It is a policy that makes absolutely no sense whatsoever. Giving oil companies billions of taxpayers dollars every year in subsidies, at a time when these same companies are making billions of dollars in profits. And the decision to continue these subsidies depends on what side of the political aisle you’re on. Democrats think the subsidies are a waste of money, and Republicans think that keeping the subsidies in place “creates jobs.”
Well, one very powerful Republican leader is sounding more and more like a Democrat on this issue. John Boehner, the Republican Speaker of the House told ABC World News that taking another look at these subsidies might be the way to move forward.
“We certainly ought to take a look at it,” Boehner said. “We’re at a time when the federal government’s short on revenues. We need to control spending but we need to have revenues to keep the government moving.”
For example, Boehner said big oil companies don’t need the so-called oil depletion allowance, but that taking it away from smaller producers would mean even less domestically produced oil. The allowance allows producers a tax deduction comparable to the break given manufacturers for depreciation of the value of an investment in plants and equipment.
Boehner is the most powerful Republican in Washington and his remarks could signal a significant change of heart. Republicans have blocked attempts by Democrats to curb oil company subsidies.
The subsidies have been a haven for the oil companies. One report shows that while America went through the biggest oil spill in history off the Gulf coast in 2010, “BP was reaping sizable tax benefits from leasing the rig. According to a letter sent in June to the Senate Finance Committee, the company used a tax break for the oil industry to write off 70 percent of the rent for Deepwater Horizon — a deduction of more than $225,000 a day since the lease began.”
The report continues;
“The flow of revenues to oil companies is like the gusher at the bottom of the Gulf of Mexico: heavy and constant,” said Senator Robert Menendez, Democrat of New Jersey, who has worked alongside the Obama administration on a bill that would cut $20 billion in oil industry tax breaks over the next decade. “There is no reason for these corporations to shortchange the American taxpayer.”
Although John Boehner is considered the most powerful Republican in Washington, he answers to a group of people who believe in corporate welfare. The Teaparty, the so-called grassroots organization, believes that giving money to billionaires under the guise of “trickle down economics,” is the only way to get America back on good economic ground.
With the news of Boehner possibly changing his mind on these subsidies, you can bet there will be marches on Washington by the Teaparty, trying to keep those poor billionaire oil empires off the unemployment line.