Short Cuts: Episode VI 
The Great White Hope
Democrats haven’t won a statewide race since 1994, so why does this middle-aged guy with a bald head and big ears think he's the fresh face of the party? Because outgoing Houston mayor Bill White has a record that makes some Republicans envious, he can raise a ton of money, and he will kiss as many babies as it takes (whether they want him to or not).
Doug says: Without a doubt, Texas needs Bill White! Think of it, going from "big hair" to "big brain!" (November 27th, 2009 at 9:39pm)
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After graduation he joined Susman & McGowan, a new Houston law firm whose unusual strategy was to do business litigation mostly on a contingency basis. To make money, the lawyers had to win their cases. White, who preferred this sort of risk-taking, was an almost instant success, and the firm quickly became one of the state’s most successful (its name was later changed to Susman Godfrey).
“Bill was such a superstar that he became a partner within a few years,” says Neal Manne, a partner at Susman Godfrey. “He had this great ability to analyze, on the front end, which cases would be successful. That, of course, is the whole game in this sort of practice.”
He was also devastating in the courtroom. “When Bill had a case in town,” says Manne, “there would be a crowd of people that would go down to watch, not just from our firm but from other firms. It was a phenomenal teaching experience, and it was world-class entertainment.” In 1989 White won jury verdicts in two major fraud cases. One involved a defective oil drilling tool and was at the time the largest securities fraud class action in the United States. The other also involved oil field fraud and was the largest award in the Western District of Texas. White, the son of schoolteachers who’d made very little money, shopped at thrift stores, and often had to struggle to make ends meet, earned millions. “If he had stayed with the firm, he would be a zillionaire today,” says Manne.
Though White prefers to govern by a sort of gentle consensus, he is fully capable of reverting to his more aggressive, inquisitorlike, trial-lawyer persona. No one felt this more than the refining and petrochemical companies of the Houston Ship Channel, who became the target of White’s ire because of their emissions of harmful pollutants. In the summer of 2004, White determined that Texas Petrochemicals was emitting unusually high levels of the chemical 1,3-butadiene and in early 2005 announced that he was going to sue the company. Texas Petrochemicals sought refuge with the State of Texas, which assured Houston that it had jurisdiction but then failed to come up with an enforceable agreement. White was furious. He indicated on the city council agenda that the city was retaining a high-profile plaintiff’s lawyer to go after “certain polluters.” “The next day our lawyer got a call from the company’s lawyer saying, ‘What do you want?’” says Elena Marks, White’s director of health and environmental policy. In the next few months White’s team worked out a settlement with the company to reduce its emissions over time that was contractual and enforceable. “They got a lot of grief from their fellow industry members, who said, ‘You caved,’ ” says Marks. “But they were going to lose a big, ugly lawsuit.”
White also went after Lyondell Chemical, the city’s largest emitter of the carcinogen benzene. Unable to force compliance under city laws, he tried an inventive strategy: He challenged Lyondell’s operating permit from the Texas Commission on Environmental Quality. “If the company believes that it’s just fine to put tons and tons of benzene in the air,” White told the Chronicle last year, in full trial lawyer mode, “then we would like to hear what scientific evidence they have that benzene is good for you.” The matter is still pending.
In July 2008 White went even further: He challenged the Environmental Protection Agency’s basic methods of estimating levels of pollutants. He insisted that because of the EPA’s flawed methods, emissions of harmful chemicals in Houston were many times what they were reported to be. The EPA’s reply, which made national news, came in April 2009. To the amazement of many, the agency agreed with White and promised to overhaul the way it calculates cancer-causing emissions from plants.
White’s stand on issues such as air quality—as well as such quality of life issues as traffic, parks, libraries, and clean energy—is what truly distinguishes him from his predecessors. Mayor Kathy Whitmire streamlined and professionalized city government; her successor, Bob Lanier, was famous for making city services work, filling potholes, repairing streetlights, cleaning ditches, and fighting crime; Lee Brown, a more politically controversial mayor, nonetheless gave the city an urban rail line and a stadium. But no one until White really focused on the way Houston residents experience life outside the workplace.
Though White had always been interested in politics, working as a page in Austin while in junior high school and registering voters in San Antonio’s Hispanic neighborhoods when he was in high school, his official political career began in 1993. That year President Bill Clinton appointed him Deputy Secretary of Energy, the department’s de facto chief operating officer. There were good reasons for the appointment. The first was that he had supported Clinton early on and had raised nearly $2 million for his presidential campaign. The second was more interesting: White was considered a leading expert on energy policy, though he had never held a real job in the field. In 1975, when he was a junior at Harvard studying natural gas policy, he had taken a semester’s leave of absence to work for newly elected Texas congressman Bob Krueger, who happened to be on the Energy and Power Subcommittee. It soon became apparent that the precocious White knew more about the subject than most congressmen. “Bill White . . . literally wrote for me legislation that gradually decontrolled oil prices,” wrote Krueger in a 2003 op-ed piece in the Chronicle. “Throughout this period, Bill was my mentor.” Krueger’s bills did not pass, but no one forgot White’s contributions, which were written up in the New York Times. In 1978 he was back, taking a temporary leave from law school and helping Krueger, who was at that time floor manager for a natural gas deregulation bill. “I recall going up to D.C. and being one office off the House floor as floor amendments were coming in,” White says now. “It was very exciting. I kept up with it over the years.”
At the Department of Energy, White spearheaded American efforts to make parts of the former Soviet Union available to oil and gas drilling. “During Clinton’s first term, Bill was one of the key players in bringing U.S. support to constructing a regionally strategic oil and gas pipeline from the Caspian Sea to the Mediterranean,” says Steve Nican-dros, the chairman and CEO of Frontera Resources, a company that White helped create. White hobnobbed with heads of state such as President Eduard Shevardnadze, of Georgia, and President Heydar Aliyev, of Azerbaijan. He helped close the Chernobyl nuclear plant in Ukraine. He undertook major reforms in the DOE, opening up more than $27 billion in contracts to competition for the first time and cutting the department’s workforce by 3,788 employees on a five-year plan. When he left the job, in July 1995, to become more involved in state politics, the Washington Post ran a flattering story under the headline “Government Loses a Key Reinventor.”
Back in Texas, White found that he was very much in demand. In a state where energy is one of the main drivers of the economy, holding the number two job at the DOE carried enormous weight. White capitalized on it right away, first by becoming head of the Texas Democratic Party and then by starting Frontera Resources, part of whose mission was an extension of what White had been doing at the DOE: looking for exploration and production opportunities in far eastern Europe. He assembled a dazzling, high-powered group of co-founders and investors that included former senator and Secretary of the Treasury Lloyd Bentsen and his son Lan, a finance and real estate executive; former Conoco chairman Constantine “Dino” Nicandros; his son, Steve, the former head of Conoco Overseas Oil; and Houston venture capitalist J. Livingston Kosberg. Former CIA director John Deutch was briefly an adviser. There were plenty of other blue-chip investors as well, including Baker Hughes, Shell Capital, Deutsche Bank, Schlumberger, and the European Bank for Reconstruction and Development. This, of course, was where White’s political connections would come into play. Though White had helped fund Frontera’s early existence from his own pocket, he had a short-lived executive role, partly because he was spending most of his time traveling around the state trying to revive the moribund Democratic party. Frontera was simply a very ambitious side project for him. He became chairman; Steve Nicandros ran the company. All in all, it was a remarkable play, and it had been entirely Bill White’s idea.
Incorporated in 1996, the high-flying, politically connected Frontera became one of the first Western companies in Azerbaijan to have an onshore production—sharing agreement. Fueled by a $60 million loan from the European Bank for Reconstruction and Development, the company ramped up production to approximately six thousand barrels of oil a day and was making money within three years. “Then we hit a speed bump,” says Steve Nicandros. “The Azeri state oil company changed the rules.” One of the company’s primary lenders bailed out, which forced Frontera to sell its assets in Azerbaijan and redistribute them in the neighboring country of Georgia, a major blow for its backers. (It is not known how much White invested; his former boss Steve Susman invested $1 million, and it is probably safe to assume that White invested at least that much.)
Though one of White’s opponents in the 2003 mayoral race portrayed Frontera as a failure, the truth is more nuanced. White himself had nothing to do with Frontera’s board or its management after 2001. Eventually Frontera went public and has focused its exploration efforts primarily in Georgia. Though it has not seen profits in recent years—its stock has fallen from a high of $2.87 to 25 cents—the company remains well funded, pursuing potentially lucrative oil and gas business.
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