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big oil subsidies

If Republicans are concerned with the budget, drop Big Oil subsidies

It makes no sense.  Actually, it makes absolute sense to those that seek the truth or are slightly educated.  If America’s fiscal health was really that important to Republicans and Democrats, there would be no oil subsidies. It’s a big one, about $40 billion a year in subsidies, tax breaks and loop holes.  And guess what?  It’s to the richest companies in the world, so I doubt that it’s going to put any of them out of business.

The argument of jobs is a mute point here.  Pain at the pump?  This isn’t a genius idea, but maybe that might drive a change in consumer behavior and increase demand for alternatives.  It’s basic supply and demand people, but that’s not what Republicans nor Democrats want you to believe.  And why is that?  Because those .01% that represent you in the White House get handouts from the energy industry.  They get campaign funds, appointed retirement positions, bogus board member positions, lobby jobs, and don’t forget a nice dividend in their stock portfolios when energy companies do well on your backs.

It’s time to wake up and stop believing what the White House wants you to believe.

And Paul Ryan, Romney’s new running mate, proposed a budget that does nothing to address this problem:

By CAPAF’s Daniel J.  Weiss and Richard W.  Caperton

House Budget Committee Chair Paul Ryan’s (R-WI) proposed FY 2012 budget resolution is a backward-looking plan that would benefit big oil companies at the expense of middle-class Americans. It retains $40 billion in Big Oil tax loopholes while completely eliminating investments in the clean energy technologies of the future that are essential for long-term economic growth.

This budget would lock Americans into paying high, volatile energy prices. It would ensure that millions of clean energy jobs are created oversees–not here in the United States. It is a path backward to Bush-Cheney Big Oil energy policies that cost jobs and harm American competitiveness. In short, the Ryan plan ensures that we lose the high-stakes competition for the $2 trillion worldwide clean tech market.

Ryan claimed in a Wall Street Journal op-ed that his plan “rolls back expensive handouts for uncompetitive sources of energy, calling instead for a free and open marketplace for energy development, innovation and exploration.” This is false. Ryan’s proposal actually violates his assertion in two ways. It maintains wasteful subsidies for Big Oil, while cutting valuable investments in the clean energy technologies of the future.

Let’s consider each of these in turn. First, Ryan’s plan would continue “welfare” for big oil companies.

Ryan was asked several times in a recent interview whether his plan would “eliminate tax breaks for Big Oil,” but he refused to answer. Evading an uncomfortable question was his acknowledgment that his budget hatchet leaves Big Oil tax breaks untouched . This is consistent with his recent vote to keep Big Oil tax loopholes as part of the FY 2011 spending bill, while cutting education, medical research, and clean-tech investments.

In addition to receiving $40 billion of unnecessary tax breaks, Big Oil does not pay its fair share of royalties for oil and gas produced from publicly owned waters. TheGovernment Accountability Office estimates that a loophole in a 1990s oil-and-gas law could deprive the treasury of $53 billion in lost royalties. In February, the House Republicans overwhelmingly voted against recovering these royalties. Although Ryan’s budget claims that it “stops spending money the government doesn’t have,” it does nothing to recoup these forgone funds. This is another gift for Big Oil, paid for by middle-class taxpayers who must suffer the consequences of other steep spending cuts.

 Daniel J. Weiss is a Senior Fellow and the Director of Climate Strategy and Richard W. Caperton is a Senior Policy Analyst with the Energy Opportunity team at American Progress.

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