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Oil subsidies by the numbers

March 28th, 2012

From Green Right Now Reports

$1 Trillion – Profits earned by the top five largest oil companies Exxon-Mobil, Chevron, ConocoPhillips and foreign-owned BP and Royal Dutch Shell came to nearly $1 trillion for the 10 years from 2001-2011.

$4 Billion – Total Annual US Subsidies to oil companies.

$7,610 — Tax breaks to the oil and gas industry, every minute.

$24 billion – The amount that could be saved over the next decade by cutting annual oil subsidies in half.

$12 billion – the amount that would be used from the oil subsidy savings to reduce the deficit under the bill to cut oil subsidies proposed by Sen. Robert Mendendez (D-N.J.) in the Senate.

$12 billion – the amount of oil subsidy savings under the Mendendez plan that could be re-dedicated to tax incentives for clean, renewable energy, from non-polluting sources.*

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The Senate is debating whether to end subsidies to big oil companies.

As usual the discussion breaks down mainly along partisan lines, in this case, with Democrats championing the cause and Republicans opposing it.

The Democratic argument: The oil companies clearly don’t need the money, which siphons away cash that could be better spent; it’s unfair to tax financially stressed Americans to enrich the already well-endowed big oil companies.

“This debate is pretty simple, says Sen. Robert Mendendez, author of the bill to slice oil subsidies in half. “It’s about whose side you’re on.  You’re either on the side of Big Oil companies making record profits, or you’re on the side of middle class American families who can’t afford the price at the pump – let alone afford to chip in billions of dollars more to make oil profits even higher.

We know whose side Big Oil is on when they take $24 billion in taxpayer money and actually produce less oil, not more, leaving families with higher gas prices while they continue to make record profits.”

Republicans agreed to debate the measure, because they say that cutting subsidies to the oil industry could cause the oil companies to try to recoup their loss at the gasoline pump, where Americans are now paying nearly $4 a gallon.

Senate Minority leader Mitch McConnell, (R-Kty), dismissed Mendendez’ plan to cut spending on oil subsidies because it fails to offer an answer to high gas prices.

“At a time when gas prices are at a national average of nearly $4 a gallon, this is what passes for a response to high gas prices for Washington Democrats — a bill that does nothing about it.

But it gets even worse than that. Because not only is the Democrat solution to high gas prices a bill that even they admit does nothing to lower gas prices; they won’t even allow Republicans to offer any amendments that would help. Not only are they pushing a bill that won’t lower gas prices; they’re blocking any measure that could actually make a difference.

So at a moment when working Americans are struggling with high gas prices, the message Democrats in Washington are sending this week is simple: get used to it. Because they’ve got nothing– nothing but a phony proposal aimed at distracting people from the fact that they have nothing to offer.”

Democrats say that this response conflates two issues — that of a corporate giveaway to oil companies, and high gas prices, an issue influenced by global markets. On the former charge that cutting oil subsidies would raise gas prices, they allege fear-mongering by Republicans.

Republicans, however, charge that the Obama Administration and Democrats should come up with ways to address the pain at the pump, or allow Republicans to offer solutions, such as expanding domestic oil drilling in the ocean and the arctic.

And so the debate goes.

* Source for numbers: US Congress, Office of Sen. Robert Mendendez.


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