Obama: End tax breaks for big oil

[Parkbandit]

WASHINGTON (AP) — President Barack Obama's plea to Congress to end $4 billion in tax subsidies to oil companies was rebuffed Thursday as the Senate turned back a Democratic bill to repeal the tax breaks.

Moments after Obama made his election-year appeal in the White House Rose Garden, the Senate failed to reach the threshold of votes needed to proceed to a measure that would have ended the subsidies. Obama had argued that Americans are getting hit twice — once at the gas pump, and once more by sending billions of dollars in tax subsidies to oil companies.

"I think it's time they got by without more help from taxpayers who are already having a tough enough time paying the bills and filling up their gas tank," the president said. "And I think it's curious that some folks in Congress, who are the first to belittle investments in new sources of energy, are the ones that are fighting the hardest to maintain these giveaways for the oil companies."

The Senate vote was 51-47, short of the 60 votes necessary. Two Republicans voted to proceed to the legislation — Maine Sens. Susan Collins and Olympia Snowe. But four Democrats rejected the effort — Sens. Jim Webb of Virginia, Mary Landrieu of Louisiana, Ben Nelson of Nebraska and Mark Begich of Alaska.

Prior to the vote, Senate Republican leader Mitch McConnell challenged Obama and Democratic leaders.

"Is this the best we have to offer folks who are staring at $4 a gallon gasoline? A bill that even Democrats admit won't do anything to lower the price of gas?" the Kentucky lawmaker asked.

Obama said oil companies are pulling in record profits and shouldn't get taxpayer help when that money could be used on alternative energy. Obama, up for re-election, has sought to align himself with people frustrated by high gas prices.

Many congressional Republicans said cutting the tax breaks would lead to higher fuel prices, raising costs on oil companies and affecting their spending on exploration. Obama couldn't end the subsidies when Democrats controlled Congress earlier in his term.

White House spokesman Jay Carney said Obama would continue pressing for repeal of the subsidies.

http://news.yahoo.com/obama-end-tax-breaks-big-oil-150646643.html

I actually agree with Obama (now, in 2012.. not Obama circa 2005 when he voted FOR the subsidies) in questioning why we would need to subsidize an industry that has been profitable for years now. It makes as much sense as subsidizing farms to not have them plant crops.

But what effect do you think taking these subsidies away at this time would do for the price of gas? Here's a clue, they wouldn't go down.

[Archigeek]

I doubt it would impact the price at the pump at all in the short term. As for the long term, it's hard to say. What do you think would happen?

[Suppa Hobbit Mage]

Unless they reduce taxes as a result of not subsidizing, it won’t affect American’s at all – maybe even drive UP gas prices if they decide to pass on some of the cost of doing business.

[Jarvan]

The best part is, they want to remove these tax breaks, so they can double down on renewable energy subsidies...

So some subsidies are bad, others are good..

Also, gas prices would certainly go up, a corporation doesn't EAT a tax increase, they pass it on.

[Archigeek]

The best part is, they want to remove these tax breaks, so they can double down on renewable energy subsidies...

So some subsidies are bad, others are good..

Also, gas prices would certainly go up, a corporation doesn't EAT a tax increase, they pass it on.

It doesn't quite work like that. It's not an unreasonable conclusion to reach, but you are forgetting that oil is a commodity, and hence the price is largely market driven. Oil companies will price their products at whatever they can to make as much money as they can. Do you think when they get a subsidy, all the money goes into lowering the price of gas? No, of course not. Neither will the elimination of a subsidy ensure an increase in price. The market will be the largest driver in determining the price of oil, not subsidies.

And yes, some subsidies are bad, others are good. What do you think is a good subsidy?

[Kembal]

The interesting question is which set of tax breaks? There's two major ones that I know of....the domestic production tax break, and the LIFO tax break. If it's LIFO.....I don't see how those oil companies are going to pass that one on. (I also don't see how they're going to carve it out so it doesn't hurt everyone else that uses LIFO)

Of course, this is probably entirely academic since it's never going to pass.

[Jarvan]

It doesn't quite work like that. It's not an unreasonable conclusion to reach, but you are forgetting that oil is a commodity, and hence the price is largely market driven. Oil companies will price their products at whatever they can to make as much money as they can. Do you think when they get a subsidy, all the money goes into lowering the price of gas? No, of course not. Neither will the elimination of a subsidy ensure an increase in price. The market will be the largest driver in determining the price of oil, not subsidies.

And yes, some subsidies are bad, others are good. What do you think is a good subsidy?

Honestly, Zero. Why should the Government get to decide which is good or bad?

For decades, my Uncle got PAID to NOT grow corn. Subsidies, they make no sense.

Edit to add: If dems for example, are all about fairness, isn't it MORE fair to treat everything the same and either give them all tax breaks, or none of them tax breaks? Just like Repubs should feel the same way. if you eliminate one, you should eliminate all. Or if you allow one, you must allow all, tho I would prefer none.

[Warriorbird]

Pay energy subsidies!

No, no, pay those energy subsidies!

LOL.

[Parkbandit]

Pay energy subsidies!

No, no, pay those energy subsidies!

LOL.

I'll be honest.. I never thought this day would come where you are criticizing Obama's energy policy.

Well done... it is a fucking joke.

PS - Next time, include a "Oh shit, they went bankrupt" after "no, no, pay those energy subsidies" and it would be even more accurate.

[Warriorbird]

American energy policy is almost entirely stupid.

[Androidpk]

Damn those Chinese!

[Warriorbird]

I can't think of any candidate who has an energy policy I approve of.

[Tgo01]

We need more nuclear powered cars.

[Androidpk]

I can't think of any candidate who has an energy policy I approve of.

I can, Ron Paul.

http://www.ronpaul2012.com/the-issues/energy/

[Warriorbird]

We need more nuclear powered cars.

http://www.youtube.com/watch?v=bXqvv3dN8i4

[Jarvan]

Personally, I don't think we should subsidize Green energy at all. We should make them WANT to find cheaper better sources of energy, not just try to make things we already know are not up to the task of replacing coal, oil, natural gas AND nuclear.

Instead of giving them 4 Billion a year for the current tech, put 4 Bill into a fund, and keep adding to it until someone comes up with something that is really a breakthrough. Make private companies invest their time and money, rather then the governments. If our entire Green Energy Subsidy is 20 bill a year, then put that into the fund. How many years of the fund growing and growing do you think it will take for someone to seriously look into it?

Maybe have different level rewards.. Come up with an electric car that can go 500 miles a charge -8 hour or less charge frame- AND costs less then 30k? Also doesn't look like a piece of shit and can go at least 70 mph. Get 20% of the fund.

Come up with an energy source that is within even 3x as costly as oil/gas/coal? Maybe 25% or 50%.

Replace Fossil fuel with cold fusion, take it all, you win.

I would not be against a fund such as this.

[Warriorbird]

I can, Ron Paul.

http://www.ronpaul2012.com/the-issues/energy/

Given what I live near I can't quite jump on the "No EPA at all." bandwagon.

http://www.epa.gov/reg3hwmd/super/sites/VAD980705404/index.htm

[Parkbandit]

Given what I live near I can't quite jump on the "No EPA at all." bandwagon.

http://www.epa.gov/reg3hwmd/super/sites/VAD980705404/index.htm

I actually agree. I believe that the EPA does overstep it's intended authority on many occasions (ZOMG CO2 IS TOXIC AND WE MUST REGULATE IT!) and politicize shit way too much.. but companies can't be left to police themselves when it comes to hazardous waste.

[Wrathbringer]

I actually agree. I believe that the EPA does overstep it's intended authority on many occasions (ZOMG CO2 IS TOXIC AND WE MUST REGULATE IT!) and politicize shit way too much.. but companies can't be left to police themselves when it comes to hazardous waste.

The problem with the EPA is that, as I understand it, they don't actually do any testing or research themselves. They review the corporation in question's tests and approve, deny, or ask for more information. As such, they allow the fox to guard the hen house. I'm not sure their contribution is worth their expense. There may be a better way.

[Atlanteax]

It really ought to be in the major oil/energy companies (ie ExxonMobile) to develop a full-ledged 'green energy' supply that they can sell to consumers.

We'll still need oil (tho far less of it), and presumably they can stick with 'cheaper' sources of oil, while finding ways to generate enough energy off solar/hydro/etc, to continue being quite profitable.

Obviously the challenge under such a scenario is whether a company generating energy from multiple different kind of sources, can effectively manage it all ... vs a strictly oil-company managing oil-supply/refining.

I reckon the subsidies are really about getting the oil majors to go 'more green' but as I stated, it is already in their interest to do so ... rendering these subsidies a very wasteful government expense.