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BIG OIL'S GUSHER OF SUBSIDIES
That Deepwater Horizon oil rig that went down in the Gulf, causing such massive destruction? Thank you for that.
"You" being American taxpayers. Not that we taxpayers caused the catastrophe, but that we heavily subsidized the very existence of Deepwater Horizon. For example, BP, which rented the drilling rig from Transocean corporation, used a special tax break to write off 70 percent of the rent it paid. Seventy percent! This deduction added up to a savings of $225,000 a day for BP.
Not to be outdone, Transocean deliberately moved its corporate address offshore in 1999 in order to dodge its tax obligations to our country. First it relocated from Houston to the Cayman Islands, then to Switzerland – slick moves that have allowed the giant corporation to avoid paying $1.8 billion in U.S. taxes.
No industry gets the absurd array of subsidies that Big Oil now enjoys – subsidies at every stage of their operations, including the ones used by BP and Transocean to search for oil in our public waters. As one political leader put it in 2005, "With $55 oil, we don't need incentives to the oil and gas companies to explore."
That was George W. Bush talking! Five years later, oil is $80 a barrel and the industry is pocketing record profits – yet, the giveaways continue. Last year, Exxon Mobil raked in $19 billion in profit, but thanks to available subsidies, it got a $156-million tax refund.
In the past two years, BP, Exxon and the rest poured $340 million into lobbyist to keep their subsidy pipelines flowing. A proposal to slash these boondoggles was killed in a June Senate vote, 61 to 35, with every Republican and 21 Democrats backing Big Oil.
For information and action to stop the ripoff, contact Center for American Progress, www.americanprogress.org.
"As oil industry fights spill tax, subsidies flow," Austin American Statesman, July 4, 2010.
"Big Oil's Good Deal," The New York Times, July 12, 2010.
"The Big Giveaways To Big Oil," www.thinkprogress.org, July 13, 2010
"BP Used Oil Industry Tax Break to Write-Off Its Rent For Failed Deepwater," www.thinkprogress.org, July 6, 2010.
"As Oil Industry Fights a Tax, it Reaps Subsidies," www.nytimes.com, July 3, 2010.