President Obama thinks it is a nifty idea to stop the tax subsidies given to the oil and gas producers. He gathered a rather motley looking bunch of folks to stand behind him as he delivered a completely ideological campaign speech in the Rose Garden Thursday morning before the vote was taken.
A little over an hour after Pres. Obama gave a speech in the Rose Garden challenging Congress to repeal billions of dollars in tax breaks for "Big Oil," the Senate went against his wishes and voted down legislation authored by Sen. Robert Menendez (D-NJ) that would've done just that.
Lawmakers struck down the bill in a vote of 51 – 47, the bill needed 60 votes to pass. The bill was voted largely on party lines, with the exception of two Maine Republicans, Senators Susan Collins and Olympia Snowe, who crossed party lines to vote to repeal the tax breaks. They were outdone however, when four Democrats voted against the bill. Alaska's Senator Mark Begich was one of those four. The other three were Mary Landrieu of Louisiana, Ben Nelson of Nebraska, and Jim Webb of Virginia.
The failure of the bill came as no surprise, a similar bill voted on last May, also failed, that bill failed on a vote of 52 – 48. Monday, Senate Republicans voted to allow debate on the bill even though they were opposed to the Menendez plan. They did so in an effort to get Senate to consider a handful of GOP amendments, among them a proposal to expand offshore oil and gas leasing. But, Senate majority leader Harry Reid of Nevada cut the debate short.
Gone with the failed bill are extensions for tax incentives for renewable power projects electric cars, energy-efficient homes and biofuels production.
Retiring Democrat Senator Webb voted against the bill, tempering the argument against the Republican candidate for his seat made by former DNC Chairman and now candidate Tim Kaine.
Undercutting Democrats' week of attacks on Republican U.S. Senate candidate George Allen, Sen. Jim Webb, D-Va., today voted against legislation that would have stripped $24 billion in tax subsidies from the country's five largest oil companies.
"By rejecting the effort to repeal billions in taxpayer funded giveaways to profitable oil companies, Republicans have again sided with special interests at the expense of Americans," Kaine responded to Thursday's vote.
"These subsidies, which have been consistently supported by my opponent George Allen, are unnecessary for the big five oil companies to turn a profit and do nothing to significantly lower the price of gas that Virginians pay when they fill up their tank," he added. "Instead, today's vote just ensures all Americans are double charged by the richest oil companies – once in their pocketbook at the pump, and again in their tax bill each year."
Never mind that the subsidies are the same as those given to all other businesses.
The real culprit in the high price of gas at the pump is the taxation of the product. No other product on the market is taxed higher.
Reducing the taxation would reduce the price at the pump. Taking away subsidies - in effect, raising taxes - on oil and gas producers will only increase the price at the pump. This is not rocket science. This is basic economics. The problem is, however, that this administration wants a bad guy and that is "big oil". The Obama administration is full of partisan ideologues with no real world business experience. It has been obvious for some time - particularly since the Deepwater Horizon explosion - that this administration is hell bent to destroy the domestic oil and gas industry.
ExxonMobil is now reporting that for its retail gasoline operations in the U.S., it made an average profit of 7 cents per gallon during the first quarter of 2011.
Seven cents per gallon. Before the price increases due to overseas demands, their profit was two cents per gallon. Two cents. To hear the Obama explanation, one would think that the oil companies profits were 99% of the price at the pump per gallon. You, the reader, have to understand that Team Obama simply does not understand the domestic energy industry.
What President Obama is counting on is the fact that he was for subsidies before he was against them. As candidate Obama in 2008, he was all for them in an all of the above approach to our energy needs. Now, however, having to court the hyper partisan far left of his party, he has to try and punish fossil fuel producers to the benefit of alternative energy. He would also like for you, the voter, to think that fossil fuel producers don't invest in alternative fuel solutions. They do.
Washington Post columnist Charles Krauthammer called President Barack Obama‘s plea to end oil tax breaks “staggering cynicism,” explaining how Obama’s rhetoric contradicted his past actions on Fox News Channel’s “Special Report” Thursday.
“I think any objective observer would look at what the president said today in the Rose Garden on this and conclude as I did: it is truly staggering cynicism,” Krauthammer said on Thursday’s broadcast. “Number one, when he was in the Senate, Obama supported the subsidies he’s denouncing today. And when our own Ed Henry asked Jay Carney about that, Carney had no answer. He was looking for a hole to hide in.”
“Second, the Congressional Research Office in March of 2011 showed that if you remove the subsidies, if it has any effect whatsoever on the gas prices, it will be to increase them, and the president is pretending he is trying to lower the gas prices,” he continued.
Ending the tax breaks would do little to solve the deficit spending problems plaguing the federal government, Krauthammer claimed. The Senate bill that Obama supported would have put about $10 billion in “big oil” tax cuts toward deficit reduction.
“Lastly, it is a trivial effect,” Krauthammer explained. “If you collected this subsidy, this tax from the oil companies for the next 100 years, it wouldn’t cover four months of deficit spending under this administration. And here he is in the Rose Garden standing up and saying again and again as he has before, ‘I am for all of the above — all kinds of sources of energy.’”
Cynical, indeed. It is what we have come to expect from this president in this election year.