Republicans Block Extra Taxes On Oil Companies

[one...two...tree 2,762]

by H. Josef Hebert

WASHINGTON — Senate Republicans blocked a proposal Tuesday to tax the windfall profits of the largest oil companies, despite pleas by Democratic leaders to use the measure to address America's anger over $4 a gallon gasoline.

The Democratic energy package would have imposed a tax on any "unreasonable" profits of the five largest U.S. oil companies and given the federal government more power to address oil market speculation that the bill's supporters argue has added to the crude oil price surge.

"Americans are furious about what's going on," declared Sen. Byron Dorgan, D-N.D., and want Congress to do something about oil company profits and "an orgy of speculation" on oil markets.

But Republicans argued the Democratic proposal focusing on new oil industry taxes is not the answer to the country's energy problems.

"The American people are clamoring for relief at the pump," said Sen. Pete Domenici, R-N.M., but if taxes are increased on the oil companies "they will get exactly what they don't want. The bill will raise taxes, increase imports."

The Democrats failed, 51-43, to get the 60 votes needed to overcome a GOP filibuster and bring the energy package up for consideration.

Separately, Democrats also failed to get Republican support for a proposal to extend tax breaks for wind, solar and other alternative energy development, and for the promotion of energy efficiency and conservation. The tax breaks have either expired or are scheduled to end this year.

The tax provisions were included in a broader $50 billion tax measure blocked by a GOP filibuster threat. A vote to take up the measure was 50-44, short of the 60 votes needed.

The windfall profits bill would have imposed a 25 percent tax on profits over what would be determined "reasonable" when compared to profits several years ago. The oil companies could have avoided the tax if they invested the money in alternative energy projects or refinery expansion. It also would have rescinded oil company tax breaks _ worth $17 billion over the next 10 years _ with the revenue to be used for tax incentives to producers of wind, solar and other alternative energy sources as well as for energy conservation.

The legislation also would:

_Require traders to put up more collateral in the energy futures markets and open the way for federal regulation of traders who are based in the United States but use foreign trading platforms. The measures are designed to reduce market speculation.

_Make oil and gas price gouging a federal crime, with stiff penalties of up to $5 million during a presidentially declared energy emergency.

_Authorize the Justice Department to bring charges of price fixing against countries that belong to the OPEC oil cartel.

Republican leader Mitch McConnell of Kentucky has acknowledged that Americans are hurting from the high energy costs but strongly opposes the Democrats' response and has ridiculed those who "think we can tax our way out of this problem."

"Republicans by and large believe that the solution to this problem, in part, is to increase domestic production," McConnell said.

A GOP energy plan, rejected by the Senate last month, calls for opening a coastal strip of the Arctic National Wildlife Refuge in Alaska to oil development and to allow states to opt out of the national moratorium that has been in effect for a quarter century against oil and gas drilling in more than 80 percent of the country's coastal waters.

http://www.huffingtonpost.com/2008/06/10/r...t_n_106282.html

[alienlovechild 75]

From the folks you told you if you drive a SUV you ride with Osama (no, not Obama) comes another Huffington Post gem on evil, greedy oil companies and evil, greedy Republicans.

What will the Justice Dept do to OPEC?

Why is drilling for oil abroad in unstable areas of the world better than drilling in ANWAR?

The alternative is the return of disco and gas lines.

Boogie on down with Barack in 2008 would make a great bumper sticker.

[Sheriff Uling 3]

This is not surprising for the Republicans based on the party affiliations nor for the Democrats who are trying to exploit the situation for political gain...

[one...two...tree 2,762]

This is not surprising for the Republicans based on the party affiliations nor for the Democrats who are trying to exploit the situation for political gain...

This part...

Separately, Democrats also failed to get Republican support for a proposal to extend tax breaks for wind, solar and other alternative energy development, and for the promotion of energy efficiency and conservation. The tax breaks have either expired or are scheduled to end this year.

The tax provisions were included in a broader $50 billion tax measure blocked by a GOP filibuster threat. A vote to take up the measure was 50-44, short of the 60 votes needed.

The windfall profits bill would have imposed a 25 percent tax on profits over what would be determined "reasonable" when compared to profits several years ago. The oil companies could have avoided the tax if they invested the money in alternative energy projects or refinery expansion. It also would have rescinded oil company tax breaks _ worth $17 billion over the next 10 years _ with the revenue to be used for tax incentives to producers of wind, solar and other alternative energy sources as well as for energy conservation.

...is inexcusable. Unbelievable.

[mawilson 2,133]

ExxonMobil, long regarded by its peers and investors as the most successful international

oil company, is beginning to show signs of weakness, revealing on Thursday that it is

struggling to increase oil production and to squeeze profit out of its refining business.

The world’s biggest energy group announced a first-quarter record profit of $10.9bn but

its oil production fell almost 10 per cent in the first three months of the year and refining

profits slumped.

...

Exxon’s overall oil and gas production fell 5.6 per cent from the year-earlier quarter.

Production in Africa, a key new area of investment, fell 20 per cent as high oil prices and

contract stipulations forced it to hand over more of its production to host country

governments. Venezuela’s nationalisation of its oil fields also hurt the group’s volumes,

as did declines at Canadian gas fields.

...

The figures are likely to increase pressure from investors for Exxon to raise dividends.

It devoted $8bn to buying back its own shares and $1.9bn to dividends while adding

another $6.9bn to its now $40.9bn cash pile.

link

Chevron said on Thursday it planned to fire up to 1,100 refining, marketing and

transportation employees after reporting an 84 per cent drop in its quarterly refining

profit.

The second-biggest US oil company said in a regulatory filing on Thursday that

about 300 workers, mostly outside the US, were notified of their terminations in the

first quarter. The remainder of the lay-offs will take place this year, though the entire

process will not be complete until 2009.

On May 2, Chevron revealed a slight drop in production as it turned in

better-than-expected earnings. Output fell 1.7 per cent in the three months to the

end of March, a drop of 44,000 barrels per day to 2.6m bpd. This compares with a

near 6 per cent drop in output revealed by Exxon this week, which spooked investors.

link

[one...two...tree 2,762]

ExxonMobil, long regarded by its peers and investors as the most successful international

oil company, is beginning to show signs of weakness, revealing on Thursday that it is

struggling to increase oil production and to squeeze profit out of its refining business.

The world’s biggest energy group announced a first-quarter record profit of $10.9bn but

its oil production fell almost 10 per cent in the first three months of the year and refining

profits slumped.

...

Exxon’s overall oil and gas production fell 5.6 per cent from the year-earlier quarter.

Production in Africa, a key new area of investment, fell 20 per cent as high oil prices and

contract stipulations forced it to hand over more of its production to host country

governments. Venezuela’s nationalisation of its oil fields also hurt the group’s volumes,

as did declines at Canadian gas fields.

...

The figures are likely to increase pressure from investors for Exxon to raise dividends.

It devoted $8bn to buying back its own shares and $1.9bn to dividends while adding

another $6.9bn to its now $40.9bn cash pile.

link

Chevron said on Thursday it planned to fire up to 1,100 refining, marketing and

transportation employees after reporting an 84 per cent drop in its quarterly refining

profit.

The second-biggest US oil company said in a regulatory filing on Thursday that

about 300 workers, mostly outside the US, were notified of their terminations in the

first quarter. The remainder of the lay-offs will take place this year, though the entire

process will not be complete until 2009.

On May 2, Chevron revealed a slight drop in production as it turned in

better-than-expected earnings. Output fell 1.7 per cent in the three months to the

end of March, a drop of 44,000 barrels per day to 2.6m bpd. This compares with a

near 6 per cent drop in output revealed by Exxon this week, which spooked investors.

link

...which is why the Big Oil's friends in Washington want to drill for more oil rather than invest much money in alternative energies.

[GaryC 7]

The dems in Washington are morons. At least the reps have some brains. When you slap a tax on any company do you know who pays that? Thats right, us. It doesn't hurt or punish the oil companies one single dollar. All they will do is pass that added exspence on to us. All this would have done is raise our price for gas. Thank you reps. You saved us from the morons again.

[GaryC 7]

...which is why the Big Oil's friends in Washington want to drill for more oil rather than invest much money in alternative energies.

Why would they be forced to invest in alternative energies? They are an OIL company. Jeez, use your brain Steven. Quit blaming big oil for wanting to sell oil. It's what they do.

[one...two...tree 2,762]

The dems in Washington are morons. At least the reps have some brains. When you slap a tax on any company do you know who pays that? Thats right, us. It doesn't hurt or punish the oil companies one single dollar. All they will do is pass that added exspence on to us. All this would have done is raise our price for gas. Thank you reps. You saved us from the morons again.

This has to do with the power lobbying by Big Oil. They want to maintain their market share and drill for more oil and many in Washington are deep in those pockets.

[GaryC 7]

The dems in Washington are morons. At least the reps have some brains. When you slap a tax on any company do you know who pays that? Thats right, us. It doesn't hurt or punish the oil companies one single dollar. All they will do is pass that added exspence on to us. All this would have done is raise our price for gas. Thank you reps. You saved us from the morons again.

This has to do with the power lobbying by Big Oil. They want to maintain their market share and drill for more oil and many in Washington are deep in those pockets.

Did you just answer a different question? What does the Big Oil (oh no!!) lobby have to do with passing on an added expense? A tax on Big Oil (oh no!!!) is really a tax on us. It doesn't hurt them one little bit.

[one...two...tree 2,762]

...which is why the Big Oil's friends in Washington want to drill for more oil rather than invest much money in alternative energies.

Why would they be forced to invest in alternative energies? They are an OIL company. Jeez, use your brain Steven. Quit blaming big oil for wanting to sell oil. It's what they do.

Big Oil has been granted all kinds of tax breaks and subsidies so where is the savings for the consumers? So now that the price is over $4 a gallon and responsible politicians are saying #######, you think that if we pull those tax breaks from under their feet, their going to collapse? Have I got something to sell you...

[one...two...tree 2,762]

Oil industry subsidies further our dangerous dependence on foreign oil supplies and burden taxpayers with unacceptable costs to human health, the environment, and the economy. In the 1990s, oil imports equaled almost half of US oil consumption and half of the trade deficit. The situation is likely to worsen with US refineries running at full capacity and all of the remaining inexpensive oil reserves lying outside US borders. This de facto energy policy also discourages private investments in new, cleaner technologies such as electric vehicles. Furthermore, hidden subsidies waste taxpayer dollars by undermining government programs to promote fuel efficiency, alternative fuels, and environmental protection.

....

Government directly subsidizes oil consumption through preferential treatment in tax codes. A multitude of federal corporate income tax credits and deductions results in an effective income tax rate of 11% for the oil industry, compared to the non-oil industry average of 18%. If the oil industry paid the industrywide average tax rate (including oil) of 17%, they would have paid an additional $2.0 billion in 1991. Our results are consistent with a report by the Alliance to Save Energy that estimated the benefits of individual federal corporate income tax provisions. Their results showed that in 1989 preferential treatment yielded $1.8 billion to $4.6 billion in individual income tax benefits to the oil industry (Koplow, 1993).

http://www.ucsusa.org/clean_vehicles/fuel_...ng-big-oil.html

....

Which is why the Democrats in Washington are saying enough is enough - we gave the oil companies a sweat deal for a long time and now that gig is up.

Edited June 11, 2008 by Jabberwocky

[mawilson 2,133]

...which is why the Big Oil's friends in Washington want to drill for more oil rather than invest much money in alternative energies.

Why would they be forced to invest in alternative energies? They are an OIL company. Jeez, use your brain Steven. Quit blaming big oil for wanting to sell oil. It's what they do.

Big Oil has been granted all kinds of tax breaks and subsidies so where is the savings for the consumers? So now that the price is over $4 a gallon and responsible politicians are saying #######, you think that if we pull those tax breaks from under their feet, their going to collapse? Have I got something to sell you...

One barrel of crude oil (42 gallons) when refined, produces about 20 gallons of gasoline (link).

According to the U.S. Department of Energy, here's an approximation of where each dollar

you spend on gas goes:

Taxes: 11%

Distribution and Marketing: 6%

Refining: 10%

Crude oil: 73%

A barrel of crude (42 gallons) costs $135.

1 gallon of gas = 2.1 gallons of crude = $6.43

If you include the taxes, refining and distribution, you will get $8.81 per gallon of gas.

You're paying only $4 instead of $8.81 - and you're asking "where's the savings"?

Edited June 11, 2008 by mawilson

[one...two...tree 2,762]

...which is why the Big Oil's friends in Washington want to drill for more oil rather than invest much money in alternative energies.

Why would they be forced to invest in alternative energies? They are an OIL company. Jeez, use your brain Steven. Quit blaming big oil for wanting to sell oil. It's what they do.

Big Oil has been granted all kinds of tax breaks and subsidies so where is the savings for the consumers? So now that the price is over $4 a gallon and responsible politicians are saying #######, you think that if we pull those tax breaks from under their feet, their going to collapse? Have I got something to sell you...

One barrel of crude oil (42 gallons) when refined, produces about 20 gallons of gasoline (link).

According to the U.S. Department of Energy, here's an approximation of where each dollar

you spend on gas goes:

Taxes: 11%

Distribution and Marketing: 6%

Refining: 10%

Crude oil: 73%

A barrel of crude (42 gallons) costs $135.

1 gallon of gas = 2.1 gallons of crude = $6.43

If you include the taxes, refining and distribution, you will get $8.81 per gallon of gas.

You're paying only $4 instead of $8.81 - and you're asking "where's the savings"?

This is the ongoing argument. Big Oil wants us to believe that by giving them the tax incentives, we're doing ourselves a favor. Had we rid ourselves of the subsidies long ago, we would be driving much different cars than we are today. That's Gary's free market argument - let the market influence consumer trends, but this proves that the market was already mucked with and the hidden costs are there - whether they can all be quantified into dollars and sense. Nothing's free - you can bet your pants we're paying for that subsidy one way or another.

[mawilson 2,133]

...which is why the Big Oil's friends in Washington want to drill for more oil rather than invest much money in alternative energies.

Why would they be forced to invest in alternative energies? They are an OIL company. Jeez, use your brain Steven. Quit blaming big oil for wanting to sell oil. It's what they do.

Big Oil has been granted all kinds of tax breaks and subsidies so where is the savings for the consumers? So now that the price is over $4 a gallon and responsible politicians are saying #######, you think that if we pull those tax breaks from under their feet, their going to collapse? Have I got something to sell you...

One barrel of crude oil (42 gallons) when refined, produces about 20 gallons of gasoline (link).

According to the U.S. Department of Energy, here's an approximation of where each dollar

you spend on gas goes:

Taxes: 11%

Distribution and Marketing: 6%

Refining: 10%

Crude oil: 73%

A barrel of crude (42 gallons) costs $135.

1 gallon of gas = 2.1 gallons of crude = $6.43

If you include the taxes, refining and distribution, you will get $8.81 per gallon of gas.

You're paying only $4 instead of $8.81 - and you're asking "where's the savings"?

This is the ongoing argument. Big Oil wants us to believe that by giving them the tax incentives, we're doing ourselves a favor. Had we rid ourselves of the subsidies long ago, we would be driving much different cars than we are today. That's Gary's free market argument - let the market influence consumer trends, but this proves that the market was already mucked with and the hidden costs are there - whether they can all be quantified into dollars and sense. Nothing's free - you can bet your pants we're paying for that subsidy one way or another.

Dude, make up your mind - do you want cheap gas or not?

If you do, appreciate the savings and stop whining - you're paying a lot less for a gallon of gas than it costs to produce it.

If not, let's get rid of the tax incentives and start paying $8-9 per gallon, like Europe and the rest of the world. Free market will take of everyone real quick, believe me.