Bribes, kickbacks, pay-to-play, cronyism and corruption is the normal standard operating procedure for Democrats.
Tax breaks for Hollywood, NASCAR, windmills, algae and multinational corporations ended up in the “fiscal cliff” bill thanks to President Obama, according to Senate Republican sources. But they were spawned by a web of lobbyists, donors and staffers surrounding Democratic Sen. Max Baucus of Montana.
Baucus’ Finance Committee passed a bill in August extending 50 expiring deductions and credits for favored industries. At Obama’s insistence, the Baucus bill was cut and pasted word for word into the cliff legislation. Set aside for a moment how this contradicts Obama’s talk about “fair shares” and the need to diminish the influence of lobbyists, and look at what this raft of tax favors shows us about the Baucus Machine.
Pick any one of the special-interest tax breaks extended by the cliff deal, and you’re likely to find a former Baucus aide who lobbied for it on behalf of a large corporation or industry organization.
General Electric may have been the biggest winner from the cliff deal. GE makes more wind turbines than any other U.S. company, and it lobbied hard for extension of the wind production tax credit. But more important for the multinational conglomerate was an arcane-sounding provision that became Section 222 of Baucus’ bill and then Section 322 of the cliff bill: “Extension of subpart F exception for active financing income.”
In short, this provision allows multinationals to move profits to offshore financial subsidiaries and thus avoid paying U.S. corporate income taxes. This is a windfall for GE: The exception played a central role in GE paying $0 in U.S. corporate income tax in 2011 when it made $5.1 billion in U.S. profits.
Peter Prowitt, formerly Baucus’ chief of staff, is now an in-house lobbyist and VP at GE. GE filings show Prowitt on the lobbying teams that won wind-tax credits, electric-vehicle tax credits, and “Extension of Subpart F Deferral for Financial Services.”
Two weeks before the Finance Committee hearing during which the bill was hashed out, GE’s political action committee topped off its contributions to Baucus’ Glacier PAC with a $2,000 check, according to the PAC’s federal filings. This brought GE’s contributions to Baucus’ PAC to the legal maximum of $10,000 for the election cycle.