Questioned about the oil industry’s “obscene” profits by ABC’s Jonathan Karl, House Speaker John Boehner (R-OH) asserted that the oil industry doesn’t require the significant (>$1 billion/year) tax subidies of the oil depletion allowance. He said that they will “pay their fair share of taxes.” As Boehner put it, ““I don’t think the big oil companies need to have the oil depletion allowances.” Speaker Boehner appeared, for a moment, to have gone 25 percent of the way to meeting President Barack Obama’s call to reduce the subsidies to the oil industry by $4 billion per year.
When questioned about the affordability of lavish tax subsidies to oil companies with record breaking profits amid serious budget challenges, Boehner stated:
It’s certainly something we should be looking at. We’re in a time when the federal government’s short on revenues. We need to control spending but we need to have revenues to keep the government going. They ought to be paying their fair share.
Boehner’s comments came in a segment where he also asserted that “Gas prices could cost Obama the election.”
After the interview, Boehner’s staff sought to backtrack from Boehner’s clear statement of a readiness to examine whether oil companies require tax subsidies:
The speaker made clear in the interview that raising taxes was a nonstarter, and he’s told the President that. He simply wasn’t going to take the bait and fall into the trap of defending ‘Big Oil’ companies.
Evidently, “paying their fair share” means receiving $billions in tax subsidies while reaping enormous profits off Americans paying $4 or more at the pump.
Speaker Boehner (or, well, his staff?) is evidently quite comfortable with the hidden tax on the American public due to fossil-foolish energy policies that focus on drilling deeper wells to use up our oil faster to send dollars faster to OPEC nations and into the coffers of oil company executives rather than policies to strengthen the national security, improving America’s economic prospects, and enriching Americans through seizing a commanding position in the 21st Century’s Clean Energy Revolution.
On Speaker Boehner’s statements, see also Talking Points Memo and Think Progress. Representative Nancy Pelosi’s office questions: is there a break-up between Speaker Boehner and Big Oil?
As Americans struggle with the price at the pump, oil companies are enjoying multi-billion dollar profits. According to the Wall Street Journal, the spike in oil prices “is expected to lift earnings by about 50% at Exxon Mobil Corp., and about 33% each at Chevron Corp. and ConocoPhillips, compared with a year earlier.” It’s clear we don’t need to be giving away billions in taxpayer dollars to the most profitable companies in the world and even ex-Shell CEO John Hofmeister agrees saying “with high oil prices, such subsidies are not necessary.”
House Republicans have made no secret of their close relationship with Big Oil from their deeply flawed “Drill Only” energy policy to their repeated votes against rolling back taxpayer subsidies. But with gas prices hitting American families and small businesses hard, the GOP is desperately trying to hide their unpopular romance. Last night, Speaker Boehner told ABC News that Big Oil “ought to be paying their fair share”:
“Everybody wants to go after the oil companies and, frankly, they’ve got some part of this to blame,” the Ohio Republican told ABC News today.
Blame aside, what about the cold, hard cash — the billions of dollars in tax breaks and other subsidies big oil receives every year? President Obama has proposed doing away with many of them, which he says would save $45 billion over the next 10 years.
“It’s certainly something we should be looking at,” Boehner said. “We’re in a time when the federal government’s short on revenues. They ought to be paying their fair share.”
That is a departure for the speaker on an issue that Republicans have long defended as necessary to encourage domestic oil production.
“A departure” is quite the understatement–House Republicans have repeatedly chosen Big Oil over the middle class. Just this month, they passed the Republican budget which ended Medicare as we know it while giving $40 billion to Big Oil in tax breaks! And that’s on top of voting down two amendments offered by Democrats earlier this year to have Big Oil, in Speaker Boehner’s words, ‘pay their fair share’:
While there is no silver bullet to address rising gas prices in the short term, there are steps we can take to ensure the American people don’t fall victim to skyrocketing gas prices over the long term. One of those steps is to eliminate unwarranted tax breaks to the oil and gas industry and invest that revenue into clean energy to reduce our dependence on foreign oil. Our outdated tax laws currently provide the oil and gas industry more than $4 billion per year in these subsidies, even though oil prices are high and the industry is projected to report outsized profits this quarter. In fact, in the past CEO’s of the major oil companies made it clear that high oil prices provide more than enough profit motive to invest in domestic exploration and production without special tax breaks. As we work together to reduce our deficits, we simply can’t afford these wasteful subsidies, and that is why I proposed to eliminate them in my FY11 and FY12 budgets.
I was heartened that Speaker Boehner yesterday expressed openness to eliminating these tax subsidies for the oil and gas industry. Our political system has for too long avoided and ignored this important step, and I hope we can come together in a bipartisan manner to get it done.