Democrats Take a Page From the Frank Luntz Playbook

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When Mitch McConnell unveiled his opposition to the Dodd financial reform bill last month, I highlighted the similarities between the minority leader’s floor speech and a memo from GOP message maven Frank Luntz. Their (mischaracterizing) argument was that the legislation would institutionalize Wall Street bailouts on the taxpayer’s dime. Luntz’s memo didn’t just provide a rhetorical roadmap for skewering financial reform, it offered the same simple formula for any bill:

Public outrage about the bailout of banks and Wall Street is a simmering time bomb set to go off on Election Day. To put it mildly, the public dislikes taxpayer bailouts of private companies. Actually, they HATE it.

Frankly, the single best way to kill any legislation is to link it to the Big Bank Bailout.

But Republicans aren’t the only ones who read Luntz missives. Back in March, long before McConnell’s critique, the environmental group Sierra Club was charging various Republicans and some Democrats with supporting a “Big Oil Bailout” in the form of legislation that would curtail EPA efforts to regulate greenhouse gases. They cut anti-Blanche Lincoln ads to that effect. As it turns out, the bailout cudgel can be used for more than just clubbing legislation, and the Sierra Club’s strategy of co-opting Luntzian language to decidedly non-Luntzian ends has stuck.

Democratic Senators Bob Menendez, Frank Lautenberg and Bill Nelson are introducing new legislation designed to up the economic damage liability of oil companies in wake of British Petroleum’s Deepwater Horizon spill. The bill’s name? The “Big Oil Bailout Prevention Act.”

Like the greenhouse gas issue, it’s a bit of a stretch — As far as I know, no one is predicting the spill will bankrupt BP, which reported $5.6 billion in profits last quarter, or that the government would rescue them. Legislators are trying to prevent taxpayer dollars from being used in the Gulf disaster’s potentially massive fallout, but I’d say “bailout” in this case misses the mark. The fact that lawmakers feel a measure increasing the culpability* of not-exactly-beloved giant oil companies even needs the bailout tie-in speaks volumes to the term’s current political cachet.

The phrase is sure to be tossed around a lot at tomorrow’s Hill press conference where Senators Menendez, Lautenberg and Nelson will make their case for the bill. Also in attendance: Michael Brune, Sierra Club’s executive director.

*Just to be clear on who’s responsible for what: BP is liable for all the clean-up and direct damage costs. The issue at hand is the indirect economic cost of the spill (think shrimping industry, not shrimp.) There is currently a cap of $75 million on the amount the government can charge an oil company for this kind of blowback. Then the government steps in, paying for further damages out of a liability trust fund (currently at $1.6 billion) filled by a small, ongoing tax on the oil industry. With the potential indirect damage from the Deepwater Horizon spill far exceeding that amount, the proposed legislation would enable the government to directly charge a company up to $10 billion and eliminate the $1 billion cap on payouts from the trust fund per incident.