The Club for Growth, which advocates making permanent some tax cuts and eliminating entirely others that, over just two years, would amount to more than $765 billion in lost revenues over two years, is a top donor to two of the three Republican Senators on the Joint Select Committee on Debt Reduction–the super committee. Other top donors include a hedge fund run by a top Republican donor that invests in, among other things, defaulted debt of sovereign nations, corporations trying to shield income earned overseas from U.S. taxes, and utility firms seeking to avoid regulation of greenhouse gases.
As we noted in our previous posts on the three House Republicans and the three Senate Democrats on the super committee, the dozen members of the Joint Select Committee on Debt Reduction all have private interests backing them who are far more concerned with their own bottom lines than they are with broad public policy. Those interests might come into play as the members of the super committee craft $1.5 trillion in debt reduction measures–spending cuts, revenue increases, or both–that can win a majority of their votes.
We went through the most recent lobbying disclosures for each of the top five donors to the three Republian Senate members of the super committee, all appointed by Sen. Mitch McConnell, R-Ky., and highlighted one or two issues that might come up as the members consider ways to cut spending, raise revenues–or both. Not every big donor had an identifiable interest that might figure in the committee's work, but these filings were made before the bill that authorized the Joint Select Committee on Debt Reduction had been passed into law.
Lobbying disclosures for large organizations can list dozens or even hundreds of bills and issues that they try to influence or monitor, and the big donors to super committee members are no exception. The companies, trade groups, universities, labor unions and other organizations whose political action committees, employees and their family members have contributed the most to the dozen members charged with addressing the nation's debt lobby on a wide range of issues. Here are a few:
Sen. Jon Kyl, R-Ariz.: His third term will be his last: Kyl, the minority whip, is retiring at the end the current Congress. He also serves on the Senate Finance and Judiciary Committees. Over the course of his career, his top donors, according to the Center for Responsive Politics, are the Club for Growth (nearly all of the donations came in Kyl's last reelection effort), law firm Snell & Wilmer, marketing and tourism firm Viad Corp., utility owner Pinnacle West Capital Corp. and Citigroup.
- Club for Growth: Like Emily's List, the Club for Growth contributes to candidates who fit the profile of their ideological interests, but there the similarities end. Kyl's fellow super committee member Toomey (see profile below) served as the Club's president. The organization has a Super PAC, Club for Growth Action that was active in the 2010 elections, spending more than $4.9 million to influence races, as well as a traditional political action committee that contributes to federal candidates. Club donors also contribute to candidates directly. The Club for Growth does not actively lobby Congress, but its website lists several of the organization's priorities, many of which involve lowering taxes. The organization favors permanently extending all of the reduced income tax rates passed during the Bush administration and extended until 2012 by President Obama (the two year extension alone will cost more than $186 billion, according to the Joint Committee on Taxation, lowering or eliminating the capital gains tax (the two year cut to capital gains taxes set to expire in 2012 reduces federal revenues by more than $25 billion), lowering or eliminating the taxes on dividends (the two year dividend rate cut costs more than $27 billion), and lowering or eliminating the corporate income tax rate (corporate income taxes are estimated to bring in a total of more than $527 billion in 2011 and 2012, according to the Economic Report of the President.) The Club also favors eliminating the estate tax, which in 2009, according to the Internal Revenue Service, raised $21 billion. In addition to cutting or eliminating taxes, the organization also advocates reining in–or cutting–entitlement spending, freezing domestic discretionary spending, and eliminating, transferring to the states or privatizing some federal programs.
- Viad Corp.: The company hasn't lobbied Congress since July 2005. Its most recent annual report discloses that the contract the company has with the U.S. Park Service to operate concessions at Glacier National Park expires at the end of 2011.
- Snell & Willmer: Though the law firm's government relations page says that it has "established long-standing relationships with congressional delegations across the region," and says its attorneys "assisted in the drafting and adoption of federal legislation creating the Central Arizona Project," the firm has registered for just one client in the last five years, Dairy 51.8 LLC, for which the firm lobbied on transportation issues.
- Pinnacle West Capital Corp.: The Obama administration's fiscal year 2012 revenue proposals call for eliminating coal preferences, among other changes to energy law, a measure that, were it adopted, would increase revenues by more than $29 billion over the next five years. Pinnacle West lobbies on a number of bills that would affect coal regulation, including the Energy Tax Prevention Act, which Kyl co-sponsored, along with 44 other members of the Senate. The company's most recent annual report notes that, "If the United States Congress…ultimately pass[es] legislation regulating the emissions of greenhouse gases, any resulting limitations on CO2 and other greenhouse gas emissions could result in the creation of substantial additional capital expenditures and operating costs in the form of taxes, emissions allowances or required equipment upgrades and could have a material adverse impact on all fossil fuel fired generation facilities (particularly coal-fired facilities, which constitute approximately 28% of APS’s generation capacity)."
- Citigroup: Like Goldman Sachs, Citigroup lobbied on a bill that extends the tax exemption for foreign income. In its most recent annual report, the company notes that without an extension of the exemption, its tax expense would increase significantly. In the same report, the company notes that the Obama administration and Congress have discussed lowering the U.S. corporate income tax rates–generally, such proposals are accompanied by discussions of closing loopholes that allow profitable companies to avoid taxes, The annual report states, "While Citigroup may benefit in some respects from any decreases in these corporate tax rates, any reduction in the U.S. corporate tax rate would result in a decrease to the value of Citi's DTAs, which could be significant." DTAs–deferred tax assets–include net operating losses, tax credits and other write-offs that the company can use in future years to offset its tax liability. In its annual report, Citigroup estimates that its DTAs are worth more than $51 billion.
Sen. Pat Toomey, R-Pa. For the former House member, the second time was the charm. Toomey his bid to unseat incumbent Sen. Arlen Specter in the 2004 Republican primary; in 2010, he defeated Rep. Joe Sestak, D-Pa., who beat Democrat-turned-Republican-turned-Democrat Specter in the primary. Between his 2004 and 2010 races, Toomey served as president of the Club for Growth, where he opposed the bank bailout, the stimulus and tax increases. Toomey's top career donors are the Club for Growth, hedge fund operator Elliott Management, gas provider Air Products & Chemicals, the Senate Conservatives Fund, a leadership PAC run by tea party favorite Sen. James DeMint, R-S.C., and utility PPL Corp.
- Club for Growth: See profile above.
- Elliott Management: Paul Singer, a major donor to Republicans, founded Elliott Management in 1977. The firm is lobbying on a bill that would help its "vulture funds" recover its investments in defaulted debt of foreign governments (for more details on how vulture funds operate, and the lobbying battle against them, see here). The firm also lobbied on debt ceiling legislation.
- Air Products & Chemicals: The company, which advertises that it sells everything from helium for balloons to dangerous greenhouse gases like nitrogen trifluoride, lobbies on several regulatory bills affecting its operations. The company also lobbies on the tax treatment of its foreign income–its most recent annual report notes that it has more than $3.2 billion in such earnings accumulated, and would owe $824 million in U.S. and foreign taxes were it to repatriate those funds. The company also lobbies on funding for some Defense research projects and other spending items.
- Senate Conservatives Fund: DeMint's leadership PAC spent more than $8 million in the 2010 election cycle, supporting tea party candidates including the failed Senate bids of Christine O'Donnell in Delaware and Sharron Angle in Nevada. It also claims partial credit for electing five conservatives to the Senate, including Toomey. The group's positions include repealing the Affordable Care Act, ending bailouts to banks and corporations, and passing a balanced budget amendment to limit spending.
- PPL Corp.: The Pennsylvania utility company lobbies on a host of regulatory issues affecting coal and nuclear plants (it owns both). It also lobbies on funding for the Low Income Home Energy Assistance Program, a federal program that helps the poor afford power by direct grants on their behalf to utility companies. It lobbied on a measure that would increase funding for the program by more than $42 million.
Sen. Rob Portman, R-Ohio A former House member and U.S. Trade Representative and then director of the Office of Management and Budget under President George W. Bush, Portman's top career donors include American Financial Group, Procter & Gamble, law and lobbying firm Squire, Sanders & Dempsey, investment house FMR Corp and uniform supplier Cintas Corp.
- American Financial Group: The Cincinnati-based holding company, whose major business is property and casualty insurance, most recently lobbied Congress on financial regulatory issues and tax extenders which, as the Heritage Foundation notes are narrowly targeted tax breaks included in the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010, which extended the tax cuts passed during the Bush administration and set to expire in 2010 to 2012. Among tax extenders, which unlike the Bush tax cuts will expire at the end of 2011, are the exemption from taxation of foreign active financing income and tax breaks for ethanol, certain auto racing tracks, mine safety equipment, and premiums for mortgage insurance, according to the Joint Committee on Taxation.
- Procter & Gamble: The first issues that the consumer products and pharmaceutical firm list in their most recent lobbying disclosures are taxes, including a proposal to end a tax break for earnings from foreign subsidiaries invested abroad. Procter & Gamble had $35 billion in such earnings, according to its most recent annual report.
- Squire, Sanders & Dempsey: The firm lobbies for a number of clients. Federal spending and taxes were among the top issues its clients sought to influence the government on, and for one client, the Cuyahoga County Board of Commissioners, it lobbied on a pair of appropriations bills.
- FMR Corp.: The investment company, formerly known as Fidelity Investments, lobbies on Dodd-Frank implementation, the regulation of mutual funds and other financial instruments, copyright reform, and on tax issues, including health savings accounts and tax audit issues. Fidelity offers health savings accounts to its customers; the tax deduction for the accounts costs the Treasury around $2 billion a year, according to an analysis of tax expenditures by SubsidyScope.org.
- Cintas Corp.: The uniform supply company lobbied on small business growth, workplace safety and veteran recruitment. Among Obama's job-boosting proposals is a tax credit for firms that hire veterans, which according to the U.S. Chamber of Commerce, citing the Joint Committee on Taxation, costs the Treasury about $200 million over ten years.