Senator Tim Johnson sees an easy way to shave another $4 billion a year off the federal budget: stop subsidizing the richest oil companies:
"High-priced oil threatens both our energy and economic security. We have a homegrown solution — ethanol," Johnson told reporters. "It's time to end the $4 billion a year of taxpayer giveaway to big oil. Oil companies don't need any help."
Johnson said the top five oil companies have recorded $32 billion in profits so far in 2011 [Denise Ross, "Tim Johnson Calls for End to Oil Subsidies; Thune Disagrees," Mitchell Daily Republic, 2011.05.12].
Meanwhile, South Dakota's junior senator John Thune is abandoning his credibility as a deficit hawk and showing once again that, for Big Oil, GOP stands for "Gild Our Pockets!" He thinks that a trillion dollars in profit over the last decade isn't enough incentive for Exxon, Shell, BP, et al. to keep drilling for oil.
Sen. John Thune (R-S.D.), who heads the Senate Republican Policy Committee, attacked the prospect of legislation that strips incentives for the major companies and uses the money to attack the deficit.
The oil industry, most Republicans and some oil-state Democrats say that repealing incentives would raise costs and slow domestic energy development.
"I think it is going to be awfully hard to make it more expensive for people in this country to buy energy, and raising taxes right now on the companies that produce the energy is probably just going to make energy prices go up even higher," Thune said in the Capitol Monday evening [Ben Geman, "Senate Dem Leaders Introduce Bill to Repeal Oil Company Tax Breaks," The Hill: E2 Wire, 2011.05.10].
(Note that when we take away tax breaks from giant corporations, Republicans like Thune call it "raising taxes" and go ape. But when we raise taxes on women and small businesses to push the GOP agenda of state power over women, the GOP never says "raising taxes.")
Higher energy prices, because we cut Exxon Welfare? Not likely:
[Robert] SIEGEL: Would ending the tax breaks affect what we pay at the pump for gasoline?
[Financial Times reporter James] POLITI: Probably not. I mean, what we pay at the pump is largely due to the crude oil price, which is set in international markets. And I think that ending the tax breaks would have too small of an impact, compared to kind of global demand trends like China's expansion ["Senate Democrats Propose Slashing Oil Subsidies," NPR: All Things Considered, 2011.05.11].
The South Dakota Democratic Party helps quantify that minimal impact:
The price of gasoline has hit consumers hard as profits at the top five oil companies have surpassed $1 trillion over the last decade. In the first calendar quarter of 2011, for example, ExxonMobil reported profits of nearly $11 billion in the first quarter of 2011, a 69 percent increase; Shell reported profits of $7 billion, ConocoPhillips reported profits of $3 billion; Chevron reported $6.2 billion; and BP reported $5.5 billion. Combined, they earned $32 billion so far this year.
"Thune is protecting billions in taxpayer funded giveaways for the biggest oil companies making record profits at the expense of South Dakotans who are getting squeezed at the pump," [SD Dems exec and actual South Dakotan Ben] Nesselhuf concluded. "South Dakotans have already shared the sacrifice of federal budget cuts. Thune should urge the top five big oil companies to share the burden too" [press release, SDDP, 2011.05.10].
$32 billion in profit in three months, and Republicans argue that oil companies won't keep drilling for black gold if we don't transfer another $4 billion from taxpayers' pockets to corporate pockets. The deficit demands that we cut Sesame Street and women's health care, but corporate profits are sacred.
The next time you hear Republicans talking about fiscal discipline and self-reliance, be sure to ask them why those values apply to you and me but not to the Big Oil corporations.