(This is a current page, from the Patterns of Power Edition 3 book contents.  An archived copy of this page is held at http://www.patternsofpower.org/edition03/3373.htm)

Politicians can offer tax breaks, or exemptions from economic regulation, as inducements to individuals or organisations – to persuade them to support a political candidate or party in an election.  These manoeuvres might take place before the election, to attract new donations, or after the election as a reward for donations given.  From a political perspective, this is a distortion of democracy – as described later (

It must be assumed that when organisations make political donations they expect to receive benefits: ‘kickbacks’.  The companies and organisations that make large political donations are tracked on the OpenSecrets.org web site.

The US Congress has responded to intensive lobbying by repeatedly legislating to allow large corporations to reduce their tax bills,[1] as a form of tax avoidance, including hiding profits overseas (  From an economic perspective, the effect of these tax concessions is to reduce payments by large corporations and therefore place a greater tax burden on citizens to pay for government spending.

The deregulation of financial markets, which led to instability (, is very probably directly connected to the political donations made by large financial corporations.



[1] The intense lobbying for tax breaks, involving an “army of 1,359 individual lobbyists”, was revealed in a report entitled Corporate Lobbying On Tax Extenders And The “GE Loophole” ; it was available in April 2018 at http://www.americansfortaxfairness.org/reports/report-on-lobbying-on-tax-extenders/.  It highlighted “the Active Financing Exception loophole” as enabling “some large corporations to escape paying federal taxes on interest and dividend income “earned” offshore”.