Nel's New Day

April 29, 2011

Oil Subsidies Elect Conservatives

Filed under: Uncategorized — trp2011 @ 2:04 PM

Two days ago, I criticized the large subsidies that oil companies received on top of the huge profits they reap. Two days before that House Speaker John Boehner (R-OH) went on record, agreeing with me, that not only should the oil industry not need at least on of the subsidies that the Democrats are attempting to terminate but also that oil companies should pay their fair share of taxes. His sanity didn’t last long. The next day his spokesman corrected Boehner’s statement, the second time he has done so in the past few weeks.

Spokesman Michael Steel sent an email on Boehner’s behalf that stated, “The Speaker wants to increase the supply of American energy to lower gas prices and create millions of American jobs. Raising taxes will not do that.”

By yesterday Boehner was refusing to allow legislation eliminating tax breaks for these wealthy corporations.

An article in The Hill about Boehner’s changing philosophies (can we say flipflop? or backtracking?) drew great criticism from what is typically a conservative readership. Angry references such as “fat cat companies” were followed by questions such as the one asking why the taxpayers’ forced to subsidize “the companies on the hill” because capitalism is the survival of the fittest. One responder ridiculed Boehner for not being able to tell the difference between a tax and a subsidy.

My favorite response was the person who said people need to pay higher gas prices to maintain people’s retirements. There is a certain irony here when conservative politicians are fighting to eliminate salaries and benefits for the public sector because taxpayers have to pay for these. Someone finally understands the connection between higher prices supporting “people’s retirements.” And they didn’t even mention that no one in the public sector receives the tens and tens of millions of dollars in annual salary that many corporate people do.

Meanwhile Exxon-Mobil is complaining about the possibility of losing its subsidies on the same day that they announced almost $11 billion (yes, that is a b for billion) in only three months. At the same time  they had a 70 percent increase in profit from the first quarter last year, gas prices rose 30 percent. 

While not making as much as Exxon, the other four top oil companies—Shell, ConocoPhillips, Chevron, and BP—managed $21.7 profit in the past three months.

To put this into slightly more manageable terms, the profit from these five companies is $15 million an hour—every hour.

Congress is taking away food from women and children because they give nearly $4 billion in taxpayer subsidies to oil companies each year. Reducing that $4 billion in subsidies could have reduced the most recent deficit cutting by ten percent.

Why do Republicans refuse to even vote on lowering or eliminating oil subsidies? Because the money from these companies will get them re-elected. How much, we won’t know any more because the conservative U.S. Supreme Court ruled that corporations can spend as much money as they want on advertising for the same people who will keep on giving them subsidies. And the more money they give, the more corporate politicians will be elected. At this point it appears to be a no-win solution because advertising doesn’t have to be accurate or truthful—it just has to persuade.

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