Subsidies for oil and gas companies are so ridiculous, and so unnecessary, that they were a laugh line in the president's State of the Union address. But when it comes to these subsidies, the joke is not on the oil companies, it's on the American people. This tax day, American taxpayers will once again fork over more than $4 billion in giveaways to oil companies that don't need the money -- indeed, Exxon Mobil's profits were $30.5 billion last year, Shell's profits doubled to $18.6 billion, and BP has more cash today than it did before the Deepwater Horizon spill just one year ago. With gas prices climbing and the oil companies lining their pockets, this should be the last tax day that taxpayers cut this massive check to the oil industry.
Until we end these subsidies, Americans will keep paying twice for gas -- once at the pump, and again on tax day. The oil industry is reaching into Americans' wallets like never before, just as many families try to get back on their feet in the wake of the great recession. These subsidies are the last thing American taxpayers need right now, but the irony is that the subsidies free up that much more money for the oil industry to lobby Congress to keep those subsidies in place.
With their subsidies and ever-expanding profits, the oil industry can afford a whole Congress full of lobbyists. In fact the oil industry has more lobbyists roaming the halls of Capitol Hill than there are members of Congress put together. In 2010 the industry employed 788 lobbyists -- nearly 1.5 lobbyists for each of the 535 members of Congress. These lobbyists are the ground troops for the oil and gas industry, fighting against commonsense approaches to make America less dependent on oil and improve clean energy resources like wind and solar. The industry reported more than $146 million on lobbying in 2010 alone.
Some oil companies are also now mobilizing their employees to lobby Congress -- Exxon Mobil instructed their employees and retirees to ask their members of Congress to rollback the Clean Air Act and lower fuel-efficiency for cars -- literally telling their workers to give up clean air and less painful trips to the pump so that the profits can top the $30 billion in profits from 2010.
If there were any moment to end the subsidies, it is now. With gas prices playing jump rope with the $4/gallon mark, oil companies will soon be seeing the same kind of record profits that they saw in 2008, when oil prices last skyrocketed.
According to a US Energy Information Administration report, domestic oil production costs, on average, about $30 per barrel, so when prices spike to over $100/barrel, the rest of the money goes straight from our wallets to the industry's pockets.
Meanwhile, the oil and gas industry and their allies continue to clamor for weaker environmental safety standards and more American lands to be handed over to them -- even as gas drillers in Wyoming are shutting in productive wells to limit the supply and push prices higher.
So despite the industry's effort drive up prices, despite their record profits, and a despite renewed fervor to cut down the federal deficit, the Republican 2012 budget proposal cuts almost all funding for clean energy development, while keeping the $4 billion in oil and gas subsidies.
Oil and gas companies don't need government support -- they have too much already. The subsidies may have been a laugh line at the State of the Union address, but this joke isn't funny anymore. Now is the time to end the subsidies, and get the oil and gas companies out of our wallets -- at the pump and on our tax returns.
Follow Bill Meadows on Twitter: www.twitter.com/Wilderness