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Public Employee Unions vs. Pennsylvania Economy

delaware riverkeeper - Jim Willis reports

Jim Willis
Editor & Publisher, Marcellus Drilling News (MDN)

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Aside from fractivist shills paid by the Heinz Endowments, William Penn Foundation, etc. no one’s threatening Pennsylvania economy more than public unions.

Pennsylvania State Rep. Greg Vitali, from the Philadelphia area, is an environmental extremist. In the past, he’s floated plans to force Pennsylvanians to use less natural gas. Nobody, except some media outlets, pay any attention to him. He’s so far left even his own party has disowned him, removing a committee assignment from him and reassigning personnel away from his office. But Vitali needs to keep his name in the news–for reelection purposes. So, a few weeks ago he popped back up again with a faux report that says “the system is rigged” in Harrisburg with respect to failing to pass a severance tax.

pennsylvania economy

Vitali addressing fractivist malcontents in 2010

That the reason a severance tax is not enacted is, according to Rep. Vitali, because of the money spent by Big Oil & Gas on lobbying and in campaign contributions. Of course mainstream media covers this nonsense without ever bothering to verify the claims.

Here’s the facts Vitali won’t tell you in his report. While Marcellus industry PACs did spend $1.1 million last year in campaign contributions, government union PACs spent a whopping $7.8 million in campaign contributions! Of that, some $2.7 million was spent by Big Education unions–the same unions that contributed money to Vitali’s campaign.

Huh. That fact got conveniently left out of all the reporting about the “unfair” advantage the Marcellus industry has. Let’s see, unions (in favor of the severance tax) are spending $7.8 million around, while shale (against the jobs-killing tax) is spending $1.1 million. Unions are spending 600% more than the shale industry–yet the shale industry has an “unfair” advantage. Tell us again how that works, Rep. Vitali.

First, the news, as reported by a non-fact-checking and unquestioning mainstream media outlet:

For the third straight year, Gov. Tom Wolf is proposing an extraction tax on Marcellus Shale natural gas drillers.

For the third straight year, Republican leaders in the Legislature are balking.

“You’re taxing job creators,” an incredulous Senate Majority Leader Jake Corman (R-Centre) said moments after the governor’s budget address. Corman said gas prices are depressed and drillers are antsy.

“How adding a tax on top of that would incentivize them [drillers] to create more jobs and incentivize them to create more investment in Pennsylvania is beyond my comprehension,” Corman said.

On Friday, Wolf was asked if the third time will be the charm for an extraction tax.

He smiled. “I have no idea. I’m hoping.”

Don’t hold your breath, governor, says Rep. Greg Vitali (D-Delaware/Montgomery).

“Every term I’m thinking, of course it’s gonna pass this year. This makes total sense and it never does,” Vitali said Friday as he gave a PowerPoint presentation in the Capitol Media Center.

He blames money in the pipeline for the lack of an extraction tax. Pennsylvania is the only major gas-producing state without an extraction tax.

He said his staff and Common Cause Pennsylvania have analyzed campaign finance reports, lobbying disclosure and ethics statements and it shows why, in his estimation, gas drillers have gotten favorable treatment in the Legislature. He used the old Watergate saw, “follow the money.”

Vitali says in 2016, the gas industry made $883,181 in campaign contributions to the Pennsylvania Legislature. House Speaker Mike Turzai (R-Allegheny) got $78,700 of it, the House Republican Campaign Committee collected $56,800 and Sen. Joseph Scarnati (R-Pro Tempore) $51,500.

“The money goes, frankly, to those people who are in a position to control the flow of legislation,” Vitali said.

There’s also a geyser of lobbying at the Capitol. Vitali’s analysis shows there are currently 203 lobbyists working on behalf of the gas industry in Pennsylvania. He notes wryly that’s equal to the number of state representatives. He says that since 2007, the total spent on lobbyists is $62,639,327.

“I think that’s startling. That’s a lot of money.” He also quoted former state senator Clarence Bell who said, “People who give money to politicians are not philanthropists.”

While there’s lots of money flying around, there’s too little oversight, according to Vitali. He points to 2016 when lobbyists report spending $79,743 on gifts, hospitality, transportation and lodging for lawmakers.

“Although there’s a lot of spending, a lot wining and dining, everyone knows that not a single lawmaker’s name appeared on any lobbyists report for the year 2016,” Vitali said. He added that only five of 253 lawmakers reported receiving gifts, hospitality, transportation or lodging from the drilling industry.

“Where did the money go? That’s the problem,” he said.

He insists that campaign finance laws and lobbyist disclosure laws are too lax and oversight too difficult. He thinks there should be a gift ban and dollar-one reporting on anything received. Currently, lawmakers don’t have to report any gift valued under $250 or any transportation, lodging or hospitality under $650. His suggestions aren’t new but, like an extraction tax, aren’t likely to pass anytime soon.

It should be noted that the gas drilling industry is well within its right to lobby and to contribute to campaigns. Vitali alleges no illegality. His criticism is directed more at the system.

But as the former chair of the House Environmental Committee, he has been a frequent critic of natural gas drillers and they of him.

Now, the truth, from the Commonwealth Foundation:

Proponents of a natural gas severance tax argue the natural gas industry wields undue political influence in Harrisburg.

State representative Greg Vitali laments:

They [natural gas industry] just always seem to win, and to me it seems like they have undue influence due to the amounts they have to spend on lobbying.

The eight largest natural gas political action committees (PAC) reported spending $1.1 million in Pennsylvania during the 2016 election cycle, however, that amount pales in comparison to government union spending.

The thirteen largest government union PACs reported $7.8 million in political contributions. The Pennsylvania State Education Association alone more than doubled the spending of these natural gas PACs combined, spending $2.7 million compared to the natural gas industry’s $1.1 million.

Unlike the natural gas industry and every other group seeking to influence Harrisburg, union leaders enjoy the unique political privilege of taxpayer-funded collection of compulsory membership dues and PAC contributions. No other group has this advantage.

In 2016, Pennsylvania government unions earmarked $9.8 million in dues money for “political activities and lobbying,” which includes advocating for increased taxation of natural gas drillers.

Click for a larger version

When it comes to lobbying, Government unions and the natural gas industry spend comparable amounts. The industry, including the Marcellus Shale Coalition, reported $2.8 million in lobbying expenditures, while government unions spent $2.4 million.

Governor Wolf’s severance tax proposals have stalled for two years because the tax kills jobs, not undue political influence. If lawmakers and other advocates are worried about leveling the political playing field they should support paycheck protection and end the use of taxpayer resources to collect money earmarked for politics. (2)

Clarification: Straight up spending for lobbying–trying to affect legislation–by shale and unions is about the same ($2.8 million by shale, $2.4 million by government unions). However, the money given to political candidates, no doubt hoping those candidates will remember you gave them that money after they win (i.e. buying influence) is ignored by Vitali because it shows how much more unions give than shale. It shows how he and other Democrats are in the hip pocket of Big Unions (including Big Education). And yet, with all of that money getting spread around, they still can’t get a severance tax passed. Why? Because even (some) Democrats know such a tax would kill the Marcellus industry in the state.

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One thought on “Public Employee Unions vs. Pennsylvania Economy

  1. Mr. Willis, who has had some really good factual articles in the past, sure stepped in the bucket on this one. Somehow the tiny percentage of the population in public employee unions represent a threat to the natural gas industry. This is not the issue we need to be dealing with.

    The problem is why natural gas saddles itself with the “trickle down” economic terminology of “job creators”, rather than benefits of using gas. The problem is not creating more gas supply, but with more distribution and replacing coal and imported oil. The solution is not make hedge funds richer, they took the risk when they bought the stock. It is to show that gas is the best solution to address our problems now and into the foreseeable future.

    One state representative, marginalized by his own party, that speaks to or for environmental groups, is not a threat, but rather an indication of the weakness of his and their positions. He/they can’t deliver on their overreaching promises and we must relentlessly point that out.

    Public employee unions have learned from right wing PAC’s and “Citizens United” court decisions that PAC money can be used in the amounts necessary to influence issues important to them. They also have more issues than taxes on natural gas as he tries to mislead with the graphic. Where are the conservative PAC’s that target taxes on business that benefit the gas industry directly and indirectly? Don’t let your ideology blind to the real problem here.

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