U.S. Sen. Bernie Sanders speaks to striking Kellogg’s workers in downtown Battle Creek, Michigan, on December 17, 2021. (Photo: Seth Herald/AFP via Getty Images)
“We cannot allow big oil companies and other large, profitable corporations to continue to use the war in Ukraine, the Covid-19 pandemic, and the specter of inflation to make obscene profits by price gouging Americans.”
U.S. Sen. Bernie Sanders on Friday unveiled the Ending Corporate Greed Act, which aims to end corporate price gouging in the midst of multiple global crises by imposing a 95% tax on the windfall profits of major companies.
The bill—spearheaded by Sanders (I-Vt.), Sen. Ed Markey (D-Mass.), and Rep. Jamaal Bowman (D-N.Y.)—is inspired by previous windfall profits tax plans implemented during World Wars I and II as well as the Korean War. During WWII, Sanders’ office noted, “the tax rate reached as high as 95%, which ensured that companies could not profiteer off the war.”
“The American people are sick and tired of the unprecedented corporate greed that exists all over this country. They are sick and tired of being ripped off by corporations making record-breaking profits while working families are forced to pay outrageously high prices for gas, rent, food, and prescription drugs,” Sanders said in a statement.
The Senate Budget Committee chair argued that “we cannot allow Big Oil companies and other large, profitable corporations to continue to use the war in Ukraine, the Covid-19 pandemic, and the specter of inflation to make obscene profits by price gouging Americans at the gas pump, the grocery store, or any other sector of our economy.”
“During these troubling times, the working class cannot bear the brunt of this economic crisis, while corporate CEOs, wealthy shareholders, and the billionaire class make out like bandits,” he added. “The time has come for Congress to work for working families and demand that large, profitable corporations make a little bit less money and pay their fair share of taxes.”
In addition to the existing federal tax rate—which congressional Republicans cut from 35% to 21% under former President Donald Trump—Sanders’ bill would establish a 95% tax on a company’s profits that exceed its average profit level for 2015-19, adjusted for inflation.
The new tax would only apply only to companies with $500 million or more in annual revenue and would be limited to 75% of income per year. Sanders’ office estimates that the temporary emergency measure, which would only apply in 2022-24, “coud raise an estimated $400 billion in one year from 30 of the largest corporate profiteers alone.”
A summary from the senator’s office details how the proposal would likely impact major corporations in various industries: automobile manufacturing, banking, Big Pharma, Big Tech, food and retail, fossil fuels, and housing.
“My constituents are hurting, and they are rightly asking what Congress can do about surging prices for food, energy, and other necessities,” Bowman said Friday. “What we cannot do is ask working Americans to shoulder any more of this burden.”
“Corporate price gouging is playing a big role in the inflation we are experiencing right now, putting families in a financial squeeze in the middle of an ongoing pandemic,” he emphasized. “These are the same corporations that are eroding our democracy, eviscerating workers’ rights, and fueling the climate crisis—and it is time to make them pay.”
According to Bowman, “The Ending Corporate Greed Act will take away any incentive for large companies to exploit our current crisis for profit, and it will protect workers, families, and small businesses in New York and across the country.”
Big Oil, in particular, is “raking in record profits, while Americans are facing price hikes at the pump,” Markey pointed out, declaring that “something is fundamentally broken when the biggest corporations in the country are leveraging a pandemic and a war to pad their profit margins as average Americans suffer.”
Recent polling found that 82% of U.S. voters believe inflation is fueled by corporations “jacking up prices.” Another survey showed that 80% of voters—including 73% of Republicans—support a windfall profits tax on fossil fuel giants and 87% of them want Congress and President Joe Biden to “crack down on price gouging and excessive price increases by oil companies that result in higher gas prices at the pump.”
Some advocacy groups supporting Sanders’ proposal directed attention at the industry on Friday. As Friends of the Earth’s Lukas Ross put it: “Big Oil is teaching a master class in war profiteering and disaster capitalism. Near record stock buybacks are reprehensible while war rages and consumers suffer. It’s time for a windfall profits tax.”
Sunrise Movement advocacy director Lauren Maunus agreed while calling out “fossil corporations” for “capitalizing on this crisis to loot working people at the gas pump.”
“It’s despicable that corporations can hold us hostage during a pandemic and a deadly conflict to make record profits and line the pockets of their executives at our expense,” she said. “If our politicians are serious about helping everyday people and making corporations pay their fair share, they must pass the Ending Corporate Greed Act.”
Other backers of the bill include tax scholar Reuven Avi-Yonah, economists Emmanuel Saez and Gabriel Zucman, and experts and campaigners at the American Economic Liberties Project, Center for Biological Diversity, Food & Water Watch, Economic Policy Institute, Groundwork Action, Patriotic Millionaires, and Roosevelt Institute.
Sanders’ proposal comes as “the White House is studying a range of potential responses to rising gas prices” and engaging in “wide-ranging internal talks about potential ideas for bringing relief to consumers,” according to The Washington Post.
As Jeff Stein reported Friday at the Post:
‘The ideas they have discussed include a major release of the nation’s oil reserves, loans and other incentives to energy producers to encourage production, and a federal gas tax holiday, according to two people with knowledge of the conversations, who spoke on the condition of anonymity to describe internal discussions.
Biden aides have also discussed ideas that they are less likely to advance. These ideas include rebate checks for motorists and using decommissioned buses in major cities to promote public transit and reduce gas demand, the people said.’
“Additionally, White House officials have had preliminary conversations about a potential ‘windfall tax’ on the profits of large oil and gas producers,” Stein noted, “although it is unclear if they will embrace such a measure. “
Jessica Corbett is a staff writer for Common Dreams.
Common Dreams, March 25, 2022, https://www.commondreams.org/news/2022/03/25/sanders-intros-revival-95-windfall-profits-tax-wwii-curb-corporate-greed