Yves here. Common Dreams publicizing this appeal to Biden suggests that the Dems even now could take messaging steps to reduce the hit they seem likely to take in the Congressional midterms. Fat profiteering corps like Big Oil, which also happen to be benefitting from energy inflation, make for easy and deserving targets. But can the Dems be bothered?
By Jake Johnson. Originally published at Common Dreams
President Joe Biden used a Wednesday speech at the White House to scold fossil fuel companies for raking in huge profits at the expense of U.S. consumers, who are being gashed by high prices at the pump.
But instead of calling for a specific policy solution that would force the industry’s hand, Biden asked oil companies to voluntarily stop padding their bottom lines and instead “pass the savings on to consumers.”
“So far, American oil companies are using that windfall, the windfall of profits, to buy back their own stock, passing that money on to their shareholders, not to consumers,” the president said. “When the cost of oil comes down, we should see the price at the gas station, at the pump, come down as well. That’s how it’s supposed to work. But that’s not what’s happening.”
The president’s latest energy address marked a continuation of his approach to countering fossil fuel industry profiteering thus far, one that has focused more on pleading with oil company executives to do what’s best for consumers than aggressively pursuing legislative and executive action to compel fossil fuel giants to constrain prices.
Jamie Henn, the director of Fossil Free Media, welcomedBiden’s direct call-out of the industry’s surging profits and ongoing share buybacks, but added that he now needs to “tell Congress to pass a Big Oil windfall profits tax!”
The Stop the Oil Profiteering campaign echoed that message.
“The price gouging from Big Oil is unacceptable and that’s exactly why we need a Big Oil windfall profits tax—the most simple first step to stop this profiteering and deliver immediate relief to working people across the country,” the campaign said.
President Joe Biden used a Wednesday speech at the White House to scold fossil fuel companies for raking in huge profits at the expense of U.S. consumers, who are being gashed by high prices at the pump.
But instead of calling for a specific policy solution that would force the industry’s hand, Biden asked oil companies to voluntarily stop padding their bottom lines and instead “pass the savings on to consumers.”
“What can we do about it? Hit Big Oil with a windfall profits tax.”
“So far, American oil companies are using that windfall, the windfall of profits, to buy back their own stock, passing that money on to their shareholders, not to consumers,” the president said. “When the cost of oil comes down, we should see the price at the gas station, at the pump, come down as well. That’s how it’s supposed to work. But that’s not what’s happening.”
The president’s latest energy address marked a continuation of his approach to countering fossil fuel industry profiteering thus far, one that has focused more on pleading with oil company executives to do what’s best for consumers than aggressively pursuing legislative and executive action to compel fossil fuel giants to constrain prices.
Jamie Henn, the director of Fossil Free Media, welcomed Biden’s direct call-out of the industry’s surging profits and ongoing share buybacks, but added that he now needs to “tell Congress to pass a Big Oil windfall profits tax!”
The Stop the Oil Profiteering campaign echoed that message.
“The price gouging from Big Oil is unacceptable and that’s exactly why we need a Big Oil windfall profits tax—the most simple first step to stop this profiteering and deliver immediate relief to working people across the country,” the campaign said.
While the Biden White House has reportedly mulled supporting a windfall profits tax in private, the administration has yet to endorse legislation that Democrats in the House and Senate have introduced and forcefully advocated in recent months.
Survey data has shown that a windfall profits tax targeting oil giants is massively popular with the U.S. public, which has signaled it wants lawmakers and political candidates to crack down on corporate profiteering that is driving up prices across the economy.
With the midterms approaching, campaigners and strategists have implored the Biden administration to get behind a windfall profits tax as part of its economic messaging, particularly as Republicans hammer away on inflation attacks even as their party threatens to make the problem worse by pushing giveaways for the rich.
In a recent memo, Democratic strategist Mike Lux argued that “there is not a reason in the world Democrats need to be defensive or mushy about their plan for inflation,” noting that a “populist message on the issue has been tested repeatedly by the smartest pollsters in the business… and it works.”
Lux wrote that a top messaging point for Democrats should be that “wealthy corporations with monopoly power are jacking up their prices, and their profits are going through the roof.”
“Big oil, food, shipping, healthcare, and real estate companies have been making record profits over the last two years,” Lux implored Democratic candidates to say. “I will crack down on price gouging, but to be clear—my opponent has proposed nothing to combat this abuse.”
Pres. Biden called out oil companies for using their 'windfall of profits' from high gas prices—$70 billion in just one quarter—to buy back their own stocks pic.twitter.com/sK7zDrsM7s
— NowThis (@nowthisnews) October 19, 2022
While the Biden White House has reportedly mulled supporting a windfall profits tax in private, the administration has yet to endorse legislation that Democrats in the House and Senate have introduced and forcefully advocated in recent months.
Survey data has shown that a windfall profits tax targeting oil giants is massively popular with the U.S. public, which has signaled it wants lawmakers and political candidates to crack down on corporate profiteering that is driving up prices across the economy.
With the midterms approaching, campaigners and strategists have implored the Biden administration to get behind a windfall profits tax as part of its economic messaging, particularly as Republicans hammer away on inflation attacks even as their party threatens to make the problem worse by pushing giveaways for the rich.
In a recent memo, Democratic strategist Mike Lux argued that “there is not a reason in the world Democrats need to be defensive or mushy about their plan for inflation,” noting that a “populist message on the issue has been tested repeatedly by the smartest pollsters in the business… and it works.”
Lux wrote that a top messaging point for Democrats should be that “wealthy corporations with monopoly power are jacking up their prices, and their profits are going through the roof.”
“Big oil, food, shipping, healthcare, and real estate companies have been making record profits over the last two years,” Lux implored Democratic candidates to say. “I will crack down on price gouging, but to be clear—my opponent has proposed nothing to combat this abuse.”
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I saw yesterday that Biden is still pleading to get Manchin’s regulatory reform for new fossil fuel projects over the line, so he appears to be spending a lot of time pleading for things. Biden may have been born in Scranton, but he was incorporated in Delaware; some of his pleadings look more special than others.
Also, too, it looks like Jake Johnson could use a good editor.
I suppose that systemic remedies, such as those envisioned in the Sherman Anti-Trust Act, are no longer mentionable.
Joe is on the horns of a dilemma:
“Big oil, food, shipping, healthcare, and real estate companies have been making record profits over the last two years,” Lux implored Democratic candidates to say. “I will crack down on price gouging, but to be clear—my opponent has proposed nothing to combat this abuse.”
Sez Mike Lux, sounding like Bernie Sanders on the stump.
Unfortunately:
“I beat the socialist,” Mr. Biden said. “That’s how I got elected. That’s how I got the nomination. Do I look like a socialist? Look at my career — my whole career. I am not a socialist.”
Joseph Robinette Biden.
So, no.
Joe Biden epitomizes the statement, “when people show you who they are, you should believe that is who they are.”
But then again, well for all the Rob Reiner(s) among our elites they do all love him so.
Archie Bunker was right about something, Rob Reiner really did turn out to be a meathead.
They just don’t live in the same world we do.
How about:
a 50% tax on all stock buybacks, extraordinary dividends and ordinary dividends > 6% of stock price, This would be thought of an insurance premium for companies which later have to be bailed out by the government.
In addition, when ever the inflation rate is > 2%, the tax rate goes to 80% as a fiscal approach to controlling inflation.
Ohhh… I LIKE these ideas!!!
In addition, capital gains to be taxed as ordinary income.
while we are at it, where is the covid windfall tax on all the tech cos? (microsoft, amazon AWS, Apple)
This of course is the problem…a windfall profits tax on one sector begs for another in several other sectors.
Not going to happen.
Jaw jaw jaw though, there’s certain to be a lot of that…
unrelated sort of, 70 billion in profit…70 billion for ukraine belligerents…
Where the heck is my “Whip Inflation Now” button? I’m getting with the program.
“Whip inflation now” buttons, showing your age. And I too remember them well. LOL.
Sloganeering solves everything in some peoples minds.
Actually there is evidence that the Ford price freezes were starting to work when he dropped them….as a result of business opposition and ridicule.
Thanks for that bit of info, being all of 10 or so at the time, lots to start learning about the world, not having much of a clue about anything at that age, just remember the buttons and such.
My sloganeering snark was directed more at today’s times, I was mixing up a lot of history.
Thanks as well for the post on this subject by the way.
Someone needs to tell the Democrats that early voting has been going on for three weeks already. They are doomed. For the first time in my life, I voted for a Republican for Congress. Anything to stop the war frenzy.
ty for sharing.
i wonder if the pollsters/DC consultant class is going to get blind-sided by erroneous polling from all the stealth Howard Beales out there.
will be happy to wallow in DC schaudenfreude.
anyone but the incumbent, regardless of party
With reference to the Biden misadministration´s pending release of oil from the Strategic Petroleum Reserve (supposedly to bring the price down), MoA noted something interesting in today´s post. The price of West Texas Intermediate Crude on February 24 was $86.91/bl. On October 19, 2022 the price of West Texas Intermediate Crude was $81.55/bl. The price has fallen by 8%. Grampa Joe´s handlers are getting frantic to appear to be doing something – virtue signaling and empty gestures.
It was mentioned here that the release was the equivalent of 18 hours of US oil use. So a literal drop in the bucket anyway.
Maybe it’s just me, but I think a “knock it off” speech like this is even worse than just doing nothing. Hey, Jack. You helped build the system that has given them windfall profits. And they know they are in zero danger of you actually doing anything within your power about the situation. All this does is make you look pathetic and weak and no one believes you give a damn anyway.
And to our strategist friend, not only are you too little, too late, but the Dems have no interest in cracking down on price gouging. If they did, they’d be doing it. Period.
Reminds me of my old saying: If people actually wanted to change they already would have done so.
Not so Dr John. In 2021 and in 2022 both House and Senate have introduced bills about windfall profits. And it’s very different than the Carter Admin Windfall profits. Although Big Oil doesn’t set global prices, doesn’t mean they can’t set prices at the pump to help Americans instead of raking in obscene profits. Remember they are also recipients of extreme tax breaks, incentives etc, very much subsidized as an industry. Painful to watch them bite the hand that helps sustain them. Part of the problem lies in lack of refining capacity. Several refineries have switched permanently to making ethanol based refined products. Several are prioritizing both jet fuel and diesel since it pays better. Fracked oil in many instances can’t be used to make petroleum distillates, it’s already mostly paint thinner. Even with all the subsidies, the oil industry is not investing in its’ infrastructure, despite the obvious that we will always use oil They prefer to take those windfall profits and reward their Directors and shareholders instead. That is obscene profit taking. https://www.americanprogress.org/article/as-energy-prices-skyrocket-congress-must-return-the-oil-and-gas-industrys-windfall-profits-to-the-american-people/
If corporations buy back stocks with profits does it make those profits untaxable?
since oil companies don’t set the price of oil or of their products, they have very little control over their profitability…but that’s no reason not to tax their windfalls, especially as a campaign gimmick..
I very much doubt that there is any chance of Congress doing any such thing for the foreseeable future. Like in 2008, the Democrats have had control of Congress for two years, and have largely sat on their a$$es, holding up Manchin, Sinema, or the Parliamentarian as their go to excuse for doing jack.
The coming red tsunami in the midterms is going to wipe out a lot of Congressional Democrats, and then the remainder can just shrug their shoulders and then say that there is nothing they can do “because Republicans”. Then, the Democratic Party in 2024 will look at its losses in 2022 and use that as evidence that it should move further right like it always does.
Governor Newsom in California also called for a windfall profits tax on oil companies. It was mainly for show since the state legislature (and Newsom as well) is completely beholden to Big Oil and so will never impose a windfall profits tax. President Manchin will most certainly veto any attempt to impose additional taxes on Big Oil.
Yes, my first thought was “why aren’t they asking President Manchin and VP Sinema.”
I don’t think this is a great idea: a tax?!! How does that lower gas prices for americans? Isn’t there something else we could do to lower the price? I think voters will say: oh, great another tax, more money for the corrupt!! The target is good, but the proposed solution leaves a lot to be desired
This is how it really should work. The govt allows free market shenanigans but then taxes at very high rates to prevent abuse. The suggested 100% tax on CEO salaries above, say, $1M is an example. MMT also works like this. Seems a perfectly good idea to me. Unless of course you believe that govt. is always and everywhere corrupt in which case you have other possibly more pressing problems.
The House and Senate both introduced Bills in 2021 and 2022.
https://www.americanprogress.org/article/as-energy-prices-skyrocket-congress-must-return-the-oil-and-gas-industrys-windfall-profits-to-the-american-people/
How about we just eliminate the stock buyback option? We did just fine without that option into the 1980’s. No need to develop complicated tax schemes if we just make the real problem illegal.
good luck raising taxes. the rich have free trade to blunt or stop anything you will try.
these are just a small sample of what the rich can accomplish under free trade..
you cannot tax the rich under free trade: Uber used 50 Dutch shell companies to dodge taxes on nearly $6 billion in revenue
https://www.nakedcapitalism.com/2021/05/200pm-water-cooler-5-17-2021.html
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under free trade Inheritance taxes, withholding taxes, taxes on land sales and capital gains taxes can all be reduced or eliminated
https://www.icij.org/investigations/pandora-papers/secret-real-estate-purchases-are-a-driving-force-behind-the-offshore-economy/
Secret real estate purchases are a driving force behind the offshore economy
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In 1983 there were only 15 billionaires in the u.s.a., under bill clintons free trade, billionaires have ballooned into more than 615, and under free trade, this is happening globally
https://www.bostonglobe.com/2021/04/01/magazine/costs-secretive-wealth-defense-industry-shell-companies-offshore-tax-havens-empty-luxury-condos/
The costs of a secretive ‘wealth defense industry’ of shell companies, offshore tax havens, and empty luxury condos
When oligarchs and ultra-wealthy around the world game the system to hide riches in Boston and other cities, everyone else pays.
By Chuck CollinsUpdated April 1, 2021, 11:55 a.m
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as long as we free trade: How oil majors shift billions in profits to island tax havens
https://www.channelnewsasia.com/news/business/special-report-how-oil-majors-shift-billions-in-profits-to-island-tax-havens-13735416
Business
Special Report-How oil majors shift billions in profits to island tax havens
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free trade is a rich mans policy, period. only benefits a few rich, to the detremint of billions
https://www.yahoo.com/finance/news/poland-sweden-estonia-malta-block-025005385.html
Tue, March 15, 2022, 9:50 PM
PARIS (Reuters) – Poland, Sweden, Estonia and Malta blocked on Tuesday a French-proposed compromise on how to implement minimum corporate tax across the European Union, dealing a blow to the global overhaul of cross-border tax rules.
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under free trade The state can no longer protect its citizens, all policies make the rich richer, and the poor, poorer
some really fine excerpts,
https://www.counterpunch.org/2022/04/22/the-crisis-of-the-nation-state-in-the-age-of-globalization/
“under the conditions of globalized(free trade) economic production nation-states lose their sovereignty in decision-making pertaining to the collective needs of the citizenry (this is noticeably the case for Canada’s foreign policy). “Today, developments summarized under the term ‘globalization’ have put this entire constellation into question”
“For if state sovereignty is no longer conceived as indivisible but shared with international agencies; if states no longer have control over their national territories; and if territorial and political boundaries are increasingly permeable, the core principles of democratic liberty—that is self-governance, the demos, consent, representation, and popular sovereignty—are made distinctly problematic”
“Globalization (free trade)is like an overflowing river, washing away all borders, boundaries, checkpoints. Habermas raises the big question of: “Which aspects of globalization could potentially degrade the capacity for democratic self-steering within a national society?”
“under Neo-liberal(free trade) conditions—corporations pressure the state to lower their tax rates so they can compete in a fiercely frenzied global environment. Cutbacks were the order of the day in the 1990s, and these cuts to the public sector continue into the jittery present.
“Taxation at the highest income brackets, capital gains taxes, and corporate taxes have fallen to such a low level in the OECD countries that the proportion of total tax revenues derived from corporate profits has drastically fallen since the end of the 1990s” (p. 69). When tax revenues decrease, governments lose the capacity (and political will) to hire more nurses, health-care workers and teachers (and those who assist them) in ever increasing anxiety-ridden schools. GDP statistics soar; the degradation of everyday life and insecurity intensifies. Even in the capital region of Canada, Ottawa city councillors squabble over where there spaces in the early morning hours for homeless men and women to stay warm.
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