January 17, 2025

Fact Sheets: Jardiance & Farxiga

• Fact Sheet: Jardiance
• Fact Sheet: Farxiga

Protest of Calpine’s Application to Export Power

By Tyson Slocum

On November 22, 2024, Calpine Energy Solutions LLC applied for renewal of its authorization to export electricity from the United States to Mexico as a power marketer.[1] The application is deficient, as it fails to identify “[t]he exact legal name of all partners” as required by 10 CFR § 205.302(b), including its affiliate partners Energy Capital Partners and Bridgepoint Group, as well as dozens of its affiliate power generation partners. Calpine Energy Solutions LLC is incapable of operating as a power marketer independent from its power plant affiliates, as it features executives and directors that serve simultaneous roles for dozens of power plants. The operation of Calpine Energy Solutions LLC-affiliated power plants have an impact on “the sufficiency of electric supply within the U.S.”, and therefore requires more analysis than is included in the application. The Department of Energy must either reject the application, or set the matter for hearing, per 16 USC § 824a(e).

Page 1 of the application states that “Calpine [Energy] Solutions is … an indirect, wholly owned subsidiary of Calpine Corporation.”[2] This description of Calpine Energy Solutions’ upstream ownership is incomplete, as it conceals that Calpine Corporation is a wholly-owned subsidiary of the private equity firm Energy Capital Partners, which in turn is affiliated with the UK financial holding company Bridgepoint Group.[3] The failure of the application to correctly identify that it is ultimately controlled by Energy Capital Partners and Bridgepoint Group is a fatal error.[4]

Page 5 of the application claims: “Calpine [Energy] Solutions does not own or control any electrical generation, transmission facilities, or distribution facilities”.[5] This statement is demonstrably false, as Calpine Energy Solutions LLC is directly affiliated and shares personnel and management with dozens of electrical generation units in the United States. Its parent company Energy Capital Partners is one of the largest owners of merchant power generation in America, with its Calpine subsidiary alone controlling over 27,000 MW of power generation capacity in the United States.[6]

Modern corporations such as Energy Capital Partners/Bridgepoint Group are organized as a series of hundreds of limited liability companies (LLCs) that are under common control and centrally managed, where the LLCs segregate various assets and activities for a variety of purposes, including shielding investors from certain types of (mostly tax) liability. This sprawling array of LLCs are under centralized control and management, and financially interact with each other as affiliates. Evidence of this is found in the Form 561 2023 Annual Report of Interlocking Positions of Calpine Corporation filed with the Federal Energy Regulatory Commission on April 30, 2024.[7] Attached as Exhibit A are the interlocking positions of 13 Calpine executives who serve as officers or directors of Calpine Energy Solutions LLC simultaneously while serving officer or director roles for dozens of other Calpine affiliates, including dozens of power plants.

Highlighting but one of the 13 executives, Caleb Stephenson’s 2023 Interlocking Positions report lists his role as a Vice President of Calpine Energy Solutions LLC, while simultaneously serving as Vice-President of at least 25 other LLCs that control power plants in the United States. Calpine Energy Solutions LLC cannot be classified as a stand-alone power marketer when its executives concurrently serve as managers for affiliated power generation facilities.

On December 31, 2024, Calpine Energy Solutions LLC filed a joint Triennial Market Power Analysis with FERC along with 24 of its affiliated generation units—because under FERC rules, power marketers such as Calpine Energy Solutions LLC must file market power analysis reports that include power sales of all affiliates, including power generation assets.[8]

The North American Electric Reliability Corporation’s 2024 Long-Term Reliability Assessment issues a dire warning for the reliability of America’s bulk power market, with a majority of the United States subject to risk of power shortfalls.[9] The application is silent on how Energy Capital Partners’ planned exports of electricity will not contribute to the risk of domestic power shortages, given its control over such significant power generation resources.

Conclusion

Calpine Energy Solutions LLC’s November 22, 2024 application to export electricity is clearly incomplete for failing to list its affiliated partners as required by 10 CFR § 205.302(b), and contains material omissions. The Department of Energy must either reject the application, or set the matter for hearing, per 16 USC § 824a(e).

read the full filing here: Calpine Energy Solutions

[1] www.govinfo.gov/content/pkg/FR-2024-12-19/pdf/2024-30221.pdf

[2] www.energy.gov/sites/default/files/2024-12/EA-284-G%20Calpine%20Energy%20Solutions%2C%20LLC%20Export%20Authorization%20Application.pdf

[3] https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20240805-3070

[4] Last week, Energy Capital Partners announced it was selling its Calpine subsidiary to Constellation Energy for $26.6 billion (including cash and debt), which we assume will include Calpine Energy Solutions LLC. The transaction likely won’t close until the 4^th quarter of 2025. www.wsj.com/business/deals/constellation-energy-agrees-to-buy-calpine-in-26-6-billion-deal-dea42906

[5] www.energy.gov/sites/default/files/2024-12/EA-284-G%20Calpine%20Energy%20Solutions%2C%20LLC%20Export%20Authorization%20Application.pdf

[6] www.calpine.com/powering-america/

[7] https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20240430-5446

[8] https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20241231-5471

[9]www.nerc.com/pa/RAPA/ra/Reliability%20Assessments%20DL/NERC_Long%20Term%20Reliability%20Assessment_2024.pdf

Gassed Up: Trump Aims to Quickly Approve 14 Climate-Destroying Methane Gas Export Terminals

Key Findings

• Fourteen proposed U.S. liquefied natural gas export terminals are quickly striking deals to sell their output worldwide and could win rapid approval by President-elect Donald Trump. These export approvals would deliver a windfall for U.S. fracking companies and exporters of liquefied methane, also known as liquefied natural gas (LNG), extending an export explosion that’s pushing up prices for American consumers while harming the climate and vulnerable communities.
• Friends of the Earth and Public Citizen examined announced agreements between exporters and LNG buyers to sell LNG from roughly two dozen terminals. The analysis found that 14 have signed at least one deal with a disclosed buyer. All told, 76 million metric tonnes per year of LNG is currently under agreement to be sold from of these facilities in the U.S and Mexico.
• Of the 76 million metric tonnes of LNG slated to be sold under these agreements,  more than 51% will go to Big Oil companies and commodity trading firms that act as speculators. These “portfolio” players sell gas worldwide to fetch the highest price — including to China, where gas imports are booming.
• Despite claims that LNG exports are needed to support European allies, Asia Pacific customers account for a bigger share, about 29%, of LNG volume to be sold from the 14 terminals. These buyers include numerous Chinese and South Korean companies. About 19% of the volume is destined for Europe, where LNG imports surged after the war in Ukraine but have since declined.
• The largest single buyer of LNG from the 14 terminals is the Saudi state-owned energy giant Aramco, accounting for 8% of the total volume. It is followed by Shell at 7% and Chevron at 5%.
• The supply agreements executed so far by the 14 terminals represent more than 510 million metric tons of climate pollution–equivalent to the annual emissions of 135 new coal plants.

“We will frack, frack, frack; and drill, baby, drill. I will cut your energy prices … in half within 12 months of taking office. That’s going to bring everything down.” Donald Trump in an October 2024 campaign event.

 Introduction

While campaigning to return to Washington, D.C., Donald Trump pledged his fealty to the oil and gas industry while promising to ease costs for consumers.

On consumer prices, the reality is just the opposite.

While the former president’s return to power will allow fossil fuel executives to drill for more oil and gas and build more pipelines, U.S. consumers will likely face higher prices as a result.

The fossil fuel industry is especially eager to ramp up exports of liquefied methane, commonly called liquefied natural gas or LNG. Executives and lobbyists want Trump’s Department of Energy to resume granting permits for LNG exports, which President Joe Biden mostly placed on hold.

This surge in exports will allow gas producers and exporters to sell more methane gas overseas, where it fetches a far higher price than in the U.S., depriving low-income American families of affordable energy and raising costs for small businesses that use gas. A comprehensive 2024 study by the U.S. Department of Energy (DOE) found numerous reasons why expanding LNG exports would harm the public. First, exports expose American households and businesses to higher energy prices: Households would pay an additional $122 per year on average on their gas and electric bills if LNG exports continue to grow as expected, with the most severe impacts on the Gulf Coast and Southwest U.S., the report found.

“We have recently lived through the real-world ripple effects of increased energy prices domestically and globally since the pandemic,” Energy Secretary Jennifer Granholm said.” Middle and low-income households already face energy bills that are too high. In parts of the South, the export-induced price increase would put some households over the energy burden threshold, further challenging their ability to meet basic needs.” Forty-two percent of American households — 51 million families — are identified as low-income and high-risk for severe energy burden hardship. (Energy burden is the percentage of gross income spent on energy; those paying above the “threshold” of 6% are considered to have high energy burdens that threaten their quality of life.)

After the election, Trump pledged to sign ‘Day One’ orders to “end all Biden restrictions on energy production, terminate his insane electric vehicle mandate, cancel his natural gas export ban, reopen ANWR in Alaska — the biggest site, potentially anywhere in the world — and declare a national energy emergency.” However, It is unclear what effect these orders will have in practice. Trump administration approvals of LNG exports may be vulnerable to legal challenges.

LNG export permits have largely been on hold for nearly a year as the Biden administration completed its study of the rapidly growing industry. That comprehensive review, released in December 2024, said rising LNG exports could increase consumer prices while harming coastal communities and the climate. This study should complicate Trump’s effort to speedily approve LNG exports by leaving the approvals more vulnerable to legal challenges. Reuters reported that the Trump transition team is weighing how quickly the incoming administration can approve stalled export terminals.

Trump’s nominee for Energy Secretary, Chris Wright, is a fracking executive and climate change denier who is sure to do whatever he can to expedite fossil fuel expansion. Democrats currently outnumber Republicans on the five-member Federal Energy Regulatory Commission. Trump has the power to name a Republican to replace the current chair Willie Phillips, a Democrat.

With Trump returning to office, industry analysts are predicting boom times for global LNG. Rystad Energy said: Trump’s policies “are likely to accelerate US LNG infrastructure expansion through deregulation and faster permitting, bolstering global supply. This could strengthen the sentiment around global LNG supply after years of uncertainty, helping to unleash long-term demand.” Shell, the international energy giant, said in October 2024 that its quarterly profit of $6 billion was driven by higher LNG sales, offsetting a drop in profits from refining. LNG terminal owner Cheniere Energy, which pioneered the gas export industry in the U.S., said it expects full-year profits to exceed $6 billion in 2024. The company expects a 50% increase in gas demand from China by 2040. And despite many warnings of a forthcoming global LNG supply glut, LNG exporters are still building terminals in North America because their massive construction projects are insulated from the risk of a collapse in LNG prices, thanks to guaranteed revenue from 20-year contracts.

Harms to the Public

By law, the U.S. Department of Energy (DOE) may permit gas exports to countries that lack free trade agreements with the U.S. only if it deems the exports “not consistent with the public interest.” Over the past year, the Biden administration evaluated whether LNG exports meet this public interest test, re-examining prior assumptions that inaccurately measure the damage exports are having on millions of American families, the climate, and the environment.

Citing the “astounding” growth of U.S. gas exports, Energy Secretary Jennifer Granholm pointed out that LNG exports may outpace global demand for the fuel. “By itself, this rapid growth to date — and the continued growth we expect under existing authorizations — recommends a cautious approach going forward,” Granholm said in a statement.

Rising exports could prompt a sharp increase in domestic gas prices, hitting low-income consumers with higher bills they may be unable to afford. Those consumers are already hurting: The price U.S. households paid for gas has increased 52% since 2016, according to the Energy Information Administration. The average winter heating bill for gas users in the Northeast is expected to rise by more than 7% to $644 for the winter of 2024-2025, according to the National Energy Assistance Directors Association. Not surprisingly, more people are falling behind on payments: Nearly 22% of American households were behind on their gas bill as of June 2024, up from 19% a year earlier, NEADA says.

Pennsylvania consumer advocates wrote a November 2024 letter to the U.S. Department of Energy about the impact on low-income consumers. “Increased gas exports overseas can have a direct and substantial negative impact on energy affordability for retail consumers at home — especially low and moderate-income families, affordable housing providers, and small businesses who already struggle to keep up with the rapidly rising cost of energy.” they wrote.” This harm is preventable.”

American businesses also face harm from LNG exports. The DOE study found LNG exports could push costs for the industrial sector up by $125 billion through 2050 — a burden that would be spread through the economy via higher prices. “We expect prices to rise substantially. It’s inflationary on all the products we produce, from consumer goods to industrial goods and national defense goods.” Paul Cicio, president of Industrial Energy Consumers of America, a business trade group, told E&E News.

The Energy Department study also countered a bogus oil and gas industry claim that LNG exports benefit the climate by providing gas as an alternative to polluting coal-fired electricity production, especially in Asia. It found exported methane would wind up displacing more renewable energy from the global power supply than coal.

Predictably, fossil fuel industry groups sought to undermine the Energy Department report. The National Association of Manufacturers quickly attacked it as a “clearly a politically motivated document designed for an audience who believes no form of carbon-based energy is acceptable” and asked Trump to “end this political war on the energy manufacturers that power our economy, fuel job growth and help ensure America’s national security.”

Fourteen Ways to Destroy the Planet

The U.S. LNG export boom got underway in 2016, with the commencement of LNG exports from Cheniere Energy’s Sabine Pass terminal in Louisiana. Since then, seven more U.S. export terminals have started exporting LNG around the world. More are under construction in the U.S. and Mexico, or are in various stages of the planning and approval process. These projects are huge, multi-billion dollar projects investments, and project developers often recruit multiple investors such as private equity firms and foreign investment funds to spread out risk among multiple parties.

Trump’s return to office is likely to speed the approval of many of these projects, including approvals of new export terminals and extensions of existing permits. However, much uncertainty remains about how many export terminals will be built in the long run. The climate for raising the billions of dollars needed to construct these massive multi-billion dollar export facilities remains uncertain, with the risk of a global supply glut that could depress prices.

Terminal developers must secure financing before they can make a final decision to invest billions in these projects. They typically sign agreements that guarantee revenue for at least 20 years. Friends of the Earth and Public Citizen analyzed about two dozen pending LNG terminals in various stages of regulatory approval. Of these, we identified 14 pending export terminals with either binding sales and purchase (SPA) contracts or an initial non-binding agreement known as a heads of agreement (HOA) with long-term LNG purchasers, indicating commercial momentum.^[1] While these 14 terminals have the greatest commercial viability, even more projects could be built. The Trump administration could push exports even harder by approving as many export terminals as possible. At that point, it would be up to investors to gauge which projects are worth massive investments, and rising construction costs and cost overruns in the U.S. also present risks.

The analysis found that:

• The 14 terminals have signed agreements to export 95 million metric tonnes of LNG per year (Table 1) Those volumes, slated to be exported from 14 terminals in the U.S. and Mexico, would be on top of existing export levels of 86.9 million metric tons in 2024.
• More than 51% of this contracted LNG volume (Chart 1) is expected to go to Big Oil companies like Saudi Arabia-based Aramco, Shell, ExxonMobil, ConocoPhillips; and commodity trading firms Gunvor and Woodside Trading. (Chart 2) These “portfolio” players can sell gas wherever it fetches the highest price — a lucrative business that Wall Street giant J.P. Morgan Chase & Co has considered re-entering.
• Purchase agreements with Asia Pacific customers account for about 29% of volume poised for approval during the Trump administration. Those include numerous Chinese and South Korean companies buying cheap U.S.-produced gas. Only about 19% of this volume is contracted for use in Europe, where LNG customers have been reluctant to sign long-term LNG supply deals as the continent curtails methane gas consumption.

Note: After the Biden administration’s pause on LNG permit approvals, the industry moved from binding supply contracts to non-binding agreements known as heads of agreement. Both kinds of agreements are included in this analysis.

Table 1: 14 LNG Export Terminals That Could Be Approved In Second Trump Administration (By Export Capacity)

Terminal	Location	Owner	Status	Signed Agreements (mmtpa)	Peak Terminal Capacity (mmtpa)
CP2 Phase 1 & 2	Cameron Parish, LA	Venture Global	Delayed due to FERC decision mandating further review	11.25	28
Woodside Louisiana LNG	Calcasieu Parish, LA	Woodside Energy	DOE/FERC Approved, likely needs DOE extension	2	27.6
Lake Charles LNG	Lake Charles, LA	Energy Transfer	Needs DOE permit	9.9	16.45
Saguaro Energia	Puerto Libertad, Sonora, Mexico.	Mexico Pacific Limited	Needs DOE permit	12.4	15
Port Arthur LNG Expansion	Port Arthur, TX	Sempra	Needs DOE permit	5.2	13.46
Delfin LNG	Cameron Parish, LA	Delfin Midstream	Needs Dept of Transportation (U.S. Maritime Admin) permit	4.1	13
Sabine Pass Liquefaction Expansion	Cameron Parish, LA	Cheniere Energy	FERC and DOE permits needed	5.225	9
Magnolia LNG	Lake Charles, LA	Glenfarne Group/Alder Midstream	FERC approval, needs DOE permit	4	8.8
Commonwealth LNG	Cameron Parish, LA	Commonwealth LNG	Delayed due to court decision mandating further review	6	8.4
Amigo LNG	Guaymas, Sonora, Mexico	LNG Alliance	Needs DOE extension	3.6	7.8
Cameron LNG Phase II	Hackberry, LA	Sempra	DOE/FERC Approved, likely needs DOE extension	5.3	6.75
Rio Grande Phase II	Brownsville, TX	NextDecade	Legal delay	1.2	5.4
Texas LNG	Brownsville, TX	Glenfarne Group	Legal delay	3	4
Corpus Christi 8 and 9	Corpus Christi, TX	Cheniere Energy	FERC and DOE permits needed	2.775	3.28
Totals				75.95	166.94

Source: Friends of the Earth/Public Citizen research of binding and non-binding supply agreements, disclosed by the Department of Energy and Federal Energy Regulatory Commission as well as public statements and filings. Terminal capacity refers to peak available capacity.

Chart 1: Destination of Exports from 14 LNG Projects

Source: Friends of the Earth/Public Citizen tally of binding and non-binding supply agreements.

In addition to these 14 major LNG projects that have publicly disclosed buyers of LNG, several more projects may pick up speed in the coming years. One particular project of note is Eagle LNG, a small proposed export terminal near Jacksonville, Fla. owned by Houston-based private equity firm Energy & Minerals Group. Eagle LNG’s business is focused on selling LNG to Caribbean island consumers for electricity generation and as fuel for cruise ships. That project’s developers told FERC in August 2024 that it had been delayed by construction cost increases, and FERC granted an extension of its approval until 2029. The Energy Department authorized exports from the project in 2019. The Eagle LNG project has kept its full list of customers confidential. The project is also noteworthy because Trump’s incoming chief of staff, Susie Wiles, worked as a lobbyist for the project in 2018 and 2019.

Chart 2: Top Buyers of LNG from 14 Projects

Source: Friends of the Earth/Public Citizen tally of binding and non-binding supply agreements.  *EQT signed a “tolling” agreement in which it pays a terminal operator to process gas that it supplies and then sells on its own.

Chart 3: 14 Pending LNG Export Projects With Signed Supply Agreements

(Volume in million metric tonnes per year)

Source: Friends of the Earth/Public Citizen tally of binding and non-binding supply agreements.

Fracking Companies Push Higher Prices While Consumers Pay the Bill

Since the U.S. fracking boom began about 15 years ago, natural gas prices in the U.S. generally have stayed low and stable — until the runup to the war in Ukraine in the second half of 2021 roiled global energy markets. U.S. gas producers and LNG exporters are eager to take advantage of the difference between prices in the U.S. and overseas markets to earn windfall profits when prices elsewhere are higher. The nonpartisan U.S. Energy Information Administration said in a 2023 analysis: “higher LNG exports results in upward pressure on U.S. natural gas prices”

Other experts forecast higher prices as well. Jigar Shah, an energy expert who has led the Department of Energy’s loan programs office under the Biden administration, said in a social media post it’s “very clear” the gas industry wants to see a doubling of prices to meet profit projections.

If this comes to pass, American consumers will pay the bill. Gas industry executives are optimistic that LNG exports, combined with domestic demand from data centers and gas-fired power plants, will keep demand high and prices stable. Justin Fowler, an executive with gas producer Antero Resources, said in a conference call with investors that he expects “a significantly higher base demand level than we have ever experienced in the past.” He added: “We expect these fundamentals will provide support to natural gas prices and lead to periods of higher prices in the coming years.”

Expand Energy, the largest U.S. gas producer, formed by the recent merger of Chesapeake Energy and Southwestern Gas, is planning to export 20% of its production as LNG. CEO Nick Dell’Osso said in an earnings conference call: “We’re well positioned to deliver gas into [the LNG export] market and see the value of our gas increase as a result of how we deliver into that market.”

Toby Rice, chief executive of natural gas producer and pipeline firm EQT Corp, is an outspoken evangelist for fracking and LNG exports. Rice waved away concerns about rising energy prices in a post-election interview with the Wall Street Journal, saying: “When you say prices are going up, well, that’s because we’ve had historic low natural-gas prices.” The company Rice leads donated $250,000 to a super PAC supporting Senate Republican candidates shortly after Biden announced a pause on new LNG export permits.

Pittsburgh-based EQT has signed a “tolling” agreement with LNG terminal developer Glenfarne Group to process LNG for export at its planned terminal in Brownsville, Texas — a riskier strategy that allows EQT to sell gas directly to major buyers.

Key Corporate Beneficiaries of Trump’s LNG Export Buildout

The LNG export industry is deeply entwined with the incoming Trump administration. In April 2024, Trump met at his Mar-a-Lago resort with several key energy executives, including the leaders of the LNG export industry from Venture Global LNG Inc., EQT Corp. and Cheniere Energy Inc.

A rundown of corporations that stand to benefit from the second Trump administration:

Venture Global: A startup run by a former banker Michael Sabel and an energy lawyer, Robert Pender, Venture Global operates two LNG export terminals in Calcasieu Pass and Plaquemines Parish; the latter exported its first cargoes in December 2024. The company has received FERC approval for its massive CP2 LNG terminal in Cameron Parish but lacks export authorization from the Energy Department. Opposition to CP2 in Gulf communities and around the country helped spur President Biden’s LNG permitting pause in January 2024. At the end of 2024, CP2 was further delayed after FERC demanded more environmental analysis of the project in reaction to formal challenges from commercial fishermen, landowners and environmental groups impacted by the project.

After the election, Venture Global CEO Michael Sabel told the Financial Times, “We look forward to working with the incoming Trump administration to cement America’s role as the world’s leading supplier of clean liquefied natural gas.” Sabel and Pender stand to make billions when the Virginia-based company sells shares to the public in 2025, valuing the company at more than $110 billion in the largest energy sector initial public offering in at least a decade.

Woodside Energy: In July 2024, Australia-based Woodside Energy Group announced it was acquiring Tellurian Inc. and its proposed Driftwood LNG project in Calcasieu Parish, Louisiana. Tellurian, unable to obtain financing, had lost major customers for the project. After Woodside closed on the $1.2 billion acquisition, it said it was negotiating with several partners and planned to make a final investment decision to begin in early 2025. The project, renamed Woodside Louisiana LNG, is expected to cost $27 billion. To be completed, the project will likely require Department of Energy permit extension.

The CEO of Woodside, Meg O’Neill, has expressed confidence that buyers around the globe will continue to purchase LNG even amid a widely projected supply glut expected later this decade. “We believe the increase in supply is unlikely to have a sustained impact on demand or pricing,” O’Neill said in an August 2024 conference call with investors. “Recent history has shown that due to customers’ energy security and decarbonization drivers, increased supply is continuously absorbed by the market with prices remaining resilient.”

Energy Transfer, a Dallas-based pipeline and export terminal giant, has been trying to develop the Lake Charles LNG export project in Lake Charles, Louisiana for about a decade. In 2015, the company received approval from the Federal Energy Regulatory Commission to convert an existing LNG import facility to an export terminal. The project suffered a major blow in 2020 when Energy Transfer’s partner at the time, Shell, backed out of the deal, citing poor market conditions. In 2023, the Biden administration denied Energy Transfer an extension of its prior export license, leading the company to seek expedited approval of a new license. Public Citizen filed a formal protest of the project, arguing in part that the company’s 2022 criminal conviction in Pennsylvania over environmental violations reflected a pattern of compliance problems, rendering the export plan contrary to the public interest.

Kelcy Warren, the billionaire chief executive of Energy Transfer, contributed $10 million in the 2024 election cycle to entities backing President-elect Donald Trump’s re-election and Republican turnout efforts. Warren has been one of Trump’s biggest oil industry supporters. Warren’s company built the infamous Dakota Access pipeline over intense objections from environmental groups and has targeted Greenpeace USA with a lawsuit that threatens the group’s existence.

Mexico Pacific Limited: The Houston-based private equity firm Quantum Capital Group is the lead investor in Saguaro Energia LNG, a proposed terminal on the Pacific coast of Mexico. Although the project is outside the U.S., it would export U.S.-produced gas and thus needs a permit from the U.S. Energy Department to operate. Mexico Pacific, which is expected to make a final investment decision on the project in 2025, has signed export agreements with Shell, ExxonMobil and Chinese companies including Guangzhou Energy and Zhejiang Energy as well as South Korea-based Posco International. Mexico Pacific says the facility, the Saguaro Energía LNG export terminal, “will leverage abundant, low-cost natural gas from the Permian Basin in Texas, providing the lowest landed price of LNG into Asia globally.” It is one of several planned LNG export terminals in Mexico that aim to sell U.S.-produced gas to Asia bypassing a costly trip through the Panama Canal, which is beset with backups and delays caused by climate changed–linked drought. These massive projects have spurred opposition  from environmental groups in both Mexico and the United States because the giant tanker ships used to carry LNG across the world will threaten the lives of whales and other marine species

Public Citizen has filed a formal protest against Mexico Pacific’s export application arguing the project is not in the public interest — because it would not deliver economic benefits, such as jobs, to U.S. workers, and because its exports would be oriented to the Asian market rather than to European buyers. In addition to Quantum Capital, other investors include New York City-based AVAIO Capital, Tortoise Capital Advisors, former Enron executive Thomas White’s DKRW Energy Partners, and former Cheniere Energy executive (and current Mexico Pacific President ) Douglas Shanda.

Sempra Energy: The San Diego-based electric utility company is the lead investor in two LNG terminals in the U.S. — the Port Arthur project in Texas and the Cameron LNG project in Hackberry, Louisiana — as well as several projects in Mexico, with the backing of the Abu Dhabi Investment Authority, a sovereign wealth fund of the United Arab Emirates. In a post-election conference call for investors, Sempra Chief Executive Jeff Martin expressed confidence in receiving permits to export gas for that Port Arthur terminal’s expansion, saying LNG exports are “a very, very important tool of American foreign policy.”

Sempra has a 28% stake in the Port Arthur project, while 42% of the project is owned by the private equity firm KKR & Co. and 30% is owned by oil and gas giant ConocoPhillips. Sempra’s Cameron LNG project, which opened in 2020, is partly owned by the French energy giant TotalEnergies, as well as Mitsui & Co., Ltd., and Japan LNG Investment, LLC, a company jointly owned by Mitsubishi Corp and another Japanese firm. Sempra is planning to make a final investment decision on the expansion of Cameron LNG in the first half of 2025.

These terminal projects have devastated communities in the Gulf Coast, which are already overburdened with industry and polluting facilities spewing toxic pollution that disproportionately impacts low income neighborhoods and communities of color located near these facilities. As John Beard of the Port Arthur Community Action Network said: “These companies, no matter what they say, are basically sacrificing communities of color in order to get wealthier, more affluent communities cheap fossil fuels.”

Foreign Investors Drive Gas Exports

The fossil fuel industry has long claimed ordinary Americans will benefit from a massive buildout of energy infrastructure. Industry lobbyists and consultants argue that profits from a fossil fuel-driven economic expansion will spur economic growth and jobs. The reality on the ground shows that foreign investors are the true beneficiaries, while local communities are left devastated and polluted.

An example of this bogus claim can be found in the 2018 study used by the first Trump administration to meet the legal mandate for allowing LNG exports. The study, written by a longtime oil and gas industry consultant, rests on several faulty assumptions, in concluding that U.S. households will benefit directly from higher LNG exports. Absurdly, the claim rests on the idea that U.S. households will gain wealth through stock investments in LNG terminal owners, and income from these investments will offset higher consumer gas bills.

This argument falls apart under light scrutiny. The wealthiest 10% of households own 93% of household stock and mutual fund investments, so claims that typical American families will benefit from LNG exports are far-fetched. An analysis by University of Massachusetts economists found that although the U.S was the largest beneficiary of fossil fuel profits in 2022 (as the oil and gas industry rebounded from the pandemic, aided by massive government support), the bottom 50% of the American public received only 1% of the profits. The wealthiest Americans accrued more than half of profits.

In addition, much of the profit from the LNG terminal buildout will flow overseas. Foreign investors will reap much of the profit from developing LNG terminals. Contrary to Trump’s “Make America Great Again” and ”Drill, Baby, Drill” messages, large overseas investors are a key source of funding for U.S. LNG projects, both by taking equity stakes in the projects themselves and by securing supply agreements. Key foreign players include large investors based in Australia, Qatar, Japan, Canada, United Arab Emirates and Saudi Arabia:

• Woodside Energy, a major Australian oil and gas producer, entered the U.S. market in fall 2024 by purchasing the struggling LNG terminal developer Tellurian Inc. and its Driftwood LNG project for $1.2 billion.
• QatarEnergy, the state-owned petroleum company, has a 70% stake in the Golden Pass LNG terminal in Texas, alongside Exxon Mobil.
• Several Japanese companies have investments in Delfin LNG, Freeport LNG, and Cameron LNG.
• The Abu Dhabi Investment Authority, a sovereign wealth fund from the United Arab Emirates, has completed deals with the parent companies of LNG terminals including Sempra and Cheniere Energy.
• South Korea’s Hanwha Group has gradually acquired about 23% of NextDecade, the developer of the Rio Grande LNG terminal in Texas.
• Saudi oil giant Aramco in summer 2024 announced two deals. First, Aramco reached a preliminary 20-year deal to buy 5 million tons per year of LNG from the second phase of Sempra Energy’s Port Arthur LNG project as well as a 25% equity stake in the project. Second, Aramco reached a preliminary 20-year deal to purchase 1.2 million tonnes per year of LNG from Next Decade Inc’s Rio Grande export terminal.

The European Ruse

The oil and gas industry has tried aggressively to position gas exports as a way to assist American allies in the wake of Russia’s invasion of Ukraine in 2022. The American Petroleum Institute launched a multi-million dollar ad blitz claiming that LNG “provides supply options for America’s allies — most notably to the European Union amid Russia’s aggression against Ukraine.”

This fossil fuel industry has pushed this national security argument with Republicans and Democrats alike, with apparent success. Major pipeline companies and gas drillers have employed former Democratic lawmakers and conducted an aggressive public relations campaign to spread these misleading pro-gas talking points among Democrats and their key allies, with bogus national security arguments a prominent feature of this campaign. As he prepared to take office, Trump threatened the European Union, calling on European leaders to buy U.S. oil and gas or face tariffs in retaliation.

However, the crisis sparked by the curtailment of Russian gas, which boosted U.S. gas exports to Europe, is waning. Europe has likely passed its peak in LNG usage, with European gas demand declining as the continent cuts gas consumption by implementing energy efficiency measures and adopting renewable energy. European officials plan to cut gas consumption in half by 2030, meaning that European demand will no longer drive export growth for U.S. producers.

The Biden administration agrees that the European crisis has largely passed. “Any sound and durable approach for considering additional authorizations should consider where those LNG exports are headed, and whether targeted guardrails may be utilized to protect the public interest,” Energy Secretary Granholm said in December 2024. ”European demand for natural gas has flattened and is set to decline substantially in line with Europe’s efforts to reduce its climate footprint.”

Conclusion

With the second Trump administration about to take power in Washington, the fossil fuel industry is set to enjoy another four years of unprecedented windfalls at the expense of taxpayers and the environment. In the weeks since Trump’s victory, fossil fuel executives and their lobbyists cheered the return of a president who called climate change a “hoax” and “one of the greatest scams of all time.”

Given the massive surge in LNG exports in recent years, the Biden administration was correct to recognize that a new approach is needed. But the only aim of the Trump administration and pro-fossil fuel lawmakers in Congress will be to serve the interest of their wealthy donors.  It is not in the public interest to allow American families to be price gouged as the natural gas industry rakes in record profits by maximizing LNG exports to China, especially when it comes at the expense of families and businesses at home.

Methodology

The 14 facilities we consider as pending in our dataset were chosen because they have shown commercial momentum in the form of signed long-term sales and purchase (SPA) contracts or heads of agreement (HOA) but still require some action from the Federal Energy Regulatory Commission (FERC), the Department of Energy (DOE) or both federal agencies. Included facilities are:

1. Venture Global, CP2, Calcasieu Parish, Louisiana
2. Woodside Energy, Woodside Louisiana LNG, Calcasieu Parish, Louisiana
3. Energy Transfer, Lake Charles LNG terminal, Louisiana
4. Mexico Pacific’s Saguaro Energia terminal in Sonora, Mexico. The developer intends to develop the project in two stages (Mexico Pacific 1-2 and Mexico Pacific 3) but we treat those projects as one.
5. Sempra Energy, Port Arthur terminal expansion, Texas
6. Delfin Midstream offshore terminal in the Gulf of Mexico
7. Cheniere Energy, Sabine Pass terminal expansion, Louisiana.
8. Commonwealth Energy, Cameron Parish, Louisiana
9. Glenfarne Group/Alder Midstream, Magnolia LNG Lake Charles, Louisiana.
10. LNG Alliance, Amigo terminal in Sonora, Mexico
11. Sempra Energy, Cameron Phase Two, Hackberry, Louisiana
12. NextDecade, Rio Grande Phase Two, Brownsville, Texas
13. Glenfarne Group, Texas LNG Brownsville, Texas
14. Cheniere Energy, Corpus Christi terminal expansion, Texas.

In calculating greenhouse gas emissions, the potential lifecycle emissions impact of these facilities was calculated using companies’ applications for their long-term LNG authorizations to the DOE or FERC. We adopted the emissions methodology of the Sierra Club LNG Tracker database. The conversion to coal plant emissions is courtesy of the EPA Greenhouse Gas Emissions Calculator.

In determining the likely destination of future LNG cargoes, we placed all agreements with commodity trading houses and Big Oil companies with commodity trading arms in the “Portfolio” category. For utility, industrial, and state-owned purchasers, we assumed the region of the purchaser to be the destination.

All LNG agreements cited directly reference either press releases from the companies themselves or public filings from the companies with the DOE. In situations where data in press releases was contradicted by official filings with the DOE, we deferred to the DOE. Although Mexico Pacific 1 and 2 and Mexico Pacific 3 are being developed as two separate projects, there is insufficient data in the public record to tie agreements to individual trains. In Table 1, we assumed that the total volume of existing agreements is divided equally between the three fully subscribed trains.

In some of our calculations, including determining destination percentages, we exclude 0.5 mtpa from our calculations due to one contract agreement with Glenfarne’s Texas LNG in July 2024 with an undisclosed firm.

Appendix

LNG purchase agreements from the 14 pending facilities are listed below:

 

Buyer	Agreement Type	Destination	Seller	Origin Facility	Volume (million tonnes per annum)	Years	Announcement Date
Vessel Gasification Solutions	HOA	Asia-Pacific	LNG Limited	Magnolia LNG	4	20	1/25/2017
New Fortress Energy	SPA	Portfolio	Venture Global LNG	CP2, Phase 1	1	20	3/16/2022
ENN	SPA	Asia-Pacific	Energy Transfer LNG	Lake Charles LNG	1.8	20	3/29/2022
ENN	SPA	Asia-Pacific	Energy Transfer LNG	Lake Charles LNG	0.9	20	3/29/2022
Guangzhou Energy	SPA	Asia-Pacific	Mexico Pacific	Mexico Pacific 1-3	2	20	3/31/2022
TotalEnergies	HOA	Portfolio	Sempra	Cameron LNG Phase 2	3.3	n/a	4/2/2022
Gunvor	SPA	Portfolio	Energy Transfer LNG	Lake Charles LNG	2	20	5/2/2022
SK Group	SPA	Asia-Pacific	Energy Transfer LNG	Lake Charles LNG	0.4	18	5/3/2022
ExxonMobil	SPA	Portfolio	Venture Global LNG	CP2, Phase 1	1	20	5/10/2022
Polish Oil & Gas Co.	HOA	Europe	Sempra	Cameron LNG Phase 2	2	20	5/15/2022
China Gas	SPA	Asia-Pacific	Energy Transfer LNG	Lake Charles LNG	0.7	25	6/5/2022
Equinor	SPA	Europe	Cheniere	Corpus Christi 8 and 9	0.875	15	6/9/2022
Shell	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	2	20	6/17/2022
EnBW	SPA	Europe	Venture Global LNG	CP2, Phase 1	0.75	20	6/21/2022
Chevron	SPA	Portfolio	Cheniere	Corpus Christi 8 and 9	1	15	6/22/2022
Chevron	SPA	Portfolio	Venture Global LNG	CP2, Phase 1	1	20	6/22/2022
Vitol	SPA	Portfolio	Delfin	Delfin LNG	0.5	15	7/13/2022
PetroChina	SPA	Asia-Pacific	Cheniere	Corpus Christi 8 and 9	0.9	24	7/20/2022
Shell	SPA	Portfolio	Energy Transfer LNG	Lake Charles LNG	2.1	20	8/24/2022
Woodside Energy	SPA	Portfolio	Commonwealth	Commonwealth	2	20	9/5/2022
EnBW	SPA	Europe	Venture Global LNG	CP2, Phase 1	0.25	20	10/6/2022
Ineos Energy	HOA	Europe	Sempra	Port Arthur LNG Phase 2	0.2	20	12/1/2022
Inpex Corp.	SPA	Asia-Pacific	Venture Global LNG	CP2, Phase 1	1	20	12/26/2022
ExxonMobil	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	1	20	2/7/2023
China Gas	SPA	Asia-Pacific	Venture Global LNG	CP2, Phase 1	1	20	2/23/2023
Chesapeake Energy	HOA	Portfolio	Delfin	Delfin LNG	1.5	15	3/6/2023
Shell	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	1	20	3/27/2023
Hartree Partners	SPA	Portfolio	Delfin	Delfin LNG	0.6	20	4/21/2023
JERA	SPA	Asia-Pacific	Venture Global LNG	CP2, Phase 1	1	20	4/28/2023
Korea Southern Power	SPA	Asia-Pacific	Cheniere	Sabine Pass Liquefaction Expansion	0.4	19	5/16/2023
Zhejiang Energy	SPA	Asia-Pacific	Mexico Pacific	Mexico Pacific 1-3	1	20	5/31/2023
Equinor	SPA	Europe	Cheniere	Sabine Pass Liquefaction Expansion	0.875	15	6/21/2023
Securing Energy for Europe	SPA	Europe	Venture Global LNG	CP2, Phase 1	2.25	20	6/22/2023
ENN	SPA	Asia-Pacific	Cheniere	Sabine Pass Liquefaction Expansion	0.9	20	6/26/2023
Centrica	SPA	Europe	Delfin	Delfin LNG	1	15	7/11/2023
ConocoPhillips	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	0.5	20	8/3/2023
ConocoPhillips	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	1.7	20	8/4/2023
BASF	SPA	Europe	Cheniere	Sabine Pass Liquefaction Expansion	0.8	20	8/22/2023
MET Group	HOA	Europe	Commonwealth	Commonwealth	1	20	9/4/2023
EQT	HOA	Portfolio	Commonwealth	Commonwealth	1	15	9/18/2023
Foran Energy	SPA	Asia-Pacific	Cheniere	Sabine Pass Liquefaction Expansion	0.9	20	11/2/2023
Gunvor	SPA	Portfolio	Delfin	Delfin LNG	0.5	15	11/27/2023
OMV	SPA	Europe	Cheniere	Sabine Pass Liquefaction Expansion	0.85	15	11/29/2023
Woodside Energy	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	1.3	20	12/6/2023
ExxonMobil	SPA	Portfolio	Mexico Pacific	Mexico Pacific 1-3	1.2	20	1/16/2024
Gunvor	HOA	Portfolio	Glenfarne	Texas LNG	0.5	20	3/18/2024
Aethon Energy	HOA	Portfolio	Woodside	Woodside Louisiana LNG	2	20	5/29/2024
DTEK	HOA	Europe	Venture Global LNG	CP2 Phase 1	2	20	6/13/2024
Aramco	HOA	Portfolio	NextDecade	Rio Grande Train 4	1.2	20	6/13/2024
Aramco	HOA	Portfolio	Sempra	Port Arthur LNG Phase 2	5	20	6/26/2024
Undisclosed Firm	HOA	n/a	Glenfarne	Texas LNG	0.5	n/a	7/2/2024
EQT	SPA	Portfolio	Glenfarne	Texas LNG	2	20	7/23/2024
Galp	SPA	Europe	Cheniere	Sabine Pass Liquefaction Expansion	0.5	20	8/5/2024
E&H Energy	SPA	Asia-Pacific	Amigo LNG	Amigo LNG	3.6	20	8/26/2024
POSCO	SPA	Asia-Pacific	Mexico Pacific	Mexico Pacific 1-3	0.7	20	8/28/2024
Glencore	HOA	Portfolio	Commonwealth	Commonwealth	2	20	9/19/2024
Chevron	SPA	Portfolio	Energy Transfer LNG	Lake Charles LNG	2	20	12/19/2024

 

January 15, 2025

DOGE Delusions

Introduction

On November 12, 2024, President-elect Donald Trump announced that billionaires Elon Musk and Vivek Ramaswamy would co-chair a new entity, called the “Department of Government Efficiency” (DOGE). “Together,” Trump asserted, “these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures and restructure federal Agencies – Essential to the ’Save America’ Movement. … It will become, potentially, the ’Manhattan project’ of our time.”[1]

The so-called Department of Government Efficiency is not a government department, but an advisory entity with no direct authority to make spending decisions, restructure government agencies or rescind or adjust governmental regulations.

Nor is the new entity concerned with anything approximating “government efficiency.” Rather its intended purpose is to shrink government, benefit corporations by cutting regulations and advance a pre-determined ideological agenda, as comments from Musk, Trump and Ramaswamy indicate.

On the campaign trail in October, Musk said that DOGE would cut $2 trillion in annual spending as part of an anti-tax agenda: “I think we can do at least $2 trillion. … I mean, at the end of the day, you’re being taxed. You’re being taxed. All government spending is taxation. … All government spending, either it becomes inflation or its direct taxation. Your money is being wasted. And the Department of Government Efficiency is going to fix that. We’re going to get the government off your back and out of your pocketbook.”[2]

In December, Trump echoed the $2 trillion cuts figure: “We’re looking to save maybe $2 trillion and it’ll have no impact. Actually, it will make life better, but it will have no impact on people.”[3]

Meanwhile, Ramaswamy stated that plans to slash the federal workforce aren’t about saving money but to carry out a preconceived ideological agenda. Cutting the number of federal workers, he said, is not “really about saving costs,” but addressing what he sees as an “overgrown federal government that is doing things that were never supposed to be done by the federal government in the first place.”[4]

Many commentators have pointed out the effective impossibility of cutting $2 trillion annually from the federal budget, given that all federal discretionary spending – including the Pentagon budget and veterans’ benefits – totals less than $2 trillion.[5]

Few would argue with the purported goal of “government efficiency,” but there is nothing “efficient” about hitting a pre-determined target for spending cuts, least of all one that is infeasible. Nor is there anything “efficient” about ideologically driven notions of shrinking government or corporate profit-driven plans to roll back regulatory protections. Additionally, “efficiency” is not a primary value. Whatever the government does, it should strive to do efficiently (mindful of other considerations), but the real question is what the government should be doing in the first place.

All that said, if one were charitably to interpret the mission of the Department of Government Efficiency as saving money, reducing waste, efficiently raising revenue and getting an economic return for government spending – in short, to get a bang for the government buck – what is a reasonable policy agenda? In an enterprise as large as the federal government, there are undoubtedly many small examples of waste or ill-advised expenditures. But what are the big-ticket items to advance a legitimate, if narrow, “efficiency” agenda?

What Real Efficiency Looks Like

This report identifies a series of policy interventions to save Americans hundreds of billions of dollars every year and to raise hundreds of billions more, every year:

• Measures to reduce prescription drug prices can save $200 billion annually.
• Ending privatized Medicare can save $100 billion annually, while improving quality of care.
• Modest reductions to the Pentagon budget would save $100 billion every year; while more aggressive, evidence-based cuts could save $200 billion annually.
• Ending tax subsidies and handouts to oil and gas corporations would save about $20 billion annually.
• Fair taxes on the rich and corporations could raise $500 billion annually, or potentially much more, as compared with the baseline of the expected extension of the Trump tax cuts.

The report also examines the broad record of regulation and shows that major regulations generate a positive economic return, disproving the notion that the DOGE can find social savings through regulatory rollbacks. And it makes the case for large-scale public investments that will generate positive economic returns, separate and apart from their non-economic benefits:

• Major regulatory protections are already subject to careful scrutiny for their economic impact and – individually and collectively – strengthen the national economy. A government efficiency agenda should leave existing rules alone and promote an efficient and robust rule-making system.
• Many significant social investments, such as early childhood programs, provide a net positive return to the government and a much wider swath of social investments generate substantial positive returns in the economy. These are efficient investments that should be expanded, not rolled back.
• Large-scale public investments to speed the transition to a clean energy future and to adapt to the now-unavoidable impacts of climate change are needed to protect the health of the national and global economy and will return many times over in narrow economic terms. Investing to prevent climate catastrophe is one of the most efficient projects the federal government can undertake.

Ending Big Pharma’s Price Gouging

The United States spends more – a lot more – than other countries on prescription drugs. Prescription drugs in the United States are three to four times the price in other rich countries.[6] The reason for the price discrepancy is simple: Other countries maintain policies to prevent price gouging by Big Pharma. In the United States, there are few restraints on Big Pharma’s monopoly pricing.

The rip-off is even worse than it seems at first blush. The federal government pays for almost half of all drug purchases in the United States through the Department of Health and Human Services.[7] Governmental drug purchases overall – including by states and municipalities and covering governmental employees – constitute nearly 60 percent of spending on prescription drugs.[8] But with the important exception of the Veterans Health Administration, the U.S. government – the largest purchaser of medicines in the world – fails to leverage its purchasing power to lower drug prices. Compounding the outrage, U.S. government funding contributes at least in some way to the invention and development of virtually every new drug[9] – and does not even demand reasonable pricing in return.  In other words, the world’s largest drug purchaser also funds the development of every new medicine – and then, with some exceptions, lets Big Pharma set whatever monopoly price it chooses. Then, the U.S. government agrees to pay that same inflated price.

There’s no question the U.S. government could lower drug prices dramatically, if it chose. Canada pays about one third the U.S. price for branded drugs. France and Japan pay less than a quarter.[10] Before Medicare was empowered to undertake limited drug price negotiations, the Department of Veterans Affairs (VA) paid about half of what Medicare Part D did.[11]

The United States spends more than $400 billion annually on drugs.[12] If the country cut its drug spending by 40 percent it would save $170 billion from 2023 levels – and more over the next decade. Even with that savings, the U.S. would still be paying prices somewhat higher than the VA and considerably higher than other rich countries.

To appreciate how badly Big Pharma is price-gouging U.S. taxpayers and consumers, consider the case of the GLP-1 inhibitor semaglutide, sold by Novo Nordisk under the brand names Ozempic and Wegovy. Novo Nordisk charges Americans up to 15 times more than it charges other wealthy countries for Ozempic and Wegovy.[13]  Novo Nordisk’s pricing isn’t justified by research and development costs. Since Ozempic’s launch in 2018, the two drugs have made the company more than $50 billion in sales,[14] an order of magnitude higher than even the most generous estimates of research and development costs for drugs that take into account failed drug candidates and a reasonable return on investment.[15] Over the past six years, Novo Nordisk has spent over $44 billion enriching its shareholders through stock buybacks and dividends—over twice as much as it spent on R&D across its entire portfolio.  Novo Nordisk’s price is also not justified by production costs. Generic Ozempic and Wegovy could be sold profitably for around $5 and $13 per month, respectively.[16] Novo Nordisk charges 100 times higher for Americans, while generics firms have indicated they would sell generics for less than $100 per month.[17]

Or consider Revlimid (generic name: lenalidomide), a drug for the treatment of multiple myeloma and other forms of cancer. Made and sold by a biotech company called Celgene until 2019, when Celgene was acquired by Bristol Myers Squibb, Revlimid is a super-expensive cancer therapy, costing more than $16,000 a month. The U.S. House Oversight Committee examined Revlimid pricing and found outrage after outrage.[18] “After launching Revlimid in 2005,” the committee found, “Celgene raised the price of the drug 22 times – as many as three times in a single year.” Internal documents obtained by the committee showed that pricing decisions were determined by the desire to hit earnings goals and executive compensation incentives. Celgene and now Bristol Myers charged the super-high prices even though the federal government underwrote virtually every stage of the research and development process. Celgene “contributed very little to the science first establishing that drugs like Revlimid could be an effective treatment for multiple myeloma,” the committee found. “Rather, Celgene benefited from the acquisition of a decades-old product, academic and non-profit research, and at least eight federally funded studies.” Yet Medicare must pay sky-high prices and some patients simply can’t afford the medicine.

The U.S. government has tools under existing law to lower drug prices. It can license generic competition – which lowers prices dramatically, often as much as 90 percent – for drugs purchased by the U.S. government and for drugs invented with U.S. government support. And Medicare now has authority to negotiate prices for top-selling medicines, after they have already been on the market for seven or more years. There’s a lot of room for much tougher Medicare negotiation – without waiting seven years, covering all drugs and demanding greater price reductions. Even after negotiation, Medicare will be paying more than twice what other rich countries do.[19]

A more robust and comprehensive program to lower drug prices would build on these measures, leveraging the U.S. government role in supporting biomedical research and as the world’s largest drug purchaser, and relying on generic competition to drive down prices that are unreasonably high. A combination of much stronger price negotiation and authorization of generic competition could easily move drug prices more in line with other countries – and the prices currently obtained by the VA – and save American consumers and taxpayers hundreds of billions annually.

Shutting Down Privatized Medicare

Medicare accounts for more than one-in-five dollars spent on health care in the United States – more than $800 billion annually and fast growing. Although Medicare is a public insurance program, the passage of the Medicare Modernization Act in 2003 launched the current era of privatized Medicare – “Medicare Advantage” – plans.^[20]

Now, more than half of seniors enrolled in Medicare are now members of private plans paid for in large part with Medicare funds. ^[21] This partial privatization of Medicare is delivering inferior care to patients, fattening insurance corporation bottom lines and costing taxpayers hundreds of billions of dollars.

Just last year, private insurers offering Medicare Advantage plans cost Medicare an excess of $83 billion.[22] From 2007 to 2023, privatized Medicare overpayments totaled more than $600 billion.[23]  Over the next decade, these excess payments to insurance companies that delay and deny care to seniors and people with disabilities are on track to exceed $1 trillion.[24]

Eliminating privatized Medicare could thus save $100 billion a year or more than $1 trillion over 10 years – with improved care for Medicare beneficiaries.

There is overwhelming evidence privatized Medicare Advantage companies are doing a worse job serving beneficiaries than traditional Medicare.[25] Companies offering privatized Medicare Advantage plans make it difficult for patients to get the care they need and for doctors to provide necessary care. With profit incentives to deny care, Medicare Advantage plans regularly refuse to authorize or reimburse care that patients need.[26] A study by the Department of Health and Human Services inspector general found that 13 percent of the Medicare Advantage denials for prior authorization were for services that met Medicare coverage rules, “likely preventing or delaying medically necessary care for Medicare Advantage beneficiaries.” The inspector general emphasized that “these denials may be particularly harmful for beneficiaries who cannot afford to pay for services directly and for critically ill beneficiaries who may suffer negative health consequences from delayed or denied care.” [27]

Just as denying patients needed care is part of the business model for privatized Medicare plans, so are a series of tricks to manipulate the system and impose extra costs on Medicare:

Cherry-Picking and Lemon-Dropping: The Medicare Advantage system is structured in a way to enable insurance companies to gain revenue and offload high-risk patients with expensive health conditions to traditional Medicare. Private insurers often limit their coverage pool to lower-risk parties – which, in the case of health insurance, means insuring only healthier people.[28] This “cherry picking” problem is pervasive in the seniors’ health insurance markets and is practically unavoidable: Medicare Advantage insurers can attract those healthier people by offering lower premiums for plans with less access to the more expensive treatments and services that less healthy people need. The result is to leave traditional Medicare with a pool of less healthy people, raising its per-patient cost.

These same plans offer barriers and inferior care when people do become seriously ill. Sicker seniors are more likely to switch from Medicare Advantage to traditional Medicare.[29] A Government Accountability Office (GAO) analysis concluded that roughly one third of the Medicare Advantage plans with high dis-enrollment rates were biased against sick people, presumably prompting sick people to leave the plan when they become ill.[30] Similarly, seniors in the final year of life – when health care costs are disproportionately high – shift from Medicare Advantage and to traditional Medicare at more than twice the rate of other Medicare Advantage beneficiaries.[31] This pattern indicates that these patients were unable to receive necessary care and were incentivized to return to traditional Medicare where their choice of provider and access to services are guaranteed.[32] This phenomenon is often referred to as “lemon-dropping.”

Upcoding: Medicare Advantage insurers drive overcharges by “upcoding,” meaning they add medical codes to patient charts to make them appear to be sicker than they are.[33] With more diagnoses, they appear to be riskier patients, and Medicare pays the insurers more.[34] By way of illustration, Medicare Advantage plans “received an estimated $9.2 billion in payments in 2017 for beneficiary diagnoses reported solely on chart reviews or health risk assessments, with no other records of services for those diagnoses in the encounter data,” according to Erin Bliss of the inspector general’s office for the Department of Health and Human Services.^[35]

A recent Wall Street Journal investigation found that privatized Medicare upcoding cost Medicare $50 billion from 2018-2021.[36] The Journal notes that insurers can add diagnoses that the treating physician does not, and that insurers have an incentive to add diagnoses that generate more income. UnitedHealth members were about 15 times more likely to be diagnosed with diabetic cataracts than patients in traditional Medicare, the Journal found, a ratio that experts said was implausible. The Journal found other elevated diagnosis rates among privatized Medicare providers for diseases such as morbid obesity, heart failure, depression and emphysema.

Other Tricks: Insurance corporation gaming of Medicare Advantage – and ripping off taxpayers – is a defining trait of the system. Regulators are completely unable to maintain pace with the gaming innovations of the industry, all of which end up imposing additional, wasteful costs on Medicare.

One of many examples: “crosswalking,” where Medicare Advantage insurers carve up and merge plans in order to maintain high ratings from Medicare, ratings which translate into substantial bonus payments.[37] A Wall Street Journal analysis found that UnitedHealth, the biggest Medicare Advantage insurer, in 2016 merged plans covering 162,088 members, across more than 15 states including Indiana, Texas and Georgia, into a contract that had included just 1,729 members in Rhode Island and Massachusetts. By doing so, United Health was able to use the high rating for the small plans and apply it to the big plan, earning a $63 million bonus in the process. Analysts from JPMorgan Chase concluded that Humana generated an extra $600 million from employing the tactic, according to the Journal.^[38]

Not all of the Medicare Advantage corporate manipulations are legal. In fact, illegality seems baked into the business model, with most Medicare Advantage insurers submitting improper bills or engaging in fraud.[39]

These problems are all specific to privatized Medicare. Medicare has its problems and needs to be improved, but all of the problems highlighted here would disappear immediately with the end of privatized Medicare, generating immediate savings – and improved patient care.

Cutting Pentagon Waste and Curbing Contractor Greed

The Pentagon budget is fast approaching $1 trillion, with the fiscal year 2025 budget set at a mind-blowing $895 billion.

This astonishing level of spending – which does not include military aid to Ukraine – is far more reflective of the political influence and power of the military-industrial complex than any legitimate national defense interest. In fact, the United States spends more on defense than the next nine largest military spenders combined.[40]

Eliminating waste, ending investments in failed weapons and curtailing spending above that requested by the Pentagon itself could easily save $100 billion annually. Even greater savings could be achieved by placing greater emphasis on diplomacy over weaponry, or by recognizing domestic and humanitarian spending priorities that are crowded out by Pentagon spending.

The constant upward pressure for more Pentagon spending is directly tied to the political power of Pentagon contractors. Pentagon contractors spent more than $38 million in the 2023-2024 federal election cycle.[41] In 2024 alone, they spent $110 million on lobbying, employing 896 lobbyists, nearly two thirds of whom had previously worked inside the government.[42] Pentagon contractors strategically deploy factories and source parts from factories spread around the country and in key districts, and then exaggerate their job creation, creating a powerful set of Congressional supporters, who fear disciplining Pentagon spending may cause job loss in their districts.[43] The result is more and more for the Pentagon, despite an unparalleled record of waste and misspending.

Pervasive Waste: The Pentagon itself has identified more than $100 billion of waste in its own budget in a 2015 study.[44] Instead of using its internal report on waste as a means to advance spending accountability, the Pentagon worked to suppress it, with top leaders (correctly) fearing it would undermine their case for more funding. The Pentagon removed the report from its website and, according to the Washington Post, “imposed secrecy restrictions on the data making up the study, which ensured no one could replicate the findings.”[45] The Pentagon has so much money that it literally can’t keep track of it. Since being required to undergo an audit, the Pentagon has failed to pass on seven successive occasions.[46]

Congressional Servility: Under the influence of Pentagon contractors, Congress frequently throws more money at the Pentagon than the President requests, resulting in a steadily increasing base of funding.

In spring 2022, President Biden proposed a Pentagon budget for fiscal year 2023 of $813 billion, an increase of $30 billion from the previous year and $60 billion more than the final Trump Pentagon budget. Congress raised that funding level by $45 billion. In two years, the Pentagon budget grew more than $100 billion from the final year of the Trump administration.

Notably, the average campaign contribution from these Pentagon contractors to House and Senate Armed Services Committee members who voted “yes” on that increase was more than triple the average gift the complex gave to those who voted “no” – $151,722 for the yes-men and women, $42,967 for the naysayers. When the dust settled and Congress raised the Pentagon budget $45 billion above Biden’s request, Pentagon contractors clinched a return of nearly 450,000 percent on their $10 million investment in campaign contributions to the armed services committees.

Useless Weaponry: The Navy’s Littoral Combat Ship: The power of the contractor lobby and Congressional servility is so intense that, even when the Pentagon itself wants to cancel programs, contractors are often able to leverage their political power to keep the programs – and their corporate welfare subsidies – alive. The U.S. Navy’s Littoral Combat Ship, for example, cannot protect itself from submarine threats, so the Navy proposed in the FY23 budget to retire nine of them.[47] Chief of Naval Operations (CNO) Admiral Michael Gilday testified to the House that “after about a year and a half study, I refuse to put an additional dollar against a system that wouldn’t be able to track a high-end submarine in today’s environment.”[48] But the House Armed Services Committee didn’t care. It passed an amendment to the defense authorization bill to keep five of the nine ships in the water. And the full House defeated an amendment that would have retired the ships.[49]

There was no mystery as to this result. Once the Navy made its recommendation, the New York Times reported, “the lobbying started.” “A consortium of players with economic ties to the ships — led by a trade association whose members had just secured contracts worth up to $3 billion to do repairs and supply work on them — mobilized to pressure Congress to block the plan, with phone calls, emails and visits to Washington to press lawmakers to intervene.”[50]

Failing Weaponry: The F-35 Fighter Jet: The F-35 jet is the Pentagon’s costliest weapon system program and is expected to cost $1.7 trillion, even though the aircraft does not yet operate correctly, the program is rife with delays and cost overruns, and a substantial number of the aircraft will be procured before they are proved to have reached “an acceptable level of performance and reliability.”[51]

The Pentagon’s goal is that F-35s be available for operations 65 percent of the time – a mark the current fleet is falling far short of hitting. The more than 600 already delivered are in fact available – a term meaning a plane can do at least one of its assigned missions – only about half the time, according to the Pentagon’s internal review.[52] Operational availability has declined in recent years.

Nuclear Waste: The Pentagon is rushing ahead with a $2 trillion plan to refurbish the nation’s nuclear weapons arsenal, disregarding options to reduce the overall arsenal and abandon land-based intercontinental ballistic missiles – measures that would save money and increase national and global security.[53]

Contractor Capture: The U.S. military has long relied on contractors, who have long ripped off taxpayers,[54] but that dependence has soared in the last two decades. By 2011, reports Brown University’s Cost of War Project, “there were more private contract employees involved in the wars in Iraq and Afghanistan than uniformed military personnel. By 2019, the ratio of contractors to troops had grown to 1.5:1, or 50 percent more contractors than troops in the U.S. Central Command region that includes Iraq and Afghanistan.[55]  “More than half of the annual Department of Defense budget is now spent on military contractors, and payments to contractors have risen more than 164 percent since 2001, from about $140 billion in 2001 to about $370 billion in 2019. A large portion of these contracts have gone to just five major corporations: Lockheed Martin, Boeing, General Dynamics, Raytheon and Northrop Grumman.”[56]

Dramatic Pentagon savings are available from reducing reliance on these contractors, including for services the Pentagon could perform in-house, and by imposing basic standards of accountability to decrease waste, fraud and abuse.

Taxing the Rich and Corporations

U.S. tax rates on corporations and the wealthy are inefficiently low. Excessively low taxes on corporations and the wealthy are not only unfair, they undermine economic growth by starving the government of money for high-return investments and enabling wealth concentration that stunts economic growth.

An efficient U.S. tax policy would feature higher taxes on high earners and the wealthy, much stiffer taxes on corporations, and a meaningful tax on financial speculation. Such policy measures could generate $300 billion and as much as $500 billion or more annually in extra revenue.

What is notably not efficient is current tax policy as shaped by the Tax Cuts and Jobs Act (TCJA) of 2017. There is very little evidence that the tax cuts strengthened the economy. The benefits of the tax package were concentrated among the wealthy. Corporate taxes were slashed and government revenue was reduced:

• Taxes for the top 1 percent of income earners were projected to drop by $60,000 annually versus $500 for those in the bottom 60 percent of earners – meaning those at the top received 120 times as much benefit as the majority of Americans. (For the richest 0.1 percent, the benefit was $250,000 annually.)[57]
• Corporate tax revenues fell off a cliff after the bill’s passage, costing the government an estimated $750 billion over 10 years and likely much more.[58]
• Overall, the TCJA was projected to reduce government revenues by $1.9 trillion, likely a low estimate, over 10 years.[59]

There is little doubt that the TCJA made the rich richer and drove corporate profits, share prices and CEO pay. But it wasn’t efficient: It didn’t drive meaningful economic growth, investment or rising wages. Among employees, all of the benefits from the corporate tax cuts were captured by the upper 10 percent of income earners: “Workers’ earnings gains are concentrated in executive pay and in the top 10 percent of the within-firm income distribution, while workers in the bottom 90 percent of the distribution see no change in earnings,” a leading analysis found. Even more startling is the overall allocation – which went overwhelmingly to investors and corporate executives: “56 percent of gains flow to firm owners, 12 percent flow to executives, 32 percent flow to high-paid workers, and 0 percent flow to low-paid workers.”[60]

Similarly, extending the entirety of the expiring provisions of the TCJA would be massively inefficient. While costing more than $4 trillion over 10 years (nearly $5 trillion if extra interest payments are included),[61] the Congressional Budget Office finds that extension would have no impact on economic growth.[62]

Taxing high earners and the wealthy

An extra dollar is worth more to a minimum wage worker than it is to a millionaire – and an extra dollar to a low-income worker has a greater stimulative effect than an extra dollar to a corporate CEO. That’s why it makes sense as a matter of both justice and efficiency to maintain a progressive tax code. There’s a lot of money to be raised with fair-share taxes on the rich, including with these illustrative examples:

• The TCJA reduced the marginal tax rate on the highest income earners to 37 percent from 39.6 percent. That tax break for the rich will expire at the end of 2025. Republican plans to extend the reduced rate would cost roughly $600 billion over the next decade.[63]
• A millionaire’s surtax – a 5 percent tax on income above $10 million – would generate $228 billion over a decade,[64] paid for by around 22,000 families.[65]
• The TCJA created a “pass-through” deduction to lower the tax rate for partnerships, S corporations and proprietorships. Although touted as helping small businesses, half the benefits have been captured by the richest households (those with income above $800,000); only 4 percent went to households with income below $80,000. The pass-through loophole for the rich will expire at the end of 2025. Republican plans to extend the loophole would cost roughly $700 billion over the next decade.[66]

Taxing corporations

The Tax Cuts and Jobs Act of 2017 slashed the corporate tax rate from 35 to 21 percent. The lower rates, combined with various loopholes, deductions, tax credits and loopholes had shocking effects.

Manipulation of the tax code is enabling dozens of major corporations to pay ZERO in taxes. The Institute for Tax and Economic Policy (ITEP) found that from 2018 to 2020 – the first three years of the Trump tax cut—39 profitable major corporations paid no taxes at all. Collectively, the 39 companies reported $122 billion in profits during the three-year period. And they collectively paid nothing in taxes.[67]

The problem is systemic. After passage of the TCJA, the largest and consistently profitable corporations saw their effective tax rates fall from an average of 22.0 percent to an average of 12.8 percent, according to ITEP. The 296 large, consistently profitable corporations in the ITEP study saw profits grow by 44 percent while their overall federal tax bill fell 16 percent. Overall, these companies paid $240 billion less in taxes from 2018 to 2021 than they would have paid under the effective rates they paid before the Trump law – that’s $80 billion a year.[68]

Taxing Wall Street speculation

While consumers pay a sales tax when they buy a cup of coffee, investors don’t pay a sales tax when they buy and sell stocks, bonds and derivatives. This inefficiency unfairly benefits the very rich, who are responsible for the overwhelming share of stock ownership, and encourages inefficient practices such as high-frequency trading. High-frequency trading creates risks for sudden crashes and panics and creates economically inefficient and counterproductive transfers of wealth from retirement and pension funds and everyday investors.[69] Globally, high-frequency trading has been shown to increase costs for investors by $5 billion annually.[70]

A tax on financial speculation – a sales tax on stocks, bonds and derivatives – would cool high-frequency trading and raise substantial revenues. A 0.1 percent tax on financial transactions would raise $100 billion a year, according to a 2018 Congressional Budget Office estimate; the number is surely much higher now.[71] In 2022, the Congressional Budget Office estimated that a tiny 0.01 financial transaction tax would generate more than $30 billion annually.[72]

Ensure the IRS has ongoing resources to enforce the law, implement and expand Direct File, and rebuild its ranks.

The return on investment in ensuring tax compliance is well-documented and saving filers money through free e-filing would have immediate positive impacts on Americans’ lives.

Ensuring adequate funding for the Internal Revenue Service (IRS) to enforce the tax laws on the books generates far more revenue than it costs, while ensuring high-income earners cannot evade the taxes they owe. Each additional dollar spent by the IRS on audits of high-income earners generates more than $12 in revenue.

Direct File is a proven, commonsense tool that automatically populates tax returns with wage income and other information the IRS already possesses. For taxpayers with simple returns, Direct File saves time and stress and enables them to forsake overpriced tax return services. Direct File exemplifies government efficiency and should not only be maintained but scaled up.

Eliminating Oil and Gas Subsidies

The oil and gas industry doesn’t just use drilling rigs to exploit natural resources, it rigs the tax code itself. From tax breaks for drilling operations to federal support for export infrastructure, fossil fuel subsidies take many forms.

It’s hard to imagine anything more inefficient than public support for super-profitable corporations that are undermining planetary well-being, yet such supports are baked into the tax code and government policy.

Like many powerful industries, the oil and gas industry has deployed political power, backed by generous donations to political campaigns,[73] to win and maintain special tax treatment. A relatively modest investment in lobbying expenses has yielded huge rewards in tax benefits that save the industry billions. By one estimate, American taxpayers hand over $20 billion in tax breaks to fossil fuel companies every year.[74] These subsidies have a zombie-like status in the tax code and have proven incredibly difficult to kill outright.[75]

The most straightforward U.S. giveaway to Big Oil is allowing the companies to drill on public land for low prices. Starting in 1920, the U.S. government allowed oil and gas companies to drill on public lands at a rock-bottom rate of 12.5 percent of the value of oil and gas produced. That low royalty rate remained in place for more than a century until the Inflation Reduction Act, passed in August 2022, bumped it up to 16.67 percent. While that is an improvement for taxpayers, it still lags what states including Texas and Louisiana charge for oil and gas production on state lands, and far behind royalty rates imposed by other nations.

Oil and gas companies have been among the most effective industries at exploiting the complexity of tax rules to win esoteric provisions with enormous benefits. For example, Pioneer Natural Resources used tax breaks to zero out its federal income taxes in 2018, despite $1.2 billion in income; while Occidental Petroleum used a special tax credit to slash its taxes by $158 million, according to an analysis by the Institute for Taxation and Economic Policy.[76]

It’s no accident that these provisions are both irrelevant to regular taxpayers and incredibly hard to understand. It’s easier for oil drillers to accrue tens of billions in subsidies if regular Americans can’t track what’s happening. Following is a partial list of the ways oil and gas companies gouge the public and get special favors.

Deducting Drilling Costs: One especially lucrative special tax benefit for Big Oil, known as “intangible drilling costs,” dates back to 1916.[77] Under regular tax rules, a company can deduct the cost of its investments over the period where the investment is expected to generate profits. But under the intangible drilling costs rule, oil and gas companies get treated differently than other industries. They can deduct many of their investment costs immediately, including expenses related to labor, surveying, or other costs unrelated to operating an oil or gas well. This carveout saves oil and gas companies billions on their tax bill; the Biden White House estimated that eliminating this one tax break would save taxpayers $9.8 billion by 2034.[78] Research from the Stockholm Environmental Institute found that the deduction has made oil and gas drilling more profitable by increasing investors’ rate of return by 11 percent (for oil fields) and 8 percent (for gas fields).[79]

A similar tax benefit, dating back to 1926, is known as the percentage depletion allowance. Under regular tax rules, when a business uses up a resource, it can deduct from its revenue the reduced value of the asset. Thus, if a business uses up 10 percent of the resource, it can take a tax deduction equivalent to that depletion. But special rules available to oil and gas producers permit them to make deductions greater than the amount they are actually depleting.[80] The White House estimated that getting rid of this deduction would result in nearly $16 billion in savings over the next decade.

Bonus Depreciation: The 2017 Trump tax cut law included a massive corporate giveaway: the ability to deduct capital expenditures immediately in a single year, as opposed to slowly over the life of an asset. This provision applies across the economy, benefiting technology companies as well as fossil fuel corporations. Energy companies including Coterra Energy, Williams Cos and Marathon Petroleum are among the 25 corporations that saved the most from this tax break.[81] Since the incentive began to phase out in 2023, major fossil fuel companies have lobbied for its renewal.

Foreign Drilling Benefits: U.S. companies that extract oil and gas overseas receive several benefits under obscure tax code provisions. These foreign drilling tax breaks are projected to cost taxpayers $86 billion over 10 years, one study found.[82] For example, the 2017 Trump tax cut imposed a minimum tax on the foreign profits of U.S.-based corporations. However, this system exempted income from foreign oil and gas extraction, resulting in a major tax windfall for the biggest of the Big Oil companies with large, multinational operations. Another tax break makes it easier for multinational companies to claim a credit against taxes owed in the U.S. for taxes paid to foreign governments, even if this tax break is not appropriate. While U.S. companies may take tax credits for foreign taxes paid, the tax break does not apply to payments like royalties. However, foreign countries may try to disguise non-tax payments as a tax, knowing that in many cases a multinational company may receive a foreign tax credit from its home country. Existing regulation gives corporate taxpayers vast latitude to assert what portions of their payments are taxes eligible to offset U.S. tax bills. The Biden administration proposed to close this loophole by placing a limit on foreign tax credits, but did not succeed.

Limited Partnerships: Master Limited Partnerships (MLPs) are a special corporate structure that are both exempt from corporate income taxes and publicly traded on stock markets. The benefits of this structure accrue overwhelmingly to fossil fuel companies, especially pipelines.

Marginal Wells: Oil and gas companies benefit from a tax credit for low-producing oil and gas wells triggered automatically by low prices. When it is in effect, the credit is worth $3 per barrel of oil and $.50 per thousand cubic feet of natural gas. This tax credit improves the economics of some of the oldest, most polluting oil and gas wells that would otherwise be shut down.[83]

Regulating Efficiency

A premise of the Department of Government Efficiency is that regulation is inefficient and stifling the American economy. That premise is wrong. Not a little bit wrong, but completely at odds with the facts.

First, the government measures major new rules for their effect on the economy – and doesn’t adopt them unless the overall impact is positive. Second, regulatory protections have demonstrably improved the quality of life in America, and generated fast savings for consumers and taxpayers. Third, the counterfactual illustrates the crucial role of regulatory protections: weakened rules and inadequate enforcement have led to financial, environmental and other catastrophes that have imposed staggering costs on society.

Regulations are Economically Smart and Efficient

Although most regulations do not have economic objectives as their primary purpose, in fact regulation is overwhelmingly positive for the economy.

While regulators commonly do not have economic growth and job creation as a mission priority, they are mindful of regulatory cost, and by statutory directive or on their own initiative typically seek to minimize costs; relatedly, the rulemaking process gives affected industries ample opportunity to communicate with regulators over cost concerns, and these concerns are considered. As a result, very few major rules are adopted where projected costs exceed projected benefits, and those very few cases typically involve direct Congressional mandates.

Every year, the Office of Management and Budget analyzes the costs and benefits of rules with significant economic impact. In the most recent report, the agency finds that benefits exceed costs by ratio of 3-1 on the low end and 5-1 on the upper end of estimates. In 2001, annual benefits are projected at $30.7 billion to $49.0 billion and annual costs are estimated at $9.6 billion to $11.9 billion.[84] These results are consistent year-to-year, with roughly comparable positive ratios recorded every year.

It is also the case that firms typically innovate creatively and quickly to meet new regulatory requirements, even when they fought hard against adoption of the rules.[85] The result is that costs are commonly lower than anticipated.

Regulations Deliver Massive Non-Monetary Benefits

The United States – and the world – have made dramatic gains through regulation, making the country safer, healthier, more just, cleaner, more equitable and more financially secure. Regulation has made all of our lives better in ways not typically “monetized.” It has:

• Made our food safer.[86]
• Saved tens of thousands of lives by making our cars safer. NHTSA’s vehicle safety standards have reduced the traffic fatality rate from nearly 3.5 fatalities per 100 million vehicles traveled in 1980 to 1.41 fatalities per 100 million vehicles traveled in 2006. [87]
• Made it safer to breathe, saving hundreds of thousands of lives annually. Clean Air Act rules saved 160,300 adult lives annually in 2010 and 230,000 lives annually starting in 2020.[88]
• Protected children’s brain development by phasing out leaded gasoline. EPA regulations phasing out lead in gasoline helped reduce the average blood lead level in U.S. children ages 1 to 5. During the years 1976 to 1980, 88 percent of all U.S. children had blood levels in excess of 10 micrograms/deciliter; during the years 1991 to 1994, only 4.4 percent of all U.S. children had blood levels in excess of that dangerous amount.[89]
• Empowered disabled persons by giving them improved access to public facilities and workplace opportunities, through implementation of the Americans with Disabilities Act.[90]
• Guaranteed a minimum wage, ended child labor and established limits on the length of the work week.[91]
• Saved the lives of thousands of workers every year. Deaths on the job have declined from more than 14,000 per year in 1970, when the Occupational Safety and Health Administration was created, to 5,400 at present. 690,000 lives have been saved since the creation of OSHA.[92]
• Protected the elderly and vulnerable consumers from a wide array of unfair and deceptive advertising techniques.[93]
• And much more.

These are not just the achievements of a bygone era. Regulation continues to improve the quality of life for every American, every day. Consider just the achievements of the Consumer Financial Protection Bureau (CFPB): Since its creation after the 2008 financial crash, the CFPB has returned $20.7 billion to consumers through law enforcement activity and aided more than 200 million Americans injured by illegal practices. The agency’s rules on junk fees alone will save consumers $20 billion annually.[94]

Industry Whining About Regulation is Not New – and Not True

Despite the historic and ongoing benefits of public regulation, there is a long history of business complaining about the cost of regulation — and predicting that the next regulation will impose unbearable burdens. Time and again, these predictions fall flat.

• Bankers and business leaders described the New Deal financial regulatory reforms in foreboding language, warning that the Federal Deposit Insurance Commission and related agencies constituted “monstrous systems,” that registration of publicly traded securities constituted an “impossible degree of regulation,” and that the New Deal reforms would “cripple” the economy and set the country on a course toward socialism.[95] In fact, those New Deal reforms prevented a major financial crisis for more than half a century — until they were progressively scaled back.
• Chemical industry leaders said that rules requiring removal of lead from gasoline would “threaten the jobs of 14 million Americans directly dependent and the 29 million Americans indirectly dependent on the petrochemical industry for employment.” In fact, while banning lead from gasoline is one of the single greatest public policy public health accomplishments, the petrochemical industry has continued to thrive. The World Bank finds that removing lead from gasoline has a ten times economic payback.[96]
• Big Tobacco long convinced restaurants, bars and small business owners that smokefree rules would dramatically diminish their revenue — by as much as 30 percent, according to industry-sponsored surveys. The genuine opposition from small business owners — based on the manipulations of Big Tobacco — delayed the implementation of smoke-free rules and cost countless lives. Eventually, the Big Tobacco-generated opposition was overcome, and smokefree rules have spread throughout the country — significantly lowering tobacco consumption. Dozens of studies have found that smokefree rules have had a positive or neutral economic impact on restaurants, bars and small business.[97]
• Rules to confront acid rain have reduced the stress on our rivers, streams and lakes, fish and forests.[98] Industry projected costs of complying with acid rain rules of $5.5 billion initially, rising to $7.1 billion in 2000; ex-ante estimates place costs at $1.1 billion – $1.8 billion.[99]
• In the case of the regulation of carcinogenic benzene emissions, “control costs were estimated at $350,000 per plant by the chemical industry, but soon thereafter the plants developed a new process in which more benign chemicals could be substituted for benzene, thereby reducing control costs to essentially zero.”[100]
• The auto industry long resisted rules requiring the installation of air bags, publicly claiming that costs would be more than $1000-plus for each car. Internal cost estimates actually showed the projected cost would be $206.[101] The cost has now dropped significantly below that. The National Highway Traffic Safety Administration estimates that air bags saved 2,790 lives in 2017, and more than 50,000 lives from 1975 to 2017.[102]
• Similarly, the auto industry threatened doom if forced to adopt catalytic converter technology, saying that as a result of such a mandate, “the prospect of unreasonable risk of business catastrophe and massive difficulties with these vehicles in the hands of the public may be faced. It is conceivable that complete stoppage of the entire production could occur, with the obvious tremendous loss to the company, shareholders, employees, suppliers, and communities.”^[103] The catalytic converter did not, in fact, impose business catastrophe on the auto industry.

There is a long list of other examples from the last century — including child labor prohibitions, the Family Medical Leave Act, the CFC phase out, asbestos rules, coke oven emissions, cotton dust controls, strip mining, vinyl chloride[104] — that teach us to be wary of Chicken Little warnings about the costs of the next regulation.

The important lessons here are that impacted industries have a natural bias to overestimate costs of regulatory compliance, and projections and claims of cost regularly discount the impact of technological dynamism. Indeed, regulation spurs innovation and can help create efficiencies and industrial development wholly ancillary to its directly intended purpose.

The Costs of Not Regulating

In contrast to Big Business’s self-interested and persistently disproved claims, the real efficiency threat comes from deregulation, under regulation and inadequate regulatory enforcement.

The most powerful illustration of this reality is the financial crash of 2008 and the Great Recession. A very considerable literature, and a very extensive Congressional hearing record, documents in granular detail the ways in which regulatory failure led to financial crash and the onset of the Great Recession. “Widespread failures in financial regulation and supervision proved devastating to the stability of the nation’s financial markets,” concluded the Financial Crisis Inquiry Commission.[105] “Deregulation went beyond dismantling regulations,” noted the Financial Crisis Inquiry Commission. “[I]ts supporters were also disinclined to adopt new regulations or challenge industry on the risks of innovations.”[106] The very extensive regulatory failures that contributed to the crisis include everything from the failure to stop toxic and predatory mortgage lending that blew up the housing bubble; the repeal of the Glass-Steagall Act; unregulated financial derivatives; and poorly regulated credit ratings firms.

To prevent the collapse of the financial system, the federal government provided incomprehensibly huge financial supports, far beyond the $700 billion in the much-maligned Troubled Assets Relief Program (TARP).

Even more significant, however, are the actual losses traceable to the regulatory failure-enabled Great Recession. A GAO study found that “[t]he 2007-2009 financial crisis, like past financial crises, was associated with not only a steep decline in output but also the most severe economic downturn since the Great Depression of the 1930s.”[107] Reviewing estimates of lost economic output, GAO reported that the present value of cumulative output losses could exceed $13 trillion.[108] Additionally, GAO found that “households collectively lost about $9.1 trillion (in constant 2011 dollars) in national home equity between 2005 and 2011, in part because of the decline in home prices.”[109]

The recession threw millions out of work, and left millions still jobless or underemployed. “The monthly unemployment rate peaked at around 10 percent in October 2009 and remained above 8 percent for over 3 years, making this the longest stretch of unemployment above 8 percent in the United States since the Great Depression,” GAO noted.[110]

As regards the impact of inadequate regulation and enforcement, the 2008 financial crisis and Great Recession are different in scale but not in kind from other corporate-caused problems. The 2010 BP oil disaster, the Wells Fargo fraudulent account scandal, predatory student loan ripoffs, the East Palestine train disaster, numerous food contamination outbreaks, the harmful effect of social media on children and much, much more could have been prevented or alleviated by smarter and stronger regulation and enforcement.

For the Department of Government Efficiency, all this should be good news: The regulatory process is working – except that it should be made stronger and more aggressive.

Investing in the Care Economy

The strongest argument for investing in childcare, paid parental leave, early education, nutrition programs and more is that these investments make our country kinder and better, fairer and more just. Such investments are profoundly democratic, evidencing a concern for every child and adult, for addressing gender imbalances and for redressing racial and economic disparities.

But set aside concerns for justice and equity. Such programs are smart investments in conventional economic terms. They are profoundly efficient.

A vast literature has developed to consider the return on investment in early childhood development, health care access and other social programs in monetary terms. These efforts are inherently imperfect and underestimate benefits, due to the impossibility of capturing in monetary terms many of the programs’ direct and indirect benefits. But a sophisticated literature has evolved to subject social investments to cost-benefit analysis. For early childhood programs, these capture monetary benefits such as increased earnings in adulthood for participants, reductions in crime and avoided costs of repeated schooling. For health care investments, they capture health care costs averted. The analyses apply a discount rate, so that dollars spent today are valued more than dollars generated or saved a decade hence.[111]

Early Childhood Education and Development: All parents want their kids to get off to a strong start in life, but opportunities are highly unequal based on family income, geography and more. A wide range of early childhood programs to ensure access for all children have been carefully studied for impact. They have a powerfully positive impact on kids’ long-term educational attainment, lifetime earnings and quality of life. And, they pay off in monetary terms: “Early learning initiatives have provided total benefits to society, including reduced crime, lower anti-poverty transfers, and educational savings, of up to $8.60 over a child’s lifetime for every $1 spent,” an estimate that includes improved lifetime earnings of children who benefit from early education and development programs.[112] These programs include everything from early maternal home visits to quality childcare to preschool. A vast literature testifies to these programs’ success and economic payback.[113] There are other important economic benefits from childcare and education programs, notably including increased labor force participation by mothers,[114] and including overall macroeconomic strength from the heightened contribution of better-educated workers; and many social, non-economic benefits, including family functioning, community cohesiveness and civic engagement.[115]

Access to Health Care: Ensuring all children have access to quality health care pays off. The wide-ranging benefits are well-established: “Those whose mothers gained eligibility for prenatal coverage under Medicaid have lower rates of obesity as adults and fewer hospitalizations related to endocrine, nutritional and metabolic diseases, and immunity disorders as adults, with particularly pronounced reductions in visits associated with diabetes and obesity. … Prenatal expansions improved educational and economic outcomes for affected cohorts. Cohorts who gained Medicaid eligibility in utero have higher high school graduation rates” and there is “evidence suggesting that they have higher incomes in adulthood.”[116] Investing in kids’ health care pays off directly to the government, not counting the social benefits, with each additional dollar invested in Medicaid returning $1.78 to the government.[117] Taking into account the social monetized benefits, returns are vastly higher.

Nutrition Benefits: Nutrition benefits alleviate hunger and provide access to healthy food, with massive multiplier effects for recipients.[118] Infants and children in families participating in the Supplemental Nutrition Assistance Program (SNAP) are more likely to see a doctor for periodic check-ups. Low-income adults participating in SNAP incur 25 percent less in medical care costs than low-income non-participants. Nutrition benefits improve birth outcomes and children’s lifelong health outcomes. Nutrition benefits help older recipients live independently and make them less likely to skip medicine dosages because of cost. In narrow economic terms, nutrition benefits pay off immediately,  generating an immediate economic return of 50 percent. “$1 billion in new spending induces further new spending in the economy that collectively increases GDP by $1.54 billion, supports 13,560 jobs, and creates $32 million in farm income.”[119] Incorporating the benefits to recipients would suggest a far higher return on investment.

A wide range of additional social interventions are efficient for businesses but are beyond the capacity of many small businesses or pose collective action problems that require governmental intervention to solve. Paid leave policies, for example, not only benefit workers and their families; they enhance productivity, worker retention and overall economic strength.[120] Large companies recognize these benefits and are far more likely to offer paid leave for disability or family leave than smaller businesses. Many small businesses simply don’t have the economic cushion to offer paid leave policy, no matter the long-term payoff to the firm. The result is a net loss to society and an unfair advantage for larger firms. States that have experimented with paid leave programs have shown they work, with one study attributing a 5 percent increase in productivity to such policies.[121]

The overriding challenge in considering the “efficiency” of social investments is that their primary purpose typically is not economic and their primary benefits are typically not monetary. In a wide range of cases, efforts to determine the pure economic value of these investments have proven their efficiency in narrow economic terms, even when applying discount rates to the value of long-term payoffs. When a further step is taken and monetary value is applied to non-monetary benefits – an inherently imperfect exercise that relies heavily on “willingness to pay” surveys, underestimates the value of benefits and fails to capture their social advantages – an overwhelming number and diverse array of social programs demonstrate “efficiency” and pay for themselves.[122]

But even this approach underestimates the benefits of social investments, which are “social,” not individual. On the one hand, the returns on investment often go beyond the value to a beneficiary, by strengthening family and community bonds and by creating societal economic benefits not captured by a person’s higher wages. On the other hand, key social investments need to focus on communities, not just individuals, again with returns both to individual and overall community strength.[123]

Investing to Avert Climate Catastrophe

“Climate change is a threat to human well-being and planetary health” and “there is a rapidly closing window of opportunity to secure a livable and sustainable future for all.”[124] That is the bottom-line conclusion from the world’s leading climatologists, who together through the Intergovernmental Panel on Climate Change (IPCC) have consistently demonstrated a very conservative assessment of climate risks.

Climate science shows the imperative of immediate action to avert catastrophe. “Risks and projected adverse impacts and related losses and damages from climate change escalate with every increment of global warming,” the IPCC finds.[125]

Climate impacts are diverse and compounding. They include: heat-related death and illness, coastal flooding and land loss, diminished agricultural production, water shortages, new and increased spread of infectious diseases, loss of biodiversity, more severe weather events, mass migration and much more. To take just one example of impacts, in the 2030s – the next decade – the number of people exposed to heat levels beyond the “survivability threshold” may total 10 million.[126] Risks will cascade across impacts and regions, the IPCC points out. “Climate-driven food insecurity and supply instability, for example, are projected to increase with increasing global warming, interacting with non-climatic risk drivers such as competition for land between urban expansion and food production, pandemics and conflict.”[127]

The monetary costs of climate inaction are hard to fathom but they will severely reduce the size of the global economy. Depending on how quickly we move and how severe we let climate chaos become, the insurance giant Swiss Re suggests the annual dollar costs could be 11 to 14 percent of total global economic output by 2050 – amounting to around $23 trillion annually – and around 7 percent of North American economic output.[128] These costs will compound and grow even worse over time.

In the face of these alarms, it should be plain that extraordinary investments to prevent the worst climate scenarios meet any standard of “efficiency.” The IPCC’s literature review concludes that climate change mitigation investments pay for themselves simply with enhanced efficiency and direct health benefits (e.g., improved air quality), not even counting averted climate-related costs.[129]

Mitigation efforts will pay off 10 times over in monetary terms alone, according to modeling from the consulting firm BCG. BCG projects annual global GDP loss of 16-22 percent by 2100 without increased action. Investments of 1-2 percent of global GDP can reduce the damage to 4-6 percent by 2100. “Overall, the net cost of inaction” – as against a course of investments now – “amounts to approximately 10% to 15% of lost global GDP by 2100,” BCG concludes.[130]

Equally, study after study has found a very high economic return on investments in climate adaptation, all of which point out that acting sooner rather than later will cost less and protect more:

• The Global Commission on Adaptation “found that the overall rate of return on investments in improved resilience is very high, with benefit-cost ratios ranging from 2:1 to 10:1, and in some cases even higher Specifically, our research finds that investing $1.8 trillion globally in five areas from 2020 to 2030 could generate $7.1 trillion in total net benefits.”[131]
• The National Institute of Building Sciences find that “public-sector investment in mitigation since 1995 by FEMA, EDA, and HUD cost the country $27 billion but will ultimately save $160 billion, meaning $6 saved per $1 invested.[132]
• The Climate Resiliency Report from the U.S. Chamber of Commerce, Allstate, and the U.S. Chamber of Commerce Foundation “finds that every $1 invested in resilience and disaster preparedness saves $13 in economic impact, damage, and cleanup costs after the event.”[133]

Preventing catastrophic climate change and adapting to the inevitably worsening impacts will require very large investments, from diverse sources and across the global economy. But the U.S. government must be at the center of these investments.

While mitigating climate change requires global solutions, as the world’s largest and most powerful economy and the historic greatest emitter of greenhouse gases, the United States must be the leader and driver of those solutions. And, along with helping fund adaptation in developing countries – a humanitarian as well as self-interested necessity, to lessen resource competition and help people stay in their homes and communities – the U.S. government will need to make large investments to adapt to domestic climate change impacts.

There will be many opportunities for corporations to profit from the clean energy transition, through selling new technologies, adopting more energy efficient systems and more. But climate change is in many ways a problem of the pollution of the global commons, which means public investment will unavoidably be central to addressing the issue.

Especially because of the immensity of what must be done, managing the transition to a clean energy future and adapting to now-inevitable impacts of climate change will require elaborate plans throughout the whole of the global economy.[134] The core concepts will include a rapid transition to 100 percent clean energy, with major restructuring of transportation, manufacturing and buildings to advance efficiency and eliminate reliance on fossil fuels; investments in soil-regenerative agriculture, transformation of the livestock sector and a serious commitment to reforestation; and attention to equity, within and among countries.

The details matter of clean energy plans matter, of course, but the top-line for thinking about government efficiency is simple: Large public investments in a clean energy future are imperative and profoundly efficient in narrow economic terms.

Conclusion

Every sign from DOGE suggests that it aims to use “efficiency” as a cover to drive a pro-corporate, anti-regulatory agenda and an ideologically driven social service cuts program. In total, this would constitute an anti-efficiency agenda. By contrast, if DOGE is interested in saving taxpayers and consumers money and making sound investments that will generate a positive return to the government and society, there is a clear set of evidence-based measures for it to pursue. The choice is as simple as that.

Endnotes

[1] Statement from President Donald J. Trump, November 12, 2024, https://truthsocial.com/@realDonaldTrump.

[2] Remarks of Elon Musk, October 28, 2024, https://www.bloomberg.com/news/videos/2024-10-28/elon-musk-we-can-cut-2-trillion-from-us-budget-video.

[3] Chris Matthews, “How Elon Musk and Vivek Ramaswamy teamed up to gut $2 trillion in government spending,” Market Watch, December 16, 2024, https://www.marketwatch.com/story/how-elon-musk-and-vivek-ramaswamy-teamed-up-to-gut-2-trillion-of-government-spending-2b2a16b9

[4] Erin Doherty, “Vivek Ramaswamy: Firing federal workers will be good for them,” December 4, 2024, Axios, https://www.axios.com/2024/12/04/ramaswamy-federal-employees-trump.

[5] Justin Lahart and Rosie Ettenheim “Musk Wants $2 Trillion of Spending Cuts. Here’s Why That’s Hard,” Wall Street Journal, November 26, 2024, https://www.wsj.com/politics/policy/government-spending-doge-elon-musk-trump-administration-60477bc5.

[6] “U.S. prices for brand drugs were 422 percent of prices in the comparison countries, or at least 322 percent if we adjust for estimated rebates in the U.S., but not for estimated rebates in other countries (for which data are generally unavailable).” https://aspe.hhs.gov/sites/default/files/documents/d5541b529a379d1f908ed2f9c00a9255/aspe-cover-idr-pricing-availability.pdf.

[7] U.S. Department of Health and Human Services, Office of Inspector General, “Drug Spending,” December 16, 2024, https://oig.hhs.gov/reports-and-publications/featured-topics/drug-spending.

[8] Elizabeth Schrier, David U. Himmelstein, Adam Gaffney, Danny McCormick and Steffie Woolhandler “Taxpayers’ Share of US Prescription Drug and Insulin Costs: a Cross-Sectional Study,” Journal of General Internal Medicine, October 2024, https://doi.org/10.1007/s11606-024-09032-x.

[9][9] “NIH funding contributed to published research associated with every one of the 210 new drugs approved by the Food and Drug Administration from 2010-2016.” Ekaterina Galkina Cleary, Jennifer M. Beierlein, Navleen Surjit Khanuja, Laura M. McNamee, and Fred D. Ledley, “Contribution of NIH funding to new drug approvals 2010–2016,” PNAS 115, no. 10 (February 2018): 2329-2334, https://www.pnas.org/doi/10.1073/pnas.1715368115.

[10] Assistant Secretary for Planning and Evaluation (ASPE), U.S. Department of Health & Human Services, “Comparing Prescription Drugs in the U.S. and Other Countries: Prices and Availability,” February 2024, https://aspe.hhs.gov/sites/default/files/documents/d5541b529a379d1f908ed2f9c00a9255/aspe-cover-idr-pricing-availability.pdf.

[11] Government Accountability Office, “Department of Veterans Affairs Paid About Half as Much as Medicare Part D for Selected Drugs in 2017,” December 2020, https://www.gao.gov/assets/gao-21-111.pdf.

[12] IQVIA, “The Use of Medicines in the U.S. 2024,” April 2024, https://www.iqvia.com/-/media/iqvia/pdfs/institute-reports/the-use-of-medicines-in-the-us-2024/the-use-of-medicines-in-the-us-2024-usage-and-spending-trends-and-outlook-to-2028.pdf.

[13] Letter from Senator Bernie Sanders to Novo Nordisk CEO Lars Fruergaard Jørgensen, April 24, 2024, https://www.sanders.senate.gov/wp-content/uploads/Letter-from-Sen.-Bernard-Sanders-to-Novo-Nordisk.pdf.

[14] Public Citizen, “Novo Nordisk’s $50 billion in Ozempic & Wegovy Sales Comes at the Expense of Healthcare Solvency,” August 7, 2024, https://www.citizen.org/news/novo-nordisks-50-billion-in-ozempic-wegovy-sales-comes-at-the-expense-of-healthcare-solvency.

[15] Congressional Research Office, “Research and Development in the Pharmaceutical Industry,” April 2021, https://www.cbo.gov/publication/57126#:~:text=Only%20about%2012%20percent%20of,than%20%242%20billion%20per%20drug.

[16] Melissa J. Barber, Dzintars Gotham and Helen Bygrave, “Estimated Sustainable Cost-Based Prices for Diabetes Medicines,” JAMA Network, JAMA Netw Open. 2024;7(3):e243474, March 27, 2024, https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2816824; Melissa Barber, Joseph S. Ross, and Reshma Ramachandran, “To get a fair deal on Wegovy, buying Novo Nordisk might not be Medicare’s worst option,” Stat, July 23, 2024, https://www.statnews.com/2024/07/23/wegovy-medicare-medicaid-costs-why-not-buy-manufacturer-novo-nordisk.

[17] Bernie Sanders, “Sanders Announces Generic Pharma Companies Willing to Sell Ozempic for Less than $100,” September 17, 2024, https://www.sanders.senate.gov/press-releases/news-sanders-announces-generic-pharma-companies-willing-to-sell-ozempic-for-less-than-100.

[18] “Drug Pricing Investigation Celgene and Bristol Myers Squibb—Revlimid,” Staff Report, Committee on Oversight and Reform U.S. House of Representatives, September 2020, https://oversight.house.gov/sites/democrats.oversight.house.gov/files/Celgene%20BMS%20Staff%20Report%2009-30-2020.pdf.

[19] Deena Beasley, “US will still pay at least twice as much after negotiating drug prices,” Reuters, September 3, 2024, https://www.reuters.com/world/us/us-will-still-pay-least-twice-much-after-negotiating-drug-prices-2024-09-03/

[20] Yash M. Patel and Stuart Guterman, “The Evolution of Private Plans in Medicare,” Commonwealth Fund, December 8, 2017, https://www.commonwealthfund.org/publications/issue-briefs/2017/dec/evolution-private-plans-medicare.

[21] Meredith Freed, Jeannie Fuglesten Biniek, Anthony Damico, and Tricia Neuman, “Medicare Advantage in 2024: Enrollment Update and Key Trends,” Kaiser Family Foundation, August 8, 2024, https://www.kff.org/medicare/issue-brief/medicare-advantage-in-2024-enrollment-update-and-key-trends/#:~:text=More%20than%20half%20(54%25),enrolled%20in%20Medicare%20Advantage%20plans.

[22] Adam Gaffney, Stephanie Woolhandler and David Himmelstein, “Less Care at Higher Cost—The Medicare Advantage Paradox,” JAMA Internal Medicine, JAMA Intern Med. 2024;184(8):865-866. doi:10.1001/jamainternmed.2024.1868, June 10, 2024, https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2819817.

[23] Adam Gaffney, Stephanie Woolhandler and David Himmelstein, “Less Care at Higher Cost—The Medicare Advantage Paradox,” JAMA Internal Medicine, JAMA Intern Med. 2024;184(8):865-866. doi:10.1001/jamainternmed.2024.1868, June 10, 2024, https://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2819817.

[24] Committee for a Responsible Federal Budget, “New Evidence Suggests Even Larger Medicare Advantage Overpayments,” July 17, 2023, https://www.crfb.org/blogs/new-evidence-suggests-even-larger-medicare-advantage-overpayments.

[25] Center for Medicare Advocacy, October 31, 2024, “Ongoing Medicare Advantage Overpayments and Barriers to Care Prompt More Congressional Interest in Oversight,” https://medicareadvocacy.org/ongoing-medicare-advantage-overpayments-and-barriers-to-care; CMS Office for Minority Health in association with Rand Corporation, “Disparities in Health Care in Medicare Advantage Associated with Dual Eligibility or Eligibility for a Low-Income Subsidy and Disability,” May 2023, https://www.cms.gov/files/document/2023-disparities-health-care-medicare-advantage-associated-dual-eligibility-or-eligibility-low.pdf.

[26] Christi Grimm, “Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care,” Office of the Inspector General, April 2022, https://oig.hhs.gov/oei/reports/OEI-09-18-00260.pdf.

[27] Christi Grimm, “Some Medicare Advantage Organization Denials of Prior Authorization Requests Raise Concerns About Beneficiary Access to Medically Necessary Care,” Office of the Inspector General, April 2022, https://oig.hhs.gov/oei/reports/OEI-09-18-00260.pdf.

[28] Adam Gaffney, David U. Himmelstein, and Steffie Woolhandler, “Medicare Dis-Advantage: Overpayments and Inequity,” July 1, 2024, The Nation, https://www.thenation.com/article/society/medicare-advantage-privatization-inequity-fraud.

[29] Fred Schulte, “As Seniors Get Sicker, They’re More Likely To Drop Medicare Advantage Plans,” NPR, July 5, 2017, https://www.npr.org/sections/health-shots/2017/07/05/535381473/as-seniors-get-sicker-theyre-more-likely-to-drop-medicare-advantage-plans.

[30] “Medicare Advantage: CMS Should Use Data on Disenrollment and Beneficiary Health Status to Strengthen Oversight,” U.S. Government Accountability Office, April 2017, https://www.gao.gov/assets/690/684386.pdf.  Other studies have reached very similar findings. One study found “that the switching rate from 2010 to 2011 away from Medicare Advantage and to traditional Medicare exceeded the switching rate in the opposite direction for participants who used long-term nursing home care (17 percent versus 3 percent), short-term nursing home care (9 percent versus 4 percent), and home health care (8 percent versus 3 percent). Momotazur Rahman, Laura Keohane, Amal N. Trivedi, Vincent Mor, “High-Cost Patients Had Substantial Rates Of Leaving Medicare Advantage And Joining Traditional Medicare,” Health Affairs. 2015 Oct; 34(10): 1675-81, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4676406.

[31] “Medicare Advantage: Beneficiary Disenrollments to Fee-for-Service in Last Year of Life Increase Medicare Spending,” U.S. General Accountability Office, last modified July 28, 2021, https://www.gao.gov/products/gao-21-482.

[32] Adam Gaffney, David U. Himmelstein, and Steffie Woolhandler, “Medicare Dis-Advantage: Overpayments and Inequity,” July 1, 2024, The Nation, https://www.thenation.com/article/society/medicare-advantage-privatization-inequity-fraud.

[33] Paige Minemyer, “Medicare Advantage risk assessments driving billions in costs each year,” Fierce Healthcare, May 9, 2024, https://www.fiercehealthcare.com/regulatory/medicare-advantage-risk-assessments-driving-billions-costs-each-year.

[34] Robert M. Kaplan and Paul Tang, “Upcoding: One Reason Medicare Advantage Companies Pay Clinicians to Make Home Health Checkups,” Stat, January 19, 2013, https://www.statnews.com/2023/01/19/rein-in-upcoding-medicare-advantage-companies.

[35] Added Bliss: “This finding raises three concerns: (1) payment integrity – if the diagnoses were inaccurate, then Medicare Advantage organizations received inappropriate payments; (2) quality of care – if the diagnoses were accurate, then beneficiaries may not have received appropriate care to treat these often-serious conditions; and (3) data integrity–if the diagnoses were accurate and beneficiaries received care, then Medicare Advantage organizations may not have reported all provided services in the encounter data as required.” “Protecting America’s Seniors,” Testimony Before the United States House Committee on Energy and Commerce Subcommittee on Oversight and Investigations, June 28, 2022 (testimony of Erin Bliss, Assistant Inspector General for Evaluation and Inspections), https://energycommerce.house.gov/sites/democrats.energycommerce.house.gov/files/documents/Witness%20Testimony_Bliss_OI_2022.06.28_1.pdf.

[36] Christopher Weaver, Tom McGinty, Anna Wilde Mathews and Mark Maremont, “Insurers Pocketed $50 Billion From Medicare for Diseases No Doctor Treated,” Wall Street Journal, July 8, 2024, https://www.wsj.com/health/healthcare/medicare-health-insurance-diagnosis-payments-b4d99a5d?mod=hp_lead_pos7.

[37] Anna Wilde Mathews and Christopher Weaver, “Insurers Game Medicare System to Boost Federal Bonus Payments,” Wall Street Journal, March 11, 2018, https://www.wsj.com/articles/insurers-game-medicare-system-to-boost-federal-bonus-payments-1520788658.

[38] Anna Wilde Mathews and Christopher Weaver, “Insurers Game Medicare System to Boost Federal Bonus Payments,” Wall Street Journal, March 11, 2018, https://www.wsj.com/articles/insurers-game-medicare-system-to-boost-federal-bonus-payments-1520788658.

[39] Reed Abelson and Margot Sanger-Katz, “’The Cash Monster Was Insatiable’: How Insurers Exploited Medicare for Billions,” New York Times, October 8, 2022, https://www.nytimes.com/2022/10/08/upshot/medicare-advantage-fraud-allegations.html

[40] Stockholm International Peace Research Institute, “SIPRI Yearbook 2024,” April 2024, https://www.sipri.org/sites/default/files/2024-06/yb24_summary_en_2_1.pdf.

[41] OpenSecrets, “Interest Groups,” https://www.opensecrets.org/industries.

[42] Open Secrets, “Sector Profile: Defense,” https://www.opensecrets.org/federal-lobbying/sectors/summary?cycle=2024&id=D.

[43] William Hartung, “More Money, Less Security: Pentagon Spending and Strategy in the Biden Administration,” Quincy Institute, June 8, 2023, https://quincyinst.org/research/more-money-less-security-pentagon-spending-and-strategy-in-the-biden-administration/#obstacles-to-reform-contractor-capture-of-congress

[44] The study suggested $125 billion in savings over a 5-year period. Craig Whitlock and Bob Woodward, “Pentagon buries evidence of $125 billion in bureaucratic waste,” The Washington Post, December 5, 2016, https://www.washingtonpost.com/investigations/pentagon-buries-evidence-of-125-billion-in-bureaucratic-waste/2016/12/05/e0668c76-9af6-11e6-a0ed-ab0774c1eaa5_story.html.

[45] Craig Whitlock and Bob Woodward, “Pentagon buries evidence of $125 billion in bureaucratic waste,” The Washington Post, December 5, 2016, https://www.washingtonpost.com/investigations/pentagon-buries-evidence-of-125-billion-in-bureaucratic-waste/2016/12/05/e0668c76-9af6-11e6-a0ed-ab0774c1eaa5_story.html.

[46] Brad Dress, “Pentagon fails 7th audit in a row but says progress made,” The Hill, November 15, 2024, https://thehill.com/policy/defense/4992913-pentagon-fails-7th-audit-in-a-row-but-says-progress-made

[47] Melissa Nann Burke, “U.S. House debates future of littoral combat ships including the USS Detroit,” Detroit News, July 14, 2022, https://www.detroitnews.com/story/news/politics/2022/07/14/house-debates-future-littoral-combat-ships-uss-detroit/10055378002.

[48] Full Committee Hearing: “Fiscal Year 2023 Defense Budget Request from the Department of the Navy,” May 11, 2022, https://armedservices.house.gov/hearings?ID=0CE42E6D-9589-41CB-AC90-FF8CE0E827FF.

[49] Melissa Nann Burke, “U.S. House debates future of littoral combat ships including the USS Detroit,” Detroit News, July 14, 2022, https://www.detroitnews.com/story/news/politics/2022/07/14/house-debates-future-littoral-combat-ships-uss-detroit/10055378002.

[50] Eric Lipton, “The Pentagon Saw a Warship Boondoggle. Congress Saw Jobs,” New York Times, February 13, 2023, https://www.nytimes.com/2023/02/04/us/politics/littoral-combat-ships-lobbying.html.

[51] “F-35 Joint Strike Fighter: Cost Growth and Schedule Delays Continue,” U.S. Government Accountability Office, last modified April 25, 2022, https://www.gao.gov/products/gao-22-105128. See also Dan Grazier, “F-35 Program Stagnated in 2021 but DOD Testing Office Hiding Full Extent of Problem,” Project on Government Oversight, March 9, 2022, https://www.pogo.org/analysis/2022/03/f-35-program-stagnated-in-2021-but-dod-testing-office-hiding-full-extent-of-problem.

[52] John Tirpak, “Report: F-35 Struggled With Reliability, Maintainability, Availability in 2023,” Air and Space Forces, February 8, 2024, https://www.airandspaceforces.com/f-35-reliability-maintainability-availability-2023

[53] William Perry, “Why Its Safe to Scrap America’s ICBMs,” New York Times, September 30, 2016, https://www.nytimes.com/2016/09/30/opinion/why-its-safe-to-scrap-americas-icbms.html; William Hartung, “More Money, Less Security: Pentagon Spending and Strategy in the Biden Administration,” Quincy Institute, June 8, 2023, https://quincyinst.org/research/more-money-less-security-pentagon-spending-and-strategy-in-the-biden-administration/#obstacles-to-reform-contractor-capture-of-congress.

[54] Stacey Smith, “How A Law From The Civil War Fights Modern-Day Fraud,” NPR, October 1, 2014, https://www.npr.org/sections/money/2014/10/01/352819369/how-a-law-from-the-civil-war-fights-modern-day-fraud.

[55] “Corporate Power, Profiteering, And The ‘Camo Economy,’” Costs of War, https://watson.brown.edu/costsofwar/costs/social/corporate.

[56] “Corporate Power, Profiteering, And The ‘Camo Economy,’” Costs of War, https://watson.brown.edu/costsofwar/costs/social/corporate.

[57] Tax Policy Center, “Conference Agreement: The Tax Cuts and Jobs Act; Baseline: Current Law; Distribution of Federal Tax Change by Expanded Cash Income Percentile, 2025,” December 18, 2017, https://taxpolicycenter.org/model-estimates/conference-agreement-tax-cuts-and-jobs-act-dec-2017/t17-0314-conference-agreement.

[58] Galen Hendricks and Seth Hanlon, “The TCJA 2 Years Later: Corporations, Not Workers, Are the Big Winners,” Center for American Progress, December 19, 2019, https://www.americanprogress.org/article/tcja-2-years-later-corporations-not-workers-big-winners.

[59] Congressional Budget Office (CBO), “The Budget and Economic Outlook: 2018 to 2028,” April 9, 2018, https://www.cbo.gov/publication/53651.

[60] Patrick J. Kennedy, Christine Dobridge, Paul Landefeld, Jacob Mortenson, “The Efficiency-Equity Tradeoff of the Corporate Income Tax: Evidence from the Tax Cuts and Jobs Act,” October 31, 2022, https://economics.yale.edu/sites/default/files/2023-01/The%20Efficiency-Equity%20Tradeoff%20of%20the%20Corporate%20Income%20Tax.pdf.

[61] Congressional Budget Office, “Budgetary Outcomes Under Alternative Assumptions About Spending and Revenues, May 2024, https://www.cbo.gov/system/files/2024-05/60114-Budgetary-Outcomes.pdf.

[62] Congressional Budget Office, “How the Expiring Individual Income Tax Provisions in the 2017 Tax Act Affect CBO’s Economic Forecast,” December 2024, https://www.cbo.gov/publication/60986.

[63] Americans for Tax Fairness, “Trump-GOP Tax Law Closeup: Restore The Top Tax Rate On The Highest-Income Households,” September 4, 2024, https://americansfortaxfairness.org/trump-gop-tax-law-closeup-restore-top-tax-rate-highest-income-households.

[64] Congressional Budget Office, “Estimated Budgetary Effects of Title XIII, Committee on Ways and Means, H.R. 5376, the Build Back Better Act,” November 18, 2021, https://www.cbo.gov/publication/57626.

[65] Jean Ross and Seth Hanlon, “The Millionaire Surcharge Would Improve the Fairness of the Tax Code,” Center for American Progress, June 8, 2022, https://www.americanprogress.org/article/the-millionaire-surcharge-would-improve-the-fairness-of-the-tax-code/.

[66] Chuck Marr and Samantha Jacoby, “The Pass-Through Deduction Is Tilted Heavily to the Wealthy, Is Costly, and Should Expire as Scheduled,” June 8, 2023, https://www.cbpp.org/research/federal-tax/the-pass-through-deduction-is-tilted-heavily-to-the-wealthy-is-costly-and#_ftn7

[67] “Corporate Tax Avoidance Under the Tax Cuts and Jobs Act,” Institute on Taxation and Economic Policy, last modified July 29, 2021, https://itep.org/corporate-tax-avoidance-under-the-tax-cuts-and-jobs-act.

[68] Matthew Gardner, Michael Ettlinger, Steve Wamhoff, Spandan Marasini, “Corporate Taxes Before and After the Trump Tax Law,” Institute for Tax and Economic Policy, May 2, 2024, https://itep.org/corporate-taxes-before-and-after-the-trump-tax-law.

[69] Michael Lewis, Michael Lewis Reflects on His Book Flash Boys, A Year After It Shook Wall Street to Its Core, Vanity Fair, March 12, 2015, https://www.vanityfair.com/news/2015/03/michael-lewis-flash-boys-one-year-later; Matteo Aquilina, Eric Budish and Peter O’Neill, Financial Conduct Authority, Quantifying the High-Frequency Trading “Arms Race”: A Simple New Methodology and Estimates, January 2020, https://www.fca.org.uk/publication/occasional-papers/occasional-paper-50.pdf.

[70] Matteo Aquilina, Eric Budish and Peter O’Neill, Financial Conduct Authority, Quantifying the High-Frequency Trading “Arms Race”: A Simple New Methodology and Estimates, January 2020, https://www.fca.org.uk/publication/occasional-papers/occasional-paper-50.pdf.

[71] Congressional Budget Office, “Impose a Tax on Financial Transactions,” December 13, 2018, https://www.cbo.gov/budget-options/54823.

[72] Congressional Budget Office, “Impose a Tax on Financial Transactions,” December 7, 2022, https://www.cbo.gov/budget-options/58708.

[73] “Oil & Gas Summary,” Open Secrets, https://www.opensecrets.org/industries/indus?ind=E01.

[74] Environmental and Energy Studies Institute, “Fossil Fuel Subsidies: A Closer Look at Tax Breaks and Societal Costs,” July 29, 2019, https://www.eesi.org/papers/view/fact-sheet-fossil-fuel-subsidies-a-closer-look-at-tax-breaks-and-societal-costs

[75] Lisa Friedman, “The Zombies of the U.S. Tax Code: Why Fossil Fuels Subsidies Seem Impossible to Kill,” New York Times, March 15, 2024, https://www.nytimes.com/2024/03/15/climate/tax-breaks-oil-gas-us.html.

[76] Matthew Gardner and Steve Wamhoff, “Corporate Tax Avoidance Remains Rampant Under New Tax Law,” Institute for Tax and Economic Policy, April 11, 2019, https://itep.org/notadime/#:~:text=Oil%20and%20gas%20tax%20breaks,by%20%24158%20million%20last%20year.

[77] Committee for a Responsible Federal Budget, “The Tax Break-Down: Intangible Drilling Costs,” October 17, 2013, https://www.crfb.org/blogs/tax-break-down-intangible-drilling-costs.

[78] ‘Budget of the U.S. Government Fiscal Year 2025,” Office of Management and Budget, https://www.whitehouse.gov/wp-content/uploads/2024/03/budget_fy2025.pdf.

[79] Ploy Achakulwisut, Peter Erickson and Doug Koplow, “Effect of subsidies and regulatory exemptions on 2020–2030 oil and gas production and profits in the United States,” Environmental Research Letters, July 29, 2021, https://iopscience.iop.org/article/10.1088/1748-9326/ac0a10.

[80] Taxpayers for Common Sense, “Getting the Facts on Oil & Gas Preferences,” October 2021, https://www.taxpayer.net/wp-content/uploads/2021/10/TCS_Facts-on-Oil-Gas-Preferences_Oct.-2021_final.pdf

[81] Steve Wamhoff, “Corporations Reap Billions in Tax Breaks Under ‘Bonus Depreciation’,” Institute for Tax and Economic Policy, June 29, 2023, https://itep.org/corporations-reap-billions-in-tax-breaks-under-bonus-depreciation.

[82] Friends of the Earth, Bailout Watch, Oxfam, “12Guilty Fogeys: Big Oil’s $86 billion offshore tax bonanza,” September 2021, https://foe.org/wp-content/uploads/2021/09/FFS_12_Guilty_Fogeys_rd3.pdf.

[83] Environmental Protection Agency, “Marginal Conventional Wells,” July 9, 2024, https://www.epa.gov/natural-gas-star-program/marginal-conventional-wells.

[84] Office of Management and Budget, Office of Information and Regulatory Affairs Draft 2023 Report to Congress on the Benefits and Costs of Federal Regulations an Unfunded Mandates on State, Local, and Tribal Entities, November 2024, https://www.whitehouse.gov/wp-content/uploads/2024/11/Draft-FY23-Benefit-Cost-Report-Final.pdf.

[85] N. Mouzoon & T. Lincoln, “Regulation: The Unsung Hero in American Innovation,” 2011, Public Citizen, http://www.citizen.org/documents/regulation-innovation.pdf.

[86] In addition to the historic advances through food safety regulation, implementation of the 2011 Food Safety Modernization Act will have tremendous benefits, eliminating most of the annual toll of 48 million illnesses, 128,000 hospitalizations, and 3,000 deaths that the Centers for Disease Control and Prevention estimates occur each year from contaminated food. M. Taylor, Implementing the FDA Food Safety Modernization Act, February 5, 2014, https://docs.house.gov/meetings/IF/IF14/20140205/101711/HHRG-113-IF14-Wstate-TaylorM-20140205.pdf.

[87] Rena Steinzor and Sidney Shapiro, The People’s Agents and the Battle to Protect the American Public: Special Interests, Government, and Threats to Health, Safety, and the Environment: University of Chicago Press, 2010.

[88] See U.S. Environmental Protection Agency, “Benefits and Costs of the Clean Air Act 1990-2020, the Second Prospective Study,” May 15, 2024, https://www.epa.gov/clean-air-act-overview/benefits-and-costs-clean-air-act-1990-2020-second-prospective-study.

[89] Office of Management and Budget, Office of Information and Regulatory Affairs, 2011 Report to Congress on the Benefits and Costs of Federal Regulations an Unfunded Mandates on State, Local, and Tribal Entities,” 2011, https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/inforeg/inforeg/2011_cb/2011_cba_report.pdf.

[90] National Council on Disability, “The Impact of the Americans with Disabilities Act,” 2007, https://www.ncd.gov/report/the-impact-of-the-americans-with-disabilities-act-assessing-the-progress-toward-achieving-the-goals-of-the-americans-with-disabilities-act.

[91] There are important exceptions to the child labor prohibition; significant enforcement failures regarding the minimum wage, child labor and length of work week (before time and a half compensation is mandated). But the quality of improvement in American lives has nonetheless been dramatic. Jim Lardner, Good Rules: 10 Stories of Successful Regulation. 2011, Demos, https://sensiblesafeguards.org/assets/documents/report-good-rules-report-demos.pdf.

[92] See AFL-CIO. Death on the Job: The Toll of Neglect, 2024, https://aflcio.org/reports/dotj-2024; Mining deaths fell by half shortly after creation of the Mine Safety and Health Administration. Weeks, J. L., & Fox, M. (1983). Fatality rates and regulatory policies in bituminous coal mining, United States, 1959-1981. American journal of public health, 73(11), 1278.

[93] See 16 CFR 410-460.

[94] Rohit Chopra, “Opening Statement before the House Financial Services Committee,” June 13, 2024, https://www.consumerfinance.gov/about-us/newsroom/opening-statement-of-director-rohit-chopra-before-the-house-financial-services-committee.

[95] Taylor Lincoln, Industry Repeats Itself: The Financial Reform Fight. Public Citizen, 2011, http://www.citizen.org/documents/Industry-Repeats-Itself.pdf.

[96] Adam Crowther, Regulation Issue: Industry’s Complaints About New Rules Are Predictable — and Wrong. 2013, http://www.citizen.org/documents/regulation-issue-industry-complaints-report.pdf.

[97] Adam Crowther, Regulation Issue: Industry’s Complaints About New Rules Are Predictable — and Wrong. 2013, http://www.citizen.org/documents/regulation-issue-industry-complaints-report.pdf.

[98] Environmental Protection Agency. Acid Rain Program Results, April 5, 2024, https://www.epa.gov/acidrain/acid-rain-program-results.

[99] The Pew Environment Group, Industry Opposition to Government Regulation,” October 2010, https://www.pewtrusts.org/~/media/assets/2011/03/industry-clean-energy-factsheet.pdf.

[100] Isaac Shapiro and John Irons, Regulation, Employment, and the Economy: Fears of job loss are overblown,” Economic Policy Institute, 2011: http://www.epi.org/files/2011/BriefingPaper305.pdf.

[101] Peter Behr, “U.S. Memo on Air Bags in Dispute,” Washington Post, August 13, 1981.

[102]  National Highway Traffic Safety Administration, “Traffic Safety Facts: Occupant Protection in Passenger Vehicles,” May 2023, https://crashstats.nhtsa.dot.gov/Api/Public/ViewPublication/813449.

^[103] April 11, 1973, hearing transcript cited in Clarence Ditlow, Federal Regulation of Motor Vehicle Emissions under the Clean Air Act Amendments of 1970, Ecological Law Journal. 1975, pp. 495-504.

[104] Adam Crowther, Regulation Issue: Industry’s Complaints About New Rules Are Predictable — and Wrong. 2013, http://www.citizen.org/documents/regulation-issue-industry-complaints-report.pdf; Hart Hodges, “Falling Prices: Cost of Complying With Environmental Regulations Almost Always Less Than Advertised,” Economic Policy Institute, November 1, 1997,  http://www.epi.org/publication/bp69 ; Isaac Shapiro and John Irons, Regulation, Employment, and the Economy: Fears of job loss are overblown,” Economic Policy Institute, 2011: http://www.epi.org/files/2011/BriefingPaper305.pdf.

[105] Financial Crisis Inquiry Commission. (2011). The Financial Crisis Inquiry Report: Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States. Washington, D.C.: Government Printing Office. p. 30.

[106] The Financial Crisis Inquiry Report. p. 53.

[107] U.S. Government Accountability Office, “Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act,” January 13, 2013, http://www.gao.gov/products/GAO-13-180.

[108] Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act. p. 16.

[109] Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act. p. 21. There is necessarily a significant amount of uncertainty around such analyses. Other estimates have placed the loss somewhat lower. A recent Congressional Budget Office study estimates the cumulative loss from the recession and slow recovery at $5.7 trillion.” (Congressional Budget Office. 2012. The Budget and Economic Outlook: Fiscal Years 2012 to 2022. p. 26.) One complicating issue is determining which losses should be attributed to the recession and which to other issues. For example, GAO notes, “analyzing the peak-to-trough changes in certain measures, such as home prices, can overstate the impacts associated with the crisis, as valuations before the crisis may have been inflated and unsustainable.[109] Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act. p. 17.

[110] Financial Crisis Losses and Potential Impacts of the Dodd-Frank Act. pp. 17-18.

[111] See Lynn Karoly, “Toward Standardization of Benefit-Cost Analyses of Early Childhood Interventions,” Rand, December 2010, https://www.rand.org/content/dam/rand/pubs/working_papers/2011/RAND_WR823.pdf;

[112] The Obama White House, “The Economics of Early Childhood Investments,” January 2015, https://obamawhitehouse.archives.gov/sites/default/files/docs/early_childhood_report_update_final_non-embargo.pdf.

[113] Lynn A. Karoly, M. Rebecca Kilburn, Jill S. Cannon, “Early Childhood Interventions: Proven Results, Future Promise,” Rand Corporation, 2005, https://www.rand.org/content/dam/rand/pubs/monographs/2005/RAND_MG341.pdf.

[114] “What the research says about the economics of early care and education,” Washington Center for Equitable Growth, September 2021, https://equitablegrowth.org/wp-content/uploads/2021/09/091521-childcare-econ-fs.pdf.

[115] Lynn A. Karoly, M. Rebecca Kilburn, Jill S. Cannon, “Early Childhood Interventions: Proven Results, Future Promise,” Rand Corporation, 2005, https://www.rand.org/content/dam/rand/pubs/monographs/2005/RAND_MG341.pdf.

[116] Sarah Miller and Laura R. Wherry, “The Long-Term Effects of Early Life Medicaid Coverage,” August 20, 2015, https://websites.umich.edu/~mille/MillerWherry_Prenatal2015.pdf.

[117] Nathanial Hendren and Ben Sprung-Keyser, “A Unified Welfare Analysis of Government Policies.” Quarterly Journal of Economics 135 (3): 1209-1318, https://scholar.harvard.edu/hendren/publications/unified-welfare-analysis-government-policies

[118] See Steven Carlson and Joseph Llobrera, “SNAP Is Linked With Improved Health Outcomes and Lower Health Care Costs,” Center for Budget and Policy Priorities, December 14, 2022, https://www.cbpp.org/research/food-assistance/snap-is-linked-with-improved-health-outcomes-and-lower-health-care-costs.

[119] Patrick Canning and Brian Stacy, “The Supplemental Nutrition Assistance Program (SNAP) and the Economy: New Estimates of the SNAP Multiplier,” U.S. Department of Agriculture, July 2019, https://www.ers.usda.gov/webdocs/publications/93529/err265_summary.pdf.

[120] On the case for paid social leave and supporting research, see Molly Weston Williamson, “America’s Small Businesses Need a National Paid Leave Program,” Center for American Progress, September 19, 2024, https://www.americanprogress.org/article/americas-small-businesses-need-a-national-paid-leave-program/.

[121] Benjamin Bennett, Isil Erel, Léa H. Stern and Zexi Wang, “Paid Leave Pays Off: The Effects of Paid Family Leave on Firm Performance,” National Bureau of Economic Research, 2020, https://www.nber.org/system/files/working_papers/w27788/w27788.pdf.

[122] Nathanial Hendren and Ben Sprung-Keyser, “A Unified Welfare Analysis of Government Policies.” Quarterly Journal of Economics 135 (3): 1209-1318, https://scholar.harvard.edu/hendren/publications/unified-welfare-analysis-government-policies.

[123] Raj Chetty, “I Have Studied Social Mobility for Years. Here’s How Kamala Harris Can Build an ‘Opportunity Economy,’” New York Times, September 20, 2024, https://www.nytimes.com/2024/09/20/opinion/kamala-harris-opportunity-economy.html.

[124] Intergovernmental Panel on Climate Change, “Climate Change 2023 Synthesis Report,” https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf.

[125] Intergovernmental Panel on Climate Change, “Climate Change 2023 Synthesis Report,” 2023 https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf.

[126] Daniel Quiggin, Kris De Meyer, Lucy Hubble-Rose and Antony Froggatt, Climate change risk assessment 2021. Summary of research findings. Chatham House, September 2021

https://www.chathamhouse.org/2021/09/climate-change-risk-assessment-2021.

[127] Intergovernmental Panel on Climate Change, “Climate Change 2023 Synthesis Report,” 2023 https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf.

[128] Swiss Re Institute, “The economics of climate change: no action not an option,” April 2021, https://www.swissre.com/dam/jcr:e73ee7c3-7f83-4c17-a2b8-8ef23a8d3312/swiss-re-institute-expertise-publication-economics-of-climate-change.pdf.

[129] Intergovernmental Panel on Climate Change, “Climate Change 2023 Synthesis Report,” 2023 https://www.ipcc.ch/report/ar6/syr/downloads/report/IPCC_AR6_SYR_SPM.pdf.

[130] Amine Benayad, Lars Holm, Hamid Maher, Edmond Rhys Jones, Sylvain Santamarta, Annika Zawadzki, and Kamiar Mohaddes, “Why Investing in Climate Action Makes Good Economic Sense,” BCG, September 23, 2024, https://www.bcg.com/publications/2024/investing-in-climate-action.

[131] Global Commission on Adaptation, “Adapt Now: A Global Call for Leadership on Climate Resilience,” September 2019, https://gca.org/wp-content/uploads/2019/09/GlobalCommission_Report_FINAL.pdf?_gl=1*1u8fzfk*_ga*MjA4MTk3OTIzMi4xNzM1MDg1MTA0*_up*MQ.

[132] National Institute of Building Sciences, “Mitigation Saves: Mitigation Saves up to $13 per $1 Invested,” 2020, https://www.nibs.org/files/pdfs/ms_v4_overview.pdf.

[133] U.S. Chamber of Commerce, Allstate, and the U.S. Chamber of Commerce Foundation, “2024 Climate Resiliency Report: The Preparedness Payoff: The Economic Benefits of Investing in Climate Resilience,” June 25, 2024, https://www.uschamber.com/security/the-preparedness-payoff-the-economic-benefits-of-investing-in-climate-resilience.

[134] For examples of comprehensive plans, see “The Six Sector Solution to the Climate Crisis,” UN Environment Program, 2020, https://www.unep.org/interactive/six-sector-solution-climate-change/; Vision for Equitable Climate Action, U.S. Climate Action Network, May 2020, https://equitableclimateaction.org/wp-content/uploads/2020/05/Vision-for-Equitable-Climate-Action-May-2020-final-1.pdf; “What is the Green New Deal?” Sunrise Movement, https://www.sunrisemovement.org/green-new-deal.

January 14, 2025

What is Medicare for All?

By Eagan Kemp

Medicare for All is a health care system that would finally allow everyone in the United States to have guaranteed access to care throughout their lives. By improving Medicare and expanding it to everyone in the United States, families would finally be able to get the care they need when they need it. All medically necessary care would be covered and premiums, copays and deductibles would be eliminated. By removing profit-seeking middlemen from the health care system, Medicare for All would finally bring down the cost of the health care system, meaning Americans would no longer have to worry about whether they can afford keep their loved ones alive and healthy.

How Would Medicare for All Change the U.S. Health Care System?

End insurance delays and denials by covering all medically necessary care and giving patients the freedom to choose their doctor. It would also improve Medicare by improving coverage for vision, dental, hearing, reproductive, gender-affirming, and long-term care, including in-home care services.

Remove employment, age and marital status as barriers to receiving health care. Under our current system, Americans struggle until age 65 to ensure they have the coverage they need and can lose health care coverage for all sorts of reasons, including losing their job, turning 26 and no longer being eligible to remain on a parent’s plan, or having even just having their income change. Medicare for All means guaranteed, lifelong care.

End medical bankruptcy and save money for American families by eliminating insurance premiums and deductibles. High levels of cost sharing contribute to many Americans struggling to get the care they need, with half reporting difficulty affording health care costs and 1 in 4 facing challenges paying for care. In addition, Americans who seek care risk medical debt and even bankruptcy.  Medicare for All would end medical bills for patients by covering all medically necessary care.

Cut financial waste currently exacerbated by greedy, profit-seeking insurance companies. Medicare for All would bring down health care costs systemwide by streamlining our currently fragmented health care system. Our health care system is made up of thousands of health insurance plans as well as numerous state and federal programs that all play some role in paying for health care. By spending health care resources on needed care instead of corporate profit or administrative waste, Medicare for All would finally bring the cost of health care under control, similar to the experience of other countries with universal health care systems.

End Pharma profiteering and guarantee medications for all who need them. Medicare for All would also prevent pharmaceutical corporation profiteering and guarantee access to needed medication by using the full weight of the government to negotiate on behalf of the American people, while also holding the power to use compulsory licensing to ensure fair negotiations.

Stop hospital closures. Medicare for All would also mean that the many hospitals, particularly rural hospitals currently at risk of closure, would have the funds they need to serve their communities through negotiated annual budgets.

Reverse our status as the sickest population in the developed world. Unlike other comparably wealthy nations, the U.S. system is much more fragmented, leaving Americans to fall through the cracks in the health care system every day. Many are unable to afford the care they need and face financial hardship if they seek needed care. This contributes to the fact that Americans are sicker than citizens of peer countries. Medicare for All would mean the U.S. would finally catch up to peer nations by guaranteeing access to health care throughout a person’s life, regardless of income.

Why Do We Need Medicare for All Now?

The American health care system is only getting worse as greedy corporations find new ways to increase their profits while they leave working families in worse health and increasing levels of medical debt. Americans recognize the need for a health care system that serves their needs. In addition, the level of support for Medicare for All legislation in Congress remains high, with 114 cosponsors in the House of Representatives and 14 cosponsors in the Senate, and so now is the time to demand the health care system we truly need.

We will only be able to pass Medicare for All by continuing to build grassroots support and taking on entrenched health care interests. The people power on this issue continues to grow as Americans feel the pain of our broken health care system. While those who profit from the current system will put everything they have behind hindering reform, it is impossible to overcome the moral imperative that everyone in the U.S. deserves guaranteed access to health care. The American people are only becoming more vocal in pushing for significant health reform. So, the question is not whether we will achieve Medicare for All, but when.

Trump’s Billionaire Cabinet Represents the Top 0.0001%

Working Americans who understand what it’s like to struggle from paycheck to paycheck to make ends meet have never been well represented in the White House. But the extraordinary wealth of appointees President Donald Trump is naming to help run the government represents an unprecedentedly hands-on intervention by the billionaire class. This is not just government by the top 1% – Trump’s government is rule by the top 0.0001% (read as the top one ten thousandth percent).

The collective net worth of Trump’s top appointees is reportedly estimated to exceed $460 billion, including Elon Musk’s $400 billion net worth. Even without Musk, Trump’s cabinet and top appointees in 2025 by far exceeds the wealth of previous cabinets, including his previous cabinet (and previous record holder), which was worth $3.2 billion. President Biden’s cabinet collectively was worth $118 million.

Sixteen of Trump’s 25 wealthiest appointees and nominees are members of the 0.0001%, meaning they are among the 813 billionaires in the United States, where some 341 million of the rest of us make up the 99.9999% (earning an average yearly income of about $61,000). Elon Musk’s outrageous wealth places him in a category all his own, as the world’s richest person. By contrast, cabinet members who are mere members of the top 1% – members such as J.D. Vance, Kristi Noem, and Marco Rubio – appear almost working class, even if the wealth of each is more than triple the median income Americans earn over their entire lives ($1.7 million).

Will rule by the ultra-rich deliver for the other 99.9999% of us? Time will tell.

Table: Wealth of Trump Administration Appointees

Name	Agency	Title	Approximate Net Worth (High Estimate)	Wealth Percentile
Elon Musk	DOGE	Co-leader	$400,000,000,000	world’s richest person
Charles Kushner*	State	Ambassador to France	$7,100,000,000	0.0001%
Donald Trump	White House	President	$6,200,000,000	0.0001%
Stephen Feinberg	Defense	Deputy Secretary	$5,000,000,000	0.0001%
Leandro Rizzuto Jr.*	State	Ambassador to the Organization of American States	$3,500,000,000	0.0001%
Warren Stephens	State	Ambassador to the United Kingdom	$3,400,000,000	0.0001%
Linda McMahon*	Education	Secretary	$3,000,000,000	0.0001%
Jared Isaacman	NASA	Administrator	$1,700,000,000	0.0001%
Howard Lutnick	Commerce	Secretary	$1,500,000,000	0.0001%
Doug Burgum	Interior		$1,100,000,000	0.0001%
Kelly Loeffler	Small Business Administration	Administrator	$1,100,000,000	0.0001%
Vivek Ramaswamy	DOGE	Co-leader	$1,000,000,000	0.0001%
Steven Witkoff		Special Envoy to the Middle East	$1,000,000,000	0.0001%
Scott Bessent	Treasury	Secretary	$1,000,000,000	0.0001%
Thomas Barrack Jr.	State	Ambassador to Turkey	$1,000,000,000	0.0001%
Frank Bisiganano	Social Security Administration	Administrator	$1,000,000,000	0.0001%
David Sacks	White House	AI and Crypto Czar	reported billionaire	0.0001%
Mehmet Oz	CMS	Administrator	$315,000,000	0.001%
Chris Wright	Energy	Secretary	$171,000,000	0.001%
Robert F. Kennedy Jr.	HHS	Secretary	$15,000,000	0.1%
JD Vance		Vice President	$11,300,000	1%
Michael Waltz		National Security Advisor	$10,500,000	1%
Pete Hegseth	Defense	Secretary	$6,000,000	1%
Krisi Noem	Homeland Security	Secretary	$5,000,000	1%
Marco Rubio	State	Secretary	$5,000,000	1%

*Sources include family wealth. Sources: ABC News, Americans for Tax Fairness, Axios, CBS News, Forbes, Inequality.org, New York Magazine, U.S. News & World Report, World Inequality Database

Billionaires, Millionaires and Lobbyists Cozy Up to Trump by Flooding the Inauguration with Record-Breaking Donations

The Trump Vance Inaugural Committee, Inc., which has already become a record-breaking cesspool of special interest financing, has surpassed its goal of raising $150 million in private donations to finance the 60^th Inaugural festivities and is likely to collect up to $200 million in the end.[1]

This far surpasses the previous record of $107 million to pay for Trump’s first Inauguration in 2017, and shatters all historical norms for Inaugural fundraising that have generally ranged from $20 million to $30 million from Reagan to Bush. Obama’s 2009 Inauguration committee raised $53 million while Biden’s 2021 Inauguration raised nearly $62 million in private contributions. (See Appendix A, “Estimated Private Donations to Presidential Inaugural Committees, 1973 – 2021”).

Nearly all the donations publicly disclosed so far have been in amounts of $1 million to $5 million each from companies and wealthy business leaders and lobbyists with business pending before the upcoming Trump administration. “EVERYBODY WANTS TO BE MY FRIEND!!!” Trump mused on his Truth Social account.[2]

Who Is Donating to Trump’s Inauguration?

Well, certain types of people want to be Trump’s friend, anyway. These million-dollar donors come from a small class of very wealthy industries in Big Tech, cryptocurrency, government contractors and others with lucrative contracts or business pending before the federal government. Some of the biggest donors had long been critics of Trump, especially following the January 6 Insurrection by Trump supporters, and who are now fearful of retributions by a vengeful president.

Public Citizen has been compiling a conflict of interest track chart of Inaugural donors who have publicly announced donations or pledges to the Trump Vance Inaugural Committee, Inc. (The Inaugural Committee eventually reports all donors of $200 or more to the Federal Election Commission, but not until 90 days after the Inauguration.)

Cryptocurrency firms and their CEOs have come out of the woodwork to embrace the new Trump administration, which has been signaling deregulation of the industry. Ripple has pledged $5 million for the Inauguration, followed by $1 million donations each from Coinbase, Moonpay, Kraken and others.

Wall Street and the financial sector are gushing over the next deregulatory administration, showing their enthusiasm with $1 million donations by hedge fund manager Ken Griffin, Bank of America, Goldman Sachs and Ondo Finance. Big Tech and Silicon Valley are joining the fray, with million-dollar donations from Apple CEO Tim Cook not to mention former adversaries of Trump, Amazon’s Jeff Bezos, Meta’s Mark Zuckerburg and OpenAI CEO Sam Altman.

All of these financers are seeking less government oversight of their business or lucrative government contracts, or both.

While the scope of the donations and, in many cases, the fear of retribution driving the donations, are unique to the second Trump Inauguration, the self-serving motivations of Inaugural donors in general are nothing new. Historically, corporations and government contractors who want something from the incoming administration overwhelmingly dominate the class of Inaugural donors.

According to an analysis by Public Citizen of donors to Bush’s 2005 Presidential Inauguration Committee, corporations and corporate executives contributed 96 percent of the total to pay for the festivities. Of the 127 contributors to Bush’s committee, 121 are either corporations or their chairmen, CEOs, presidents or owners.[3]

Even while Obama banned donations from corporations and lobbyists and limited individual donations to no more than $50,000 for his first Inauguration in 2009, almost 80 percent of the contributions disclosed by President-elect Obama’s Presidential Inauguration Committee came from 211 “bundlers.” More than $27.6 million of contributions came from 677 donations of at least $25,000. Prominent Wall Street figures comprised the largest portion of these bundlers. As common with every Inauguration, very little money comes from small donors. Only 113 donors to Obama’s first Inauguration reported giving just $200.[4]

As shown in Appendix A, the big jump in transforming Inaugurations from more of a ceremonial transition of power to lavish parties and balls began in earnest with Ronald Reagan in 1985. Nixon in 1973 only raised $4 million from private sources to finance his Inauguration, and Carter raised even less at $3.5 million. During the Second World War, Franklin Delano Roosevelt kept festivities for his 1945 Inauguration at a bare minimum, holding a luncheon but no balls or parades. Thomas Jefferson eschewed all of the Inaugural pomp and circumstance in 1801 and simply walked to the Capitol in casual clothing for his swearing in.[5] Presidents today cannot even fathom that type of dignity.

Rules of the Road

The very root cause of allowing Inaugurations to become the playground for special interests currying favor with the incoming administration is the absence of meaningful limits and disclosure of inaugural funding. A president-elect forms a Presidential Inaugural Committee (PIC) as a nonprofit organization, registered with both the IRS and the FEC. There are no disclosure reports filed until 90 days after the Inauguration, and these reports disclose only donors of $200 or more. There is no disclosure of how the money is spent nor what happens to any surplus funds, other than very general and nondescript information provided to the IRS when the PIC disbands. Only foreign nationals are prohibited from making donations to an inaugural committee. Corporations, PACs and all other sources may make donations of any amount to a PIC,[6] unless the PIC itself sets voluntary limits.

Occasionally, a Presidential Inaugural Committee will set voluntary limits on the sources and amounts of donations in an effort to avoid a public perception of a tarnished and potentially corrupting affair. President Clinton’s 1997 committee limited contributions to $100 and sold ball tickets for up to $3,000. However, the committee benefited from a $9.9 million in rollover funds from his 1993 inauguration. The committee raised $29 million under the 1997 rules.

Obama’s 2009 PIC prohibited contributions from corporations, PACs, unions and lobbyists. It also placed a $50,000 cap on individual contributions, though bundling of individual contributions was permitted up to $300,000. Obama lifted many of these restrictions for his second Inauguration. George W. Bush limited contributions to no more than $100,000 in 2001 and no more than $250,000 in 2005. President Joesph Biden prohibited contributions from lobbyists and fossil fuel companies and their executives in 2021.

Trump has placed no special restrictions on the sources or amounts of donations to his 2025 Presidential Inaugural Committee.

What Does All This Money Buy?

While the public will not have precise records of who funded Trump’s second Inauguration until sometime in Spring, the historical patterns of inaugural donations and the glimpses of the companies and wealthy special interests that have publicly pledged to pay for Trump’s Inaugural parties and balls, leave little doubt that the current system allows for a cesspool of influence peddling.

Buying access to the president and the president’s inner circle is the name of the game. Like many recent PICs, the Trump Vance Presidential Inaugural Committee has outlined what donors can buy at various amounts of donations. Donors are separated into tiers depending on the amount they gave. Donors who contributed $1 million or raised $2 million from others for the Inauguration are in Tier 1. The lowest tier consists of donors of $50,000. Below that amount, there is no special access, other than for a small number of inaugural lottery winners from the general public.[7]

The committee is planning three days of events for supporters and wealthy donors, beginning with a Victory Rally on Jan. 18. There will be an exclusive “Cabinet Reception” for the Tier 1 donors to rub shoulders with incoming cabinet officials. A “Vice President’s Dinner” is also reserved for Tier 1 donors to share an intimate dinner with Vice President Vance and Usha Vance, and another “Candlelight Dinner” with Trump for donors of $250,000 or who raised at least $500,000.[8] There is even a “One America, One Light” Sunday service, at which donors of $100,000 or who raised at least $200,000 may pray with Donald and Melania Trump.[9]

For corporations and wealthy special interests attempting to influence public policy or secure lucrative government contracts, writing big checks to Trump’s Inaugural committee – or any Presidential Inaugural Committee – provides a bonanza of access to leading government officials and influence over public policy. This is a level of influence peddling only available to those who can afford to pay the price and is denied to those who are not wealthy.

Buying access may not always translate into buying government favors. But the sheer volume of money thrown at the feet of the president-elect through Inaugural donations certainly suggests that wealthy special interests believe it is worth the price.

Conclusion: Closing the Inaugural Window for Corruption

Legislation to establish source prohibitions, contribution limits and full disclosure of donations and expenditures for Presidential Inaugural Committees have been proposed unsuccessfully in previous congressional sessions in both the House and the Senate. The record-shattering abuses of the 2025 Trump Vance Presidential Inaugural Committee, Inc., are likely to elevate the importance of closing this window of opportunity for buying favors this time around.

One such measure – the “Inaugural Fund Integrity Act” – is expected to be reintroduced by Rep. Mary Gay Scanlon (D-PA) and others before Trump’s Jan. 20^th Inauguration. Similar legislative efforts are likely to follow.

In order to ensure that undue influence-peddling through Inaugural donations is mitigated, effective regulation of the financing of presidential inaugurations should include, but not be limited to:

• Source Prohibitions: Banning contributions from corporations, government contractors and lobbyists seeking government favors.
• Contribution Limits: Placing reasonable limits on the size of donations from any single source.
• Spending Restrictions: Requiring that funds be spent on activities directly related to conducting Inaugural festivities and not for personal use or the enrichment of the president-elect’s own business interests and political committees.
• Surplus Funds: Establishing that surplus funds be returned on a pro rata basis back to donors or disbursed to qualified nonprofit organizations unaffiliated with the president-elect.
• Routine and Full Disclosure: Disclosure reports should be filed with the Federal Election Commission on a regular basis, both before and after the Inauguration, and should include specific information on how the money was spent.

The possibility for corruption exists any time an officeholder accepts large donations from those who have business pending before the official.  Congress should end the double standard for presidential inauguration fundraising. The celebration of an election victory should be viewed as part and parcel of the process of selecting our president.

Appendix A:

Estimated Private Donations to Presidential Inaugural Committees,

1973 – 2021

The law requiring Presidential Inaugural Committees to report donors of $200 or more 90 days after the Inauguration (36 U.S.C. §510) was adopted by Congress on March 27, 2002. The total costs of presidential inaugurations prior to that date rely on estimates provided by the respective inaugural committees and other sources.

The figures below do not include expenditures of public funds, which are managed by several different agencies such as the Department of Homeland Security and the Joint Congressional Committee on Inaugural Ceremonies, for the swearing-in ceremony, security and maintenance.

Richard Nixon, 1973 — $4 million

Jimmy Carter, 1977 — $3.5 million

Ronald Reagan, 1985 — $20 million

George H.W. Bush, 1989 — $30 million

William Clinton 1993/1997 — $25 million/$29 million

George W. Bush 2001/2005 — $30 million/$42 million

Barack Obama 2009/2013 — $53 million/$45 million

Donald Trump, 2017 — $106.8 million

Joseph Biden, 2021 — $61.8 million

[1] Soo Rin Kim, “Trump Vance inaugural committee on track to raise record amount as pledged contributions surpass $150 million,” ABC News (Dec. 18, 2024), available at: https://abcnews.go.com/US/trump-vance-inaugural-committee-track-raise-record-amount/story?id=116918692

[2] Anna Merlan, “With Tim Cook’s $1 million inaugural donation, Big Tech sends warm wishes to Trump,” Mother Jones (Jan. 4, 2025), available at: https://www.motherjones.com/politics/2025/01/tim-cook-apple-inauguration-trump/

[3] Public Citizen press release (Jan. 13, 2005), available at: https://www.citizen.org/?s=%22New+Public+Citizen+Analysis+Finds+Corporations+and+Their+Executives+Have+Contributed+96+Percent+of+Bush%E2%80%99s+Inauguration+Funds%22

[4] Public Citizen press release (Jan. 14, 2009), available at: https://www.citizen.org/?s=The+Presidential+Inauguration%2C+Brought+to+You+by+the+Few%2C+the+Wealthy

[5] Id.

[6] 36 U.S.C. 510, and 11 C.F.R. Parts 104 and 110.

[7] Soo Rin Kim, “Trump Vance inaugural committee on track to raise record amount as pledged contributions surpass $150 million,” ABC News (Dec. 18, 2024), available at: https://abcnews.go.com/US/trump-vance-inaugural-committee-track-raise-record-amount/story?id=116918692

[8] Id.

[9] Chris Walker, “A Trump Inauguration event is charge $100K for donors to ‘pray’ with him,” Truthout (Dec. 30, 2024), available at: https://truthout.org/articles/a-trump-inauguration-event-is-charging-100k-for-donors-to-pray-with-him/

Driving Denial: How Toyota’s Unholy Alliance with Climate Deniers Threatens Climate Progress

Key Findings

Toyota is no longer the green darling that it was nearly three decades ago when it introduced the Prius. The Japanese auto giant has spent the past several years quietly building a powerful U.S. influence operation to weaken climate policy. Among automakers, Toyota has become the largest funder of climate deniers in Congress[1] and the most ardent opponent of climate protections.[2] After the 2024 election, with Toyota’s climate-denying allies in power, the company is poised to dismantle climate policy.

While Toyota bills itself as a climate leader, it has long failed to make the needed transition to electric vehicles, instead investing in decades-old gas-powered hybrid technology, as well as hydrogen-powered vehicles that have failed in the marketplace. It is a risky strategy that has left Toyota vulnerable to an influx of competitors who have leapfrogged the auto giant to build the next generation of vehicles. Instead of innovating, Toyota has bankrolled lobbyists and climate-hostile lawmakers to help it defeat EVs^[3]. Our analysis found:

• Over the last three electoral cycles, Toyota has become the top auto industry financier of climate deniers[4]. It has helped to finance campaigns of 207 climate-denying congressional candidates, more than twice as many as Ford and nearly 50% more than General Motors, the only other automakers with federal political action committees (PACs).^[5]
• In the most recent electoral cycle, Toyota widened the gap, donating to more than four times as many climate deniers as Ford and nearly twice as many as GM. It contributed $271,000—nine times as much in funds as Ford’s $29,500 and over twice as much as GM’s $128,500.^[6]
• In recent years, Toyota has emerged as the automaker most aggressively opposed to EVs. With its allies entering power in the White House and Congress, Toyota is poised to help dismantle climate policy that threatens its business model.

Introduction

“If our PAC [political action committee] was a brand, what would that brand be? What would it stand for?… We never focus on making our PAC bigger. We focus on making our PAC better…A better PAC in terms of the image that we have.”

This is Stephen Ciccone, the longtime Vice President of Public Affairs for Toyota Motors North America. With an angular jaw and a tightly drawn ponytail, he looks like Terry Silver, the villain from Karate Kid III. Ciccone spoke in spring of 2015 where the Public Affairs Council had just granted Toyota its inaugural award for “Outstanding Corporate PAC.” Ciccone was advising other Public Affairs Council members on how to responsibly grow their PACs.

In hindsight, his warning sounds prescient: “Over time a PAC evolves. And that’s normally a good thing, but over time it can also evolve in strange directions and lose its way.” As this report will reveal, Toyota did not just lose its way under Ciccone’s leadership; it changed directions and is now taking a route that is dangerous for communities and the planet.

The world’s largest automaker has quietly spent the past decade building a powerful U.S. influence operation to try to delay the EV transition. It is bankrolling an army of climate denying lawmakers and lobbying aggressively against emissions and fuel economy standards. After the 2024 election, with Toyota’s allies entering power, the company is better positioned than ever to weaken auto climate policy. However, it is a risky strategy. Toyota’s failure to build EVs has left it vulnerable to competitors who have embraced the next generation of vehicles.

Funding Climate Deniers

By The Numbers

Over the last three electoral cycles, Toyota has become the top auto industry financier of climate deniers, with its political action committee spending $808,500 to support climate deniers, ahead of General Motors at $670,000 and more than double Ford’s expenditure of $387,500. (Chart 1) Among those elections, dating back to the 2019-2020 cycle, Toyota was the leading supporter of climate deniers among the three automakers with federal political action committees (PACs). (Chart 2) Toyota backed 207 climate-denying political campaigns over the past three election cycles, compared with 137 campaigns for General Motors and 103 campaigns for Ford (these calculations include re-election campaigns by the same candidate backed in a prior cycle).

Chart 1: Total Amount Donated to Climate Deniers by Automaker PAC, Cycle, and Congress

 

Chart 2: Number of Climate Denier Recipients by Automaker PAC, Cycle, and Congress

Toyota also ramped up its funding to Republicans and cut funding to Democrats, helping to cement a Republican trifecta. While in the previous two cycles Toyota donated relatively evenly to both parties, this cycle it contributed over 60% to Republicans. In contrast, this cycle GM gave nearly 43% and Ford gave nearly 46% of its individual PAC contributions to Republicans. Toyota contributed nearly twice as much as GM and nearly nine times as much as Ford to GOP congressional candidates.^[7]

A Few of Toyota’s Climate Deniers

House Speaker Mike Johnson (R-LA)

2024 cycle donations from Toyota: $10,000 (maximum amount allowed)

In a town hall, Johnson said “The climate is changing, but the question is, is it being caused by natural cycles in the atmosphere over the span of the Earth’s history? Or is it changing because we drive SUVs? I don’t believe in the latter. I don’t think that’s the primary driver.” He has also led the effort to try to strip funding for green energy from the IRA.

Rep. Jason Smith (R-MO)

2024 cycle donations from Toyota: $10,000 (maximum amount allowed).

Smith has called for eliminating the EPA and introduced legislation to end EV tax credits. Smith has laughed at the science behind climate change, tweeting “Saw these Missouri cows this morning. I didn’t have the heart to tell them their gases are the cause of climate change…”

Rep. David Schweikert (R-AZ)

2024 cycle donations from Toyota: $7,000.

In 2020, Rep. Schweikert was ordered to pay a $50,000 fine for misusing official funds. That did not stop Toyota from donating to Rep. Schweikert, an avowed climate denier who had served as chairman of the subcommittee of the environment.  “I don’t see the data,” Rep. Schweikert said in an interview. “…I think it’s incredibly arrogant, you know, for the Al Gores of the world to stand up and say the world’s coming to an end.”

Top 20 Climate Deniers Receiving PAC Contributions from Toyota, 2019-2024

Candidate	Body	State	Toyota 20-24
James Comer (R)	House	Kentucky	$24,000
David Schweikert (R)	House	Arizona	$23,500
Cathy McMorris Rodgers (R)	House	Washington	$22,000
Tom McClintock (R)	House	California	$21,000
Ann Wagner (R)	House	Missouri	$20,000
Mike Kelly (R)	House	Pennsylvania	$19,000
Larry Bucshon (R)	House	Indiana	$18,500
John Moolenaar (R)	House	Michigan	$17,500
Pete Sessions (R)	House	Texas	$17,000
Beth Van Duyne (R)	House	Texas	$17,000
Darrell E Issa (R)	House	California	$17,000
Alex Mooney (R)	House	West Virginia	$16,500
Jodey Arrington (R)	House	Texas	$16,000
Darin LaHood (R)	House	Illinois	$15,000
Jason Smith (R)	House	Missouri	$15,000
Rodney Davis (R)	House	Illinois	$15,000
Richard Hudson (R)	House	North Carolina	$14,500
Bill Huizenga (R)	House	Michigan	$14,000
Mitch McConnell (R)	Senate	Kentucky	$14,000
Dan Crenshaw (R)	House	Texas	$14,000

Source: Public Citizen analysis of OpenSecrets campaign finance data.

Toyota’s Ace in the Hole

Toyota’s anti-climate influence is even larger than the numbers suggest. Not included in Public Citizen’s tally is Toyota’s support of candidates like car dealer mogul and Senator-elect Bernie Moreno (R-Ohio), who have not publicly denied climate change, but have committed themselves to undermining and reversing climate action.

Auto dealers played an important role in Moreno’s campaign, serving as major donors and validators who defended Moreno against attacks from his opponent, Senator Sherrod Brown. After his victory in one of the most high-profile senate races in the nation, The Detroit Free Press wrote that Moreno’s “closest relationships now are with leaders at Toyota Motor North America, which he said helped organize the coalition of car dealers that supported his Senate run.”

Noting that Toyota has been an outlier in its refusal to build electric vehicles, Moreno said that “the winner in this whole thing [eliminating the $7,500 federal rebate for EVs] will probably be Toyota because they were the one company that said, ‘We’re just not going to do that.’”

Lobbying Against the Future

On the Offensive

Toyota took aim at climate policy just days after the election and has signaled that it will ramp up its lobbying even further. With a favorable incoming Congress and administration, Toyota has wasted no time cozying up to the Trump transition team and working to water down the Biden administration’s fuel economy and emission standards.

Just three days after the November election, Toyota Motor North America Chief Operating Officer Jack Hollis railed against California and the EPA’s tailpipe emissions standards on a call with reporters. Falsely referring to them as “EV mandates,” he said, “These EV mandates were an attempt to change the entire landscape of the industry, to remove customer choice.” Just five days after that, the Japanese news outlet Nikkei published a story detailing Japanese automakers’ plans to ramp up lobbying in the second Trump administration. In late November, Hollis wrote a Wall Street Journal op-ed entitled “Trump Can Get EVs Back on Track,” calling on the new administration to dismantle the Biden-era policies that encourage automakers to reduce emissions, complaining that “unrealistic regulations favor one carbon-reducing option over, and at the expense of, all others.” On Christmas Eve, Toyota announced it was donating $1 million to Trump’s inauguration.

Shortly after the election, Alliance for Automotive Innovation, the main auto industry lobby in the U.S., called on the incoming Trump administration to preserve the $7,500 EV tax credits enshrined in the Inflation Reduction Act. The credit has been key to growing EV adoption in the U.S. In 2023, the first full year of the credit, EV sales shot up by 46%. The latest data from Kelley Blue Book shows EV sales reached record highs in Q3 of 2024, attributing much of this growth to “incentives and discounts.”  The National Bureau of Economic Research has estimated that if the Trump administration and Congress eliminate the credit, EV sales would drop by 27%.

Shortly after AAI called on Trump to preserve the credit, Toyota publicly broke with the group, calling on the Trump team to water down the credit so that its hybrids can qualify. As auto analyst Alan Baum noted, “Obviously that’s somewhat self-serving.” Serving its own short-term gains at the cost of the climate has been at the core of Toyota’s strategy for the past decade.

Global Influence

Instead of embracing a green energy future, Toyota has aggressively lobbied to delay and weaken climate action. In 2022, InfluenceMap named Toyota the third worst company in the world–after Chevron and Exxon–for its anti-climate lobbying. It has routinely ranked as the worst automaker for its anti-climate lobbying. As InfluenceMap notes in its May 2024 scorecard, Toyota had a busy year^[8]. The company once again received a D, the lowest score amongst all automakers, and was fueling opposition to climate regulations around the world. The scorecard highlights Toyota’s lobbying efforts against emissions standards in the U.S. and Australia and against EV mandates in Canada and the United Kingdom, as well as Toyota’s success in weakening emissions stands in the U.S. and fuel efficiency standards in Australia.

All-powerful in Japan

Toyota is especially powerful in Japan. It is by far the nation’s largest company, with revenue more than twice and market cap nearly twice that of the closest runner-up. It holds the kind of cultural cache that can only be compared to General Motors in its heyday, which has given Toyota an immense amount of political power.

No corporation gives more than Toyota to the LDP, the pro-business party that has ruled Japan for most of the past 70 years. The only group to donate more in 2023 was JAMA, the Japanese auto industry trade group that Akio Toyoda chaired from 2012 to 2014 and from 2018 to 2023. Collectively, the Toyoda family has chaired the powerful trade group for over twenty years.

In the summer of 2022, Japan was set to phase out the sale of polluting combustion engine vehicles by 2035—a few months before California made that historic commitment. But at the last minute, Akio Toyoda, then Toyota’s CEO, met Akira Amari, a key official from Japan’s Liberal Democratic Party (LDP) and intervened to ensure that the government did not fully ban fossil-fueled cars.

In an LDP policy meeting the next day, Amari shared Toyoda’s message with his colleagues: “I spoke with Chairman Toyoda yesterday and he said that JAMA cannot endorse a government that rejects hybrids…If we don’t make that clear, JAMA will push back with all its might,” Amari said, according to notes and audio of the meeting. After Toyoda’s message, officials changed the document to eliminate its zero-emission goal.

An Aggressive Outlier

Toyota is attempting to exert the same kind of overpowering political influence in the U.S. as it has at home. Between 2019 and 2023 it spent over $31 million just on federal lobbying. That was second only to GM and is significantly more than every other automaker. Much of that lobbying focused on weakening fuel economy and pollution standards and tailpipe emissions rules, according to lobbying records.

Toyota is also the only major automaker that has failed to set a target for 100% EVs. That is likely because the company has made bad business decisions on EVs for a decade or more and is simply far behind its competitors.

According to OpenSecrets, in 2023 Toyota spent $6.3 million on lobbying “related to greenhouse gas emissions standards” and “supply chain issues impacting the auto industry, including critical minerals for EVs.”

In the leaked memo, Toyota’s chief lobbyist Stephen Ciccone emphasized how uncommonly aggressive Toyota has been in fighting climate policy: “For more than two years, Toyota and our dealer partners have stood alone in the fight against unrealistic BEV [Battery Electric Vehicle] mandates…We have taken a lot of hits from environmental activists, the media, and some politicians. But we have not—and we will not—back down.” Falsely referring to emissions standards as an “unrealistic government mandate,” Ciccone said that the regulations create an “existential crisis” for the auto industry.

Out on a Limb

As Ciccone notes, Toyota has been an outlier in opposing climate action, even among automakers. In 2020 Toyota declined to join the compromise agreement that other automakers reached with California on emissions standards that were “expected to be a model for new standards from the Biden administration.” Even the Alliance for Automotive Innovation (AAI), a powerful industry group that regularly lobbies against climate action, publicly supported the deal. However, AAI “argued in closed-door meetings in Washington that the California compromise… [was] in fact not feasible for all of its members.” When AAI made that argument, its chairman was none other than Chris Reynolds, a longtime Toyota North America executive who oversees Toyota’s lobbying efforts.

Federal lobbying disclosures are opaque and do not reveal which side of an issue a company takes. However, the formal written comments that Toyota’s lobbyists submit to government agencies give insight into the company’s attempts to influence policy and regulation. One illustrative example is this 94-page comment on the EPA’s proposed light-duty and medium-duty vehicle emissions standards. Tom Stricker, Toyota’s VP for Sustainability and Regulatory Affairs, advocates for looser emissions standards and argues that including electric vehicles in the calculation of achievable emissions is illegal.

That advocacy has borne results. During the Biden administration, lobbying from Toyota and others forced the EPA to weaken an ambitious EPA plan to limit vehicle emissions. The changes slow the adoption of more stringent vehicle pollution limits, making it easier for EV laggards like Toyota to meet regulations without building electric vehicles.

Toyota has also fought to undermine states’ climate standards. Under the Clean Air Act, since the 1970s states have been allowed to set their own emissions standards. However, in 2019 then-President Trump sought to revoke that right as part of an effort to roll back Obama-era rules. While Honda, Ford, Volkswagen, and BMW all sided with California, Toyota sued the state. Unlike GM, which initially sided with the Trump administration before quickly reversing itself after pledging to sell only electric vehicles by 2035, Toyota spent three years fighting California before finally acknowledging the state’s long-held right to regulate its own emissions.

Now another fight is brewing. On December 13, 2024 the Supreme Court announced that it would decide whether a challenge to EPA’s approval of California’s emission standards could proceed, and five days later the EPA granted California a new waiver allowing it to enforce another state policy–Clean Cars II–which required EPA approval. That rule would require all new light duty vehicles to have zero emissions by 2035. With Toyota champing at the bit, it is primed to play a key role in the fight to weaken emissions and fuel economy standards.

An EV Laggard

Stalled out on EVs

How did we get here? Why did Toyota go from the green darling that made the Prius to aligning itself with climate deniers? In short, it adopted a deeply misguided business model, then created an aggressive influence operation to defend itself from suffering the consequences of its mistakes.

While Toyota bills itself as a climate leader, it has long failed to make the needed transition to electric vehicles, instead doubling down on decades-old gas-powered hybrid technology. Toyota was an innovator when it introduced the Prius in 1997, but in recent decades, it has fallen to the back of the pack. In this era of rapid energy transition, Toyota has “substantially miscalculated” its approach to electric vehicles. Toyota’s longtime CEO Akio Toyoda, who led his grandfather’s company for almost 14 years before stepping down in April 2023, is well-known for his deep dislike of EVs. Even as Chairman of the Board, he is continuing to rail against electric vehicles.

Under Toyoda’s guidance, the automaker has fallen far behind its rivals on electric vehicles. In 2023, fewer than 1% of the 11.2 million vehicles that Toyota sold were fully electric, far behind the global average of 11.1%. That is also far behind the U.S. average, where in Q3 of 2024 EVs accounted for a record high of 8.9% of all new car sales.

Unsurprisingly, that has made it difficult to reduce its carbon footprint. In late November, Toyota Motor North America admitted that it is failing its embarrassingly modest goal of reducing its greenhouse gas emissions by 15% from 2018 to 2026. In fact, it is emitting more than it was two years before.

But Toyota doubtless has a greater concern: EV adoption is proceeding so rapidly that it may be impossible for an automaker that makes so few EVs to remain a market-leader in sales. Hence Toyota’s need to slow EV adoption by any means necessary — including by supporting aggressive climate deniers.

The Mirage of Mirai

Instead of building EVs, Toyota has invested in carbon-intensive hydrogen-powered vehicles that have failed miserably in the marketplace. Toyota started developing hydrogen fuel cell vehicles (HFCVs) in 1992 and introduced the Mirai, its HFCV, in 2014. Since then it has sold fewer than 25,000 units. It has been so hard to sell the $66,000 vehicle that Toyota has cut the sticker price by $40,000, adding in $15,000 in free hydrogen, and offering a 0% loan. All in all, Toyota is offering the Mirai, which ironically means “future” in Japanese, for $11,000. Even with that sweetheart deal, Toyota can’t seem to give away the Mirai, with sales dropping by 74% in Q1 of 2024. Even Toyota has admitted that its HFCV sales have “not been successful.”

There are just 60 hydrogen refueling stations in all of the U.S. and Canada. Mirai drivers claim that prior to buying their vehicles, Toyota assured them that fueling with hydrogen was “seamless,” but Toyota’s infrastructure is so sparse and fault-ridden that they filed a class-action lawsuit against the automaker.

Toyota drivers are not the only ones up in arms. Ahead of the Paris Olympics, which Toyota sponsored, 120 scientists, engineers, and academics wrote an open letter to organizers calling on them to drop the Mirai as the official vehicle of the games. That is because over 99% of hydrogen is made with fossil fuels and hydrogen production emits about as much annually as all global aviation, making hydrogen vehicles far dirtier than EVs. Like Toyota’s broader greenwashing strategy, the Mirai presents a veneer of green energy but is actually just a mirage. 

Misleading Consumers

As Public Citizen noted in our December complaint to the Federal Trade Commission, Toyota has deceptively marketed its gas-powered hybrids as EVs instead of investing in electric vehicles. In the decade between 2013 and 2022–the most recent available year–Toyota spent $17.2 billion on marketing. Much of its advertising budget has gone toward sleek campaigns that use terms like “electrified” and “beyond zero” to deceive consumers into believing that its gasoline-powered hybrids are electric. Toyota uses lightning bolts and plugs and words like “range” to describe vehicles with internal combustion engines that do not plug in.

Misleading the public appears to be Toyota’s modus operandi. In 2022 Toyota subsidiary Hino Motors admitted to cheating on up to 20 years of emissions tests. In 2023 Toyota subsidiary Daihatsu shut all four of its factories in Japan amidst a government probe that forced the automaker to admit that it cheated on thirty years of crash tests. Last January Toyota Chairman Akio Toyoda was forced to apologize for cheating on engine testing that led the Japanese government to raid one of its plants. Less than six months later, he was forced to apologize again, this time for “massive cheating on certification tests for seven vehicle models” that led to Toyota suspending production on three models.  Investors have not been impressed, leading Mr. Toyoda to admit that “there has never been a director at Toyota with such a low approval rate before” and “if we continue at this pace, I will no longer be able to serve as a director next year.”

The Next Kodak?

In 1975, 24-year-old Kodak engineer Steven Sasson created the first digital camera. However, Kodak saw digital as a threat to its core film and film camera business and buried the invention. According to Sasson, “Every digital camera that was sold took away from a film camera and we knew how much money we made on film.” Before joining Toyota Motors North America in 2011, TMNA chief lobbyist Stephen Ciccone spent 23 years leading Kodak’s policy work. During his tenure, Kodak reached an 80% market share in the U.S. and about 50% market share globally. However, eschewing innovation eventually caught up with Kodak. That fatal error ultimately helped lead to the company’s bankruptcy in 2012, the year after Ciccone moved to Toyota. When Kodak finally embraced the digital future, it was too late.

Just two years before Sasson’s invention, Toyota introduced the EV2 at the 1973 Tokyo Motor show. The EV2 was a concept electric car, but the company never produced it. It would take nearly fifty years for Toyota to release its first battery-electric vehicle. By the time it produced the Lexus UX300e in 2020 and the Toyota BZ4X in 2021, the automaker’s peers had lapped it in the EV market. And by then, its tech was behind. Lexus did not introduce an EV to the U.S. market until 2023. Consumer Reports called that debut “a disappointing first EV effort” and noted that its “meager range and EV tech are already behind the times.” The popular auto site Top Speed published the article “The 2023 Toyota bZ4X is What Happens When a Carmaker Doesn’t Want to Sell EVs.” Editor-at-Large William Clavey called it “a terrible EV” that “lacks an inspiring design, energy efficiency, and charging performance.” He deftly notes that “while Toyota is the carmaker that makes the wildest claims about EVs, it can’t seem to deliver a truly competitive electric model.”

Toyota sells more vehicles than any automaker on the planet and of course will not go bankrupt overnight. However, when Kodak had 80% U.S. market share, no one would have predicted its precipitous decline. Wall Street clearly thinks that electric vehicles are the future. As of mid-December 2024, Tesla’s market cap was $1.375 trillion, 5.9 times the value of Toyota.

Investors appear to expect the EV market to continue its rapid growth. The S-curve is “a well-established phenomenon where a successful new technology reaches a certain catalytic tipping point (typically 5-10% market share), and then rapidly reaches a high market share (i.e. 50%+) within just a couple more years once past this tipping point.” There is a self-reinforcing cycle where the technology becomes more cost-effective as it becomes more prevalent. That is certainly the case for EV batteries, which fell by 20% in cost in 2024 alone.

Toyota is trailing its competitors on EVs and is at risk of falling behind even further as Chinese competitors make low-priced EVs to sell around the globe. Even Toyota’s Japanese competitor, Honda, has recognized the threat. In announcing plans in December 2024 to merge with Nissan, Honda CEO Toshihiro Mibe cited technological trends of electrification and autonomous driving, saying, “The rise of Chinese automakers and new players has changed the car industry quite a lot…We have to build up capabilities to fight with them by 2030, otherwise we’ll be beaten.”

Meanwhile, the Chinese smartphone company Xiaomi launched its first EV at the end of March and is already selling more EVs than Toyota. The world’s largest automaker losing to a smartphone company shows that Toyota’s failure is not a matter of resources or even expertise, but a matter of effort. If it truly wanted to, Toyota could marshal its massive resources to thrive in the electric future. However, instead of competing in the EV marketplace, Toyota is fighting tooth and nail to delay the inevitable electric future.

Conclusion

The Japanese auto giant has quietly spent the past several years building a powerful U.S. influence operation to try to delay the transition to EVs. It is funding an army of climate denying lawmakers and lobbying aggressively against emissions and fuel economy standards. After the 2024 election, with Toyota’s climate-denying allies entering power, the company is poised to marshal an assault on climate policy. However, it is a risky strategy. Its failure to build EVs has left it vulnerable to an influx of competitors who have embraced the next generation of vehicles.

In twenty years, how will the world think of Toyota? Will it become the next Kodak or Blockbuster? Will it become a relic of the past, a cautionary tale for industry giants that refuse to adapt? Will Toyota continue to make dirty, polluting vehicles and align itself with climate deniers in a futile effort to hold onto the past for a bit longer? Or will it instead embrace the urgent, imminent future of electric vehicles? We shall know soon.

Methodology

To analyze automakers’ political contributions, we examined OpenSecrets’ campaign finance data for the three automakers with political action committees: Toyota, General Motors, and Ford. We cross-referenced those with the Center for American Progress’ lists of climate deniers from the 118th, 117th, and 116th sessions of Congress. We also examined statements from candidates in the 2023-2024 cycle who did not serve in any of the previous three congresses.

For its report on the 118th Congress, CAP used a slightly more expansive definition of “climate denier” than it had in its previous reports. It included members who used other rhetorical tactics like climate doomism (saying there is nothing that can be done), portraying climate activism as alarmism, and who downplayed the need to act to address climate change.

Appendix: Toyota, GM, Ford PAC Contributions to Climate Deniers 2022-2024

Candidate	Body	State	Toyota 20-24	GM 20-24	Ford 20-24	All PACs
Cathy McMorris Rodgers (R)	House	Washington	$22,000	$25,000	$18,500	$65,500
Tim Walberg (R)	House	Michigan	$13,000	$14,500	$20,500	$48,000
Bill Huizenga (R)	House	Michigan	$14,000	$13,500	$19,500	$47,000
Darin LaHood (R)	House	Illinois	$15,000	$10,000	$21,000	$46,000
John Moolenaar (R)	House	Michigan	$17,500	$21,000	$7,500	$46,000
Jason Smith (R)	House	Missouri	$15,000	$11,500	$15,000	$41,500
Rodney Davis (R)	House	Illinois	$15,000	$18,000	$8,000	$41,000
Ann Wagner (R)	House	Missouri	$20,000	$8,500	$10,500	$39,000
John Curtis (R)	Non-incumbent	Utah	$8,000	$15,000	$15,500	$38,500
James Comer (R)	House	Kentucky	$24,000	$3,500	$10,500	$38,000
Jodey Arrington (R)	House	Texas	$16,000	$15,000	$4,000	$35,000
Kevin McCarthy (R)	House	California	$3,500	$15,000	$15,000	$33,500
Richard Hudson (R)	House	North Carolina	$14,500	$16,500	$2,500	$33,500
Chuck Grassley (R)	Senate	Iowa	$13,000	$10,000	$10,000	$33,000
John Cornyn (R)	Senate	Texas	$12,000	$11,500	$9,500	$33,000
Steve Scalise (R)	House	Louisiana	$12,500	$20,000	$0	$32,500
Fred Upton (R)	House	Michigan	$9,500	$10,500	$11,000	$31,000
Larry Bucshon (R)	House	Indiana	$18,500	$12,000	$0	$30,500
Marsha Blackburn (R)	Both – House 115, Senate 116-118	Tennessee	$10,000	$10,000	$10,000	$30,000
Roger Wicker (R)	Senate	Mississippi	$10,000	$10,000	$10,000	$30,000
Blaine Luetkemeyer (R)	House	Missouri	$12,500	$16,000	$1,000	$29,500
Pete Sessions (R)	House	Texas	$17,000	$12,500	$0	$29,500
Bill Johnson (R)	House	Ohio	$2,000	$20,000	$6,500	$28,500
Mike Kelly (R)	House	Pennsylvania	$19,000	$8,500	$1,000	$28,500
Mitch McConnell (R)	Senate	Kentucky	$14,000	$7,500	$7,000	$28,500
Todd Young (R)	Senate	Indiana	$11,500	$7,500	$9,000	$28,000
Patrick McHenry (R)	House	North Carolina	$9,000	$7,500	$10,500	$27,000
Tom Emmer (R)	House	Minnesota	$11,500	$7,500	$8,000	$27,000
Adrian Smith (R)	House	Nebraska	$4,000	$14,500	$7,000	$25,500
Michael C Burgess (R)	House	Texas	$11,000	$7,500	$7,000	$25,500
Beth Van Duyne (R)	House	Texas	$17,000	$7,000	$1,000	$25,000
Cory Gardner (R)	Senate	Colorado	$8,000	$10,000	$7,000	$25,000
Dan Crenshaw (R)	House	Texas	$14,000	$5,000	$6,000	$25,000
Dan Sullivan (R)	Senate	Alaska	$4,500	$11,500	$8,000	$24,000
Marco Rubio (R)	Senate	Florida	$9,000	$7,500	$7,500	$24,000
Shelley Moore Capito (R)	Senate	West Virginia	$8,000	$7,500	$8,500	$24,000
David Schweikert (R)	House	Arizona	$23,500	$0	$0	$23,500
Gary Palmer (R)	House	Alabama	$9,000	$14,500	$0	$23,500
Jake Ellzey (R)	House	Texas	$10,000	$13,500	$0	$23,500
Mike Crapo (R)	Senate	Idaho	$8,500	$10,000	$5,000	$23,500
Mike Johnson (R)	House	Louisiana	$10,000	$12,500	$0	$22,500
Mike Lee (R)	Senate	Utah	$7,500	$10,000	$5,000	$22,500
David Perdue (R)	Senate	Georgia	$0	$15,000	$7,000	$22,000
Lance Gooden (R)	House	Texas	$12,500	$3,500	$6,000	$22,000
Thom Tillis (R)	Senate	North Carolina	$5,500	$10,000	$6,500	$22,000
Tom McClintock (R)	House	California	$21,000	$0	$0	$21,000
John Boozman (R)	Senate	Arkansas	$8,000	$7,500	$5,000	$20,500
Jeff Duncan (R)	House	South Carolina	$11,000	$5,500	$3,500	$20,000
Joni Ernst (R)	Senate	Iowa	$7,000	$8,000	$4,500	$19,500
Kevin Brady (R)	House	Texas	$8,500	$10,000	$1,000	$19,500
Bill Cassidy (R)	Senate	Louisiana	$10,000	$8,500	$0	$18,500
Steve Daines (R)	Senate	Montana	$8,500	$5,000	$5,000	$18,500
Bruce Westerman (R)	House	Arkansas	$3,000	$14,500	$0	$17,500
Buddy Carter (R)	House	Georgia	$3,000	$10,000	$4,500	$17,500
Darrell E Issa (R)	House	California	$17,000	$0	$0	$17,000
Deb Fischer (R)	Senate	Nebraska	$10,000	$2,500	$4,500	$17,000
Markwayne Mullin (R)	Both – House 115-117, Senate 118	Oklahoma	$3,000	$8,000	$6,000	$17,000
Michael McCaul (R)	House	Texas	$12,000	$5,000	$0	$17,000
Alex Mooney (R)	House	West Virginia	$16,500	$0	$0	$16,500
John Joyce (R)	House	Pennsylvania	$5,000	$8,000	$3,500	$16,500
Van Taylor (R)	House	Texas	$13,500	$2,000	$1,000	$16,500
John James (R)	House	Michigan	$2,000	$10,000	$3,500	$15,500
Rick Crawford (R)	House	Arkansas	$10,500	$5,000	$0	$15,500
Thomas Massie (R)	House	Kentucky	$13,000	$2,500	$0	$15,500
Devin Nunes (R)	House	California	$5,000	$10,000	$0	$15,000
Liz Cheney (R)	House	Wyoming	$7,000	$5,000	$3,000	$15,000
Randy Feenstra (R)	House	Iowa	$8,500	$1,500	$5,000	$15,000
Ben Cline (R)	House	Virginia	$12,000	$2,500	$0	$14,500
Mike Bost (R)	House	Illinois	$0	$11,000	$3,500	$14,500
Rand Paul (R)	Senate	Kentucky	$9,000	$1,000	$4,500	$14,500
Barry Loudermilk (R)	House	Georgia	$11,000	$0	$3,000	$14,000
Billy Long (R)	House	Missouri	$4,500	$6,000	$3,000	$13,500
John Barrasso (R)	Senate	Wyoming	$5,000	$6,000	$2,500	$13,500
Victoria Spartz (R)	House	Indiana	$4,000	$8,500	$1,000	$13,500
David Rouzer (R)	House	North Carolina	$6,000	$7,000	$0	$13,000
Ron Wright (R)	House	Texas	$3,000	$10,000	$0	$13,000
Jim Banks (R)	House	Indiana	$4,000	$8,500	$0	$12,500
Kevin Cramer (R)	Both – House 115, Senate 116-118	North Dakota	$10,000	$2,500	$0	$12,500
Virginia Foxx (R)	House	North Carolina	$12,500	$0	$0	$12,500
Doug LaMalfa (R)	House	California	$1,000	$5,000	$6,000	$12,000
Steve Womack (R)	House	Arkansas	$1,000	$10,000	$1,000	$12,000
James Lankford (R)	Senate	Oklahoma	$0	$7,500	$4,000	$11,500
Kat Cammack (R)	House	Florida	$4,000	$7,500	$0	$11,500
Roger Marshall (R)	Both – House 115-117, Senate 118	Kansas	$3,000	$2,500	$6,000	$11,500
Chip Roy (R)	House	Texas	$11,000	$0	$0	$11,000
Chuck Fleischmann (R)	House	Tennessee	$10,000	$0	$1,000	$11,000
Pete Stauber (R)	House	Minnesota	$0	$11,000	$0	$11,000
Ted Budd (R)	Both – House 115-117, Senate 118	North Carolina	$6,000	$5,000	$0	$11,000
Tim Burchett (R)	House	Tennessee	$8,000	$2,500	$0	$10,500
Bob Gibbs (R)	House	Ohio	$0	$9,000	$1,000	$10,000
Guy Reschenthaler (R)	House	Pennsylvania	$4,000	$6,000	$0	$10,000
Morgan Griffith (R)	House	Virginia	$6,000	$2,000	$2,000	$10,000
Cynthia M Lummis (R)	Senate	Wyoming	$6,000	$1,000	$2,500	$9,500
Andy Biggs (R)	House	Arizona	$9,000	$0	$0	$9,000
Ken Buck (R)	House	Colorado	$8,000	$0	$1,000	$9,000
Lloyd Smucker (R)	House	Pennsylvania	$5,500	$2,500	$1,000	$9,000
Tom Cotton (R)	Senate	Arkansas	$4,000	$0	$5,000	$9,000
Pete Olson (R)	House	Texas	$2,500	$3,500	$2,500	$8,500
JD Vance (R)	Senate	Ohio	$3,000	$5,000	$0	$8,000
Don Bacon (R)	House	Nebraska	$3,000	$4,000	$0	$7,000
Lori Chavez-DeRemer (R)	House	Oregon	$7,000	$0	$0	$7,000
Robert Aderholt (R)	House	Alabama	$7,000	$0	$0	$7,000
Bill Flores (R)	House	Texas	$2,000	$3,500	$1,000	$6,500
Claudia Tenney (R)	House	New York	$5,500	$1,000	$0	$6,500
Jim Inhofe (R)	Senate	Oklahoma	$4,000	$2,500	$0	$6,500
Randy Weber (R)	House	Texas	$3,000	$3,500	$0	$6,500
Barry Moore (R)	House	Alabama	$6,000	$0	$0	$6,000
Debbie Lesko (R)	House	Arizona	$6,000	$0	$0	$6,000
Doug Collins (R)	House	Georgia	$1,000	$5,000	$0	$6,000
Mark Walker (R)	House	North Carolina	$6,000	$0	$0	$6,000
Mike Carey (R)	House	Ohio	$6,000	$0	$0	$6,000
Nancy Mace (R)	House	South Carolina	$0	$6,000	$0	$6,000
Scott Perry (R)	House	Pennsylvania	$1,000	$2,500	$2,500	$6,000
John Carter (R)	House	Texas	$1,000	$2,500	$2,000	$5,500
Neal Dunn (R)	House	Florida	$0	$4,500	$1,000	$5,500
Chris Stewart (R)	House	Utah	$0	$0	$5,000	$5,000
Don Young (R)	House	Alaska	$0	$5,000	$0	$5,000
Jim Hagedorn (R)	House	Minnesota	$5,000	$0	$0	$5,000
Kevin Hern (R)	House	Oklahoma	$2,000	$2,000	$1,000	$5,000
Mark Amodei (R)	House	Nevada	$0	$5,000	$0	$5,000
Mark E Green (R)	House	Tennessee	$5,000	$0	$0	$5,000
Pete Ricketts (R)	Senate	Nebraska	$5,000	$0	$0	$5,000
Ted Cruz (R)	Senate	Texas	$5,000	$0	$0	$5,000
John Shimkus (R)	House	Illinois	$2,500	$0	$2,000	$4,500
Byron Donalds (R)	House	Florida	$3,000	$1,000	$0	$4,000
Eric Burlison (R)	House	Missouri	$4,000	$0	$0	$4,000
French Hill (R)	House	Arkansas	$4,000	$0	$0	$4,000
Marlin Stutzman (R)	House	Indiana	$4,000	$0	$0	$4,000
Rob Wittman (R)	House	Virginia	$4,000	$0	$0	$4,000
Vicky Hartzler (R)	House	Missouri	$4,000	$0	$0	$4,000
Brian Babin (R)	House	Texas	$0	$2,500	$1,000	$3,500
Daniel Webster (R)	House	Florida	$0	$3,500	$0	$3,500
John Kennedy (R)	Senate	Louisiana	$0	$2,500	$1,000	$3,500
Lee Zeldin (R)	House	New York	$1,000	$2,500	$0	$3,500
Mike Lawler (R)	House	New York	$0	$3,500	$0	$3,500
Steve Chabot (R)	House	Ohio	$0	$3,500	$0	$3,500
Steve Stivers (R)	House	Ohio	$0	$2,500	$1,000	$3,500
Mike Flood (R)	House	Nebraska	$3,000	$0	$0	$3,000
Mo Brooks (R)	House	Alabama	$3,000	$0	$0	$3,000
Rob Portman (R)	Senate	Ohio	$0	$0	$3,000	$3,000
Dennis Ross (R)	House	Florida	$2,880	$0	$0	$2,880
John Hoeven (R)	Senate	North Dakota	$0	$0	$2,500	$2,500
Ken Calvert (R)	House	California	$0	$2,500	$0	$2,500
Roy Blunt (R)	Senate	Missouri	$2,500	$0	$0	$2,500
Craig Goldman (R)	Non-incumbent	Texas	$2,000	$0	$0	$2,000
Johnny Isakson (R)	Senate	Georgia	$2,000	$0	$0	$2,000
Mark Meadows (R)	House	North Carolina	$2,000	$0	$0	$2,000
Matt M Rosendale Sr (R)	House	Montana	$0	$0	$2,000	$2,000
Ronny Jackson (R)	House	Texas	$2,000	$0	$0	$2,000
Ross Spano (R)	House	Florida	$1,000	$0	$1,000	$2,000
Jerry L Carl (R)	House	Alabama	$0	$1,500	$0	$1,500
Andy Harris (R)	House	Maryland	$1,000	$0	$0	$1,000
Brad Knott (R)	Non-incumbent	North Carolina	$0	$1,000	$0	$1,000
Brandon Gill (R)	Non-incumbent	Texas	$1,000	$0	$0	$1,000
David Taylor (R)	Non-incumbent	Ohio	$1,000	$0	$0	$1,000
David Young (R)	House	Iowa	$1,000	$0	$0	$1,000
Doug Lamborn (R)	House	Colorado	$0	$0	$1,000	$1,000
Glenn Grothman (R)	House	Wisconsin	$0	$0	$1,000	$1,000
Jake Laturner (R)	House	Kansas	$1,000	$0	$0	$1,000
Jim Justice (R)	House	West Virginia	$1,000	$0	$0	$1,000
Joe Wilson (R)	House	South Carolina	$1,000	$0	$0	$1,000
Mario Diaz-Balart (R)	House	Florida	$1,000	$0	$0	$1,000
Mary E Miller (R)	House	Illinois	$1,000	$0	$0	$1,000
Pat Harrigan (R)	Non-incumbent	North Carolina	$0	$1,000	$0	$1,000
Pat Toomey (R)	Senate	Pennsylvania	$1,000	$0	$0	$1,000
Rich McCormick (R)	House	Georgia	$1,000	$0	$0	$1,000
Ron Johnson (R)	Senate	Wisconsin	$1,000	$0	$0	$1,000
Tommy Tuberville (R)	Senate	Alabama	$1,000	$0	$0	$1,000
Tracey Mann (R)	House	Kansas	$0	$1,000	$0	$1,000

Endnotes

[1] See Chart 1 on page 6 and Chart 2 on page 7.

[2]See “Lobbying Against the Future” section and “We Won’t Back Down” section of the Ciccone memo: https://docs.google.com/document/d/1oIht01XqAbyet2cpX79ugcFpUtHiZYT5IZcDTp-v1tg/edit?tab=t.0

[3] See “Lobbying Against the Future” section.

[4] See Chart 1 on page 6 and Chart 2 on page 7.

[5] See Chart 2 on Page 7 and methodology and appendix on pages 18-24.

[6] See Chart 1 on page 6 and methodology and appendix on pages 18-24.

[7] Not all congressional Republicans are climate deniers. However, all climate deniers in Congress are Republicans. Thus, while party affiliation is not a perfect signifier of a candidate’s support for climate action, it is a helpful reference point.

[8] See pages 3, 12, and 14 of InfluenceMap scorecard.

January 13, 2025

Public Citizen Co-Presidents Request Appointment to “Department of Government Efficiency”

Transition Co-Chairs Howard Lutnick and Linda McMahon
Mar-a-Lago
1100 S. Ocean Blvd.
Palm Beach, FL 33480

Dear Transition Co-Chairs Howard Lutnick and Linda McMahon:

We are co-presidents of the nonprofit consumer advocacy organization Public Citizen. For more than 50 years, Public Citizen has worked for strong—and smart—regulation to advance the public good. We thus write to request our appointment as members of the “Department of Government Efficiency” (DOGE).

President-elect Trump has charged Elon Musk and Vivek Ramaswamy with leading DOGE, an advisory committee to “provide advice and guidance from outside of Government, [that] will partner with the White House and Office of Management and Budget [OMB] to drive large scale structural reform, and create an entrepreneurial approach to Government never seen before.”

Public Citizen has concerns about DOGE’s structure and mission. In structure, an advisory committee led by individuals such as Messrs. Musk and Ramaswamy who hold financial interests that will be directly affected by federal budgetary policies presents substantial conflict of interest concerns that threaten to undermine public confidence in the committee’s recommendations to the administration. And DOGE’s mission to advise OMB on how to “slash excess regulation” and “cut wasteful expenditures” puts at risk important consumer safeguards and public protections, because it focuses only on eliminating rules and spending without considering the other half of the picture: more efficiently regulating corporations to better protect consumers and the public from harmful corporate practices, and making sound and efficient public investments.

Despite these concerns, Mr. Trump has given no indication that, once inaugurated, he will reconsider his decision to designate Messrs. Musk and Ramaswamy as DOGE’s leaders or his decision to direct OMB to partner with DOGE to cut federal spending and regulation. Accordingly, and in light of the significant influence that DOGE is expected to have on the administration’s fiscal and regulatory policy, Mr. Trump and OMB should take steps to ensure that DOGE’s advice and recommendations take into consideration the viewpoints of the consumers and citizens who would be directly affected by the regulatory and spending proposals that DOGE will advance, not only the viewpoint of wealthy businesspeople.

To that end, we request our appointment to serve as members of DOGE as voices for the interests of consumers and the public who are the beneficiaries of federal regulatory and spending programs. Appointing us to DOGE would be consistent with the expectations that Mr. Trump has articulated for DOGE. We would both be voices for consumers and the public from “outside of Government”; we share Mr. Trump’s stated goal of “making changes to the Federal Bureaucracy” to “make life better for all Americans,” and we agree with Mr. Trump that the “U.S. Government” should be “accountable to ‘WE THE PEOPLE.’” Moreover, our appointment to DOGE would not raise conflict of interest concerns because, unlike Mr. Musk, neither of us nor Public Citizen has a financial interest in federal government contracts and spending. In bringing the consumer and public perspective to DOGE, we can offer views that are truly untainted by the appearance of corruption or self-dealing.

As co-presidents of Public Citizen, we have a direct interest in DOGE’s mission of advising the administration on, and making recommendations regarding, the federal government’s regulatory and spending policies. Since its founding in 1971, Public Citizen has worked to hold the government and corporations accountable to the people, including by focusing on research and advocacy with respect to regulation of health, safety, consumer finance, and the environment. Indeed, an entire section of our website, citizen.org, is titled “Making Government Work.”

Consistent with Public Citizen’s mission—and that of DOGE—Public Citizen on December 20, 2024, sent Messrs. Musk and Ramaswamy a letter proposing two measures that would save the government and taxpayers billions of dollars, while improving health and access to medicines: authorizing generic competition to anti-obesity medications and implementing the Medicare drug price negotiation and inflation rebate programs to lower drug prices. Public Citizen has also advocated for reductions in Pentagon spending, which could trim billions from the federal budget; changes to privatized Medicare (“Medicare Advantage”), which could save a trillion dollars over the next decade; and elimination of wasteful and harmful oil and gas subsidies, which could save taxpayers hundreds of billions of dollars, among other measures. We have also supported efficient public investments—ranging from early childhood education programs to measures to mitigate climate change—that would both advance the broad public interest and generate positive monetary returns.

Appointing us to DOGE would be an important step towards compliance with the Federal Advisory Committee Act (FACA), which requires “the membership of the advisory committee to be fairly balanced in terms of the points of view represented and the functions to be performed by the advisory committee.” As things stand, DOGE’s membership falls far short of satisfying FACA’s fair-balance requirement. Mr. Musk, the world’s richest individual, has corporate financial interests that stand to benefit from a reduction in federal regulation and an interest in shielding his companies from federal spending cuts. Mr. Ramaswamy, also a billionaire investor, founded a biotech firm that stands to benefit from weaker federal drug regulation. DOGE member Katie Miller’s background is in handling press relations for government officials. William McGinley worked as a lawyer for various Republican Party groups and big law firms. Other people reported in the media as connected with DOGE also appear to have corporate backgrounds. These individuals lack the consumer and public interest perspective needed if Mr. Trump expects DOGE to have any hope of complying with FACA.

We look forward to your, or Mr. Trump’s, prompt response to this letter.

Sincerely,

Lisa Gilbert                                                     Robert Weissman

Co-president, Public Citizen                       Co-president, Public Citizen

January 10, 2025

Challenge to PSEG Transmission Fraud

Challenge in FERC Docket No: ER25-775

By Tyson Slocum

On December 20, PJM submitted a rate filing under Section 205 of the Federal Power Act proposing amendments to Schedule 12 of its Open Access Transmission Tariff to provide updated annual cost allocations for certain projects in its regional transmission expansion plan. The proposed cost allocations for Public Service Electric and Gas Company’s (PSEG) transmission projects identified by baseline project code b2986 in PJM’s filing are unjust and unreasonable, as they include imprudently incurred expenditures as revealed in a December 5, 2024 Commission enforcement action.[1] Given the stipulated facts, summarized below, the Commission should not apply its presumption of prudence. To the extent the Commission presumes the expenditures related to b2986 were prudently incurred, the stipulated facts create “serious doubt” that the expenditures were prudently incurred[2] (“The regulated entity has the burden of proof to establish prudence. However, in order to ensure that rate cases are manageable, a presumption of prudence applies until the challenging party ‘creates a serious doubt as to the prudence of an expenditure.’” (quoting Iroquois Gas Transmission Sys., 87 FERC at 62,170)). The Commission must find the proposed rates to be unjust and unreasonable, and set the matter for hearing. Furthermore, the Commission must reject PJM’s motion for a waiver of the Commission’s notice requirements[3] and disallow its request for an effective date of January 1.

To the extent that any PJM formula rate protocols require a party such as Public Citizen raising prudence challenges prior to raising them in a section 205 proceeding, the Commission should waive that requirement. The Commission’s December 5 enforcement order reveals new information that clearly raises “serious doubt” about the prudence of these expenditures and is relevant to whether these rates are just and reasonable. There is therefore good cause for waiving any procedural requirements in the Tariff.

The December 5 enforcement action details, in our opinion, harrowing fraud committed by PSEG,[4] and a failure by PJM and its Board of Managers to perform a modicum of independent oversight, not to mention inane record keeping practices by the grid operator. While the enforcement order documents clear wrongdoing committed by PSEG—imposing a civil penalty upon the transmission owner of $6.6 million payable to the U.S. Treasury[5]—the enforcement order fails to protect consumers from unjust and unreasonable rates resulting from PSEG’s scam.

As the enforcement order states at ¶ 10, PSEG recommended that PJM approve its $546 million Roseland-to-Pleasant Valley transmission line replacement project. PSEG submitted PowerPoint presentations to PJM that claimed 67 transmission towers in this corridor featured “foundations requiring extensive reconstruction”,[6] when in reality only 8 towers met that criteria.[7] And the enforcement order notes that, rather than conduct any independent evaluation, PJM relied entirely on PSEG’s PowerPoints in approving the $546 million project,[8] failed to perform any independent due diligence, and did not maintain basic recordkeeping of meetings where hundreds of millions of dollars in ratepayer-funded projects were discussed.[9] Six years ago we formally complained about PJM’s failure to transcribe its stakeholder meetings despite the inexpensive cost to do so, but yet here we are again.[10] It is disturbing that PJM and its Board of Managers would approve a cost recovery rate filing incorporating a transmission project it knew to be the subject of an enforcement order—demonstrating PJM’s disinterest in ensuring just and reasonable rates in its Open Access Transmission Tariff.

PSEG’s Roseland-to-Pleasant Valley transmission project, included in PJM’s cost recovery rate filing, includes imprudently incurred charges that were the subject of a Commission enforcement action. PJM’s filing seeking cost recovery for this project is clearly unjust and unreasonable, and the Commission must set the matter for hearing to ensure that families living within PJM’s footprint do not shoulder PSEG’s falsified charges. Read the full filing here PJMPSEG

[1] 189 FERC ¶ 61,175, Docket No. IN21-5, https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20241205-3039

[2] BP Pipelines, 153 FERC ¶ 61,233 at ¶ 13 https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20151120-3065

[3] At page 2 of the transmittal letter.

[4] The entire enforcement order should be read, but ¶¶ 25-26 detail how PSEG withheld incriminating pages from a presentation that would have exposed that only 8 towers required “[e]xtensive foundation rehabilitation”, and not the 67 that PSEG claimed to PJM.

[5] Enforcement order, at ¶ 2.

[6] Enforcement order, at ¶ 15.

[7] Enforcement order, at ¶ 17.

[8] Enforcement order, at ¶ 16.

[9] Enforcement order, at ¶ 13.

[10] “PJM’s failure to record or transcribe stakeholder meetings where proposed tariffs are deliberated is no longer an acceptable practice in the year 2018, as technology has enabled inexpensive recording and archiving tools to preserve the full record of stakeholder meetings. We have more detail in the fossil record of the Brontosaurus from the Late Jurassic epoch 150 million years ago than is contained in PJM stakeholder committee meeting minutes 6 months ago.” Section 206 Complaint of Public Citizen, Inc. under EL18-61, at page 5, https://elibrary.ferc.gov/eLibrary/filelist?accession_number=20180220-5158