Exxon Mobil has been lobbying against parts of Biden reconciliation bill
A view of the ExxonMobil Baton Rouge Refinery in Baton Rouge, Louisiana, May 15, 2021.
Reuters has been opposing parts of a large-scale Democratic budget bill aimed to boost working class families as well as combating climate change.| Reuters
Exxon Mobil has been lobbying against pieces of a sprawling Democratic budget bill aimed at boosting working class families and fighting climate change.
Over the last week, the fossil fuel company has spent $275,000 on Facebook ads targeting tax increases Democrats include in the bill. The bill currently has a price tag of $3.5 trillion. A lobbyist for Exxon focused earlier in the year on legislation concerning corporate and international taxation.
The final shape of the bill has yet to be determined, although it is expected to include measures to boost child and elder care, and policies aimed at cutting carbon emissions. Democratic leaders are hopeful that the bill will be passed within weeks.
These ads do not mention President Joe Biden and the Democrats. At least six of the ads ran from Friday through Monday, although they are now inactive. The one that caught my attention said, “Tell Congress there are no tax increases.” After a user clicks the ad, it reads, “Contact your elected officials today and let them know you oppose the proposed tax increases on American businesses.”
Exxon spent $2 million on Facebook ads in the last 90 days. This includes the $275,000 plus ad purchase. The ads opposing tax increases on business were also shown before that week’s period.
Democrats propose raising the corporate tax from 21% to 26.5% to pay for the bill. While they have called for higher fees to be charged the fossil fuel sector, there is still disagreement over whether a carbon tax should be included.
Majority of the public supports tax increases on wealthy corporations. A recent Morning Consult poll shows that 68% of those surveyed support raising taxes on the wealthy, and 62% have the same opinion of a possible uptick in corporate taxes.
Several special interest groups have launched lobbying efforts against the tax proposals and other elements of the bill, with much of the focus on centrists such as Sens. Joe Manchin (D-W.Va) and Kyrsten Silena (D-Ariz. Democrats will need 50 senators to approve the bill using a budget reconciliation tactic. This means that they don’t have to convince any Republicans to give the bill 60 votes.
Any overhaul will require support from Manchin, whose home state of West Virginia is a large producer of fossil fuels such as coal, natural gas and oil. The state is home to part of the Marcellus Shale, a geological formation that also serves as one of the biggest natural gas fields in North America. Exxon Mobil oil and gas fracking subsidiary XTO Energy has operations in West Virginia.
According to the data of the Center for Responsive Politics, Manchin received $12,000 from Exxon Mobil since the 2012 election cycle. Manchin serves as the chairman of the Senate’s natural and energy resources committee. A senior Exxon lobbyist was caught on camera by the UK’s Channel 4, saying that Manchin was one of his top targets. Manchin was called the “Kingmaker” by the lobbyist who said he used to speak with him on a weekly basis.
Manchin’s staff did not respond to our request for comment.
The CRP data shows that Exxon Mobil had spent $2.7million on lobbying in the first quarter of this year. Exxon lobbyist Michael Solon received $10,000 for work done during the second quarter. The work was specifically on reconciliation legislation that related to international and corporate taxes. According to the disclosure,
Before he was a lobbyist, Solon worked as a policy director for Senate Minority Leader Mitch McConnell, R-Ky.
A spokesperson for Exxon did not return a request for comment.
Both the Senate and House Democrats have been working to develop a bill framework that would be acceptable by progressives as well and centrists. Although the final bill may look very different, some clues can be found in the House committees’ approvals of a larger plan this month by Democrats. Democratic leaders hope to get their climate and social safety net investments passed in the next weeks.
Others companies linked to the oil and natural gas sector have been active in lobbying for reconciliation tax proposals. According to the lobbying disclosure, Valero gas giant paid Cornerstone Government Affairs $5,000 to meet with lawmakers in the House and Senate on “corporate tax provisions” of the Build back Better budget reconciliation bill.
According to the second quarter report, around the same amount was spent by The International Association of Drilling Contractors (a non-profit trade association) on lobbying politicians and Biden administration officials regarding “oil and natural gas policies in reconciliation,” and other policies. According to the LinkedIn profile, the group “dedicated towards enhancing the interests oil-and gas and geothermal drilling & completion industry worldwide.”
Other Democratic proposals related to climate change could also be relevant for the oil and gas industry.
In its markup the House Natural Resources Committee suggested increasing fossil fuel fees and royalty rates for extracting on public lands. It also included other proposals that would impact the oil industry. In addition, the panel has pushed for the repeal of the Arctic National Wildlife Refuge’s oil-and gas leasing program. This was part the Republican tax law 2017.
The House Energy and Commerce Committee proposed a methane emission fee, which is a result of oil and natural gas operations. This was in addition to other energy-related policies.
The proposal for a carbon tax is also disputed by Democrats. It could go against Biden’s commitment not to raise taxes for households earning less than $400,000 and it seeks to decrease fossil-fuel emissions.