Bad Deeds for 5-16-2011

 

Big Oil Makes an Investment in Congress and It Pays Off – The CEOs from the five major oil companies — which together booked $36 billion in profits in the first quarter of 2011 alone — went to the Senate last Thursday to try to justify the $4 billion in tax giveaways they’re receiving this year. These companies don’t need and don’t deserve taxpayer money — especially with a budget deficit to close and gas prices at or near record highs. These CEOs are so out-of-touch that one of the CEOs went so far as to say that cutting oil giveaways would be “un-American.”

Even worse is the fact that when the Senate tries to strip these oil company giveaways, it’s likely that a minority of senators will block a vote from happening. And even if the Senate manages to pass a bill eliminating the giveaways, there’s little chance it will be brought up for a vote in the House.

Here’s why: These five companies are expert manipulators of the money-for-influence game in Washington that the President is working to change. It’s simple math — they spent more than $145 million last year on nearly 800 lobbyists whose job is to defeat bills like this one. The $4 billion they’ll likely get to keep as a result represents a 2,700% return on their investment.

 

Why Keep 500 Texas Teachers When We Can Have Race Cars? – At a time when Texas is dealing with a record budget deficit by slashing essential services and possibly laying off 97,000 teachers, state lawmakers have committed taxpayers to funding Formula One auto racing at a steep price: $25 million a year for the next 10 years. Bloomberg points out that for $25 million a year, “the state could pay more than 500 teachers an average salary of $48,000.”

The motorsport franchise left the U.S. four years ago because of low attendance, but the effort to bring it back — and base it in Texas — has been spearheaded by B.J. “Red” McCombs, the co-founder of conservative media conglomerate Clear Channel Communications. Despite being consistently ranked as one of Forbes 400 richest Americans — with a net worth last estimated at $1.4 billion — McCombs has gotten state Comptroller Susan Combs to agree to build a racing track in Austin at taxpayer expense. Austin’s city government may also invest an additional $4 million a year in tax revenue to facilitate the plan. Red McCombs is the guy who left Minnesota after selling the Minnesota Vikings, in part because the state wasn’t going to build him a better stadium for his team to play in. So if this racing thing doesn’t make him enough money, he has shown that he will leave taxpayers holding the bag.

Richard Viktorin, an accountant with Audits in the Public Interest, says his Austin-based group opposes government support for the races because they are a gross misuse of state funds. “It’s off-balance-sheet financing for a rich man’s sport.”

 

Republicans Wants To Dismantle Consumer Financial Protection – Last July, President Barack Obama signed the Dodd–Frank Wall Street Reform and Consumer Protection Act into law, the most sweeping overhaul of the financial regulatory system since the Great Depression.

Dodd-Frank introduces a number of reforms aimed at Wall Street. And, unsurprisingly, big banks and other financial institutions aren’t very happy about it. Wall Street unleashed an army of lobbyists onto Capitol Hill in an attempt to convince congress to dismantle Dodd-Frank as much as possible, and they’ve found a captive audience in the Republican Party.

This is bad news for consumers. The Dodd-Frank legislation created the Consumer Financial Protection Bureau (CFPB), the first financial regulator with the express mission of catering to consumers, not big banks and other financial institutions. When it opens in July, the CFPB will advocate on behalf of consumers against unfair and illegal practices by these financial giants. They’ll be tackling issues like confusing financial contracts, credit report errors, unfair overdraft fees, high-cost prepaid cards and costly payday loans. Consumers will finally have a powerful advocate working on their behalf – something big banks and financial institutions are considerably afraid of.

But it’s also bad news for the future stability of the global economy. If the reforms in Dodd-Frank are eroded to the extent that big banks and other financial institutions want, the economic climate that brought on the recent financial crisis could very well happen again. The findings of the Financial Crisis Inquiry Committee concluded that the crisis was an “’avoidable’ disaster caused by widespread failures in government regulation, corporate mismanagement and heedless risk-taking by Wall Street”.

Indeed, the repeals Wall Street want would push regulations back to where they were before the financial crisis. Watering down Dodd-Frank would be, in the words of Senate Banking Committee leader Tim Johnson (D-SD), “dangerous and irresponsible”.

 

U.S. Chamber of Commerce Attacks President Obama’s Corporate Disclosure Order – President Obama recently introduced an executive order that will force corporations with government contracts to disclose any campaign contributions over $5,000.

Disclosure like this is essential to ending corruption and making sure that the companies that get contracts are those who deserve them, not just those who can pay for them with campaign contributions.

The public has the right to know who their taxes are paying for government contracts and to feel confident that campaign contributions didn’t play a part, but the U.S. Chamber of Commerce (and their Republican supporters) are throwing everything they have against the order.

Tell President Obama that he has your support in standing up to the U.S. Chamber of Commerce and ending the corruption surrounding government contracts.

Regards,

Jim