Republicans Pushing Oil-Friendly Tax Bill Received Significant Donations from BP Employees

BP sign

Several top Republican lawmakers behind the new US tax bill received donations from oil giant BP’s employee political action committee (PAC), data shows. The bill gives big corporations in America a hefty tax break and opens up oil drilling in the Arctic.

Official documents from the Federal Election Committee and data from The Center for Responsive Politics, a non-profit and nonpartisan research group which tracks the effects of lobbying on elections and is also known as Open Secrets, show the BP employee PAC financed some of the key lawmakers sponsoring the bill adopted at the beginning of December.

PAC donations are part of a wider lobbying strategy and in this instance BP’s staff are supporting lawmakers with a questionable record on climate change. 

House speaker Paul Ryan, Senate majority leader Mitch McConnell and Senator Lisa Murkowski of Alaska, each received about $20,000 from the BP PAC over the last couple of years, the data shows.

Both Ryan and McConnell have previously denied the science behind man-made climate change and the pair fully backed Donald Trump’s decision to pull out the US of the Paris Agreement.

The BP employee PAC, officially called BP Corporation North America Inc, allows money to be raised by the company’s staff and their families and spent to help elect and defeat candidates in elections.

BP made headlines this week by welcoming the new tax bill which the company said would boost its profit in the long run.

In a statement, the oil company said it expected “its future US after-tax earnings to be positively impacted by the recently-enacted changes to US corporate taxes”.

A spokesman for BP told DeSmog UK the company does not directly contribute funds to the BP employee PAC and described it as “a non-partisan committee that encourages voluntary employee participation in the political process”.

Hundreds of US and international companies are expected to benefit from the tax changes including other UK-headquartered companies involved in fossil fuel extraction and financing such projects, such as Royal Dutch Shell and Barclays, which have both announced they were likely to see tax reduction over time after an initial charge.  

The bill creates a particularly favourable tax environment for the oil and gas industry while opening up the northern-most part of the Arctic National Wildlife Reserve (ANWR) for oil and gas exploration and development.

BP previously expressed an interest in drilling in the ANWR and the company still co-owns the Trans-Alaska oil pipeline alongside Exxon Mobil and ConocoPhillips. In November, The Washington Examiner reported that BP and Exxon refused to reveal their current level of interest in drilling the Arctic reserve.

Tax break for polluters

The tax bill was a major win for the White House as President Trump pledged to slash corporation tax and deregulate the system by which companies do business.

The new law which came into effect on January 1 will see the US federal corporate income tax rate dwindle from 35 percent to 21 percent. BP estimated the change in law could initially trigger a one-off cash payment of around $1.5bn before earnings increase.

By handing out such tax breaks, the bill allows the world’s biggest fossil fuel companies to ramp up their profit by exploiting oil and gas. But for Erik Solheim, the head of the UN’s Environment Programme, big polluters such as major oil companies should pick up the costs of destroying the planet and not taxpayers, as he told a conference in New York in September.

A quick glance at the BP employee PAC’s lobbying activities shows it has been handing out significantly more money to Republicans than Democrats since 2014. The tax bill was voted through along party lines with Republicans relying on their majority in Congress to push the law through.

While there is no evidence of the PAC distributing payments to Republicans to specifically influence the tax bill, donations to politicians are part of a lobbying strategy in all sectors.

Indeed, in 2016 the BP PAC also donated money to nine of the 22 Republican Senators who sent a letter to President Trump, urging him to pull out of the Paris Agreement. This includes: Jim Inhofe, John Barrasso, Mitch McConnell, Roy Blunt, Roger Wicker, Michael Enzi, Orrin Hatch, Ted Cruz and Tim Scott.

Tax bill Republican sponsors backed by BP PAC

Data compiled by OpenSecrets shows that in 2016, 61 percent of BP’s employee PAC donations went to Republicans while 38 per cent were handed to Democrats. At the start of 2018, the divide remained with 55 percent directed to Republicans and 45 percent to Democrats.

The PAC’s spending records show the commitee has supported key Republican sponsors of the Trump administration’s tax reform. This includes Texas Representative and Chairman of the House Ways and Means Committee — the tax-writing committee — Kevin Brady who received $9,500 in 2016 according to Open Secrets.

Other Republican heavyweights which have backed the bill and received money from BP’s staff PAC include House speaker Paul Ryan, who received $16,935 in 2016 according to Open Secrets and $5,000 in 2017 according to officials documents from the Federal Election Commission (FEC).

House majority leader Kevin McCarthy also received $5,000 from BP’s PAC last year while Peter Roskam, also a member of the House Ways and Means Committee got $1,000. Open Secrets data shows Roskam received a total of $4,000 from the PAC in 2016.

In the Senate, majority leader Mitch McConnell has also largely benefited from the oil company staff’s financial support. In 2016, this amounted to $19,525 according to Open Secrets.

Another important legislator in the passing of the tax bill is the chairman of the Senate’s Finance Committee Orrin Hatch. Hatch was one of a number of Republicans to serve on the conference committee on the tax reform legislation.

Hatch received $1,000 from BP’s PAC in 2017 on the back of receiving $3,500 the previous year according to Open Secrets.

Senator Lisa Murkowski of Alaska, chairwoman of the Energy and Natural Resources Committee, has been campaigning in favour of allowing oil drilling in the Arctic Refuge for years.

According to Open Secrets, Murkowski received $20,350 in 2016 and $2,000 directly from the PAC in 2017 according to the Federal Election Committee data.

Mike Enzi, chairman of the Senate’s Budget Committee has also repeatedly received money from BP’s staff fund. According to Open Secrets, this amounted to $10,000 in 2014 and $4,000 in 2016 while official documents show $2,000 were donated last year.

Cash for Climate Science Denier

Although the company is keen to relinquish its image of big polluter following the 2010 devastating spill in the Gulf of Mexico, the BP employee PAC’s continues to support Republican Senator Jim Inhofe, one of the most outspoken opponents to climate science in the US.

In 2015, it was revealed Inhofe received $10,000 from BP’s PAC. The money was traced back to senior staff including chief executive Bob Dudley and embarrassed the company and its CEO who had been calling for more regulatory measures on the fossil fuel industry to provide sustainable energy.  

At the time, records showed that Inhofe’s 2014 campaign was a funding priority for the BP PAC and ranked as one of the top recipients of the committee fund.

Three years on, records continue to show the PAC financing “The Friends of Jim Inhofe committee”.  The BP employee PAC donated $2,000 twice in 2016 and 2017 to the Inhofe committee with Open Secrets reporting the Republican Senator received a total of $5,000 in 2016.

BP was contacted by DeSmog UK but declined to comment on the story. 

Main Image: Credit Flickr/ Mike Mozart (CC-BY-2.0)

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