September, 22 2021, 07:49am EDT
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New Report reveals Big Oil's $86B offshore tax bonanza
Groups call on Senate to repeal domestic, international fossil fuel subsidies
WASHINGTON
A new report from Friends of the Earth, Oxfam America, and BailoutWatch shines a light on $86 billion worth of offshore tax loopholes benefiting Big Oil. The report provides fresh details about the history and potential cost of these subsidies, which are embedded deep in the tax code.
Fossil fuel subsidies like these are a hot topic for climate and justice groups, who see the misspent funds as low-hanging fruit that could help pay for Democrats' proposed $3.5 trillion climate and care reconciliation package.
Recent legislation passed by the House Ways and Means Committee would eliminate two subsidies addressed in the new report: the exemption for Foreign Oil and Gas Extraction Income (FOGEI) and special treatment for dual-capacity taxpayers, worth at least $86 billion to just a handful of oil majors. Unfortunately, the legislation left intact at least another $35 billion in domestic fossil fuel subsidies that President Biden proposes ending, some of which are over a century old. Alternative proposals in the Senate like Chairman Wyden's Clean Energy For America Act would address both domestic and international polluter giveaways.
"The House bill made a decent start by targeting Big Oil's international tax loopholes, but it went nowhere near far enough," said Lukas Ross, Climate and Energy Justice Program Manager at Friends of the Earth, "Leader Schumer needs to lead on climate and ensure that all $121 billion in fossil fuel subsidies are repealed in the final package."
Repealing the Trump-era exemption for FOGEI will raise an estimated $84.8 billion in revenue. Based on an analysis of SEC filings and other data, the report finds that only 12 companies are currently eligible for the special treatment this loophole affords.
The dual capacity loophole, which allows oil companies substantial latitude to potentially misrepresent royalties and other payments to foreign governments as creditable tax payments, would raise at least another $1.4 billion; other estimates put the number much higher.
"US Big Oil companies like Exxon and Chevron have fought tooth and nail to keep the payments they make to governments around the world a secret, while paying lip service to the global movement for payment transparency," said Daniel Mule, Policy Lead for Extractive Industries Tax and Transparency at Oxfam. "This secrecy has a potential tax impact in the US as well, as it makes it all the more difficult to discern if US oil & gas companies are illegitimately inflating their foreign tax credits."
The report documents the lobbying activities of firms like Chevron and Conoco specifically to protect these loopholes in particular.
"Big Oil isn't going quietly," said Chrive Kuveke, Analyst at BailoutWatch, "Since Biden became President, it is unfortunate but not surprising that the handful of companies benefitting from these loopholes are lobbying to protect their special treatment."
Friends of the Earth fights for a more healthy and just world. Together we speak truth to power and expose those who endanger the health of people and the planet for corporate profit. We organize to build long-term political power and campaign to change the rules of our economic and political systems that create injustice and destroy nature.
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'Disgusting': Global 1% Captured $42 Trillion in New Wealth Over Past Decade
"The richest 1% of humanity continues to fill their pockets while the rest are left to scrap for crumbs."
Jul 25, 2024
The richest sliver of the global population hauled in more than $40 trillion in new wealth over the past decade as countries around the world cut taxes for those at the very top, supercharging inequality that poses a dire threat to democracy and the planet.
An Oxfam analysis released Thursday ahead of a meeting of G20 finance ministers estimated that over the past 10 years, the global 1% has accumulated $42 trillion in new wealth. That's "nearly 34 times more than the entire bottom 50% of the world's population," the group observed.
"That is disgusting," Michael Taylor, founder of the Australian Independent Media Network, wrote in response to the new figures.
The analysis comes amid a growing push by current and former world leaders for rich countries to enact a global tax on billionaire wealth that would begin to reverse the damage done by decades of regressive policy. Oxfam found in a separate analysis released earlier this year that economic and political elites' global "war on fair taxation" has slashed taxes for the rich by 32% since 1980.
Oxfam said Thursday that global billionaires "have been paying a tax rate equivalent to less than 0.5% of their wealth."
"Inequality has reached obscene levels, and until now governments have failed to protect people and planet from its catastrophic effects," Max Lawson, Oxfam's head of inequality policy, said in a statement Thursday. "The richest 1% of humanity continues to fill their pockets while the rest are left to scrap for crumbs."
"Momentum to increase taxes on the super-rich is undeniable, and this week is the first real litmus test for G20 governments," Lawson added. "Do they have the political will to strike a global standard that puts the needs of the many before the greed of an elite few?"
A recent report by renowned economist Gabriel Zucman of the University of California, Berkeley outlined how nations could go about implementing a 2% minimum tax on the wealth of global billionaires—a policy change that he shows would raise up to $250 billion in annual revenue that could be used to support a range of priorities, from climate investments to education and healthcare programs.
"Thanks to recent progress in international tax cooperation, a common taxation standard for billionaires has become technically possible," said Zucman. "Implementing it is a question of political will."
The economist's report was commissioned by the government of Brazilian President Luiz Inácio Lula da Silva, who has championed a global billionaire tax in the face of resistance from powerful nations, including the United States—which has more billionaires than any other country. In 2018, U.S. billionaires paid a lower effective tax rate than working-class Americans.
But reporting indicates that the leaders of G20 nations—which are home to roughly 80% of the world's billionaires—are likely to rebuff Lula's push for billionaire wealth tax, opting instead to pursue what Bloombergdescribed as "research on taxation and inequality that could take years to deliver results."
Reuters similarly reported Wednesday that G20 finance ministers meeting in Brazil "are preparing a joint statement for Thursday in support of progressive taxation that will stop short of endorsing the hosts' proposal for a global 'billionaire tax.'"
The global billionaire wealth surge comes in the context of growing misery for large swaths of the world's population. A report released Wednesday by the United Nations' Food and Agriculture Organization (FAO) estimated that one out of 11 people around the world—or up to 757 million people—"may have faced hunger" last year.
"The world's poorest people are paying the highest price of hunger," Eric Munoz, Oxfam's food policy expert, said in response to the FAO report. "We need deeper, structural policy and social change to address all of the drivers of hunger, including economic injustice, climate change, and conflict."
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Groups Demand Probe of Israeli Influence Operations Targeting Americans
"The administration must work to defend our democracy fully, and ensure that no foreign state has a green light to inappropriately target American citizens or manipulate our democratic process."
Jul 24, 2024
Over two dozen organizations on Wednesday demanded that the Biden administration launch a multi-agency investigation into recent reporting that "the Israeli government is engaging in illicit social media influence operations targeting U.S. elected officials and U.S. civil society."
Pointing to June reports by The New York Times, Haaretz, and The Guardian, the groups—including the Center for International Policy, CodePink, Democracy for the Arab World Now (DAWN), National Iranian American Council (NIAC), U.S. Campaign for Palestinian Rights (USCPR) Action, and Win Without War—wrote to President Joe Biden and the departments of Homeland Security, Justice, and State.
As Israel began waging war on the Gaza Strip in retaliation for the Hamas-led October 7 attack, the country's Ministry of Diaspora Affairs "allocated about $2 million to the operation and hired Stoic, a political marketing firm in Tel Aviv, to carry it out," the Times reported June 5, citing related documents and unnamed Israeli officials.
"Unfortunately, what has been reported thus far could just be the tip of the iceberg."
Although the Israeli ministry denied involvement in the campaign and Stoic didn't respond to requests for comment, the newspaper noted that "at its peak, it used hundreds of fake accounts that posed as real Americans on X, Facebook, and Instagram to post pro-Israel comments. The accounts focused on U.S. lawmakers, particularly ones who are Black and Democrats."
As The Guardian reported on June 24, "That effort is only one of many such campaigns coordinated by the ministry."
The newspaper detailed "a sprawling relaunch of a controversial Israeli government program initially known as Kela Shlomo, designed to carry out what Israel called 'mass consciousness activities' targeted largely at the U.S. and Europe."
"Concert, now known as Voices of Israel, previouslyworked with groups spearheading a campaign to pass so-called 'anti-BDS' state laws that penalize Americans for engaging in boycotts or other nonviolent protests of Israel," The Guardian explained, referring to the Palestinian-led Boycott, Divestment, and Sanctions movement.
"Its latest incarnation is part of a hardline and sometimes covert operation by the Israeli government to strike back at student protests, human rights organizations, and other voices of dissent," according to the newspaper. "Voices' latestactivities were conducted through nonprofits and other entities that often do not disclose donor information."
The coalition calling on Biden to launch an investigation wrote that "it is incumbent on our government to protect its citizens from efforts by foreign governments to inappropriately interfere in our democratic process by spreading disinformation, targeting U.S. elected officials, and seeking to intimidate members of U.S. civil society."
Highlighting previous action "to punish and deter such nefarious behavior" by Russian firms, the groups argued that "as an administration that has defined itself as defenders of American democracy against threats from both domestic and foreign state actors, the news of the Israeli government's attacks on our democracy must be addressed."
NIAC president Jamal Abdi said, "What this letter asks for is very simple: that President Biden and his administration treat reports of inappropriate Israeli influence operations with the same seriousness that it has allegations of Russian and Iranian influence campaigns."
"Unfortunately, what has been reported thus far could just be the tip of the iceberg," he continued. "The administration must work to defend our democracy fully, and ensure that no foreign state has a green light to inappropriately target American citizens or manipulate our democratic process."
The U.S. government has provided weapons and diplomatic support for Israel's war on Gaza, which has killed at least 39,145 Palestinians and injured another 90,257, according to local officials, and is the subject of an International Court of Justice genocide case.
"The United States has failed to protect Palestinian communities, putting them at risk of harm to continue emboldening Israel," USCPR Action policy manager Mohammed Khader said Wednesday. "As the Israeli government and its foreign agents attempt to undermine our collective efforts on Palestinian rights, we strongly urge for the federal government to impose sanctions to hold Israeli officials and institutions accountable for violating the law."
In addition to the reported covert operations, there have been overt actions by Israel's leaders. As Israeli National Security Minister Itamar Ben-Gvir on Wednesday endorsed former U.S. President Donald Trump for the November election, saying that he believes the Republican "will receive the backing to act against Iran," Israeli Prime Minister Benjamin Netanyahu was invited to address a joint session of Congress, despite protests from American lawmakers.
Trump, Biden, and Vice President Kamala Harris—now the presumed Democratic nominee for the November election—are all set to separately meet with Netanyahu while he is visiting the United States.
"It's time for the Biden administration to end its policy of exceptionalism towards Israel and hold all nations to the same standards," declared DAWN advocacy director Raed Jarrar. "The administration must take decisive action to protect our democracy from all forms of foreign interference."
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730 Million People—Including 20% of Africans—Faced Hunger Last Year
Jul 24, 2024
More than 730 million people around the world faced hunger last year, including 1 in 5 Africans, with over half a billion people set to be chronically malnourished by the decade's end if current trends continue, according to a report published Wednesday by a United Nations agency.
One in 11 people globally went hungry in 2023, the latest U.N. Food and Agriculture Organization (FAO) State of Food Security and Nutrition in the World (SOFI) report revealed.
"The report shows that the world has been set back 15 years, with levels of undernourishment comparable to those in 2008-2009," according to the FAO. "An alarming number of people continue to face food insecurity and malnutrition as global hunger levels have plateaued for three consecutive years."
"Hunger is not something natural. Hunger is something that requires a political decision."
The agency noted significant variation in regional trends as "the percentage of the population facing hunger continues to rise in Africa (20.4%), remains stable in Asia (8.1%)—though still representing a significant challenge as the region is home to more than half of those facing hunger worldwide—and shows progress in Latin America (6.2%)."
"If current trends continue, about 582 million people will be chronically undernourished in 2030, half of them in Africa," FAO said, warning that "the world is falling significantly short of achieving Sustainable Development Goal (SDG) 2, Zero Hunger, by 2030."
FAO Director-General Qu Dongyu said in a statement that "transforming agrifood systems is more critical than ever as we face the urgency of achieving the SDGs within six short years. FAO remains committed to supporting countries in their efforts to eradicate hunger and ensure food security for all."
"We will work together with all partners and with all approaches, including the G20 Global Alliance against Hunger and Poverty, to accelerate the needed change," Qu added. "Together, we must innovate and collaborate to build more efficient, inclusive, resilient, and sustainable agrifood systems that can better withstand future challenges for a better world."
FAO argued that "achieving SDG 2 Zero Hunger requires a multifaceted approach, including transforming and strengthening agrifood systems, addressing inequalities, and ensuring affordable and accessible healthy diets for all."
"It calls for increased and more cost-effective financing, with a clear and standardized definition of financing for food security and nutrition," the agency added.
The new report comes ahead of this November's scheduled G20 Global Alliance against Hunger and Poverty Task Force Ministerial Meeting in Rio de Janeiro, Brazil. On Wednesday, Qu praised Brazilian President Luiz Inácio Lula da Silva—who currently chairs the G20—for centering food security in the bloc's agenda.
In the 2000s, Lula's leftist government implemented plans including Fome Zero (Zero Hunger) and Bolsa Familia (Family Allowance) that significantly reduced malnutrition and poverty in Brazil.
"We need to build on the progress achieved in this region, and share this experience with other regions, especially Africa," Qu said.
Speaking in Rio de Janeiro on Wednesday, Lula said that "hunger is not something natural. Hunger is something that requires a political decision."
Cindy McCain, executive director of the U.N.'s World Food Program (WFP), said Wednesday that "a future free from hunger is possible if we can rally the resources and the political will needed to invest in proven long-term solutions."
"I call on G20 leaders to follow Brazil's example and prioritize ambitious global action on hunger and poverty," she continued. "We have the technologies and know-how to end food insecurity—but we urgently need the funds to invest in them at scale."
"WFP is ready to step up our collaboration with governments and partners to tackle the root causes of hunger, strengthen social safety nets, and support sustainable development so every family can live in dignity," McCain added.
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