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October 27, 2020

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Lima's fight for its refinery detailed by Bluffton University professor, Perry Bush

Perry Bush

Dr. Perry Bush says his new book is about several things.
How Lima, Ohio, saved its oil refinery from closure by British Petroleum in the 1990s is the story of a city's fight and survival against long odds, says the Bluffton University history professor and author of "Rust Belt Resistance: How a Small Community Took on Big Oil and Won."

But it's also, Bush notes, about such timeless qualities as human emotions and morality, as well as the ongoing, contemporary question of corporate personhood.
Published recently by the Kent State University Press, "Rust Belt Resistance" was more than a decade in the making. Bush had just finished "Dancing with the Kobzar," his centennial history of then-Bluffton College published in 2000, when he met Lima Mayor David Berger, a central figure in the refinery fight who remains in office today.

Berger told Bush what had happened and said he had records of it, the author recalls. Those records included a CD with every refinery-related article that appeared in the Lima News over three years, he adds, remembering his feeling that "this guy's putting a fantastic story in my lap."
The story was set at what had been John D. Rockefeller's first oil refinery, established just south of Lima in 1886. BP assumed control when it absorbed Sohio about 100 years later and, within several years, in the early '90s, corporate representatives informed refinery managers that BP deemed the facility to be dying and was "getting rid of it," Bush says.

But a strange thing happened on the way to Lima's losing about 500 more manufacturing jobs, on top of the roughly 8,000 already lost in preceding years as the city became, as Bush calls it, "a poster child for the Rust Belt."
James Schaefer, commercial manager for BP's Midwest operations, was respected by blue-collar workers because he listened to, and sometimes implemented, their suggestions, the author says. So, when he issued a challenge to the Lima workers facing unemployment, he empowered them, Bush continues. The result, he says, was that a "remarkable" work force, moving with "incredible efficiency," had the refinery operating in the black within a few years.

BP, however, was unmoved, announcing in January 1996 that it was going to sell. The assumption, says Bush, was that someone would be interested in a profitable facility with productive, motivated employees but, that October, the corporation said it couldn't find a buyer and would close the refinery.
To try to stop the defection--which would have taken retail jobs away, too, Bush points out--Berger, the Democratic mayor, joined forces with Republican officials in the city and surrounding Allen County, plus the Lima News.

Berger had a BP insider--dubbed "Deep Well" by the newspaper a la the Washington Post's Watergate-era "Deep Throat"--who fed the mayor information that he relayed to the paper, Bush says. With that help, the News became a muckraking paper for a time, he adds, saying it "acted heroically" in the effort to save the refinery.
Eventually, Berger also dealt with David Stockman, who gained notice in the '80s as President Reagan's young budget director. Fifteen years later, he was a senior managing investor for the Blackstone Group, a private equity firm that bought controlling interest in Clark Oil in early 1998.

That spring, the behind-the-scenes work of Berger, Stockman and others produced a buyer for the refinery in Clark. Berger had to lay low because BP was prepared to walk away from the nearly quarter-billion-dollar deal with Clark if it learned of involvement by the persistent mayor, who had "stuck his thumb in BP's eye," Bush notes.
The refinery has since been owned by Valero Energy and now by Canada-based Husky Energy, which purchased it for $2 billion in 2007. Husky, says Bush, has put another $2 billion into the facility in preparation for processing controversial tar sands crude oil from Alberta, where the company is headquartered.

Interviewing more than 30 sources and using other oral histories in his research for the book, Bush found "a lot of heroic people in the BP world" as well as outside the corporation, he asserts. Many were "sick at heart with what BP was doing," he says, pointing out that they knew Lima's reputation as an oil town--and the derrick featured prominently on the city flag.
Although BP has been "remarkably generous around the world" historically, Bush maintains, the company has also been torn between public responsibility and the pursuit of profit.
Turning a profit is a corporation's only responsibility, according to a precedent-setting, 1919 Michigan Supreme Court ruling, he says. But the question of responsibility remains when chief executive officers make decisions, based primarily on spreadsheets, that can move people around "like poker chips" and "tear the heart out of communities," he suggests.

Citing the court's granting of personhood to corporations--which dates to 1886--Bush adds that "if an individual moves and trashes his house, it has an impact on the neighbors."
Few communities have emerged as winners from such a move by a corporation, he says, calling Lima "a remarkable example on the landscape of deindustrialization." While luck was involved, he largely credits the "broad-based coalition" whose major players included labor and politicians, although not, in this case, partisan ones.

The moral of the story, he says, is that "human agency still matters; human emotions still matter," including those of people in the corporate sector--such as Berger's BP informant--who "are still human beings" and not slaves to spreadsheets. "It's about doing the right thing."
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