A view of the ExxonMobil Baton Rouge refinery in Baton Rouge, Louisiana, May 15, 2021.
Kathleen Flynn | Reuters
Exxon Mobil has lobbied parts of a sprawling Democratic budget bill aimed at empowering working class families and tackling climate change.
The fossil fuel giant last week spent $ 275,000 on Facebook ads that feature commercials targeting tax hikes, which the Democrats added to the bill, which is currently priced at $ 3.5 trillion Has. An Exxon lobbyist earlier this year also focused on corporate and international tax legislation.
The final form of the bill has yet to be determined, although it is expected to include measures to promote child and elderly care as well as measures to reduce carbon emissions. The democratic leaders hope to pass the law within a few weeks.
The ads don’t mention President Joe Biden or the Democrats. At least six of the ads ran Friday through Monday, although they are now inactive. One of those ads said, “Don’t tell Congress not to raise taxes.” After a user clicks the ad, it reads, “Contact your elected representatives today and let them know that you are against the proposed tax increases for American businesses.”
The most recent ad purchase, valued at over $ 275,000, is part of $ 2 million Exxon spent on Facebook advertising over the past 90 days. The spots that opposed the corporate tax hike also ran before the previous week’s period.
“Our lobbying is related to a tax burden that could disadvantage US companies, and we have made this position public,” Exxon spokesman Casey Norton told CNBC after this article was published. “ExxonMobil stands by our position that higher taxes on American companies make the US less competitive.”
The Democrats have proposed raising the corporate tax rate from 21% to 26.5% to pay the bill. They have also called for higher fees for the fossil fuel industry while disagreeing on whether to include a carbon tax.
The public broadly supports tax hikes for businesses and the wealthy. A recent survey by Morning Consult shows that 68% of respondents oppose an increase in taxes for the rich and 62% agree about a possible increase in corporate taxes.
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Several stakeholders have lobbied against the tax proposals and other elements of the bill, with a focus on centrists such as Sens. Joe Manchin, DW.Va, and Kyrsten Sinema, D-Ariz. The Democrats need all 50 members of their faction in the Senate to pass the measure using a tactic called budget balancing.
A logo of Exxon Mobil Corp can be seen at the Rio Oil and Gas Expo and Conference in Rio de Janeiro, Brazil, September 24, 2018.
Sergio Moraes | Reuters
Any overhaul will require the assistance of Manchin, whose home state of West Virginia is a major producer of fossil fuels such as coal, natural gas, and oil. The state is home to part of the Marcellus Shale, a geological formation that also serves as one of the largest natural gas fields in North America. XTO Energy, Exxon Mobil’s oil and gas fracking subsidiary, operates in West Virginia.
Since the 2012 election cycle, Manchin has received just more than $ 12,000 from Exxon Mobil’s political action committee, according to the non-partisan Center for Responsive Politics. Manchin chairs the Senate’s Energy and Natural Resources Committee. A senior Exxon lobbyist was caught on camera by UK Channel 4 and said Manchin was one of its main targets. The lobbyist called Manchin the “kingmaker” and said he spoke to the senator’s office on a weekly basis.
After the story was published, a Manchin spokeswoman told CNBC that the Exxon lobbyist had “greatly exaggerated” its influence on Manchin’s team. E&E News reports that the lobbyist is no longer with the company.
“Throughout his civil service career, Senator Manchin and those who work for him have always had an open door policy and a willingness to learn from those with different and diverse opinions,” Manchin’s spokeswoman said in an email on Wednesday opposite CNBC. “But recently an Exxon employee greatly exaggerated his relationship and influence with Senator Manchin’s staff in an attempt to advance his own career only to be misled by an activist organization with an agenda of its own. The Virginians is categorically wrong.”
According to CRP data, Exxon Mobil has spent more than $ 2.7 million on lobbying so far this year. Michael Solon, one of Exxon’s lobbyists, received $ 10,000 for work done in the second quarter that specifically focused on “unspecified corporate and international tax reconciliation laws,” according to the disclosure report.
Prior to becoming a lobbyist, Solon was the policy director for Senate Minority Leader Mitch McConnell, R-Ky.
Democrats in the House of Representatives and the Senate are trying to create a legal framework that could win the support of centrists and progressives alike in both chambers. While a final bill is likely to look different, the guidelines approved by the House committees this month when the Democrats were putting together a larger proposal offer clues as to what the plan might contain. The democratic leaders want to pass on their investments in the social safety net and climate policy in the coming weeks.
Other companies with ties to the oil and gas industry have also actively targeted the reconciliation tax proposals through their lobbyists. Gas giant Valero paid Cornerstone Government Affairs less than $ 5,000 in the second quarter to share with House and Senate lawmakers “the corporate tax requirements of the Build Back Better Budget Alignment Act,” according to the Lobbying Disclosure Report.
The International Association of Drilling Contractors, a not-for-profit trade association, spent roughly the same amount on lobbying lawmakers and officials in the Biden government, including on “oil and gas policy for reconciliation,” according to its second quarter report. The group is dedicated to “advancing the interests of the oil and gas and geothermal drilling and completion industries worldwide,” according to its LinkedIn page.
There are other proposals from the Democrats related to combating climate change that may be of concern to oil and gas industry actors.
As part of its serve, the House of Representatives Natural Resources Committee proposed increased fossil fuel fees and royalties for mining on public land, among other plans that would impact the oil industry. The panel has also advocated repealing the oil and gas leasing program established under the 2017 Republican Tax Act at the Arctic National Wildlife Refuge.
The House of Representatives Energy and Trade Committee has levied a fee for methane emissions, a product of its oil and gas activities, along with other energy-related measures.
Democrats are also split over whether to include a proposed carbon tax in legislation. The provision, which could violate Biden’s promise not to impose taxes on households earning less than $ 400,000, aims to reduce fossil fuel emissions.
Exxon’s Norton said Wednesday that the company has supported “a macroeconomic price” on carbon emissions for more than a decade.
“We have clearly spoken out in favor of an efficient, macroeconomic price for CO2 as the best way to achieve the goals of the Paris Agreement,” said the spokesman. “While there is not widespread support for a tax, we are actively and publicly discussing other options, including lower-carbon fuels and other sector-based approaches that would add a uniform, predictable cost to carbon.”
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