Mad Dog Liberal

U.S. income inequality is the worst it’s been since the 1920s but still the GOP and their corporate masters, blather on about how raising marginal tax rates on the wealthiest among us will spell disaster for the country and be a “job killer.” They argue that those generous Bush-era tax cuts prompt the rich to reinvest in America and create jobs. Sounds good but it’s just another of those Republican lies that get repeated and repeated in the hope that the public accepts it as truth.

For real truth, check out Pat Garofalo’s excellent piece for Think Progress. As Garofalo cites, a report by the Center for American Progress found that over six decades, job growth was greatest when the top marginal tax rate was highest. For every year since 1950, the years with marginal top tax rates of 70% or higher showed the greatest growth in payroll employment rates. The worst years for overall job growth were when the top marginal rate was 35% or below.

In budget negotiations over the past week or ten days, Congressional negotiators and Vice President Joe Biden found about $1 trillion in cuts that they could agree on and were allegedly trying to pin down another $1.4 trillion when Republicans walked away from the bargaining table over the suggestion that $400 billion could come from closing tax loopholes and ending certain subsidies and credits.

One such loophole; the “Last In/First Out” (LIFO) provision. This is an accounting method that allows companies to assume, for tax purposes only, that all of their inventory was purchased at the last (most expensive) price. When they sell that inventory, they falsely reduce their taxable income. International accounting standards refuse to recognize the use of LIFO accounting but the greatest beneficiaries of its use are the oil and gas industries so Republican lawmakers refuse to consider its repeal.

As expected, Congressional Republicans (with two exceptions) voted in mindless unison to block a Senate bill that would have put an end to decades of subsidies granted to the five biggest oil companies. That single act would have cut an estimated $21 billion over the next ten years from the deficit that has been a hot-button issue in Conservative rhetoric. Instead, voting almost exclusively along party lines, 45 of the 47 Senate Republicans argued that the move would hurt domestic oil production and raise gas prices at the pump, arguments that the same oil companies debunked themselves in 2005 while testifying before a Congressional committee. The bill failed with a 52-48 vote with Democrats unable to secure the 60 vote super-majority required for it to pass. Although I’m outraged by Republicans who preach against the deficit but oppose cutting oil subsidies, choosing instead to balance the budget on the backs of our poorest citizens, what’s even more despicable are the three Democrats who voted with the GOP to maintain the status quo of corporate welfare being given to one of the most profitable industries in the country.

Why would Democrats vote against their own party? Picking such a high-profile, visceral vote that was certain to draw the ire of constituents and colleagues? Three words… big oil money.

According to Oil Change International, Mary Landrieu (D-LA), Mark Begich (D-AK) and Ben Nelson (D-NE), along with the 45 Republican senators who voted against the bill have received, roughly, five times more in contributions from oil and gas companies than the 52 senators who voted for the bill. Those who voted to end the subsidies (48 Democrats, 2 Independents and 2 Republicans), received about $72,145 each in campaign contributions from oil and gas. The 48 senators who voted against the bill took in an average of $370,600 each in campaign contributions from oil and gas.

Over the course of the careers for these pocket senators, oil and gas company employees, executives and PACs have spent $17,791,875 to ensure that their interests are protected. They’ve also spent an additional $39 million and employed 633 lobbyists to blanket Capitol Hill for the first quarter of this year alone all to make sure they have friends in high places. Apparently, they got what they paid for.