“The Big 5 oil companies have made nearly $1 trillion in profits in the last decade - and more than $30 billion of that in the first three months of this year alone. At the same time, many Americans are struggling to make ends meet, find a job, or fill their gas tanks with $4 per gallon gasoline.”
The U.S. Senate yesterday refused a Democratic Party sponsored proposal to end billions of dollars in taxpayer subsidies worth an estimated $21 billion during the next five years.
In a procedural vote along party lines on S940, the upper chamber of the House – sometimes referred to by critics as a millionaire’s club – could not muster the 60 votes required to move ahead with the legislation, falling eight votes short.
Forty-eight Democrats, two independents and two Republicans voted for the bill. Three Democrats crossed the aisle to vote with Republicans -Mark Begich, Mary L. Landrieu and Ben Nelson – all from energy producing states dependent on industry revenues, Alaska, Louisiana and Nebraska, respectively.
Energy industry tax breaks will not however go away anytime soon as a contentious political issue given a soaring U.S. budget deficit that now requires borrowing 41 cents of every dollar spent, and gasoline prices at $4-$5 a gallon making voters poorer and angrier every day.
The bill singled out the five largest oil companies: BP, Exxon Mobil, Shell, Chevron and ConocoPhillips by raising their corporate tax rates. This may or may not be constitutional since the U.S. Constitution requires that tax bills originate in the House of Representatives, whose members – all up for reelection in 2012 – aren’t even in Washington this week. It certainly fell far short of the needed policy debate about decades of failed U.S. energy policy – and just as certainly the maneuvering provides for populist campaign talking points and populist talking points.
(See also Tougher Vehicle Economy Standards to Save Billions in Costs? and U.S. Gasoline, Diesel Prices Move Higher, Setting May Record)
“Last week, as gas prices continued to climb, squeezing family budgets and putting even more pressure on already-struggling businesses, Democrats here in Congress sprang into action.
“Instead of actually doing something about high gas prices, our Democratic friends staged what one of my Republicans colleagues accurately described as a dog and pony show.
“They rounded up what they believed were a few unsympathetic villains who they could blame for high gas prices, hoping nobody would notice they don’t have a plan of their own to deal with them.
“That’s been their strategy from the beginning.
“Blame this crisis on somebody else — and then see if they can’t raise taxes while they’re at it.
“They’ve been so shameless, in fact, that they haven’t even pretended they’re doing anything to lower gas prices, readily admitting the bill we’ll vote on today won’t lower gas prices by a penny.
“As the Democrat Chairman of the Finance Committee put it last week, `That’s not the issue.’
“Well, I would submit that for most Americans high gas prices is, in fact, the issue.
“And this week, Democrats will show once again how little they care about it when we take up an energy plan that several more of them have admitted will do nothing to lower the price of gas at the pump.
“One Democrat senator, a member of their own leadership team, called their bill a ‘gimmick.’
“I would also argue that with Americans looking for real relief, symbolic votes like this that aim to do nothing but pit people against each other will only frustrate the public even more.
“Americans aren’t interested in scapegoats. They just want to pay less to fill up their cars.
“That’s why this Democrat bill to tax American energy is an affront to the American people, and so is the President’s announcement over the weekend that he now plans to let these same energy producers lease lands throughout the U.S. that his administration had previously blocked off.
“The administration knows perfectly well that leasing is just the start of the development process, which is why its only hope is that Americans don’t pay close attention to the details of its plan.
“Permits are what really matters, and by refusing to issue permits in any meaningful way, the administration is showing its true colors in this debate.
“If the administration were serious about increasing domestic energy production, it would increase leases — and address this administration’s de-facto moratorium on permits.
“In the end, the only thing Democrats will actually achieve this week is to make Republican arguments for comprehensive energy legislation seem even stronger than they already are.
“By pretending to want to increase domestic energy production, the President is not only acknowledging that the U.S. has vast energy resources of its own waiting to be tapped.
“He’s also acknowledging that tapping those resources would at some point help drive down the price of gas at the pump.
“That’s what Republicans have been saying all along. Now the President is acknowledging it.
“Supply matters. And American supply matters even more.
“So the only thing that seems to be standing between Republicans and Democrats at this point is that Democrats don’t seem to have the political will to follow through on their conclusions.
“And in this, today’s Democrats are no different than their predecessors.
“For decades, Democrats from Jimmy Carter to President Obama have sought to deflect attention from their own complicity in our nation’s over-dependence on foreign oil.
“Every time gas prices go up, they pay lip service to the need for domestic exploration while quietly supporting efforts to suppress it.
“But President Obama’s energy policy puts the current administration in a whole new category.
“Over the past two years, the President has mounted nothing short of a war on American energy, cancelling dozens of leases, imposing a moratorium off the Gulf Coast, arbitrarily extending public comment periods, and increasing permit fees. On the crucial issue of permits, the administration has held them up in Alaska, the Rocky Mountain West, and particularly offshore.
“Every one of these decisions has had a major impact on future production — and on future jobs, since every permit the administration denies is another job creation opportunity denied.
“So the truth of the matter is that the Obama administration has done just about everything it can to keep our own domestic energy sector down and to stifle the jobs that come with it.
“Until now, the President has stuck to attacking Republicans for being stuck in the present without preparing for the future.
“But this has always been a disingenuous argument.
“It ignores history, since we have repeatedly supported alternative fuels and renewable energy, as well as comprehensive energy legislation that commits us to the development of cleaner technologies. And it ignores science, since even if a million electric vehicles are sold here by 2015, they’d still only account for less than one half of one percent of the entire U.S. vehicle fleet. However much we desire it, the transition from oil will take decades. Any serious energy policy must account for that.
“With this latest gambit, the President may have acknowledged the wisdom of our approach. But his plan to allow a few lease sales without corresponding permits falls short. Energy producers might end up with a lot of expensive land, but the rest of us would have nothing to show for it.
“A better approach to this crisis is the Republican alternative that will also get a vote tomorrow.
“Our bill would return American offshore production to where it was before this administration locked it up, require federal bureaucrats to process permits — to make a decision one way or the other — rather than sitting on them.
“And it would improve offshore safety. Our plan not only acknowledges the importance of increasing domestic production — it does something about it, while ensuring environmental safety.
“If President Obama and his party are really serious about lowering gas prices, making us less dependent on foreign oil, and creating the thousands of jobs that American exploration is proven to produce, they would embrace our plan and stop pretending to care about a crisis they have done so much to create and, their latest public relations efforts notwithstanding, continue to ignore.”
– U.S. Senate Republican Leader Mitch McConnell made the following remarks on the Senate floor Tuesday before the vote – editor