GM says it supports Build Back Better... and the lobbying campaign to kill it
Welcome to Popular Information, a newsletter about politics and power. Today’s newsletter is written by Judd Legum, Tesnim Zekeria, and Rebecca Crosby. From the outset, lobbying groups representing large businesses and top CEOs, including the U.S. Chamber of Commerce and the Business Roundtable, have opposed Biden's Build Back Better (BBB) package. Biden's proposal has been shrinking in an effort to woo Senators Joe Manchin (D-WV) and Kyrsten Sinema (D-AZ). But it still includes historic investments to combat climate change, provide universal Pre-K, expand the Child Tax Credit, and improve health care. Many corporate members of these lobbying groups — including General Motors (GM), Apple, and Amazon — have endorsed BBB's climate provisions, emphasizing the need for urgent action. The opposition from corporate lobbying groups, however, has been focused on how to pay for those programs. The initial proposal included an increase in the corporate tax rate from 21% to 26.5%. Before Trump's 2017 tax cuts the corporate tax rate was 35%. Still, the business lobby insisted this increase would be devastating. In an October 18 press release, the Chamber said that increasing the rate to 26.5% would "take our country back to the dark days." In the framework announced by the Biden administration on October 28, however, the corporate rate increase was dropped. Instead, the proposal would establish a 15% minimum tax on foreign profits and corporations that report over $1 billion in annual profits to shareholders. The new minimum is six points lower than the current statutory rate. Nevertheless, the Chamber and the Business Roundtable announced they will continue to oppose BBB. So do the companies that have been outspoken about the need for significant climate investments support BBB? Or do they support efforts by the Chamber and the Business Roundtable to kill the legislation? Perplexingly, GM told Popular Information that the company supports the bill and the efforts to kill it. "General Motors supports the goals of the framework, and, critically, we support the provisions that accelerate the adoption of electric vehicles and establish the U.S. as a global leader in electrification today, and into the future," the company said. But GM added that it also supports "the Business Roundtable in their efforts to support sound public policies that promote a thriving U.S. economy and supports the U.S workforce." GM CEO Mary Barra is the incoming president of the Business Roundtable and currently sits on its board. Concern about the impact on small business melts awayThe Chamber insisted their opposition to BBB was rooted in concern about how a rate increase would impact small businesses:
Under the current framework, the corporate tax rate will stay at 21%. The proposal would instead establish a 15% minimum tax on corporations that report over $1 billion in annual profits to shareholders and a minimum 15% tax on foreign profits. Since small businesses do not have $1 billion in annual profits and do not operate abroad, they would not be impacted. So small business owners would get benefits, including universal pre-K for themselves and their employees, without an increased tax rate. But despite their deep concern for small business owners, the U.S. Chamber of Commerce and the Business Roundtable have maintained their opposition. It's almost as if they were less concerned about the fate of small businesses and more interested in preserving the ability of companies with billions in profits to pay no taxes at all. 55 corporations paid no federal income tax in 2020A statement released by the Senators who drafted the proposal for a new corporate minimum tax cited Amazon’s tax avoidance. They noted that “over the last three years, Amazon reported $45 billion in profits” but the “effective tax rate it paid on those profits was just 4.3% - well below the 21% corporate tax rate.” However, many corporations in the United States are paying even less. In 2020, “at least 55 of the largest corporations in America paid no federal income taxes” on almost $40.5 billion in profits, according to an analysis by the Institute on Taxation and Economic Policy, a progressive think tank. The total corporate tax breaks in 2020 for these 55 corporations is around $12 billion. If these companies had paid the standard corporate federal tax rate of 21%, they “would have paid a collective total of $8.5 billion for the year.” Instead, the 55 corporations received “$3.5 billion in tax rebates.” Among the 55 companies were FedEx, Nike, Duke Energy, Dish Network, and Salesforce. FedEx was able to avoid taxes on the $1.2 billion of pre-tax income it made in 2020 by receiving a $230 million tax rebate. This results in an effective tax rate of -18.9%. Nike, which made nearly $2.9 billion in pre-tax income, received a rebate of $109 million, resulting in a -3.8% effective tax rate. Duke Energy made $826 million last year, yet the company’s effective tax rate was -34%. Both Dish Network and Salesforce made around $2.5 billion in 2020, yet neither company paid any federal income taxes, with Dish Network's effective tax rate at -9.1% and Salesforce at -0.5%. Many of these companies were able to avoid paying taxes because of tax breaks created by Trump’s 2017 tax cuts. According to the New York Times, 26 of the companies listed were able to “avoid paying any federal income tax for the last three years even though they reported a combined income of $77 billion.” Corporate climate duplicityIf passed, BBB will be “the single largest investment in clean energy in U.S. history.” The $555 billion climate change plan aims to reduce greenhouse gas emissions in the U.S. 50-52% by 2030––“well over one gigaton” according to the White House. The centerpiece of the bill is a $320 billion tax credit package for clean energy. The tax credits will be in place for 10 years and will incentivize consumers and businesses to transition to clean energy. The bill also includes funding for rural energy projects, a new Clean Energy and Sustainability Accelerator, and the development of new domestic supply chains. The 15% minimum tax on corporations is one way Democrats plan to raise revenue for the clean energy tax credits and other climate provisions. GM is not the only company trying to have things both ways. On September 20, Apple's VP for Environment, Policy, and Social Initiatives Lisa Jackson called on Congress and the Biden administration to take "urgent action" to pass "climate policies that quickly decarbonize our electric grid." “Addressing the urgent threat of climate change is a key priority across our operations,” Jackson said. The climate provisions have changed since Jackson released her statement but still would address the priorities that Jackson identified. Apple CEO Tim Cook, however, sits on the board of the Business Roundtable, which is continuing its "significant, multifaceted campaign" to defeat BBB and the climate provisions. Popular Information contacted Apple and asked if, in light of its commitment to climate change, it supported the latest version of BBB. Apple declined to answer the question directly but emphasized Apple's commitment to climate action. An Apple spokesperson also flagged to Popular Information a statement from the Business Roundtable titled “Business Roundtable Supports Urgent Congressional Action on Climate Change.” In that statement, however, the Business Roundtable said it opposed BBB because it would include "one of the largest corporate tax increases in history." The corporate tax increases included in the September version of the bill have been removed, but the Business Roundtable continues to oppose the package. Netflix published a statement in September stating that “the urgency for climate policy could not be clearer.” Yet, Netflix’s Chief Content Officer and co-CEO, Ted Sarandos, is a member of the Business Roundtable and, therefore, is helping lead the effort to defeat BBB. Netflix did not return a request for comment. In its 2021 Global Impact Report, Deloitte’s Global CEO Punit Renjen stressed that “the climate change emergency is unfolding in front of our eyes” and that “creating a net-zero world is non-negotiable.” The company says it plans to achieve “net-zero greenhouse gas emissions by 2030.” “There is no time to waste,” Renjen wrote. Deloitte’s Chief Growth Officer, Stacy Janiak, sits on the Chamber's Board of Directors. |
Older messages
Youngkin campaign pushes election fraud claims: "I know how Democrats are cheating"
Tuesday, November 2, 2021
The race between Glenn Youngkin (R) and Terry McAuliffe (D) to be the next governor of Virginia is very close. Several recent polls show Youngkin ahead. When all the votes are counted Tuesday night,
The truth about Glenn Youngkin's closing ad
Sunday, October 31, 2021
Critical Race Theory (CRT) has become a central issue in the Virginia gubernatorial election, which will take place on Tuesday. Republican Glenn Youngkin claims that CRT is being used to indoctrinate K
The political exploitation of sexual assault in Virginia high schools
Thursday, October 28, 2021
Last May, a boy sexually assaulted a girl in a bathroom at Stone Bridge High School in Loudoun County, Virginia. The teen was convicted of the assault this week in a Virginia juvenile court. The
The billionaires are angry
Wednesday, October 27, 2021
Since the start of the pandemic, the nation's billionaires have done well. Very well. Between March 18, 2020, and October 15, 2021, the total wealth of American billionaires increased more than 70%
5 things you should know about Facebook
Tuesday, October 26, 2021
Whistleblower Frances Haugen, a former Facebook product manager, has released a trove of internal Facebook documents to a variety of media outlets, including the Wall Street Journal, the Associated
You Might Also Like
Is there life after CNN? Chris Cillizza hopes so
Tuesday, November 5, 2024
After being cast off from the “most trusted name in news,” the political analyst is trying to forge his own path. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Ask Chris Black: Which Coat Should I Get If I Don’t Want a Puffer?
Tuesday, November 5, 2024
Plus: A rare 50-percent-off Dyson. The Strategist Every product is independently selected by editors. If you buy something through our links, New York may earn an affiliate commission. November 04,
What A Day: Selzer bubbles
Tuesday, November 5, 2024
One day before the election, Kamala Harris is enjoying some good news. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Final Takeaways on Election Eve
Monday, November 4, 2024
Columns and commentary on news, politics, business, and technology from the Intelligencer team. Intelligencer 2024 election Election Fright A city on the verge of a nervous breakdown. Illustration:
An unexpectedly useful tool with “simply no negatives”
Monday, November 4, 2024
Think of it like a giant clothespin View in browser The Recommendation “My farm is held together by $1 spring clamps” The anvil clamp attached to a brown tarp with an illustrative orange frame. Doug
It's All Greek to Me
Monday, November 4, 2024
Election Prediction-ish, Refunds Without Returns ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Tuesday Briefing: Americans brace for Election Day
Monday, November 4, 2024
Plus, remembering Quincy Jones. View in browser|nytimes.com Ad Morning Briefing: Asia Pacific Edition November 5, 2024 Author Headshot By Gaya Gupta Good morning. We're covering the US on the eve
Can you donate $5 to expose Israel’s atrocities?
Monday, November 4, 2024
Over the last several weeks, Israel has launched a ferocious new assault in northern Gaza, targeting hospitals, schools, and apartment buildings while killing hundreds. There were hopes for a ceasefire
Making sense of Election 2024
Monday, November 4, 2024
Arming you with facts and understanding – while we wait for results
Expedia chairman on rumored Uber deal and Washington Post ‘blunder’
Monday, November 4, 2024
High-tech 'Portal' is a visual delight at Seattle office tower | Qualtrics names new CFO ADVERTISEMENT GeekWire SPONSOR MESSAGE: Unlock Seamless Communication: BYON integrates T-Mobile calling