Big Oil Windfall Profits Tax Needs to be Lameduck Priority
TO: Partners
FROM: STOP
DATE: Monday, Nov 14, 2022
SUBJECT: Big Oil Windfall Profits Tax Needs to be Lameduck Priority
What “red wave”?
Many life-or-death issues on the ballot and courageous efforts by organizations and frontline groups contributed to the success of Democratic candidates in the midterms. But one critical aspect is worth highlighting here: voters rewarded candidates who correctly, and consistently, blamed corporate profiteering for the cost-of-living crisis.
In the lame duck, it is critical that lawmakers to follow up on their promises to hold Big Oil accountable for the profiteering bonanza of 2022. Oil and gas corporations have raked in over $300 billion in profits this year, their highest earnings ever. And there’s every reason to believe that fourth quarter profits—which will become public in Jan/Feb 2023—will be similarly obscene.
The messaging and strong stances we all helped push and which were taken up by Democrats, including President Biden in his October 31 speech on a windfall profits tax, resonated with Americans of all political stripes. Democrats should not cede economic populism to the Right. Now is the time to call on leadership to follow through and pass a tax on Big Oil and redirect some of their profits into direct relief for the working class.
This is a winning issue that will materially help people as winter heating costs begin to rise. We can expect utilities around the country to similarly try and gouge their customers with a familiar script about the war in Ukraine and the big bad Biden Administration. Americans can see through this; and they need someone to stand up for them against these powerful forces.
Interestingly, it now appears that the same pundits who sentenced the Democrats to doom because of inflation and gas prices are now quick to reverse course and deny that inflation had any effect at all on election outcomes. That this conventional wisdom is beginning to congeal among the pundit class is a little too convenient given their blown predictions of a “red wave.”
Crucially, as David Dayen wrote in The American Prospect:
“I heard about it from every candidate I talked to this year. They pointed to a vote held in May in the House of Representatives on the Consumer Fuel Price Gouging Prevention Act, which would have enhanced the powers of the Federal Trade Commission to go after corporate price-gouging by gas companies, as well as giving the president additional tools to crack down…it would be wrong to say that Democrats won despite a lack of an economic message. The message was always lurking in the background in campaigns. And that message correlated with a populist frame of fighting corporate power.”
Against record inflation, Democrats had an answer and a viable solution to the cost-of-living crisis. They should take credit for it! One of the biggest wins in the midterms was in Pennsylvania where Senator-elect John Fetterman repeatedly called out Big Oil greed and made the case for a windfall profits tax. That Fetterman won on this message in a major gas producing state underscores just how powerful it was and will continue to be.
It cannot be said enough, taking action on Big Oil and corporate profiteering is enormously popular with majorities of Americans. One pre-election poll showed 87% of voters supporting a Congressional effort to crack down on price gouging, while 80% supported a windfall profits tax. For younger Americans too, climate justice and taking on the fossil fuel industry were top priorities. And more than just providing short-term relief, Americans want to see increasing investments in clean energy that will provide long-term relief and freedom from the power of Big Oil CEOs who can set high prices just to reward their wealthy shareholders.
As another pre-election survey of the electorate found:
Critically, with the high price for a gallon of gas, fossil fuels are now seen as a high-cost option produced by companies reviled by the country. So, when we ask, “which one is the right approach to oil and energy companies during the energy crisis?” the dominant response by far (40 percent) was “use the profits to invest in clean energy to get faster shift away from higher-cost fossil fuels.”
Before the next Congress is seated, we need to push lawmakers to act fast. If Republicans manage to capture the House, they’ll be sure to act as the industry’s attack dog, doing whatever they can to try and dismantle Biden’s climate agenda and prevent him from taking stronger executive actions to address the crisis. And with high home heating prices beginning to hit Americans in their pocket books, we can expect new waves of disinformation about who’s to blame.
But with the success of the midterms, we have a roadmap for fighting back against price hikes and industry lies: stay on offense against Big Oil. Highlight industry profiteering and price gouging. Support policies like a Big Oil Windfall Profits Tax in the lameduck. Connect the role of high prices to our dependence on fossil fuels and make the case to move to clean energy.
The best midterm election for an incumbent party in decades should encourage us to stay the course and fight for the American people who will continue to struggle after all the votes are counted. We have the policy ideas and the momentum. Let’s keep going together.
