prompted the general rush to judgment — is that no one at the meeting used the odious term "nigger." A reference to "St. Nicholas" — in a discussion about Kwaanza — was "misinterpreted" by folks eager to brand Texaco as a hotbed of unchecked racism.

Facts rarely catch up with early — sensationalistic — allegations. Texaco — its corporate image at stake — wasn't even prepared to try to set matters straight.

True, Texaco Chairman Peter Bijur met last week with Jackson, Sharpton and other racial ambulance chasers. Bijur pointed out that even as total employment at the company dropped — by nearly 30 percent over the past five years — the number of blacks, women and other minorities on Texaco's payroll actually increased. He also emphasized that Texaco provides scholarships for minorities; targets black colleges in its recruitment efforts; looks for college interns among minorities; and gives money to outside scholarship funds and to organizations like the Urban League and the NAACP.

If Bijur thought Jackson and his comrades were listening, he's living in a dream world. Jackson & Co. learned long ago that the mere charge of racism can generate spectacular results — like Friday's settlement. There's nothing new about "racial McCarthyism."

It's important to note that while we're generally dubious about disparate-impact-based discrimination lawsuits, we don't pretend to a view on whether or not Texaco practiced discrimination. Our objection turns on the fact that the company settled these cases in response to the Jackson-Sharpton deadline -- thereby legitimating discrimination.