Pennsylvania's #1 Special Interest Problem

A solution that makes the problem worse is no solution at all.

Yet, recent calls for campaign finance reform and a natural gas severance tax would do just that—selectively condemning natural gas lobbying while overlooking the largest special interest spender of all.

Public sector unions vastly outpace the natural gas lobby in political spending. Since 2007, the top union PACs have given $53.6 million to candidates, including over $10 million in campaign contributions to Governor Wolf. In comparison, the natural gas industry, according to the Conservation Voters of PA report, donated $11.2 million.

The report further calculates $61.4 million in natural gas lobbying since 2007. This is still less than the additional $69 million of members’ dues unions spend on “political activities and lobbying.”

 (Natural gas v. union political spending since 2007)

What’s more, as David Spigelmyer recently highlighted, the Conservation Voters of PA erroneously include non-industry spending:

Though the report claims to tally shale-related political contributions, it included non-industry donors, such as wind, nuclear and utility companies. Specifically, the report considered contributions from a Pittsburgh-area Coca-Cola distributor, a federal credit union, and the Humane Society of the United States as "Marcellus" contributors. 

On the other hand, it’s nearly impossible to capture the true extent of public-sector union spending. Not only do many unions never file detailed spending reports, they also frequently misreport political spending as “representational” expenditures or non-profit “contributions.”

This political giving and lack of transparency leads to lucrative deals at taxpayer expense.

• Since his election, Gov. Wolf has secretly negotiated billion-dollar contracts with the same unions that gave millions of dollars to his election and reelection campaigns. 
• After receiving $1.5 million from government unions in his first campaign, Gov. Wolf unionized 20,000 home care workers by executive order, which—after an extended court battle—could funnel $8 million annually to union coffers.
• Legislators received $32,150 from union PACs before voting on Paycheck Protection legislation in 2017 (and received an additional $39,300 in the subsequent weeks). Similarly, unions gave $111,100 to representatives in August and September 2018 when the House debated union reform legislation.

Campaign finance restrictions haven’t fixed the federal government, other states, or Philadelphia—where cronyism persists despite new laws.

The truth is, there is so much “money in politics” because politics determines who profits from state subsidies and taxes. A severance tax would only perpetuate this problem, further taxing an industry that already pays an impact fee—which generates $200 million annually for the state—on top of every other business tax.   

The truth is, there is so much “money in politics” because politics determines who profits from state subsidies and taxes.

 

If Pennsylvania wants to “be like other natural gas-producing states,” we’d need to eliminate our income or corporate income taxes before enacting a severance tax.

Keeping special interests in check begins with prohibiting conflicts of interest between government unions and elected officials and restricting—not expanding—governments’ taxing power.

That’s a true, transformative solution.