A Republican-led filibuster blocked Senate consideration today of a bill that would end “tax breaks for the five largest oil companies: Exxon Mobil, Shell, BP, ConocoPhillips and Chevron.” Click here for more detail on tax breaks that would be eliminated. The 52 to 48 vote in favor of proceeding with the “Close Big Oil Tax Loopholes Act” failed because 60 votes are needed to overcome a filibuster. The roll call shows that Iowa’s Chuck Grassley voted against the motion to proceed, as did all but two Senate Republicans. Tom Harkin voted for considering the bill, as did all but three Democrats.
I’m all for ending oil company subsidies, but this bill was about optics rather than good energy policy. Andrew Restuccia wrote in The Hill,
Democrats’ pledge to continue pushing the bill signals that they view the effort as a winning political issue amid $4-a-gallon gas, soaring oil company profits and growing concern about the deficit. […]
Democrats say the bill would save $21 billion over the course of 10 years, savings that can be used to reduce the deficit at a time of increased belt-tightening.
Those talking points would be more convincing if party leaders had genuinely tried to end oil subsidies when Democrats controlled the U.S. House and had close to 60 votes in the Senate. It also makes no sense to focus this bill on the biggest oil companies, rather than the sector as a whole. Democrats apparently wrote the bill that way because of those companies’ large profits in the first quarter of this year.
Senate Majority Leader Harry Reid told journalists today that he will press for ending oil companies’ tax breaks as part of legislation on raising the debt ceiling. The U.S. hit its current debt ceiling yesterday and won’t be able to pay all its bills if Congress does not act to raise the ceiling by August 2. I believe President Barack Obama and Congressional Democrats are playing a losing game by making budget negotiations part of a deal on raising the debt ceiling. When it was time to raise the government’s borrowing limit in 1995, President Bill Clinton wisely refused to let Republicans use the occasion to “backdoor their budget proposals.”
Share any relevant thoughts in this thread.
UPDATE: After the jump I’ve added a statement Grassley released on May 17, calling on Secretary of State Hillary Clinton to approve the proposed Keystone XL Canadian pipeline project. Grassley depicts that project as a way for the Obama administration to help reduce the cost of gasoline. But an analysis commissioned by the U.S. Department of Energy earlier this year suggested that building this pipeline might cause oil and therefore gasoline prices to rise in the Midwest. Environmental groups have raised many objections to the Keystone XL project as well.
SECOND UPDATE: I’ve also added below excerpts from a report by the Congressional Research Service on “the extent to which proposed tax changes on the oil industry are likely to affect domestic gasoline prices.” The report briefly explains the five tax breaks that would be repealed under the bill senators filibustered.
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