Friday, February 25, 2011

Big Oil Lobby Announces It Will Start Donating Directly To Candidates

Pat Garofalo

The American Petroleum Institute, the Big Oil industry’s chief lobbying organization, will start directly backing political candidates in the second quarter of this year. API, whose membership includes oil giants like Exxon-Mobil and Chevron, already spends tens of millions of dollars every year on lobbying, advertisements and Astroturf campaigns to support the the oil industry agenda. As CAP’s Dan Weiss wrote, API “wants to drill in fragile, sensitive places, keep government tax breaks, expand offshore drilling without reforms, and block global warming pollution reduction requirements.”

“This is adding one more tool to our toolkit,” Martin Durbin, API’s executive vice president for government affairs, told Bloomberg News. “At the end of the day, our mission is trying to influence the policy debate.” As Bloomberg pointed out, oil-supported political action committees like the Independent Petroleum Association of America overwhelmingly donate to Republican candidates.

According to the Center for Responsive Politics, API spent $6.7 million on lobbying alone last year, after clearing $7 million in 2009. In 2010, API was the seventh most prolific spender in the oil and gas industry, following ConocoPhillips, Chevron, Exxon-Mobil, Shell, Koch Industries and BP.

API’s turn toward direct political donations is doubly problematic because, in addition to acting as the industry’s chief lobbyists, the institute runs technical committees that set standards for the oil industry. In its official report, the commission that investigated the BP oil spill found that API was too “compromised” to be setting industry standards. “Because they would make oil and gas industry operations potentially more costly, API regularly resists agency rulemakings that government regulators believe would make those operations safer, and API favors rulemaking that promotes industry autonomy from government oversight,” the commission found. And this was before API established a political action committee!

In its proposed 2012 budget, the Obama administration suggested, once again, removing the billions in subsidies that taxpayers give oil companies every year. API has been at the forefront of the lobbying fight to preserve Big Oil’s subsidies, demonizing the removal of them as new “energy taxes,” even while admitting that cutting the subsidies and plowing the money back into clean energy technology would create “a lot more jobs.”

Oil Group Starts Political Giving as Congress Weighs Repeal of Tax Breaks
By Jim Snyder

The American Petroleum Institute, the largest oil and gas industry trade group, will start backing political candidates this year as the U.S. considers repealing $46 billion in subsidies and imposing pollution rules.

The group, whose members include Exxon Mobil Corp. and Chevron Corp., would make donations separately from industry executives and employees, who gave $27.6 million mostly to Republican candidates for Congress last year, according to the Center for Responsive Politics in Washington. API has paid for advertising on policy issues and to lobby on legislation.

“This is adding one more tool to our toolkit,” said Martin Durbin, API’s executive vice president for government affairs, in an interview. “At the end of the day, our mission is trying to influence the policy debate.”

The Obama administration is proposing to end tax breaks for energy companies and to limit greenhouse-gas emissions, actions the API says will cost jobs and cut domestic production as fuel costs rise.

Durbin declined to say how much the Washington-based group hoped to donate. API spent $7.3 million to lobby Congress and the White House last year, ranking seventh behind six oil-and- gas companies, according to the Center for Responsive Politics.

Former Republican and Democratic aides in Congress and from the White House lobby for the group. They include David Castagnetti, an ex-chief of staff to Senate Finance Committee Chairman Max Baucus, a Montana Democrat, and Bruce Mehlman, a Commerce Department official under George W. Bush.

Balancing Donations
The oil group, which filed to set up the committee with the Federal Election Commission in May, will start distributing donations in the second quarter of this year, Durbin said. API has more than 460 members.

“Do we really need another oil-industry PAC in this city?” said Michael Gravitz, a lobbyist for Environment America who has opposed energy-industry efforts to open more areas offshore for drilling. “Their level of influence is pretty obvious, and large.”

The energy industry succeeded in blocking efforts by Congress to raise the liability oil companies would face for spills and to repeal subsidies the industry receives, he said.

Meredith McGehee, policy director for the Campaign Legal Center, a campaign-finance watchdog in Washington, said API may see opportunities to advance its agenda with Republicans in control of the U.S. House.

“This is the way the game is played,” she said.

Republican Donations
Oil and gas companies and groups with political committees, such as the Washington-based Independent Petroleum Association of America, gave about 77 percent, or $19.6 million, of their total contributions for 2009-2010 to the Republican party, according to the Center for Responsive Politics.

Oil and gas companies were the 15th largest source of political contributions leading up to the 2010 election.

Koch Industries Inc. was the industry’s largest contributor, giving $1.79 million to candidates, more than 90 percent of whom were Republicans. Exxon, which gave $1.33 million to congressional campaigns, was the second largest. More than 80 percent of Exxon’s money went to Republicans.

President Barack Obama’s proposed budget calls on Congress to repeal subsidies that would be valued at $3.6 billion for oil and gas companies in 2012. In a decade, the administration estimates the repeal would yield about $46 billion. Obama said in his State of the Union address that the industry can afford to pay higher taxes.

Tax Breaks Repealed
Congress has twice rejected requests to repeal the breaks.

The proposal would “lower revenue to the government by many billions of dollars as a result of foregone revenues from projects the tax hikes would prevent going forward,” Jack Gerard, the group’s chief executive officer, said in a statement.

API has said greenhouse-gas regulations issued by the Environmental Protection Agency are burdensome and a threat to the economic recovery. The agency says the rules support cleaner technologies and will lead to more “green” jobs.

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