Subsidies
neglected? new tag
see subsidies 2 age of trump
see also TARP bailouts
charter schools
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ymail 3 25
So now that Congress is writing spending bills — with lots of harsh cuts to important programs like Medicaid — the fossil fuel industry is looking for a return on its investment:
- The fossil fuel industry is pressuring Congress to increase fossil fuel extraction on public lands and waters
- The industry is pushing for Congress to prop up fossil fuel projects far into the future — decades longer than they’d otherwise be financially viable
- And the industry is trying to preserve and even expand century-old tax loopholes so polluters can continue to profit at our expense
In total, the fossil fuel industry is pushing for giveaways that are estimated to cost the American people more than $170 billion over the next decade while increasing climate emissions and fossil fuel extraction.
...
public citizen
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surota lever 11 24
Kill The Worst Corporate Welfare
Through tax-exempt municipal bonds, the federal government has spent billions subsidizing the cost of professional sports stadiums, despite almost no evidence that these subsidies significantly boost local economies or job creation. DOGE can recommend preventing such bonds from being used to finance stadium construction.
Through the U.S. Agriculture Department, the federal government spends hundreds of billions of dollars on farm subsidies. As the Department of Health and Human Services Secretary nominee Robert F. Kennedy, Jr. recently noted, these subsidies not only disproportionately benefit the largest and wealthiest farms, they also support commodities for processed foods at the heart of the country’s chronic disease crisis. They can be significantly reformed or limited.
Through special tax breaks, the federal government massively subsidizes the fossil fuel industry, which distorts the energy market as cleaner energy becomes cost-competitive and fortifies an industry responsible for an increasingly expensive climate crisis.
These and so many other corporate welfare programs often waste money that could be used to make other efficiency measures — like tax code simplification — budget neutral.
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an 11 23
to be honest, I didn't really care whether the Arizona Diamondbacks or the Texas Rangers won the World Series. Once my two favorite teams—the Dodgers and the Red Sox—were eliminated, I didn’t have a stake in the outcome of the World Series. I just wanted to watch to see first-rate baseball and see interesting games, and the Diamondbacks and Rangers didn't disappoint.
Most of the 30 MLB teams are owned by billionaires. But the owners of the Rangers and the Diamondbacks are particularly disgusting. Ken Kendrick, who owns the Diamondbacks, and Ray Davis—whose Rangers won the World Series in Game 5 on Wednesday night with a 5-0 shutout win—are both billionaires with a history of providing financial support for Republican candidates and right-wing causes.
:{:{According to Forbes magazine, Davis has a personal net worth of $2.9 billion. Before getting into the baseball business, Davis was CEO of two fossil fuel corporations—Energy Transfer Partners (ETP) and Energy Transfer Equity (ETE}:). ETP is a natural gas distributor and pipeline company. Davis stepped down as CEO in 2007 but still owns 2.4% of the company. In 2017, despite protests by the Standing Rock Sioux tribe, Energy Transfer finished building the $3.8 billion Dakota Access Pipeline.
The corporation operates over 125,000 miles of pipeline that move approximately 30% of America's oil and natural gas. Davis and a group of investors bought the Texas Rangers for about $600 million in 2010; it's now worth $1.5 billion. Since 2021, Davis has donated at least $225,000 to Texans for Greg Abbott, the state's right-wing Republican governor, according to state campaign finance records. He's also donated to other Republican candidates.}:
In 2003, the Chicago Cubs hosted the first Pride game to celebrate their LGBTQ fans. Since then, all but one of the 30 Major League teams have hosted an annual Pride Day or Pride Night event. The Texas Rangers are the only team without a Pride Night.
Ken Kendrick is only worth $1 billion, according to Forbes, but he's a much bigger donor to politicians and right-wing causes than Davis. He and his wife Randy have made large donations to conservative groups connected with the Koch brothers. According to FEC filings, he has donated to many Republican election deniers, including Arizona U.S. Congressman Paul Gosar and Andy Biggs as well as to conspiracy-theory nutjob Congresswoman Lauren Boebert of Colorado.
Kendrick founded a software company called Data Technology which merged in 1979 with another company called Datatel. General Motors bought the company in 1988 for $511 million, giving Kendrick a big boost in his personal wealth. He made more money by investing early in Woodforest National Bank, which now has more than $1.7 billion in assets. Woodforest National Bank is Walmart’s largest retail partner. Kendrick became part-owner of the Diamondbacks with the team's inception in 1995 and has been the managing general partner (the major owner) since 2004.
Kendrick is one of those Republicans who decry "big government," but he's perfectly happy receiving government subsidies for his business from Arizona taxpayers. The Diamondbacks built Bank One Ballpark (later renamed Chase Field), the first retractable roof stadium in MLB with a grass field, in 1995 with the help of $253 million dollars in public financing through an increase in sales tax in Maricopa County. This happened during a huge county budget deficit and lack of funding for other services. The County Supervisors approved the tax increase without asking for voters' approval. In 2016, Kendrick decided that the stadium needed about $65 million worth of repairs, and estimated that it would need a total of $187 million of upkeep costs over the final 12 years of its lease with Maricopa County. And of course, they wanted the taxpayers to pay for it. County officials refused. One of them, Andy Kunasek, described the Diamondbacks as “parasitic enterprise.” When the County wouldn't provide Kendrick with the subsidy, he sued the County in an attempt to get out of the Diamondback's lease, which expires in 2027. Kendrick has hinted that if the County doesn't pay for those improvements, he'd consider moving to the team and building another stadium.
Oh, and in case you're wondering, Kenrick is also a union-buster. In 2020, when the 30 major league owners locked the players out for three months (essentially, an owners' strike), Kendrick was one of the four most reactionary owners who voted against signing a new collective bargaining agreement with the players union.
So it was a win for the Rangers last night, and congrats to all the players. However, no matter which way this series may have gone, it would have been one right-wing billionaire or another holding the trophy in the end.
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719
The cost of the nuclear bailout for Ohio ratepayers is a bargain compared to the bill being given to residents in South Carolina. The cost of a failed program to build a nuclear power plant there topped $9 billion. Two of the companies involved — Dominion Energy and SCANA Corporation — entered into a buyout and settled a large portion of the bill, leaving ratepayers responsible for footing the remaining $2.3 billion, more than twice the Ohio figure. Not a single kilowatt of energy was produced in South Carolina by the project, which consisted largely of a hole in the ground.
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Summary
California "Tesla Bill" has been reduced to a study and for all practical purposes is dead.
The Company is now facing a huge competitive ASP headwind due to expiring federal subsidies.
We believe that even 200K per year demand for Model 3 could be a stretch once the Company exhausts its reservation queue.
On Friday, California Senate effectively scrapped AB-1184, a bill for EV rebates that was infamously dubbed the “Tesla Bill”.
The bill, which was watered down heavily last week, has been further watered down, stripped of reference to funding, and reduced to a study. The essence of the revised bill now boils down to the following paragraph:
“SEC. 2.(A) On or before January 1, 2019, the State Air Resources Board, pursuant to Section 9795 of the Government Code, shall submit to the Legislature a report regarding the operation of the vehicle incentive programs that includes both of the following:
(1) The funding levels necessary to support continuous, year-round operation of each of its zero-emission vehicle and near-zero emission vehicle incentive programs.
(2) Changes to the zero-emission vehicle incentive programs that are necessary to increase market penetration of zero-emission vehicles.
(B) The State Air Resources Board may contract with a third party for the preparation of the report required pursuant to subdivision (A).”
In effect, what would have been monstrous rebates in favor of Tesla (TSLA) have now disappeared. To be sure, the death of the rebate is not that significant to Tesla given that earlier revisions already reduced potential benefits.
However, there should be little question that, as the bill was originally written, Tesla management was hoping that this bill will help the company ride out the federal credit phase out. The failure of the bill shows a big challenge that Tesla faces as the federal $7500 rebate is set to phase out in 2018.
For reference, IRS defines the phase-out language as follows:
“The new qualified plug-in electric drive motor vehicle credit phases out for a manufacturer's vehicles over the one-year period beginning with the second calendar quarter after the calendar quarter in which at least 200,000 qualifying vehicles manufactured by that manufacturer have been sold for use in the United States (determined on a cumulative basis for sales after December 31, 2009) ("phase-out period"). Qualifying vehicles manufactured by that manufacturer are eligible for 50 percent of the credit if acquired in the first two-quarters of the phase-out period and 25 percent of the credit if acquired in the third or fourth quarter of the phase-out period. Vehicles manufactured by that manufacturer are not eligible for a credit if acquired after the phase-out period.”
In the case of Tesla, assuming management guidance for the Model 3 ramp holds, the rebate phase-out timeline could be as follows:
$7,500 Federal Tax Credit through 03/31/18
$3,750 Federal Tax Credit 04/01/18 through 09/31/18
$1,875 Federal Tax Credit 10/01/18 through 03/31/19
No Federal Tax Credit after 03/31/19
However, we are skeptical Model 3 ramp will go per management guidance. Instead, we expect the ramp to be slow and the rebate phase out schedule to be as follows:
$7,500 Federal Tax Credit through 06/30/18
$3,750 Federal Tax Credit 07/01/18 through 12/31/18
$1,875 Federal Tax Credit 01/01/19 through 06/30/19
No Federal Tax Credit after 06/30/19
It should be noted that none of Tesla’s competitors are ramping BEV production as aggressively as Tesla and are not facing a similar rebate phase out timeline. Consequently, Tesla is likely to be at a relative subsidy disadvantage compared to other EV manufacturers.
General Motor’s (GM) Bolt and Nissan Motor’s (OTCPK:NSANY) Leaf, in particular, are significant competitive threats to Model 3.
The following table represents our estimate of the relative disadvantage of Tesla compared to other manufacturers....
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The Senate voted early Saturday to approve a major overhaul of the U.S. tax code that critics say would decimate clean energy investments while continuing to hand out tax breaks to the oil and gas industries.
The sweeping tax system overhaul bill—which represents the biggest corporate tax cut in the country's history and would reach into many areas of American lives—also contains language that would open the door for oil and gas companies to drill in the Arctic National Wildlife Refuge.
While the Senate proposal preserves tax credits that have spurred huge growth in the wind and solar industries, it contains an obscure provision that could undercut investment in renewables.
Larger challenges for clean energy lie in the House of Representatives' tax proposal, which passed in mid-November. That version takes a whack at a bundle of clean energy tax credits that were extended in 2015 in exchange for lifting a decades-old ban on crude oil exports.
Now, as the two chambers begin work on reconciling their versions of the bill, the clean energy industry is bracing for a fight.
Here's what the two tax bills, as currently written, would do.
New Hits to Clean Energy Investments
The Senate bill contains a provision that has raised alarm across the clean energy industry: The Base Erosion Anti-Abuse Tax (BEAT) provision would subject tax credits given to companies with operations overseas to a new, 100 percent tax. That provision, according to a letter sent to the Senate by clean energy groups this week, would send investors fleeing and put $12 billion in clean-energy investments at risk. It says the impact would be "devastating."
"The tax equity marketplace would collapse under these provisions, leading to a dramatic reduction in wind and solar energy investment and development," the letter states.
Another last-minute change in the Senate bill, which was still being written just hours before the chamber voted on Dec. 2, could push more corporations to the Alternative Minimum Tax. The change could mean that certain clean energy tax credits could no longer be used and that depreciation for wind and solar projects would be calculated at a lower rate.
"If these provisions are retained, they will result in broad instability and uncertainty for businesses and investors across many sectors, including the clean energy sector," said a coalition of clean energy groups led by the American Council on Renewable Energy.
Solar Power
The Senate proposal says nothing about solar credits, so it would effectively maintain the current timeline on phasing out the Investment Tax Credit for solar developers and homeowners, which remains at 30 percent through 2019, then lowers every year until 2022, when it stays at 10 percent indefinitely. Congress approved this timetable in 2015, with the industry's support.
The House version maintains the current phase-down timetable, but at the end of 2021, the credit for homeowners drops to zero and the credit for developers drops to 10 percent. The 10 percent credit terminates altogether in 2027.
The House proposal also would retroactively change how solar developers qualify for credits, a provision that could stall or halt investments that have already been made. (This applies to wind, too. See below.)
Wind Power
The Senate proposal, which says nothing about wind credits, would effectively maintain the current timeline for phasing out the Production Tax Credit for wind developers, which is currently 2.3 cents per kilowatt-hour and extends through 2019, but begins phasing down in 2017.
The House version maintains the timeline but removes an inflation adjustment, a move that would drop the value of the credit by 40 percent to 1.5 cents per kilowatt-hour.
The House proposal would also retroactively change the rules that dictate how wind developers qualify for credits. This change would mean that developers who started on wind projects that depended on the credits would, in effect, have to eat the costs or abandon the work. The American Wind Energy Association estimates this threatens 60,000 jobs and $50 billion in private investment.
Together, the inflation adjustment and eligibility rule change would mean $12.3 billion less in incentives over 10 years, according to an analysis by Congress's Joint Committee on Taxation.
Electric Vehicles
The Senate bill is silent on electric vehicle tax credits.
The House bill would eliminate the current $7,500 tax credit for purchases of electric vehicles, starting after the 2017 tax year.
Oil and Gas
The House and Senate bills maintain tax provisions for the oil industry, including deductions for drilling costs and preferential accounting rulesthat allow oil companies to reduce their tax burden.
In the Senate bill, an amendment offered by Sen. John Cornyn (R-Texas) and approved by the chamber would also allow some income from oil and gas companies to be taxed at a significantly lower rate. It would let energy companies classified as "master limited partnerships"—many based in Texas—qualify for the reduced rate under the "pass-through" benefit. (The New York Times points out that much of President Donald Trump's income has been taxed in this way.)
The House bill would kill tax breaks for the oil industry on marginal wells—a provision the Joint Committee on Taxation says will have no effect on revenue—and for "enhanced oil recovery," a process designed to extract more oil from old reservoirs, which the committee says will have a $200 million impact.
Drilling in the Arctic National Wildlife Refuge
The Senate bill would allow oil and gas companies to drill in a 1.5 million-acre area of Alaska's nearly 20-million acre Arctic National Wildlife Refuge. Drilling in this pristine wilderness has been a longtime goal of Republicans, and the Senate voted down an amendment on Saturday that would have removed it from the tax bill.
The House bill contains similar language, but environmental groups are hopeful that, with some House Republicans expressing concern, it could be changed as the chambers negotiate the final legislation.
What's Next?
As lawmakers now work to settle differences between the two bills, environmental and clean energy groups are watching closely.
"The fight's not over," said Evan Vaughan, a spokesman for the American Wind Energy Association.
Members of the Senate Finance Committee, which writes tax legislation, have signaled they could also make changes to clean energy tax credits later using spending measures—as they did in 2015.
It's clear, though, that neither chamber is likely to scale back provisions in the tax code that boost the fossil fuel industry.
"If you're actually trying to address the challenges we're facing with the deficit, and how to offset these cuts, the first place you might cut is the $14 billion in subsidies for the oil and gas industry," said Elizabeth Noll, a legislative director with the Natural Resources Defense Council. "Neither the House or Senate did."
https://www.ecowatch.com/tax-bill-wind-solar-2514029749.html
Senate Tax Bill Could Be 'Devastating' to Wind and Solar Power
The tax bill heading barreling towards a vote in the Senate already includes a worrisome rider that would open up the pristine Arctic National Wildlife Refuge to oil and natural gas drilling.
Now, renewable energy trade associations are raising the alarm about a eleventh-hour provision called the Base Erosion Anti-Abuse Tax (BEAT) program that "would have a devastating, if unintended, impact on wind and solar energy investment and deployment," according to a letter addressed to the Senate.
The BEAT provisions "undermine our capacity to use renewable energy tax credits, which have value only if they can be monetized," a letter, signed by the Solar Energy Industries Association, the American Council on Renewable Energy, American Wind Energy Association and Citizens for Responsible Energy Solutions, warned.
As Utility Dive explained, while BEAT is meant to make it harder for corporations to dodge taxes, it also renders impractical the monetization of the Production Tax Credit (PTC) for wind power projects and the Investment Tax Credit (ITC) for solar projects.
Tax credits have fueled the renewable energy industry's boom. The current PTC and ITC allows developers to deduct 30 percent of the cost of installing a solar or wind energy system from their federal taxes.
Greg Wetstone, president and CEO of the American Council on Renewable Energy, told Utility Dive that the BEAT provision would affect $50 billion in annual investment in renewable energy projects.
"This should not be happening now," he said. "It came out of nowhere." Apparently, the provision was inserted on Thanksgiving eve during a last-minute markup of the tax bill in the Senate finance committee.
Greentech Media delved further:
That problem is the Base Erosion Anti-Abuse Tax (BEAT) provision, which targets "earnings strippings," where large companies with foreign operations reduce their tax bills through cross-border payments they can then deduct in the U.S. The BEAT provision aims to circumvent that stripping with a minimum tax of 10 percent of taxable income.
BEAT would require every company to do two calculations: one quantifying 10 percent of a company's taxable income, including cross-border payments, and another quantifying the corporation's tax liability, excluding any tax credits the company received from tax equity investments.
The BEAT provision applies to all but R&D; credits. If a company has invested in renewables, the second number could be lower than the first. If that's the case, the company would have to pay the difference in taxes.
"This is Defcon One," Wetstone also told TIME. "It would simply undermine the financial structure that is critical for renewable energy and bring a booming sector to a halt."
Environmental groups have also spoken out against the heavily contested tax bill.
Michael Brune, executive director of the Sierra Club, condemned the House version "for [gutting] incentives for renewable energy and electric cars while ignoring the tens of billions of dollars the government hands out to fossil fuel corporations (which, of course, would also see their taxes slashed)."
Here's the letter from the renewable energy trade groups in full:
We are writing on behalf of the thousands of leading investors, developers, manufacturers, and corporate energy consumers in the U.S. renewable energy sector to alert you to urgent concerns with the Base Erosion Anti-Abuse Tax (BEAT) provisions in the Senate Tax Cuts and Jobs Act. As drafted, the BEAT program would have a devastating, if unintended, impact on wind and solar energy investment and deployment.
While we are grateful that the Senate tax proposal leaves the current phase-down schedules for wind and solar energy tax credits unchanged, the bill's BEAT provisions undermine our capacity to use renewable energy tax credits, which have value only if they can be monetized. For multi-national companies covered under the BEAT provisions, the renewable tax credits would, as drafted, be subject to a new 100 percent tax. Not surprisingly, major financial institutions have indicated that, under such a regime, they would no longer participate in tax equity financing, the principle mechanism for monetizing credits. The tax equity marketplace would collapse under these provisions, leading to a dramatic reduction in wind and solar energy investment and development.
It is important to note that, while the BEAT provisions are intended to promote U.S. investment and job growth, the program's treatment of renewable energy tax credits – which are generated exclusively through investment in U.S. projects – would have the opposite impact, dramatically reducing American wind and solar energy investment and job creation. These sectors are important national economic drivers, generating nearly $50 billion in annual U.S. investment.
It is also extremely problematic that the BEAT provisions apply retroactively to tax credits generated by operating, as well as new, projects, and would penalize companies that have relied on the tax code. Companies holding tax credits would do their best to sell them immediately, even at great discounts, a phenomenon that would flood the marketplace and further damage tax equity markets. We do not believe it fair or appropriate for Congress to reduce the value of tax incentives that have been relied upon in good faith by investors and developers. Such a result is especially concerning in this case, given that the wind and solar power sectors agreed to the phase-down of their own tax credits as part of the bipartisan compromise captured in the PATH Act of 2015.
We respectfully, and urgently, ask that the BEAT program be amended to exempt the production and investment tax credits from the calculation of the base erosion tax, just as the research and development tax credit is exempted from the provision in the current draft. Please feel free to let us know if we can provide additional information regarding any aspect of this issue.
...Financial institutions that invest in renewables, many of which are members of ACORE, have indicated they need to bolt from the renewable investment market if that tax becomes law, Wetstone said.
Peter L. Kelley, vice president of public affairs at the American Wind Energy Association, added by email, "Otherwise it could kill over half the wind projects in America, cause factory layoffs and break construction contracts already signed, and deprive farming communities of a cash crop they’re counting on."
This month, a group of GOP senators from wind-swept states — Charles E. Grassley of Iowa, John Thune of South Dakota and Dean Heller of Nevada — said they wouldoppose the alteration that the House made to the production tax credit benefiting onshore wind energy. Their stance on the Senate language, however, is unclear.
Now, Grassley and other senators like Rob Portman (R) of Ohio, have asked the nonpartisan Joint Committee on Taxation to score the effect such an exemption would have on the overall tax package, according to a person who has spoken to one of the senator’s offices....
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11/17 ***
https://www.alternet.org/environment/scott-pruitt-declares-war-wind-and-solar-energy-while-fossil-fuels-get-billions
negin
E:{PA Administrator Scott Pruitt recently proposed eliminating federal tax credits for wind and solar power, }
:{ that they should “stand on their own and compete against coal and natural gas and other sources” as opposed to “being propped up by tax incentives and other types of credits....”}:
Stand on their own?
Pruitt surely must be aware that fossil fuels have been feasting at the government trough for at least 100 years. Renewables, by comparison, have received support only since the mid-1990s and, until recently, have had to subsist on scraps.
Perhaps a review of the facts can set Administrator Pruitt straight. There’s a strong case to be made that Congress should terminate subsidies for fossil fuels and extend them for renewables, not the other way around.
A Century (or Two) of Subsidies
To promote domestic energy production, the federal government has been serving the oil and gas industry a smorgasbord of subsidies since the early days of the 20th Century. Companies can deduct the cost of drilling wells, for example, as well as the cost of exploring for and developing oil shale deposits. They even get a domestic manufacturing deduction, which is intended to keep U.S. industries from moving abroad, even though—by the very nature of their business—they can’t move overseas. All told, from 1918 through 2009, the industry’s tax breaks and other subsidies amounted to an average of $4.86 billion annually (in 2010 dollars), according to a 2011 study by DBL Investors, a venture capital firm. Accounting for inflation, that would be $5.53 billion a year today.
The DBL study didn’t include coal due to the lack of data for subsidies going back to the early 1800s, but the federal government has lavished considerably more on the coal industry than on renewables. In 2008 alone, coal received between $3.2 billion and $5.4 billion in subsidies, according to a 2011 Harvard Medical School study in the Annals of the New York Academy of Sciences.
Meanwhile, wind and other renewable energy technologies, DBL found, averaged only $370 million a year in subsidies between 1994 and 2009, the equivalent of $421 million a year today. The 2009 economic stimulus package did provide $21 billion for renewables, but that support barely began to level the playing field that has tilted in favor of oil and gas for 100 years and coal for more than 200.
A 2009 study by the Environmental Law Institute looked at U.S. energy subsidies since the turn of this century. It found that between 2002 and 2008, the federal government gave fossil fuels six times more than what it gave solar, wind and other renewables. Coal, natural gas and oil benefited from $72.5 billion in subsidies (in 2007 dollars) over that seven-year period, while “traditional” renewable energy sources—mainly wind and solar—received only $12.2 billion. A pie chart from the report shows that 71 percent of federal subsidies went to coal, natural gas and oil, 17 percent—$16.8 billion—went to corn ethanol, and the remaining 12 percent went to traditional renewables.
A new study by Oil Change International brings us up-to-date. Published earlier this month, it found that federal subsidies in 2015 and 2016 averaged $10.9 billion a year for the oil and gas industry and $3.8 billion for the coal industry. By contrast, the wind industry’s so-called production tax credit, renewed by Congress in December 2015, amounted to $3.3 billion last year, according to a Congress Joint Committee on Taxation (JCT) estimate. Unlike the fossil fuel industry’s permanent subsidies, Congress has allowed the wind tax credit to expire six times in the last 20 years, and it is now set to decline incrementally until ending in 2020. Similarly, Congress fixed the solar industry’s investment tax credit at 30 percent of a project’s cost through 2019, but reduced it to 10 percent for commercial projects and zeroed it out for residences by the end of 2021. The JCT estimates that the solar credit amounted to a $2.4-billion tax break last year. Totaling it up, fossil fuels — at $14.7 billion — still received two-and-a-half times more in federal support than solar and wind in 2016.
The Costs of Pollution
Subsidy numbers tell only part of the story. Besides a century or two of support, the federal government has allowed fossil fuel companies and electric utilities to “externalize” their costs of production and foist them on the public.
Although coal now only generates 30 percent of U.S. electricity, down from 50 percent in 2008, it is still responsible for two-thirds of the electric utility sector’s carbon emissions and is a leading source of toxic pollutants linked to cancer; cardiovascular, respiratory and neurological diseases; and premature death. The 2011 Harvard Medical School study cited above estimatedcoal’s “life cycle” cost to the country—including its impact on miners, public health, the environment and the climate—at $345 billion a year.
But that was last year. Since taking office, the Trump administration has been working overtime to bolster coal, which can no longer competeeconomically with natural gas or renewables. Earlier this year, it rescinded a rule that would have protected waterways from mining waste, and a few months ago it filed a repeal of another Obama-era measure that would have increased mineral royalties on federal lands. More recently, Energy Secretary Rick Perry asked the Federal Energy Regulatory Commission to ensure that coal plants can recover all of their costs, whether those plants are needed or not.In July 2016, the federal government finally began regulating the more than 1,400 coal ash ponds across the country containing billions of gallons of heavy metals and other byproducts from burning coal. Coal ash, which has been leaching and spilling into local groundwater, wetlands, creeks and rivers, can cause cancer, heart and lung disease, birth defects and neurological damage in humans, and can devastate bird, fish and frog populations.
Natural gas burns more cleanly than coal, but its drilling sites, processing plants and pipelines leak methane, and its production technique—hydraulic fracturing—can contaminate water supplies and trigger earthquakes. Currently the fuel is responsible for nearly a third of the electric utility sector’s carbon emissions. Meanwhile, the U.S. transportation —whose oil-powered engine exhaust exacerbates asthma and likely causes other respiratory problems and heart disease—is now the nation’s largest carbon polluter, edging out the electric utility sector last year for the first time since the late 1970s.
Like the coal industry, the oil and gas industry has friends in high places.Thanks to friendly lawmakers and administrations, natural gas developers are exempt from key provisions of seven major environmental lawsthat protect air and water from toxic chemicals. Permitting them to flout these critical safeguards forces taxpayers to shoulder the cost of monitoring, remediation and cleanup—if they happen at all.
The Benefits of Clean Energy
Unlike fossil fuels, wind and solar energy do not emit toxic pollutants or greenhouse gases. They also are not subject to price volatility: wind gusts and solar rays are free, so more renewables would help stabilize energy prices. And they are becoming less expensive, more productive, and more reliable every year. According to a recent Department of Energy (DOE) report, power from new wind farms last year cost a third of wind’s price in 2010 and was cheaper than electricity from natural gas plants.
Perhaps the biggest bonus of transitioning to a clean energy system, however, is the fact that the benefits of improved air quality and climate change mitigation far outweigh the cost of implementation,according to a January 2016 DOE study. Conducted by researchers at the DOE’s Lawrence Berkeley National Laboratory and National Renewable Energy Laboratory, the study assessed the impact of standards in 29 states and the District of Columbia that require utilities to increase their use of renewables by a certain percentage by a specific year. Called renewable electricity (or portfolio) standards, they range from California and New York’s ambitious goals of 50 percent by 2030 to Wisconsin’s modest target of 10 percent by 2015.
It turns out that it cost utilities nationwide approximately $1 billion a year between 2010 and 2013—generally the equivalent of less than 2 percent of average statewide retail electricity rates—to comply with the state standards. On the benefit side of the equation, however, standards-spawned renewable technologies in 2013 alone generated $7.4 billion in public health and other societal benefits by reducing carbon dioxide, sulfur dioxide, nitrogen oxide and particulate matter emissions. They also saved consumers as much as $1.2 billion by lowering wholesale electricity prices and as much as $3.7 billion by reducing natural gas prices, because more renewable energy on the grid cuts demand—and lowers the price—of natural gas and other power sources that have higher operating costs.
Take Fossil Fuels Off the Dole
If the initial rationale for subsidizing fossil fuels was to encourage their growth, that time has long since passed. The Center for American Progress (CAP), a liberal think tank, published a fact sheet in May 2016 identifying nine unnecessary oil and gas tax breaks that should be terminated. Repealing the subsidies, according to CAP, would save the U.S. Treasury a minimum of $37.7 billion over the next 10 years.
An August 2016 report for the Council on Foreign Relations by Gilbert Metcalf, an economics professor at Tufts University, concluded that eliminating the three major federal tax incentives for oil and gas production would have a relatively small impact on production and consumption. The three provisions—deductions for “intangible” drilling costs, deductions for oil and gas deposit depletion, and deductions for domestic manufacturing—account for 90 percent of the cost of the subsidies. Ending these tax breaks, Metcalf says, would save the Treasury roughly $4 billion a year and would not appreciably raise oil and gas prices.
At the same time, the relatively new, burgeoning clean energy sector deserves federal support as it gains a foothold in the marketplace. Steve Clemmer, energy research director at the Union of Concerned Scientists, made the case in testimony before a House subcommittee last March that Congress should preserve wind and solar tax incentives beyond 2020.
“Until we can transition to national policies that provide more stable, long-term support for clean, low-carbon energy,” he said, “Congress should extend federal tax credits by at least five more years to maintain the sustained orderly growth of the industry and provide more parity and predictability for renewables in the tax code.” Clemmer also recommended new tax credits for investments in low- and zero-carbon technologies and energy storage technologies.
Despite the steady barrage of through-the-looking-glass statements by Trump administration officials, scientific and economic facts still matter. Administrator Pruitt would do well to examine them. Congress should, too, when it considers its tax overhaul bill, which is now being drafted behind closed doors. If they did, perhaps they would recognize that—economically and environmentally—it would be far better for the future of the planet to phase out fossil fuel subsidies and provide more incentives for clean energy.
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https://www.ecowatch.com/trump-fossil-fuel-subsidies-2492371087.html
Taxpayers on Hook for $20 Billion in Dirty Energy Subsidies Annually, New Study Finds
By Andy Rowell
Millions of Americans may be struggling to pay routine household bills, but still U.S. taxpayers are handing out a whopping $20 billion in fossil fuel subsidies a year.
This is the major finding of a new report *Dirty Energy Dominance: Dependent on Denial* published by Oil Change International Tuesday.
Subsidies are where the government gives financial incentives to artificially lower the cost of production or consumption of fossil fuels to encourage more drilling or oil, gas or coal use.
The report is published on the day that President Donald Trump is due to visit the island of Puerto Rico, which was recently devastated by Hurricane Maria. Millions of people on the island remain without power and basic sanitation.
Many leading climate scientists believe the recent destructive hurricane season is being driven by warmer waters fueled by our warming climate.
So there is something deeply ironic about the Trump administration subsidizing an industry with billions of dollars which is causing climate change which is costing billions to America and Caribbean nations from hurricane-related damage.
But the irony gets worse. There is something morally wrong with a billionaire-led administration handing out money to rich executives, when this money could help America's poorest and most at need.
The cost of the subsidies to American taxpayers is equivalent to the projected 2018 budget cuts from Trump's proposals to slash 10 public programs and services, including supports for America's most vulnerable children and families.
The report lays out a comprehensive analysis of federal and state subsidies supporting the production of oil, gas and coal. It concludes that:
- The U.S. federal and state governments gave away $20.5 billion a year on average in 2015 and 2016 in production subsidies to the oil, gas and coal industries, including $14.7 billion in federal subsidies and $5.8 billion through state-level incentives. And this is likely to be a conservative estimate at the state level, due to limited data.
- Repeated proposals by the Obama administration to remove some of the most damaging federal subsidies were thwarted in large part due to the cozy relationship between Congress and the fossil fuel industry. In the 2015-2016 election cycle, members of Congress received $350 million in campaign contributions and lobbying expenditures from the fossil fuel industry—which equates to a 8,200 percent return on investment.
- The U.S. spent on average $2.5 billion annually subsidizing the exploration of new fossil fuel resources in 2015 and 2016, even though the science clearly shows that fossil fuel expansion must stop immediately in order to meet internationally recognized climate goals.
- Government giveaways in the form of permanent tax breaks to the fossil fuel industry—one of which is over a century old—are seven times larger than those to the renewable energy sector.
"Every taxpayer dollar wasted subsidizing this industry takes us further from a stable climate and protecting our families from disasters made worse by climate change," said Janet Redman, U.S. Policy Director of Oil Change International and principal author of the report. "No tax plan that leaves in place a 20 billion-dollar transfer of wealth from American taxpayers to one of the country's most profitable and polluting industries can be considered credible."
Redman added: "While the rest of the world moves toward a renewable energy future, dirty energy defenders in the Trump administration are using our taxpayer dollars to promote dangerous new fossil fuel development. Until we separate oil and state, the dirty energy money cycle of fossil fuel contributions going into Congress and oil, gas and coal subsidies coming out will stymie our chances at transitioning the energy sector and staving off worsening climate disasters."
https://www.ecowatch.com/fossil-fuel-incentives-2471768921.html
World's Richest Governments Aid Big Carbon's Efforts to Delay Climate Reckoning
One of President Obama's main climate policy thrusts was to persuade the world that since you often get what you pay for, the world should stop paying for more extreme climate disruption by subsidizing fossil fuels. Both the G7 and the G20 accepted Obama's lead—at least nominally.
Some countries did something. Revealingly, both rich and poor countries which were helping energy consumers get cheaper fuel reformed. The United Arab Emirates has dismantled its subsidy regime for gasoline. Indonesia eliminated its gasoline subsidies and capped diesel supports. India has moved very aggressively, first eliminating diesel supports, and now phasing out even the subsidized kerosene intended to help the off-grid poor pay for lighting their homes. (Dealing with electricity subsidies has proven a heavier lift).
But most richer countries, including the U.S. and China, the nations who started the clamor to get prices right haven't done so well. Their subsidies are mostly aimed at well-connected fossil fuel producers. Recent analysis shows that $60 billion a year is still flowing from 12 Organization for Economic Co-operation and Development members to oil, gas and coal producers, in a variety of forms, particularly export credits to encourage emerging markets to purchase oil, gas and coal technologies and equipment. This is four times as much subsidy as those same countries provide to clean energy.
So the world's strongest economies are handing out more than $60 billion in public funds to the world's biggest polluters, including some of the world's richest companies, aiding and abetting Big Carbon's effort to postpone the climate reckoning. At the same time they are pleading that their Treasuries are so depleted that they cannot keep their much less expensive long-standing promises to help finance the clean energy transition in developing countries.
Australia, for example, which was just chosen to lead the primary vehicle for climate aid, the Green Climate Fund, has provided $200 million for that agency. But Australia's Queensland State is proposing to spend $1 billion—five times as much—helping to build a single new railroad to enable an Indian mining company, Adani, to develop its Carmichael mine, a decision which caused one of Adani's competitors, Glencore, to snipe at "risky ventures that rely on taxpayer subsidies to get across the line and which will bring on massive volumes of additional coal supply into the market, which could undermine existing operations." (The Carmichael coal project is also expected to receive significant financial concessions on royalty payments).
The U.S., under President Trump, has become something of a caricature of what this fossil subsidy end game might look like. Trump campaigned with strong support from coal, oil and natural gas nationally—but messaged around his promise to bring back coal mining jobs in Appalachian states like Ohio, West Virginia and Kentucky.
Elected, he moved promptly to reverse a series of Obama administration regulations which would have improved environmental standards for oil, gas and coal extraction. Coal industry executive and even Kentucky Sen. Mitch McConnell conceded that these roll-backs, while good for coal company pocket books, would do nothing to bring back Appalachian jobs, which were being lost because of competition from cheaper strip-mined western coal, natural gas and renewables.
Trump next reversed a series of Obama reforms designed to ensure that companies mining fossil fuels from public lands paid fair royalties, and that leases were bid competitively. The roll-back added another billion dollars a year to the taxpayer give-away to public lands producers, but also made it even more difficult for labor intensive Appalachian coal miners to compete—speeding the loss of jobs. (The new administration's moves to lower environmental standards for gas drilling also hampered eastern coal)....
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May 24, 2017
Oil Change International
The federal government is providing extensive support for fossil fuel production on public lands and waters offshore, through a combination of direct subsidies, enforcement loopholes, lax royalty collection, stagnant lease rates and other advantages to the industry, a report released Wednesday found.
The government is contributing at least $7 billion per year in subsidies to support fossil fuel production on federally held lands and offshore waters alone, and is holding some $35 billion in public liabilities for drilling in public waters of the Gulf of Mexico. These subsidies support increased fossil fuel production on U.S. lands and waters out of step with efforts to meet international climate objectives.
The report, released by Oil Change International in partnership with 350.org, WildEarth Guardians, Center for Biological Diversity, Clean Water Action, Food & Water Watch and Public Citizen, for the first time outlines in detail the subsidies and other public support being provided in the U.S. to the fossil fuel industry for its activities on public lands.
The report, Unequal Exchange: How Taxpayers Shoulder the Burden of Fossil Fuel Development on Federal Lands, presents an accounting of the minimum amounts of direct taxpayer dollars going to support fossil fuels on public lands, not including externalities such as climate and health impacts, which would bring the totals even higher. If those factors are taken into account, for example, mining coal in the Powder River Basin alone would have a net cost to the U.S. public of some $17.8 billion per year as of 2015.
"Rex Tillerson and other members of the Trump administration deny that these subsidies even exist just like they deny climate change. The reason is clear—in both cases, if you admit the truth, the only answer is a managed decline of the fossil fuel industry," said Stephen Kretzmann, executive director of Oil Change International.
"The first step towards that is to stop supporting the industry with our public dollars. These subsidies are a raw deal for American taxpayers, and a disaster for our climate."
Particularly notable is a finding that some royalty and lease rates for fossil fuel development on public lands have remained unchanged since the 1920s.
"As if simply allowing the toxic, climate-killing extraction of fossil fuels on our sensitive public lands isn't shameful enough, that the federal government actually subsidizes this foolish activity with taxpayer money is downright absurd," said Wenonah Hauter, executive director at Food & Water Watch.
"For the sake of climate stability, the transition to a clean energy future must begin immediately. An ideal place to kick-start the transition is with a ban on fossil fuel extraction on our precious public lands, and most certainly, a halt to the underhanded propping-up of this antiquated industry with our precious public dollars."
The report makes a number of key recommendations, starting with a basic determination that the fossil fuel leasing program on public lands should be phased out in line with climate science. Until that become reality, the report finds immediate action to reduce large, unfunded liabilities for U.S. taxpayer money associated with fossil fuel production on public lands should be reduced and royalty and lease rates should be increased to better reflect the full costs to the public of these activities.
"This report makes it clear as day that the Trump agenda is the fossil fuel billionaire agenda," said Jason Kowalski, policy director at 350.org.
"The industry finances corrupt politicians, who in turn help them keep fossil fuels economically viable at a time when the science suggests most oil, gas and coal needs to be kept in the ground. They set out to rig the system and they succeeded. History will judge them harshly."
Topic(s):
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http://www.globalpossibilities.org/elon-musk-hits-back-at-coal-baron-who-called-him-a-fraud-over-green-subsidies/
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Read more
“[Musk]’s gotten $2bn from the taxpayer, has not made a penny yet in cashflow,” Murray continued. “Here again: it’s subsidies.”
In response, Musk tweeted that the real fraud going on was “denial of climate science”.
“As for ‘subsidies’, Tesla gets pennies on dollar vs coal. How about we both go to zero?” he said.
Tesla does not, in fact, receive direct government subsidies but does receive money for selling “carbon credits” to other companies whose vehicle fleets don’t meet emissions standards in states such as California.
Buyers of Tesla vehicles also currently receive a $7,500 tax credit from the government, but that is an incentive subsidy to the purchaser, rather than to the company itself.
The last handout from the government that Tesla received was $465m as part of the auto industry bailout in the early days of the Obama administration, which the company paid back in full nine years early, in 2013.
...
The coal industry, by contrast, receives billions of dollars in taxpayer subsidies, as well as preferential treatment from the Internal Revenue Service, according to an investigation by ThinkProgress.
Companies such as the Murray Energy Corporation can also take advantage of loopholes allowing them to cheaply obtain leases on public lands – more than 40% of US coal comes from publicly owned land, according to the Energy Information Administration.
A 2011 study by Management Information Services found that fossil fuels – oil, natural gas and coal – had received 70% of total energy subsidies between 1950 and 2010. Coal power’s total subsidy totaled $104bn, the study found.
A representative for Murray was contacted for comment.
Murray’s political activity has long been controversial. In 2012, he hosted a rally for Mitt Romney at a mine he owned in Beallsville, Ohio, which miners told a local radio station they were forced to attend without pay.
Workers were also coerced into donating to Republican campaign Pacs, according to an FEC complaint filed in 2012.
Even before he became the Republican presidential nominee, Trump made coal-fueled power – including so-called “clean coal” – a central part of his pitch to voters. In Sunday’s presidential debate in St Louis, Missouri, he made the grandiloquent pronouncement that “coal will last for a thousand years in this country”.
In return, the coal industry has been good to Trump. Murray himself told the Virginia Coal and Energy Alliance annual conference in May that Trump “has got his head on right” and was “the horse to ride” in the election, according to SNL Financial. He also personally hosted a fundraiser for Trump in West Virginia in June.
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On Monday, Robert Murray, President and CEO of coal giant Murray Energy Corporation, called Tesla Motors a “fraud” on CNBC, going on to bash the company for failing to yet turn a profit despite subsidies.
“Tesla is a fraud. [It] has gotten $2 billion from the taxpayer and has not made a penny yet in cash flow. Here again, it’s subsidies,” Murray claimed. Read more.
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10/16 fight, murray coal v musk and
A long-awaited campaign to rebrand fossil fuels called Fueling U.S. Forward made its public debut at the Red State Gathering 2016 on Saturday, where the organization's President and CEO Charles Drevna gave attendees the inside scoop on the effort, and confirmed that the campaign is backed financially by Koch Industries.
Back in February, Peter Stone first reported in the Huffington Post that a $10 million-a-year effort was proposed by a Koch Industries board member, James Mahoney, and Mr. Drevna, aiming “to boost petroleum-based transportation fuels and attack government subsidies for electric vehicles.” In early August, the Fueling U.S. Forward website launched, and on Saturday, the first public comments were made about the campaign by Mr. Drevna, and they revealed a lot about how the Koch-backed initiative is working to re-frame fossil fuels.
“We need a sustainable energy to ensure the future of the country,” Mr. Drevna told the audience.
The source of that energy? That which Mr. Drevna labeled “reliable, abundant, efficient and sustainable fuels.”
“Folks, that's of course the fossil fuels,” he immediately added.
Never mind that fossil fuels don't align with any dictionary definition of “sustainable,” as oil, gas and coal reserves are limited to what's buried in the ground, unlike renewable sources of energy. Technically speaking, fossil fuels are the opposite of sustainable energy sources — but that fact did little to slow Mr. Drevna down as he made what he called the “pro-human” case for burning fossil fuels.
The top line takeaway from Mr. Drevna's comments is that the Koch-funded Fueling U.S. Forward is an effort to rebrand fossil fuels, focusing on the “positive” sides of oil, gas and coal.
The new initiative comes at a time when the impacts of climate change are becoming more difficult to ignore. 2016 is already on track to be the hottest year ever recorded, a mid-year climate analysis from NASA reported, and unusual storms, like the torrential rainfall that struck the Gulf Coast over the past few days causing historic flooding, have become more frequent.
For its part, Fueling U.S. Forward wants to talk not about statistics, facts and figures, but to reach people's emotions.
“We've got to take this to the emotional and personal level,” Mr. Drevna, a former D.C. lobbyist and Sunoco executive, told the crowd. “Oil and natural gas, they're not the fuels of the past and maybe the present or a necessary evil. They are the future.”
In Peter Stone's investigation for Huffington Post, many familiar with the early workings of the project that would grow into Fueling U.S. Forwarddescribed it as an effort to bolster public opinion of fossil fuels and to combat electric vehicles.
Charles Drevna's new organization appears for now largely focused on the first half of that equation. Asked after his talk if Fueling U.S. Forward planned to campaign against electric vehicles, Mr. Drevna said that his organization was focused on the positives of fossil fuels. Drevna confirmed that he was working with Mr. Mahoney and that Fueling U.S. Forward had indeed received funding from Koch Industries.
Koch Vs. Clean
Koch Vs. Clean, a DeSmog microsite launched today, takes a closer look at the Koch network's efforts to promote the continued burning of fossil fuels and undermine clean energy innovations and electric vehicles, and the role that Mr. Drevna and a handful of others are playing in that offensive.
Throughout the day at Red State Gathering, panelists from Koch-linked organizations repeatedly cited Tesla Motors as an example of government subsidies gone awry, a talking point that seemed aimed to resonate with fiscal conservatives at the RSG 2016.
There's good reason for the oil industry to fear the rise of American electric vehicles. “Volkswagen AG, in an attempt to recover from its emissions-cheating scandal, has said it will create 30 new electric models within a decade,” E&E News recently reported. “General Motors Co. has invested $500 million in Lyft, the ride-hailing service, and intends for Lyft's drivers to pick up passengers in GM's new electric compact, the Chevrolet Bolt.”
The Kochs' newest effort doesn't openly oppose electric vehicles or renewable energy technologies, but tries to frame them as uniquely dependent on government subsidies (despite the fact that the fossil fuel industry benefits from quadruple the amount of government subsidies as the renewable energy industry, according to the International Energy Agency).
And Fueling U.S. Forward is an effort to paint fossil fuels as good for people because they're cheap — a gamble that Americans have already forgotten how prices have fluctuated wildly for the past decade, when repeated price spikes saw average US gas prices rise as high as $4.10 a gallon, roughly double current prices.
That said, the argument that everyone benefits from cheap fossil fuels could be dangerously appealing at a time of historic economic stratification in the U.S.— a staggeringly large gap between the ultra-rich like the Koch brothers and the rest of us.
But supporting fossil fuels to aid the poor is a message that the Kochs have also paired with campaigns that will keep people poor, including opposing minimum wage hikes (at a time when the Fight for 15 movement, which supports more than doubling the current federal minimum wage is gaining credible political traction) or calling for the minimum wage to be repealed altogether.
As of press time, Koch Industries had not responded to questions from DeSmog about the company's motivation for funding Fueling U.S. Forward.
It's a tension that seemed to trip up Drevna as he talked this weekend, describing how fossil fuels had led to prosperity for the world's people — or at least some of them.
“And we are basically richer than ever before,” Mr. Drevna told the crowd at the Red State Gathering, before catching himself and adding “as a world we are. As a nation we are basically richer than ever before.” In other words, some people have gotten rich because of fossil fuels — and for the rest of us, we better keep using coal and gasoline and hope it stays cheap.
Mr. Drevna also told the crowd that for a long time, the oil industry had “been engaged in asymmetric warfare”—hardly the language of someone who sees themselves as on the side of the masses.
The new tactics that Fueling U.S. Forward plans to bring to the table then?
“We're partnering with other organizations too, especially non-traditional allies like the minority community,” Mr. Drevna told the nearly all-white crowd. “Who in the heck gets hit hardest and fastest when there's an energy crisis and prices go up? They do.”
While Mr. Drevnamay want to research the definition of tokenizing as well as “sustainable energy,” it's worth noting that communities of color also get hit hardest and fastest when climate catastrophes occur (think the aftermath of Hurricane Katrina), and by the day to day impacts of, say, refineries located in black and Latino neighborhoods, where asthma, cancer, and other health problems too often plague residents.
But then again, Fueling U.S. Forward aims to keep attention on the positives. Stay tuned to KochvsClean.com for regular updates about this Koch-funded pro-fossil PR effort.
Video: Charles Drevna Introducing Fueling U.S. Forward at the Red State Gathering
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**http://www.ecowatch.com/firstenergy-bailout-puco-2043994096.html**
The Ohio Public Utilities Commission (PUCO) approved a scheme Wednesday that will force FirstEnergy's customers to hand over approximately $200 million annually to the company and its shareholders for the next 3-5 years. Customers will receive virtually nothing in return for this massive subsidy, which could ultimately reach $1 billion.
Under Wednesday's order, FirstEnergy will begin to receive hundreds of millions of dollars, with effectively no strings attached. Although characterized as a "distribution modernization rider," nothing in the commission's order requires that these customer dollars be invested in modernizing Ohio's electrical grid or in any way be spent to benefit Ohio customers. Instead, the dollars can be siphoned off from FirstEnergy's Ohio utilities and used to bail FirstEnergy Corp. out of its poor coal investments while boosting the profits of corporate shareholders.
"Today's decision takes hundreds of millions of dollars out of customers' pockets in order to create a massive slush fund for FirstEnergy Corp. and its shareholders," said Shannon Fisk, attorney at the non-profit environmental law firm Earthjustice.
"And the fact that FirstEnergy asked for billions more does not make this decision any less unreasonable. Rather than forcing customers to prop up profits for a corporation that made a bad bet on aging coal plants, the commission should be looking after customers and ensuring investments in job-creating renewable energy, energy efficiency and smart grid initiatives."
Through Wednesday's decision, the commission has aided FirstEnergy's efforts to sidestep a recent order of the Federal Energy Regulatory Commission (FERC) that raised serious questions about FirstEnergy's previous bailout proposal. Under that proposal, customers would have directly assumed all of the financial risk of financially struggling coal and nuclear plants owned by FirstEnergy Corp.'s unrelated competition generation business.
In late April, FERC ruled that FirstEnergy's previous bailout proposal—which PUCO had approved a month earlier—may violate federal safeguards concerning transactions between public utilities and their unregulated affiliates. FERC blocked FirstEnergy's bailout scheme pending a federal review. Rather than submit its proposal for FERC review, FirstEnergy concocted a new scheme intended to bypass the FERC order. Although the bailout ultimately approved by PUCO is structured a bit differently and Wednesday's order mentions grid modernization in passing, the fact remains that this bailout poses the same risk to customers that the FERC order sought to prevent.
"In this long-awaited and complicated decision, PUCO missed a critical opportunity to seriously focus FirstEnergy on the more diversified, cleaner energy future that tens of thousands of customers wrote the commission asking for," said Dan Sawmiller, senior representative for Sierra Club's Beyond Coal Campaign in Ohio.
"A few months ago, FirstEnergy took an important step in moving beyond coal when it announced closure of four units at its Sammis coal plant. With PUCO's decision now issued, we hope to be able to work with FirstEnergy to accelerate its path beyond coal and nuclear and toward new investments in clean energy, energy efficiency and other modern grid initiatives like infrastructure for electric vehicles."
Wednesday's order marks the latest development in a more than two-year effort by FirstEnergy to obtain a customer-funded bailout. Throughout that time consumer groups, industrial customers, independent power producers and environmental non-profits have united in challenging FirstEnergy's efforts as contrary to law and bad for customers. Challenges before the Ohio Supreme Court and FERC to the commission's approval of the bailout are expected.
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Cashing in on All of the Above: U.S. Fossil Fuel Production Subsidies under Obama
Shakuntala Makhijani, July 9, 2014
Cashing in on All of the Above: U.S. Fossil Fuel Production Subsidies under Obama
Oil Change International
July 2014
A new report by Oil Change International, *Cashing in on All of the Above: U.S. Fossil Fuel Production Subsidies under Obama*, demonstrates the huge and growing amount of subsidies going to the fossil fuel industry in the U.S. every year. In 2013, the U.S. federal and state governments gave away $21.6 billion in subsidies for oil, gas, and coal exploration and production.
The value of fossil fuel exploration and production subsidies from the federal government have increased by 45 percent since President Obama took office in 2009 – from $12.7 billion to a current total of $18.5 billion – a side effect of his Administration’s “All of the Above” energy policy that promotes the U.S. oil and gas boom and amounts to nothing less than climate denial. President Obama has repeatedly tried to repeal some of the most egregious of these subsidies, but these attempts have been blocked by a U.S. Congress that has been bought out by campaign finance and lobbying expenditures from the fossil fuel industry.
http://priceofoil.org/2014/07/09/cashing-in-on-all-of-the-above-u-s-fossil-fuel-production-subsidies-under-obama/
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reason mag trashes
http://www.seia.org/policy/finance-tax/1603-treasury-program
stimulus?
1603 Treasury Program
Just as the solar industry was beginning to significantly expand across United States, economic downturn in 2008 significantly reduced the supply of capital available for renewable energy investments. SEIA continues to support the 1603 Treasury Program, which provides additional liquidity in the marketplace by allowing solar project developers to more easily monetize existing tax incentives through 2016.
Quick facts
- The 1603 Treasury Program is a technology-neutral finance mechanism that allows solar and other renewable energy project developers to receive a direct federal grant in lieu of the Section 48 Investment Tax Credit (ITC).
- As of December 2013, the Treasury Department had awarded more than 9,000 grants totaling $18.5 billion, $4.4 billion of which went to solar projects.
- A preliminary analysis by the National Renewable Energy Laboratory's (NREL) conservatively estimated that the 1603 Program has supported an average of 52,000 to 75,000 jobs over the period analyzed.
What is the 1603 Treasury Program?
The 1603 Treasury Program is a technology-neutral finance mechanism that allows solar and other renewable energy project developers to receive a direct federal grant in lieu of the Section 48Investment Tax Credit (ITC). This modification allows taxpayers and small businesses to maximize the return and value of existing tax incentives. The program provides access to needed capital and streamlines project financing transaction costs for project developers.
The 1603 Treasury Program has been a proven success and given taxpayers a good return on investment. Since its enactment, the National Renewable Energy Laboratory's (NREL) preliminary analysis conservatively estimated that the 1603 Program supported an average of 52,000 to 75,000 jobs over the period analyzed. The program hasleveraged more than $30 billion in private sector investment for a wide range of energy technologies in all 50 states. As of September 2012, the 1603 Treasury Program awarded approximately 6,400 grants for more than 44,000 individual solar projects in all 50 states and has supported over $7.17 billion in private investment in the solar industry.
Peabody Coal’s long-awaited concession that bankruptcy lies ahead signals the curtain fall on the long-running, silent and secret bailout of the management of the U.S. coal industry. As one analyst put it when Peabody announced that it faced a “going concern” letter, “It’s the end of the era of publicly traded coal companies.”
Peabody is about to join Arch, Murray, Alpha and other coal producers in bankruptcy. The total market value of the U.S. coal sector since 2011 has plunged from more than $70 billion to barely $6 billion and most of the remaining value is natural gas operations owned by Consol Inc. Coal stocks have dropped far faster than coal consumption, because the industry, ignoring competition from renewable energy and dismissing pressure to clean up the air, recklessly invested in far greater mining capacity than the market needs. Coal prices dropped by 75 percent.
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Finally, in February 2015, the Administration moved, proposing a “Power Plus” plan to help protect miner’s pensions, health care and the economic based on coal dependent communities. (It also moved in the same month to reform royalty abuses).
But, of course, by this time such aid required Congressional appropriations. Bankruptcy courts had already let Patriot and other companies dump their pension and health care obligations. The same Republican leaders who blasted Obama for making war on coal denounced the new plan. Leading the charge? Kentucky Senator and Majority Leader Mitch McConnell, who made it clear that his hostility towards the United Mines Workers trumped whatever concern he might have had for Kentucky coal miners. In December, McConnell personally blocked efforts to include community and pension rescue efforts in the budget deal Republicans cut with Obama.
Here there is a partisan difference. Democrats who are waging “War on Coal” favor keeping the promise America made to coal miners. Hilary Clinton has strongly advocated help for the workers and communities.
How do conservatives justify this stand? By calling any effort to ensure that miners get the pensions they earned yes, “a bailout.” But conservative attacks on such efforts to protect pensions simply don’t mention the shenanigans by which companies like Peabody got rid of their debts. These are actually worse than bailouts. In a bailout the calculation is that a healthy enterprise emerges. But there is no prospect in these cases that Patriot, Arch or Shortly Peabody is going to bounce back.
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mconnell staffers:
After helping with the reelection effort, the lobbyists have all gone back to their jobs, where clients will expect them to use their ties with the office to get access and information on critical bills and to help shape them.For example, a set of business-tax deductions and subsidies, called extenders, that are worth billions to companies must be renewed by the end of the year. It’s a top priority for K Street, especially this year, when some downtowners are nervous that the package could spark a fight between establishment Republicans and movement conservatives. Top lobbyists will game out a way to get the measures through. McConnell has said he wants the package done during the lame duck session of Congress.
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bailout list fannie
http://projects.propublica.org/bailout/list
The biggest aggregate bailout recipient is Bank of America, whose gross borrowing (excluding repayments) is just under $3.5 trillion (including the amounts for its Merrill Lynch and Countrywide Financial acquisitions). Three other banks are in the trillion-dollar club: Citigroup ($2.6 trillion), Morgan Stanley ($2.1 trillion) and JPMorgan Chase ($1.3 trillion, including Bear Stearns and Washington Mutual). A dozen U.S. and foreign banks account for 78 percent of total face value of loans, loan guarantees and bailout assistance...
A small number of companies have obtained large subsidies at all levels of government. Eleven parent companies among the 50 largest recipients of federal grants and allocated tax credits are also among the top 50 recipients of state and local subsidies. Six of the 50 largest recipients of federal loans, loan guarantees and bailout assistance are also on that state/local list. Five companies appear on both federal lists and the state/local list: Boeing, Ford Motor, General Electric, General Motors and JPMorgan Chase. • Foreign direct investment accounts for a substantial portion of subsidies. Ten of the 50 parent companies receiving the most in federal grants and allocated tax credits are foreign-based; most of their subsidies were linked to their energy facilities in the United States.
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tool:
http://www.goodjobsfirst.org/sites/default/files/docs/pdf/UncleSamsFavoriteCorporations.pdf
provision of the 2009 Recovery Act providing cash payments in lieu of tax credits. Iberdrola’s subsidy total is $2.2 billion. Other top grant/ allocated tax credit recipients include NextEra Energy (parent of Florida Power & Light), NRG Energy, Southern Company, Summit Power and SCS Energy, each with more than $1 billion. The results exclude the numerous corporate tax breaks that ...
The biggest aggregate bailout recipient is Bank of America, whose gross borrowing (excluding repayments) is just under $3.5 trillion (including the amounts for its Merrill Lynch and Countrywide Financial acquisitions). Three other banks are in the trillion-dollar club: Citigroup ($2.6 trillion), Morgan Stanley ($2.1 trillion) and JPMorgan Chase ($1.3 trillion, including Bear Stearns and Washington Mutual). A dozen U.S. and foreign banks account for 78 percent of total face value of loans, loan guarantees and bailout assistance...
http://www.goodjobsfirst.org/subsidy-tracker
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http://ecowatch.com/2015/12/28/obama-gifts-to-big-oil BP writes off civil $?
2New refining subsidy
Since lifting the crude oil export ban means that domestic crude can sell for a higher price on the global market, some U.S. refiners may find their margins squeezed as the price of crude itself rises. The Congressional solution? Compliment the lifting of the export ban with a new$1.8 billion tax break for refiners over the next six years.
. BP’s dirty tax break
More than five years after Deepwater Horizon, BP is still paying for its disaster. The problem is that BP is still seeing major tax breaks as part of the costs. Although it was dinged with an out-of-court settlement worth $20.8 billion, most of those costs are going to be tax deductible—allowing the company to capture a tax windfall worth $5.35 billion for the worst oils pill in U.S. history.
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The crowd roared. But Kennedy wasn’t finished yet.
“These are the apocalyptical forces of ignorance and greed. These are the four horsemen from the book of Revelations herding humanity toward a dystopian nightmare of their creation. Koch Industries is not a benign corporation. It’s a suicide pact for creation. It’s the archetype of ‘disaster capitalism.’ It’s the command center of an organized scheme to undermine democracy and impose a corporate kleptocracy that will allow these greedy men to cash in on mass extinction and the end of civilization.”
Kennedy went on to explain, “These men claim in their rhetoric to embrace a theology of free market capitalism. But if you look at their feet instead of listening to the seductive noises that issue from their mouths and their phony think tanks, the truth is clear. These men hate free markets. They want a system of cushy socialism for the rich and a savage, merciless capitalism for the poor. The real purpose of their ‘think tanks’ they created and fund—like the Heritage Foundation and the CATO Institute—is not to promote free market capitalism, but to gin up the philosophical underpinnings for a scheme of uncontrolled corporate profit taking. And the press, consolidated as it is into private monopolies, and relieved of social obligation are on the carbon and pharma pay role and in full cahoots with the scheme. They don’t love markets—they despise them. The Koch Brothers’ purpose in purchasing our political system is to engineer monumental subsidies and market failure, which are their formulae for profit. And the winds, the storms, the floods, the heatwaves, the fires and the melting continents that they cause, the cities that they drown, the refugees they drive from their lands all provide new opportunities for profit and authoritarian control.”
Kennedy shared a story about the commercial fisheries on the Hudson River, among the oldest commercial fisheries in North America. He began his career as an environmental lawyer representing these fishing families. He explained how the fisheries regulated themselves as a sustainable industry for more than three centuries.
“The fishermen had a business model that worked,” he said. But then General Electric “used its political clout to cheat the free market and to arrange vast subsidies for itself by externalizing its costs and dumping its toxins into the river. In this way, GE privatized the fish in the Hudson River. New York’s constitution says that we, the people of New York State, own the waterways of the state and we own the fish in the Hudson. But we don’t own them anymore. The General Electric Company owns every fish in the river because they privatized them. They put their toxins in our fish and our cash in their pockets.
“While we own to fish legally, we can’t use them. GE has liquidated a public asset for cash and profit. All those men and women who made their living on the river and lived decent lives—they are all out of work and out of luck and General Electric has liquidated their assets and their livelihoods for corporate profit.”
He went on to explain; “Now the coal industry has done the exact same thing to every freshwater fish in America.” The National Academy of Science found dangerous levels of mercury in every American freshwater fish. The mercury is mainly coming from coal fired power plants. Since there is no known safe level for mercury consumption, the fish are no longer suitable for public consumption and are effectively privatized. “King Coal has privatized every fish in America by putting toxic mercury in every filet,” he said.
“Whether we recognize it or not, we are all locked in a life and death struggle with these corporations over control of our landscapes and political sovereignty,” Kennedy said. “If a foreign nation did to our country what the coal and oil barons do every day, we would consider it an act of war! They poison our rivers and aquifers, steal our fish, flood our cities and trample our democracy. They are pilfering our values, robbing our culture, impoverishing our lives, sickening our children and stupefying our minds with pollution. They subvert our heritage by privatizing our patrimony. They are turning America into a colonial economy.
“Under the colonial model multinational corporations exploit weak political systems to commoditize and privatize a nation’s resources. A robust democracy would never allow a foreign company to plunder the nation’s natural resources, poison her landscapes and subjugate her people. So colonialism requires the multinationals to weaken and capture the indigenous political system of the target nation. They do so by making alliances with local oligarchs with military and intelligence apparatus and conservative religious organizations and buying off the media. All these indigenous elites get a share of the profits in exchange for allowing the theft of their country’s resources. Pollution is not just theft—it is treason. The Koch brothers are not just America’s biggest polluters—they are thieves and they are traitors to our country and their crimes against America and humanity have made them the richest men on Earth.
“The colonial model results in the evolution of an upper class with massive wealth and political power, the elimination of the middle class and the exponential increase of an impoverished class who eke a declining meagre living from the barren polluted moonscapes left behind by greed and pollution. And, when you have a wealthy class and a poor class and no middle class, you get extreme political division. The role of one political party devolves into a single minded mission of protecting the perks and power of the wealthy class and the rights of corporations to rape the land and enslave the people.”
This is why, as Kennedy explained, we have another precedented divide between Democratic and Republican parties in this country. Since tax breaks for billionaires and unregulated pollution are not potent vessels for populism, the corporate kleptocracy must steal elections, eliminate poor voters from the rolls, lie about the issues and employ propaganda and all the lowest alchemies of demagoguery, including appeals to religious and patriotic symbols and dividing the electorate using bigotry, greed, and racial and religious prejudices—the “wedge” or “cultural war issue,” according to Kennedy.
Even using these techniques, as Kennedy says, the policies they advocate are so viscerally unpopular that their hold on the voting public is always remaining tenuous. “Politics,” Kennedy explained “Is driven by both money and political intensity. Since they don’t have reliable ground troops, they must overwhelm the system with their money.” For this reason, “The hostile takeover of our democracy by polluting corporations and our country’s transition into a colonial economy is completely reliant on the financial floodgates opened by Citizens United.”
To further make his point, Kennedy said, “So you have the Koch’s who have deployed their front group ALEC—American Legislative Exchange Council—in every state working with local legislators in the anti-American enterprise of impeding the transition to new energy by bribing and blackmailing politicians to weaken support for wind and solar and foster a hostile environment toward renewables.
“The Koch brothers understand that renewables are good for the economy, good for our security and good for democracy. They create high paying jobs, promote small businesses, create wealth, democratize our energy sector, give us local, resilient power and reduce dependence on foreign carbon that makes them for the country, but bad for the Koch brothers.
“Renewables fill the Koch brothers with fear. In order to compete, they have to rig the rules that govern energy in this country to favor the dirtiest, filthiest, most destructive, most poisonous and addictive fuels from hell over the cheap, clean, green, local and patriotic fuels from heaven. But even with market and utility rules against them, new renewable technologies are so efficient that the allow wind and solar to beat the carbon industry even in their rigged markets and slanted playing fields—the only way for carbon to survive is by massive subsidies. The Koch brothers cannot compete against renewables in a free market without their subsidies.”
A recent report by the International Monetary Fund said, global energy subsidies amounts to $5 trillion annually, with the U.S. providing $700 billion in subsidizes to big oil “the richest industry in the history of the planet,” remarks Kennedy.
“Why would we be doing that?” he asks. “The only reason we’d give subsidies to a century old industry with the biggest profits in human history is because the oil barons own our government. There is no economic reason. Carbon’s economic model is looking at the same bleak future as the horse and buggy industry faced in 1903. So what do you do when your profits rely on a fading economic model? You use your money and use the campaign finance system that consists of legalized bribery to get your hooks into a public official who allows you to privatize the commons, dismantle the market place and rig the rules to give you monopoly control,” Kennedy explained.
Free market capitalism is the most powerful economic engine ever devised. But, according to Kennedy, it must be harnessed to a social purpose, as it will drag us down the path of political oligarchy and environmental destruction. Free market rules should allow people to make themselves rich by doing good things for humanity. But under the Koch’s scheme, oilmen get rich by dong bad things to humanity, he said.
Corporations are a useful economic tool. However, “corporations should not be running our government because they don’t want the same thing for America as Americans want,” he continued. “They don’t want democracy. They want profits. They want no competition. They are corrupting our democracy. They are stealing everything that we care about in this country.
“I believe in a true free market where you can’t make yourself rich without making your neighbors rich and without enriching your community, where we properly value our national resources and where we reward efficiency. But polluters make themselves rich by making everybody else poor. They raise standards of living for themselves while lowering quality of life for everybody else. They undervalue natural resources or take them for free. And they do it all by escaping the discipline of the free market. Polluters externalize their costs to artificially lower the price of their product. The 28 environmental laws that we passed after the first Earth Day in 1970 were intended to restore true free market capitalism by forcing actors in the marketplace to pay the true cost to bring their product to market. There is a huge difference between true free market capitalism—which makes a nation more efficient, more prosperous and more democratic—and the kind of corporate crony capitalism which we have today.”
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fair pt:
We need a consumer boycott on fossil fuels says Dale Vince, founder of green electricity company Ecotricity, because the divestment campaign on its own isn’t enough to end the demand for fossil fuels.
Vince, who has received an OBE for his services to the environment, adds that in addition to the divestment campaign and a consumer boycott we must eliminate government fossil fuel subsidies. “These three things together will get us to where we need to be,” he said.
Speaking at a Guardian Live debate on divestment last week, Vince argued: “Simply selling shares of a fossil fuel company doesn’t undermine its fundamental business plan. The problem is that we are all demanding fossil fuels and that is what underpins the business plan.”
According to the International Monetary Fund (IMF),fossil fuel companies are benefiting from global subsidies of $5.3 trillion (£3.4tn) a year.And in March, Chancellor George Osborne’s budget announcement gave new exemptions of more than £200 million a year to encourage exploration in the North Sea.
This is not to mention the everyday direct and indirect consumer purchasing of fossil fuels, from petrol to beef.
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world’s biggest and most profitable fossil fuel companies are receiving huge and rising subsidies from U.S. taxpayers, a practice slammed as absurd by a presidential candidate given the threat of climate change.
A Guardian investigation of three specific projects, run by Shell, ExxonMobil and Marathon Petroleum, has revealed that the subsidizes were all granted by politicians who received significant campaign contributions from the fossil fuel industry.
The Guardian has found that:
- A proposed Shell petrochemical refinery in Pennsylvania is in line for $1.6bn (£1bn) in state subsidy, according to a deal struck in 2012 when the company made an annual profit of $26.8bn.
- ExxonMobil’s upgrades to its Baton Rouge refinery in Louisiana are benefitting from $119m of state subsidy, with the support starting in 2011, when the company made a $41bn profit.
- A jobs subsidy scheme worth $78m to Marathon Petroleum in Ohio began in 2011, when the company made $2.4bn in profit.
“At a time when scientists tell us we need to reduce carbon pollution to prevent catastrophic climate change, it is absurd to provide massive taxpayer subsidies that pad fossil-fuel companies’ already enormous profits,” said senator Bernie Sanders, who announced on 30 April he is running for president.
Sanders, with representative Keith Ellison, recently proposed an End Polluter Welfare Act, which they say would cut $135bn of US subsidies for fossil fuel companies over the next decade. “Between 2010 and 2014, the oil, coal, gas, utility, and natural resource extraction industries spent $1.8bn on lobbying, much of it in defense of these giveaways,” according to Sanders and Ellison.
In April, the president of the World Bank called for the subsidies to be scrapped immediately as poorer nations were feeling “the boot of climate change on their neck”. Globally in 2013, the most recent figures available,the coal, oil and gas industries benefited from subsidies of $550bn, four times those given to renewable energy.
“Subsidies to fossil fuel companies are completely inappropriate in this day and age,” said Stephen Kretzmann, executive director of Oil Change International, an NGO that analyses the costs of fossil fuels. OCI found in 2014 that US taxpayers were subsidizing fossil fuel exploration and production alone by $21bn a year. In 2009, President Barack Obama called on the G20 to eliminate fossil fuel subsidies but since then UN federal subsidies have risen by 45%.
“Climate science is clear that the vast majority of existing reserves will have to stay in the ground,” Kretzmann said. “Yet our government spends many tens of billions of our tax dollars – every year – making it more profitable for the fossil fuel industry to produce more.”
Tax credits, defined as a subsidy by the World Trade Organization, are a key route of support for the fossil fuel industry. Using the subsidy tracker tool created by the Good Jobs First group, the Guardian examined some of the biggest subsidies for specific projects.
Shell’s proposed $4bn plant in Pennsylvania is set to benefit from tax credits of $66m a year for 25 years. Shell has bought the site and has 10 supply contracts in place lasting up to 20 years, including from fracking companies extracting shale gas in the Marcellus shale field. The deal was struck by the then Republican governor, Tom Corbett, who received over $1m in campaign donations from the oil and gas industry. According to Guardian analysis of data compiled by Common Cause Pennsylvania, Shell have spent $1.2m on lobbying in Pennsylvania since 2011.
A Shell spokesman said: “Shell supports and endorses incentive programs provided by state and local authorities that improve the business climate for capital investment, economic expansion and job growth. Shell would not have access to these incentive programs without the support and approval from the representative state and local jurisdictions.”
ExxonMobil’s Baton Rouge refinery is the second-largest in the US. Since 2011, it has been benefitting from exemptions from industrial taxes, worth $118.9m over 10 years, according to the Good Jobs First database. The Republican governor of Louisiana, Bobby Jindal has expressed his pride in attracting investment from ExxonMobil. In state election campaigns between 2003 and 2013, he received 231 contributions from oil and gas companies and executives totaling $1,019,777, according to a list compiled by environmental groups.
A spokesman for ExxonMobil said: “ExxonMobil will not respond to Guardian inquiries because of its lack of objectivity on climate change reporting demonstrated by its campaign against companies that provide energy necessary for modern life, including newspapers.”
The Guardian is running a campaign asking the world’s biggest health charities, the Bill and Melinda Gates Foundation and the Wellcome Trust, to sell their fossil fuel investments on the basis that it is misguided to invest in companies dedicated to finding more oil, gas and coal when current reserves are already several times greater than can be safely burned. Many philanthropic organizations have already divested from fossil fuels, including the Rockefeller Brothers Fund whose wealth derives from Standard Oil, which went on to become ExxonMobil.
In Ohio, Marathon Petroleum is benefitting from a 15-year tax credit for retaining 1,650 jobs and a 10-year tax credit for creating 100 new jobs. The subsidy is worth $78.5m, according to the Good Jobs First database. “I think Marathon always wanted to be here,” Republican governor John Kasich said in 2011. “All we’re doing is helping them.” In 2011,
Kasich was named as the top recipient of oil and gas donations in Ohio, having received $213, 519. The same year Kasich appointed Marathon Petroleum’s CEO to the board of Jobs Ohio, a semi-private group “in charge of the economic growth in the state of Ohio”.
A spokesman for Marathon Petroleum said: “The tax credit recognizes the enormous contribution we make to the Ohio economy through the taxes we pay and the well-paying jobs we maintain. We have more than doubled the 100 new jobs we committed to create.” The spokesman said the company paid billions of dollars in income and other taxes every year across the US.
“Big oil, gas, and coal have huge influence on politicians and governments and they get that influence the old fashioned way – they buy it,” said Kretzmann. “Through campaign finance, lobbying, advertising and superpac spending, the industry has many ways to influence candidates and government officials seeking re-election.”
He said fossil fuel subsidies were endemic in the US: “Every single well, pipeline, refinery, coal and gas plant in the country is heavily subsidized. Big Fossil’s lobbyists have done their jobs well for the last century.”
Ben Schreiber, at Friends of the Earth US, said. “There is a vibrant discussion about the best way to keep fossil fuels in the ground – from carbon taxation to divestment – but ending state and federal corporate welfare for polluters is one of the easiest places to start.”
Schreiber also defended subsidies for renewable energy: “Fossil fuels are a mature technology while renewable energy is nascent and still developing. It makes sense to subsidize technologies that are going to help solve climate change, but not to do the same for those that are causing the problem.”
Damian Carrington is the head of environment at the Guardian.
Harry Davies is Special Projects Researcher at the Guardian.
americans love ranchers: Gritty ranchers, mom-and-pop ranchers, renegade ranchers — especially those who raise livestock on the vast open prairies of the West through hard work and rugged independence. But there’s another side to the ever-popular rancher mythology— a side the media doesn’t cover and the public never sees.
The Koch brothers, Ted Turner, the Hilton family and nine other powerful ranchers share an uncommon privilege: giant public subsidies, unknown to U.S. taxpayers. It’s the other side of the Cliven Bundy story, the other side of the Wright brothers saga—the bronc-riding, ranching family at the center of the New York Times photographic essay published March 11, 2015. It’s also the other side of the ongoing news feed in which ranchers work to remove wild horses from public lands.
That “other side” of those stories is the federal grazing program that enables the Wrights to run their livestock on public lands for cheap; allows ranchers to have thousands of protected wild horses removed from public lands at public expense. It’s also the program that earned Bundy the title of welfare rancher.
Bundy didn’t earn it by failing to pay his grazing fees, though. The welfare rancher label applies to allranchers who hold permits to graze the vast public spaces of the West, both delinquent and not. It includes the Wright brothers; the ranchers in Iron and Beaver counties in Utah complaining that wild horses eat too much; and 21,000 others.
They are all welfare ranchers subsidized by US taxpayers, and you know who are the biggest welfare ranchers of all, grazing livestock across hundreds of millions of acres of public grass and forest land, all assisted by public subsidies paid for by US taxpayers?
Billionaires appearing on Forbes rich lists
The .01 percenters are the nation’s biggest welfare ranchers, according to numerous environmental and policy groups; and it’s time they brought some attention to themselves and the federal grazing program they’re exploiting to the tune of an annual estimated one billion dollars in taxpayer subsidies while causing long-term damage to one of the public’s most treasured assets.
Fifteen years ago, two percent of public lands ranchers controlled fifty percent of permitted grazing acreage, according to John Horning, Executive Director of WildEarth Guardians.
Today, Horning says, that elite group of mega-rich owners has consolidated its hold on federal grazing property even further through grazing leases attached to the larger-than-life ranches they inherit or buy outright.
Along with that comes all kinds of perks paid for by taxpayers: the USDA’s wildlife services, which killed four million endangered and predator species in 2013 to help livestock operators. The costly and wildly ineffective Wild Horses and Burros Program which operates to the benefit of welfare ranchers. Numerous programs that work to undo the grazing damage that welfare livestock causes. And let’s not forget the bank loans that an estimated 45% of public lands ranchers obtain, using their grazing leases as collateral, and which heighten the value of their primary ranching property.
Only 2.7 percent of the nation’s ranchers hold such leases. That’s a lot of costly benefits flowing to a small segment of the livestock industry. That two percent of them hold more than fifty percent of the acreage under that program? Never mind that two of the recipients love to attack all welfare programs that benefit the bottom tier of the economic pyramid. It’s the antithesis of rugged independence. It’s undemocratic, too.
Their faces are absent from the media’s coverage of ranchers. Some of that is is laziness. The other part is resources. It takes a lot of digging to identify any public lands ranchers with precision. Why? Because the Bureau of Land Management and US Forest Service (which administer most federal grazing leases) have record-keeping systems that are the antithesis of transparent. There is no central database. Finding out who’s doing what on federal lands requires identifying all the various LLCs that ranchers establish to hide who they are, then tracking down leases in 10 Western states.
The BLM, for its part, isn’t eager to help. Call any BLM specialist and identify yourself as media, and they send you to a media representative. Most I reached out to didn’t return phone calls—not promptly, anyway. You want information? You’ll be stuck sending out Freedom of Information Act requests. I sent on April3, 2014. It’s still outstanding.
Paul Rogers of the San Jose Mercury Newsspent nine months collecting information on 26,000 grazing leases in order to publish a comprehensive article (“Cash Cows”) in 1999 on the money pit that was the federal grazing program at that time. Many of the same players are still in the game, but the process of keeping tabs using real records is so arduous that no environmental groups do it.
The way I came up with the names in the accompanying photo gallery was by interviewing groups working to reform public lands grazing and cross-checking names against news reports online. The estimates provided of leased acreage were provided by Jon Marvel, founder of Western Watersheds Project. Net worth figures and list rankings are from Forbes; the rankings of richest land owners from the Land Report 100.
It’s not an exact science, but one thing is clear: the public is being lulled by stories about bronc riders like the Wright brothers and outliers like Cliven Bundy while missing the big picture: a handful of cattle rustlers—rich ones—whose hands are deep in the public’s pockets, along with all the other smaller permittees.
And that’s what ranching in the West is like. It’s still rough and tumble. But if you don’t have a big-ass ranch, a huge fortune and public assistance, you’d best just head for the hills.
This is Part IV of an ongoing SourceWatch series on ranchers in the media:
[Part I] The Media Adores Ranchers. Here’s Why They Shouldn’t
[Part II] Sustainable Cowboys or Welfare Ranchers of the American West? (contains reading list of source materials on public lands ranching)
[Part III] Bad Ranchers, Bad Cows
alternet
Some of America's biggest welfare ranchers:
David and Charles Koch (Koch Industries)
The brothers hold a half-dozen grazing permits on public land in Montana to go with its 300,000-acre Matador Ranch there. The brothers are tied for fourth place on Forbes 2014 400 Richest People in America list (net worth: $ 42 billion each). The Koch family ($ 89 billion) is #2 on Forbes Richest Families list; Koch Industries is #2 on Forbes America's Largest Private Companies list, ($ 115 billion in sales).
J.R. Simplot Corp.
The largest U.S. public lands ranching entity (with an estimated 2 to 3 million acres of allotments in CA, ID, NV, OR and UT) is #63 on Forbes 2014 list of America's Largest Private Companies ($ 5.8 billion in sales). In 2014, the family was #29 on Forbes list of America’s Richest Families (net worth: $ 8 billion).
Bruce McCaw (McCaw Cellular)
McCaw was #382 on Forbes 400 list of America’s Richest People in 2005 (net worth: $ 925 million). Through his 9 sprawling ranches, he controls a significant number of public grazing leases in ID and possibly NV. One of them (Camas Creek ranch) includes 272,000 acres of Federal grazing allotments in Idaho's Camas Prairie. Grazing permitted to his other ranches could easily double or triple that to a million acres or more.
Barrick Gold
The Canadian mining company is one of the two largest public lands ranchers in NV, ranking 771st on Forbes Global 2000 list of the World’s Biggest Public Companies in 2014, (sales: $ 12.56 billion). Like many other large public lands ranchers, Barrick buys ranches to secure water rights.
Southern Nevada Water Authority (SNWA)
The supplier of drinking water to Las Vegas is a large NV public lands rancher with an estimated 1 million acres of public grazing allotments. Like Barrick Gold, it, buys up private ranches to gain their water rights.
W. Barron Hilton (Hilton Hotels)
The hotel heir dropped off Forbes Billionaires list (ranked #459 in 2011) as well as its list of the 400 Richest Americans (#144 in 2010), with a net worth of $ 2.5 billion. He died in 2013.
Though records are hard to pin down, Hilton's heirs inherited a ranching operation in the CA-NV border area, which has been known to have vast public lands grazing allotments permitted to it.
Mary Hewlett-Jaffe (Hewlett-Packard)
Jaffe holds the largest BLM public lands grazing permit in central ID and is among the top 15 public lands ranchers in the state (estimated at under 200,000 acres that are said to be in extremely degraded condition, according to sources).
James Barta (Sav-Rx.com)
Barta is not on any Forbes rich lists, but owns one of the largest cattle ranching operations in the U.S., according to his attorneys. Barta holds grazing permits to nearly 900,000 acres of public grazing allotments in connection with two properties: White Horse Ranch (in OR) and Soldier Meadows (in NV). Barta may have additional NV grazing leases through two other ranches in NV, according to Jon Marvel, founder of Western Watersheds Project.
T. Wright Dickinson
Though not on any Forbes list, the Dickinson family is a large public lands rancher, with grazing permits estimated at more than a half million acres of CO, UT and WY public lands under its LLC, Vermillion Ranches. Dickinson is a former County commissioner and proponent of county efforts to gain control of federal lands, according to the Denver Post.
Stan Kroenke (Kroenke Group) & Ann Walton Kroenke (Walmart)
With just two of his ranches (in MT and WY) totaling 664,000 acres (not including public grazing allotments), Kroenke is one of the ten top land owners in the U.S. In 2014, he ranked #89 on Forbes list of the 400 Richest Americans, #247 on its Billionaires list, and #5 on its list of Richest American Sports Team Owners (net worth: $ 5.8 billion). His wife, Ann Walton Kroenke (net worth: $ 5.6 billion), was #261 on Forbes Billionaires list and #11 on its list of America’s Richest Women.
Family of Robert Earl Holding (Sinclair Oil and hotels)
Forbes ranks the family #87 on its 2014 list of America’s Richest Families (net worth: $ 2.7 billion). With 400,000 acres of land, the family is the 19th largest private land owner in the US, according to the 2014 Land Report 100. This includes land that Forbes reported “may be the largest ranching operation in the Rocky Mountains.” Public grazing leases are associated with some of the family’s WY and possibly MT holdings, according to Jon Marvel, founder of Western Watersheds.
Ted Turner
He's the second largest U.S. land owner (2 million acres in 6 states), is estimated to hold grazing leases in MT and NM (estimated at as much as 300,000 acres), and owns the world's largest bison herd. Forbes ranked him #296 on its 2014 list of the 400 Richest Americans and #818 on its global Billionaires list (net worth: $ 2.2 billion).
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...Over the years, critics of clean energy have learned a few things about dirty politics. In their latest attempt to protect fossil fuel special interests—and stop the progress of renewable energy dead in its tracks—they have turned to a tried-and-true tactic: someone in Congress asks for a half-baked study on energy subsidies, designed to leave skewed results and certain to draw the interest of government watchdog groups. Then, a front group for the Koch brothers steps in and starts trashing clean energy, and Americans find themselves confused.
Welcome to Washington, Mr. Smith. As Mark Twain once mused, “A lie can travel half way around the world while the truth is putting on its shoes.”
This latest dustup started with a new report by the Energy Information Administration (EIA), which offers a snapshot in time of the different incentives for various energy sources, and was requested by several Republican members of Congress. Predictably, Watchdog.org then picked up the report and posted a story with the less-than-flattering headline, “Solar and wind energy pack a wallop—in federal subsidies.” While Watchdog.org did a good job of seeking comment from both the solar and wind industries, the real truth aboutclean energy incentives was consistently clouded by an organization known as The Institute for Energy Research, which—surprise, surprise—was founded by Charles Koch and former Enron executive Robert Bradley, who wrote speeches for disgraced Enron CEO—and I should add, corporate crook—Ken Lay.
For its part, EIA did what it was asked to do, but the request was narrowly defined to only include subsidies with clear identifiable impacts on the U.S. Treasury and that are provisions specific to energy. This restrictive definition leaves out some of the largest fossil and nuclear subsidies, which results in a skewed, apples-to-oranges comparison. For example, the EIA report omits:
- Price-Anderson nuclear insurance liability limitations (because it has no identifiable impact on the Treasury), even though American taxpayers are on the hook for an unlimited amount of money in insurance costs in the event of a catastrophic accident.
- It does not account for royalties on foreign crude oil being classified as income taxes, which makes these royalties eligible for the foreign income tax credit. Huh? If they were accurately classified as royalties they would be treated as expenses and would only be eligible for a deduction, instead of a tax credit. This distinction is likely worth billions of dollars a year to Big Oil.
- It does not count the externalities of pollution from fossil-fueled power plants as subsidies (which they are).
Additionally, EIA did not include any loan guarantees in the subsidy numbers because guarantees, or outlays, were not made in 2013. This goes for nuclear, renewables and others. But it’s important to point out, nuclear did get a disproportionate share of the loan guarantees in prior years.
To put this in some perspective, DBL Investors looked at the historical incentives given to fossil fuels, nuclear and renewables—and the numbers weren’t even close: $447 billion for fossil fuels; $185.5 billion for nuclear; and less than $6 billion for renewables—less than 1 percent of the total amount given to fossil fuels and nuclear.
In a previous iteration of this report, EIA refused a request to display subsidies per unit of energy, or per unit of capacity, because it is an invalid/misleading metric for judging subsidies. Because most subsidies are frontloaded, traditional generation—such as coal, nuclear and hydro—received their government support years or decades ago, and the plants built with that support continued to exist and generate energy in 2013—even if their support did not include substantial outlays in 2013. This is one of the key points of the widely-respected Baker Center study.
The Baker Center study also shows that solar incentives are in line with those given to other energy industries. What’s more, solar is following a similar curve in development as traditional energy sources (coal, gas, oil), which received substantial subsidies during their growth period and are still getting many of them today.
Even the nonpartisan Congressional Research Service has explained, “For more than a half a century, federal energy tax policy focused almost exclusively on increasing domestic oil and gas reserves and production. There was no major tax incentive promoting renewable energy or energy efficiency.” In other words, the Koch brothers and fossil fuel interests were given a stranglehold on the marketplace—thanks, in large part, to preferential tax treatment and federal subsidies—and now they want to freeze everyone else out.
For example, by its own figures, the oil and gas industry will receive nearly $100 billion over the next 10 years in special tax breaks, including: expensing of intangible drilling costs; the domestic manufacturers tax deduction; use of the “last-in, first-out,” or LIFO, accounting method; exemption from Superfund waste cleanup taxes; and preferential treatment that reduces taxes for master limited partnerships. And the list goes on.
In truth, the oil and gas industry has been getting substantial tax breaks since 1913, while solar has only been receiving the 30 percent Investment Tax Credit (ITC) since 2006.
Most troubling, the EIA report only looks at the “costs” to the U.S. Treasury of solar subsidies—without considering a single dime of economic benefits—or return on investment—created by one of the fastest-growing industries in America. Today, solar employs nearly 175,000 Americans—with 140,000 of those jobs created since the ITC was implemented—and we pump nearly $20 billion a year into the U.S. economy. We’re also providing enough clean electricity to power 4 million homes.
Similarly, the report does not take into account the huge amount of income taxes paid by solar developers, distributors, installers, manufacturers and employees, as well as the taxes paid by support industries including engineering, financing and legal. Nor does the report include any indirect, or induced, benefits from widespread solar development.
From an environmental prospective, the EIA report does not take into account the staggering costs from harmful carbon pollution to the health and well-being of Americans. Today, the solar industry is helping to displace an estimated 20 million metric tons of damaging carbon emissions, which is the equivalent of removing 4 million cars off U.S. highways and roads. So, through this omission, the report mistakenly dismisses the real health care costs of “dirty air,” which is associated with asthma, lung disease, heart disease and even cancer.
And finally, the report also fails to include the benefits that solar provides when it comes to national security, emergency preparedness, grid reliability, America’s clean energy future and on and on.
We’re very proud of the progress made by the solar industry in a very short period of time—and we appreciate the faith put in us by both Republicans and Democrats in Congress, by both President Obama and President Bush, and by 9 out of 10 Americans who want to see an expanded use of solar nationwide. By any measurement, the solar ITC is paying huge benefits to the U.S. and to American taxpayers, and we believe it should be extended to maintain a level playing field with long-time, entrenched energy sources.
Unfortunately, you would never know any of this by reading the EIA report, or listening to the subsequent scathing attacks on solar and wind by the Koch brothers’ cronies. But before getting all worked up by their nonsense, I’m reminded of something else Mark Twain once said: “Never argue with stupid people. They will drag you down to their level and then beat you with experience.”
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oligarch capture gov't to minimize cost: raw mat'ls, labor , regs, but also want gov't revenue: farm subsidy, vouchers, dump health and food costs on taxpayer (while claiming to be champion al la jarvis prop 13).
==
==
http://ecowatch.com/2014/04/30/dirty-money-dirty-fuels-politics/
What if fighting dirty money in our elections was the key to fighting dirty fuels in our economy?
That’s the question asked in a recent report released by the Sierra Club and Oil Change International. From the perspective of the fossil fuel industry, political contributions are just another form of investment. The only difference is that, for the millions polluters spend on elections, they see billions in bonus profits.
As the report says, “The return these polluters are getting on these political investments—in the form of billions in corporate tax handouts—exceed 5,000 percent, demonstrating that Congress remains the best ‘investment’ possible for the coal, oil, and gas industries.”
The oil and gas industries are among the worst offenders. Between 2009 and 2010, the report estimates that they spent $347 million on lobbying and campaign contributions, and in return netted a handsome $20 billion in federal subsidies. Most of these came in the form of accounting gimmicks that help hide corporate profits and obscure tax breaks that help cover drilling and refining costs. Because of loopholes like these, the actual taxes paid by most big energy companies fall well below the top corporate rate of 35 percent.
You would think that at a time when both Democrats and Republicans are preoccupied with deficits and debt, cutting subsidies for polluters should be an easy move. After all, these are some of the most profitable companies in world history; surely they need government support like Bill Gates needs food stamps. The fact that many of these giveaways are nearly a century old, dating from a time when fossil fuel extraction was a much riskier game, only adds to their irrelevance. At a time of significant fiscal strain, decades-old free money for rich polluters should be the first thing on the chopping block.
Unfortunately, in the new world of campaign finance born after Citizens United and supercharged earlier this month by McCutcheon vs. FEC, money speaks much louder than fiscal and environmental sanity. The report points out that solid majorities of Americans support action on climate change, investment in renewable energy, and a repeal of fossil fuel subsidies. And yet, Congress is arguably in its most rabidly anti-environment phase in U.S. history, voting repeatedly to block action on climate change, cut support for renewable energy, and hobble enforcement of clean air and water provisions.
The only way to solve this disconnect is through a new system of public financing. As such, the Sierra Club and Oil Change International are throwing their weight behind the recently sponsored Government By The People Act, which would allow federal candidates to receive money from small donors matched on a six-to-one basis. This would not end money in politics, or even strip polluters of their ability to purchase influence.
Winning those fights has to be part of a much longer campaign against corporate personhood and the idea of money as free speech. But in the meantime, it would give candidates who share the increasingly pro-environment sentiments of the American people a chance to be heard. Friends of the Earth supports the Government By The People Act and its vision for a more healthy and just world.
===
The Huffington Post / By Amy Traub [1]
Food Stamps Don't Keep Walmart's Prices Low, They Keep Its Profits High
April 5, 2014 |
"The same company that brings in the most food stamp dollars in revenue [2] -- an estimated $13 billion last year -- also likely has the most employees using food stamps."
The name of the mammoth food stamp-reliant company is no secret: Walmart.
As journalist Krissy Clark notes in Marketplace's valuable new series "The Secret Life of the Food Stamp [3]," Walmart benefits from food stamps in multiple ways, as taxpayers both underwrite the company's food sales and also subsidize its payroll costs.
There is no doubt that food stamps (and a host of other public subsidies from Medicaid to home heating assistance to the Earned Income Tax Credit and beyond) reduce Walmart's employment costs substantially. A study[4] released last year by staff of the U.S. House Committee on Education and the Workforce found that a single 300-employee Walmart Supercenter may cost taxpayers anywhere from $904,542 to nearly $1.75 million per year.
Consider that the working people who turn to food stamps to supplement inadequate wages are demonized as society's lazy "takers" -- a young Walmart employee who enrolled in food stamps to help support his pregnant partner told Marketplace that previously "I'd always considered people who use food stamps as just taking advantage of the government." Yet the company itself continues to be seen as a paragon of free enterprise, notwithstanding the tens of billions of dollars in subsidies through the same program.
Marketplace has done a great service by shining light on a key public misperception, illuminating the low-wage employers who benefit most from programs like food stamps. Yet an important part of the story still gets missed. It's probably intended to be a rhetorical question when part II of the food stamp series asks: "Are Walmart's prices so low because its employees are on food stamps?" But the answer is no.
In reality, it's not Walmart's low prices that taxpayers are subsidizing -- it's the company's mammoth profits.
Walmart made $17 billion in profit in 2013, and spent $7.6 billion buying back shares of its own stock -- further consolidating the company's ownership in the hands of the Walton heirs, already among the wealthiest people on the face of the earth. As my colleague Catherine Ruestchlin and I explain in our 2013 study [5], these stock buybacks did nothing to boost Walmart's productivity or bottom line. They contributed zilch to cutting consumer prices or keeping those prices low. But if, for example, funds from this financial maneuvering were redirected to Walmart's low-paid employees, workers would each see a raise of $5.83 an hour [5]. As a result, the overwhelming majority of Walmart workers would no longer need to turn to food stamps to supplement their wages. Other observers have found additional ways [6] the company could substantially boost pay (and reduce reliance on food stamps) without increasing prices. Yet Walmart has made a decision to continue its dependence on food stamps and other public subsidies.
It's no surprise that Walmart itself works to obscure the pivotal role of its corporate decision making. David Tovar, Walmart's vice president of communications, told Marketplace that since Walmart is the nation's largest employer "its work force is bound to reflect the country's current economic realities, including growing rates of food stamp use." This statement passes the buck impressively, overlooking the role that Walmart has played in shaping the country's current economic realities -- in creating an America where millions of people who get up and go to work each day are nevertheless paid too little to feed themselves.
The truth is that Walmart and all the other large and profitable retailers [7], fast food companies [8], and other corporations that fatten their bottom line by letting the public feed their employees have made a business decision to shrink their payroll on the taxpayer's dime. It's up to us to decide whether to continue allowing them to do it.
See more stories tagged with:
walmart [9],
food stamps [10],
minimum wage [11],
economy [12]
Source URL: http://www.alternet.org/labor/food-stamps-dont-keep-walmarts-prices-low-they-keep-its-profits-high
==
http://thinkprogress.org/climate/2013/01/09/1423351/oil-zero-subsidies/
Despite ranking among the most profitable corporations in the world, Big Oil benefits from $4 billion in annual tax breaks. It fights to maintain them through aggressive political donations, lobbying, and heavy ad spending, but also employs another tactic: Pretending these tax breaks don’t exist.
“The oil and gas industry gets no subsidies, zero, nothing,” API President Jack Gerard said on Tuesday. “We get cost-recovery benefits, much like other industries. You can go down the road of allowing economic activity, generating hundreds of billions to the government, or you can take the alternative route by trying to extract new revenue from industry by increasing their cost to do business.”
Tax deductions are indeed subsidies, as API admitted in a document that labeled “subsidies for alternative fuels” as “preferential tax treatment.” And the oil industry’s $4 billion preferential treatment is written permanently into the tax code. These include:
Percentage depletion allowance: lets companies deduct the costs of an oil or gas well, about 15 percent, from its taxes.
Domestic manufacturing tax deduction: Allows oil companies to collect $1.8 billion each year, even though there are vast differences between oil and traditional U.S. manufacturing. It is a benefit that was never intended for them, according to Sen. Bob Corker, a Tennessee Republican, who said Congressincluded oil producers “almost inadvertently.”
The foreign tax credit: Oil companies overwhelmingly fall into the category of companies that can claim credits for payments to foreign governments.
Expensing intangible drilling costs: For over a century, oil companies have written off wages, fuel, repairs, and hauling costs.
ExxonMobil, Chevron, and ConocoPhillips have paid federal tax rates well below the 35 percent top corporate rate, a far cry from paying “more than our fair share”. ExxonMobil, for instance, paid a 13 percent tax rate in 2011, after drilling deductions and benefits, and 14 percent on average between 2008 and 2010.
The record-high gas prices of 2012 reinforce the decades of data showing domestic drilling has very little impact on gas prices. At the same time, the Big Five companies are on track to collect more than $100 billion profit this year.
Tags:
http://www.loe.org/shows/segments.html?programID=13-P13-00045&segmentID=1
farm http://www.washingtonpost.com/blogs/wonkblog/wp/2013/07/12/the-u-s-has-few-farmers-so-why-does-congress-love-farm-subsidies/
ethanol and junk food
http://www.nytimes.com/2013/11/07/us/billionaires-received-us-farm-subsidies-report-finds.html?_r=0
November 7, 2013
Billionaires Received U.S. Farm Subsidies, Report Finds
By RON NIXON
WASHINGTON — The federal government paid $11.3 million in taxpayer-funded farm subsidies from 1995 to 2012 to 50 billionaires or businesses in which they have some form of ownership, according to a report released Thursday by the Environmental Working Group, a Washington-based research organization.
http://www.ewg.org/research/forbes-fat-cats-collect-taxpayer-funded-farm-subsidies
The billionaires who received the subsidies or owned companies that did include the Microsoft co-founder Paul G. Allen; the investment titan Charles Schwab; and S. Truett Cathy, owner of Chick-fil-A. The billionaires who got the subsidies have a collective net worth of $316 billion, according to Forbes magazine.
The Working Group said its findings were likely to underestimate the total farm subsidies that went to the billionaires on the Forbes 400 list because many of them also received crop insurance subsidies. Federal law prohibits the disclosure of the names of individuals who get crop insurance subsidies, the group said.
The report is being issued as members of the House and Senate are meeting to come up with a new five-year farm bill. The authors of the report said it is timely, given that lawmakers are debating a House proposal that would cut nearly $40 billion over 10 years from the food stamp program, which helps provide food for nearly 47 million people. A Senate provision would cut $4.5 billion over the same period.
A report released Wednesday by the Center for American Progress, a left-leaning research group, found that food stamps kept about five million people above the poverty line last year. The food stamp program was cut by about $5 billion on Nov. 1 when a provision in the 2009 stimulus bill that added funding for the program expired.
“The irony is that farm subsidies are going to billionaires at the same time that there are proposals to kick three to five million people off of food stamps,” said Scott Faber, vice president for government affairs at the Environmental Working Group. “This clearly highlights the need for reform to our farm programs.”
Some of the company officials identified by the Working Group said they were surprised to find their names in the report.
Don Millican, the chief financial officer at the Kaiser-Francis Oil Company in Tulsa, Okla., which is owned by the oil and banking magnate George Kaiser, said he did not know why the company was shown as receiving crop subsidies.
The Working Group report shows the oil company received about $17,500 in subsidies for wheat, sorghum and barley from 1996 to 2003. Forbes puts Mr. Kaiser’s net worth at $10 billion.
“It’s possible we could have gotten the surface rights to land that was being farmed and that’s why we were listed as getting subsidies,” Mr. Millican said. “It’s rare, but it happens.”
Other companies listed in the report declined to discuss its findings.
Allen D. Israel, a lawyer for Kona Residence Trust in Seattle, which is owned by Mr. Allen, said the company would not comment on its farm subsidies. Mr. Allen’s net wealth is estimated at $15.8 billion, according to Forbes.
The trust received about $14,426 in crop subsidies for barley from 1996 to 2006, the Working Group’s report said.
Mr. Faber said that one of the proposals he found most disturbing in the farm bill would shift money from farm subsidy programs like direct payments, which have income limits, to those like crop insurance, which do not. Other measures would subject food stamp recipients to drug testing, work requirements and income means-testing.
Unlike traditional farm subsidies, crop insurance premium subsidies are not now subject to income requirements, payment limits or conservation compliance, the Working Group found.
“So basically the bills would allow billionaires to get even more in subsidies, all without taxpayers knowing who they are, while imposing draconian requirements on low-income people,” Mr. Faber said.
According to the Working Group’s analysis, more than 40 billionaires own properties where crops are grown that are among the most likely to be insured through the federal program, including corn, soybeans, wheat, cotton and sorghum.
The billionaires who received farm subsidies between 1995 and 2012 have a collective net worth of $316 billion, based on the Forbes magazine estimates. They include:
- Paul Allen (Net worth: $15.8 billion)
- Co-founder of Microsoft
- Charles Ergen (Net worth: $12.5 billion)
- Co-founder of DISH Network
- Philip Anschutz (Net worth: $10 billion)
- Owner of Anschutz Entertainment Group and co-founder of Major League Soccer
- Leonard Lauder (Net worth: $7.6 billion)
- Son of Estee Lauder and former CEO of the Estee Lauder Companies Inc.
- Richard DeVos (Net worth: $6.8 billion)
- Co-founder of Amway and Republican candidate for governor of Michigan in 2006
- Jim Kennedy (Net worth: $6.7 billion)
- Chairman of Cox Enterprises
- S. Truett Cathy (Net worth: $6 billion)
- Founder of Chick-fil-A
- Leslie Wexner (Net worth: $5.7 billion)
- CEO of L Brands Inc., which owns Victoria's Secret
- Charles Schwab (Net worth: $5.1 billion)
- Founder of brokerage firm Charles Schwab Corporation
- Stewart & Lynda Resnick (Net worth: $3.5 billion)
- Owners of POM Wonderful, Fiji Water and Teleflora
- David Rockefeller, Sr. (Net worth: $2.8 billion)
- Former chairman and chief executive of Chase Manhattan Bank
- Penny Pritzker (Net worth: $2.2 billion)
- U.S. Secretary of Commerce
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The billionaires profiting from farm subsidies were identified by matching EWG’s Farm Subsidy Database with the Forbes 400 list of the richest Americans. [See original article.]
| Name | Source of Farm Subsidies |
|---|---|
Paul Allen Net worth: $15.8 billion #26 on Forbes 400 | Kona Residence Trust, which received $14,429 in barley subsidies from 1996 to 2006. |
Philip Anschutz Net worth: $10.3 billion #38 on Forbes 400 | Clm Company, which received $553,323 in cotton, wheat, sorghum, corn, oat, barley and other farm subsidies from 1995 to 2003. Equus Farms, which received $53,291 in livestock subsidies in 2002. |
John Arrillaga Net worth: $1.8 billion #314 on Forbes 400 | Peery & Arrillaga, which received $59,711 in wheat, sorghum, corn, barley, safflower and other farm subsidies from 1995 to 2006. |
Lee Bass Net worth: $2.1 billion #260 on Forbes 400 | Panther City Cattle Company, which received $823,129 in cotton, wheat, corn and sorghum subsidies from 2000 to 2007. El Coyote Ranch, which received $297,950 in wheat, sorghum, corn, soybean, oat and barley subsidies from 1995 to 2002. |
Riley Bechtel Net worth: $3.4 billion #143 on Forbes 400 | Fremont Investors, which received $484,283 in rice and other farm subsidies from 1995 to 2003. |
Stephen Bechtel, Jr. Net worth: $3.4 billion #143 on Forbes 400 | Fremont Investors, which received $484,283 in rice and other farm subsidies from 1995 to 2003. Wild Goose Club, which received $947 in farm subsidies from 2006 to 2010. |
Eli Broad Net worth: $6.9 billion #59 on Forbes 400 | Placer Ranch Partners LP, which received $56,880 in wheat and rice subsidies from 1995 to 2005. |
S. Truett Cathy Net worth: $6 billion #68 on Forbes 400 | Rock Ranch LLC, which received $4,536 in livestock subsidies in 2003. |
Gayle Cook Net worth: $5.2 billion #85 on Forbes 400 | Cedar Farm Harrison County Inc., which received $41,141 in soybean, corn and tobacco subsidies from 1998 to 2003. |
Richard DeVos Net worth: $6.8 billion #60 on Forbes 400 | Ada Holdings LLC, which received $37,986 in corn, wheat and soybean subsidies from 2001 to 2006. |
Charles Ergen Net worth: $12.5 billion #32 on Forbes 400 | Telluray Ranch, which received $117,826 in crop and livestock disaster payments from 2002 to 2008. |
Gerald J. Ford Net worth: $1.9 billion #296 on Forbes 400 | Rio Hondo Land & Cattle Co. Inc., which received $222,433 in wool subsidies from 1995 to 2003. |
Harold Hamm Net worth: $12.4 billion #33 on Forbes 400 | $26,785 in wheat subsidies and disaster payments from 1995 to 2002. Continental Resources of Illinois, which received $318 in disaster payments, corn and soybean subsidies from 2003 to 2004. |
Diane Hendricks Net worth: $4.4 billion #103 on Forbes 400 | H&H Farms of Wisconsin Inc., which received $379,933 in corn, soybean, wheat, oat and other farm subsidies from 1998 to 2001. |
Ray Lee Hunt Net worth: $5.6 billion #74 on Forbes 400 | Sharyland Limited Partnership, which received $110,270 in cotton, sorghum, sunflower and corn subsidies from 1998 to 2000. Hunt Oil Co., which received $49,381 in livestock subsidies in 2002. |
Paul Tudor Jones, II. Net worth: $3.7 billion #130 on Forbes 400 | Buck Ridge Farms LLC, which received $8,260 in crop disaster payments, cotton, soybean, sorghum and corn subsidies from 1998 to 2003. Tudor Farms Inc., which received $1 in sorghum subsidies in 1996. |
George Kaiser Net worth: $10 billion #40 on Forbes 400 | Kaiser-Francis Oil Company, which received $17,518 in wheat, sorghum and barley subsidies from 1996 to 2003. |
Jim Kennedy Net worth: $6.7 billion #61 on Forbes 400 | $37,162 in rice, corn, sorghum, wheat, soybean, sunflower and other farm subsidies from 1996 to 2004. York Woods At Yonkapin Cutoff LLC, which received $19,545 in rice, sorghum and soybean subsidies from 2002 to 2003. |
Henry Kravis Net worth: $4.7 billion #95 on Forbes 400 | M&T Chico Ranch, which received $511,633 in wheat, rice, corn, sorghum, sunflower, safflower, barley and other farm subsidies from 1995 to 2005. M&T Staten Ranch, which received $502,363 in corn and wheat subsidies from 1996 to 2002. |
Ann Walton Kroenke Net worth: $4.7 billion #95 on Forbes 400 | JL Walton Trust, which received $13,273 in corn, wheat, sorghum, soybean and oat subsidies from 1996 to 2002. St. Roberts Centers & Farms, which received $6,642 in corn, wheat, sorghum and soybean subsidies from 1996 to 2002. $378 in corn and sorghum subsidies in 1995. |
Leonard Lauder Net worth: $7.6 billion #56 on Forbes 400 | Horizon Organic Dairy Idaho Farm, which received $360,102 in wheat, diary, barley, corn and other farm subsidies from 1997 to 2004. Horizon Organic Dairy Maryland Farm, which received $202,088 in dairy, corn, soybean, wheat and other farm subsidies from 1998 to 2005. |
Nancy Walton Laurie Net worth: $4 billion #110 on Forbes 400 | JL Walton Trust, which received $13,273 in corn, wheat, sorghum, soybean and oat subsidies from 1996 to 2002. St. Roberts Centers & Farms, which received $6,642 in corn, wheat, sorghum and soybean subsidies from 1996 to 2002. |
Marianne Liebmann Net worth: $2.6 billion #209 on Forbes 400 | Morse Land Co. Ltd., which received $4,282 in livestock, barley, oat, wheat and other farm subsidies from 2000 to 2005. |
Whitney MacMillan Net worth: $3.8 billion #122 on Forbes 400 | $25,226 in wheat and barley subsidies from 1996 to 1999. Wild Eagle Mountain Ranch LLC, which received $10,417 in wheat and barley subsidies from 2001 to 2003. |
Neal Patterson Net worth: $1.5 billion #352 on Forbes 400 | $51,911 in wheat and sorghum subsidies from 1995 to 2001. Southpoint Farms LLC, which received $66,770 in disaster payments, wheat, sorghum and other farm subsidies from 2002 to 2012. |
Richard Peery Net worth: $2.1 billion #260 on Forbes 400 | Peery & Arrillaga, which received $59,711 in wheat, sorghum, corn, barley, safflower and other farm subsidies from 1995 to 2006. |
Anthony Pritzker Net worth: $3 billion #166 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Daniel Pritzker Net worth: $1.95 billion #293 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Jay Robert Pritzker Net worth: $3 billion #166 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Jean (Gigi) Pritzker Net worth: $2.1 billion #260 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Jennifer Pritzker Net worth: $1.7 billion #327 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
John Pritzker Net worth: $2 billion #273 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Karen Pritzker Net worth: $3.3 billion #151 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Linda Pritzker Net worth: $1.8 billion #314 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Nicholas Pritzker, II. Net worth: $1.35 billion #382 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Penny Pritzker Net worth: $2.2 billion #252 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Thomas Pritzker Net worth: $2.7 billion #201 on Forbes 400 | Chicago Mill & Lumber Co., which received $1,604,288 in cotton, soybean, corn, sorghum, wheat, rice, oat and other farm subsidies from 1996 to 2006. |
Stewart & Lynda Resnick Net worth: $3.5 billion #134 on Forbes 400 | Paramount Land Co. LP, which received $566,603 in wheat, cotton, corn, sorghum and other farm subsidies from 1995 to 2002. |
David Rockefeller, Sr. Net worth: $2.8 billion #193 on Forbes 400 | $563,715 in corn, soybean, wheat, oat, sorghum and other farm subsidies from 1996 to 2006. |
Robert Rowling Net worth: $4.9 billion #93 on Forbes 400 | Rowling Ranch Corp., which received $157,427 in corn, sorghum and livestock subsidies from 2000 to 2008. |
Fayez Sarofim Net worth: $2 billion #273 on Forbes 400 | Holly Sugar Corp., which received $51,246 in wheat, corn, barley, sugar beet, oat and other farm subsidies from 1995 to 2003. FS Ranch Corporation, which received $67,125 in livestock subsidies in 2002. |
Charles Schwab Net worth: $5.1 billion #88 on Forbes 400 | $525,593 in rice and other farm subsidies from 1995 to 2003. |
Walter Scott, Jr. Net worth: $2.2 billion #252 on Forbes 400 | $62,031 in livestock subsidies in 2002. Double Eight Land Corp., which received $41,101 in livestock subsidies in 2002. |
Harold Simmons Net worth: $10 billion #40 on Forbes 400 | Dixie Rice Agriculture Corp., which received $677,300 in rice, sorghum and other farm subsidies from 1995 to 2003. Southwest Louisiana Land Co Inc., which received $272,511 in disaster payments, rice, soybean and other farm subsidies from 1995 to 2003. Contran Realty Corp., which received $17,754 in rice and other farm subsidies from 1996 to 2003. Contran Corp., which received $2,960 in wheat subsidies from 1998 to 2000. |
Warren Stephens Net worth: $2.5 billion #222 on Forbes 400 | Stephens Group Incorporated, which received $146,260 in peanut, wheat, corn, oat, sorghum and other farm subsidies from 1996 to 2003. Greenbriar Lodge LLC, which received $86,642 in rice, soybean and wheat subsidies from 2002 to 2008. |
Glen Taylor Net worth: $1.7 billion #327 on Forbes 400 | Glen A. Taylor Revocable Trust, which received $832,970 in corn, soybean, wheat, oat and other farm subsidies from 1995 to 2007. |
Alice Walton Net worth: $33.5 billion #8 on Forbes 400 | Robson Ranch Inc., which received $261,292 in crop disaster payments, wheat, soybean, corn and other farm subsidies from 1995 to 2008. |
Jim Walton Net worth: $33.8 billion #7 on Forbes 400 | Robson Ranch Inc., which received $261,292 in crop disaster payments, wheat, soybean, corn and other farm subsidies from 1995 to 2008. |
S. Robson Walton Net worth: $33.3 billion #9 on Forbes 400 | Robson Ranch Inc., which received $261,292 in crop disaster payments, wheat, soybean, corn and other farm subsidies from 1995 to 2008. |
Leslie Wexner Net worth: $5.7 billion #73 on Forbes 400 | LAW Plantation Co. LLC, which received $209,717 in wheat, corn, sorghum and oat subsidies from 1997 to 2003. The New Albany Co., which received $13 in farm subsidies in 1996. |