The Daily Sandwich

"We have to learn the lesson that intellectual honesty is fundamental for everything we cherish." -Sir Karl Popper

Location: Boston, Massachusetts, United States


Thursday, April 27, 2006

GOP blocks vote to end federal subsidies to big oil

Amazing. Senator Ron Wyden tried to get the measure on the floor for a vote-- you know, one of those "up or down votes" the GOP loves so much. But the Republicans aren't about to go on record as opposing any substantive measures dealing with energy prices. The goal is to avoid committing to anything until they cobble together some illusory piece of legislation that lets them crow about their strength and populism without doing a thing to address the issue. A case in point is Frist's mind-boggling suggestion that the government send out $100 checks to Americans. Ostensibly that would all be paid for in foreign debt-- and thus by taxpayers-- while keeping in place corporate welfare for big oil and their billions in tax breaks.

Under the Energy Bill signed into law last summer, oil companies were given new subsidies in the form of reduced royalty fees for the oil and gas they extract from Federal lands, including off-shore drilling in the Gulf of Mexico. What the Wyden amendment would do would be to force energy companies to pay royalties to the government on all oil and gas they produce on federal leases in the Gulf of Mexico, if the price of crude oil is above $55 a barrel.

That's federal leases, the public resource, and billions and billions of dollars of taxpayer money going to oil and energy companies. The Department of Interior provides royalty relief to oil companies as incentive to prevent disruptions because of hurricanes or other natural disasters. But that "incentive" price is $55 a barrel, and oil is now selling for more than $70 a barrel--seems like incentive enough.

The subsides for oil and gas companies add up to as much as $35 billion.