Will Obama Sacrifice Social Security So He Can Continue Bush/Cheney Policies Of Giving Big Oil Big (Unnecessary) Subsidies?

Joe Barton of the Texas Freedom Fund money laundering operation, Big Oil's man in the House

Big Oil, the most profitable and richest industry in America, also gets the most taxpayer subsidies-- at least $45 billion a year... right out of our pockets and into theirs. Well... theirs and the political elites'. You see, government gives Big Oil that $45 billion a year and Big Oil turns around a returns a nice portion of it to its political allies. Since 1990 Big Oil has invested $144,706,971 directly into the careers of its favored politicians-- $106,031,540 to Republicans and $38,395,021 to Democrats (almost entirely conservative Democrats willing to whore themselves out the way Republicans do). These 6 corporate whores are the only Members of Congress to have gotten over a million dollars, although ex-Congressman Steve Pearce (R-NM) is at $998,178, running again and likely to go over the million dollar mark sometime this month. And none of this counts lobbying. This year alone-- and we're just halfway through-- Big Oil has spent $38,178,838 on federal lobbying.


They're looking for special rules and special regulations (as in as few as they can get away with) and lots of subsidies. In return, Big Oil was the financial mainstay of the Republican Party under the Bush Regime. And Obama hasn't changed much of anything. As you may have read here at DWT, we're all worked up over Obama's austerity jag and all the whining coming out of DC about deficits and what looks like a stealth plan to cut the deficit on the backs of ordinary Americans by "reforming" Social Security. Instead of ending the absurdly unfair FICA exclusion on income over $106,800 or reducing military spending, it looks like Obama will try to go along with conservative GOP precepts to raise the retirement age, something John Boehner has been clamoring for. A far better proposal would be to cut the Big Oil subsidies from $45 billion to... of let's use a round number: zero. Over the weekend Steve Benen at the Washington Monthly said the subsidies should be on the table.

Under the circumstances, it's tempting to think Congress wouldn't have too much trouble ending breaks for the oil industry-- energy giants have enjoyed remarkable generosity for quite a while.

[A]n examination of the American tax code indicates that oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.

According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.

And for many small and midsize oil companies, the tax on capital investments is so low that it is more than eliminated by various credits. These companies' returns on those investments are often higher after taxes than before.

"The flow of revenues to oil companies is like the gusher at the bottom of the Gulf of Mexico: heavy and constant," said Senator Robert Menendez, Democrat of New Jersey, who has worked alongside the Obama administration on a bill that would cut $20 billion in oil industry tax breaks over the next decade. "There is no reason for these corporations to shortchange the American taxpayer."

The Center for American Progress' Sima J. Gandhi told the NYT, "We're giving tax breaks to highly profitable companies to do what they would be doing anyway. That's not an incentive; that's a giveaway."

The report added, however, "Despite the public anger at the gulf spill, it is far from certain that Congress will eliminate the tax breaks."

It didn't say which party will be pushing to protect the oil industry, but it's not a stretch to suspect Republicans will play their traditional role.

With plenty of help from Rahm Emanuel, Ken Salazar, the Blue Dogs, Mary Landrieu, Blanche Lincoln, and other Democrats with terminally conservative mindsets.




UPDATE: And, Yes, There Already Was A Vote On Taking Away Some Of The Big Oil Subsidies-- It Lost

On June 15 Bernie Sanders offered an amendment "to eliminate big oil and gas company tax loopholes, and to use the resulting increase in revenues to reduce the deficit and to invest in energy efficiency and conservation." Obviously, every single Republican voted against it. But so did a ton of Democrats who have been bought off by Big Oil too. Sanders' amendment failed 35-61 with Blanche Lincoln, Mary Landrieu, Evan Bayh, Ben Nelson, John Kerry, Mark Pryor, Mark Warner, Max Baucus, Chris Dodd and, obviously, Joe Lieberman (I-CT- $190,900)-- among others-- making it the ultimate bipartisan vote-- the Senate + Big Oil against the American People. Peter Welch (D-VT) questioned Big Oil executives about this in the House: