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Sen. Lamar Alexander: Taxpayer-Funded Corporate Welfare Bad, Except When It’s For Fossil Fuels

Posted By Lowell F. on August 27th, 2014

See below for the latest example of Sen. Lamar Alexander’s relentless push for continued, even increased, taxpayer-funded corporate welfare to the fossil fuel industry.

Sen. Lamar Alexander (R-Tenn.) called on the administration to expand oil and gas drilling in the Outer Continental Shelf.

“There is no reason we shouldn’t be using all the resources we have available to increase our energy security, create more jobs at home and reduce our reliance on oil from countries that want to do us harm,” Alexander said Tuesday.

He made the comments after he and 20 other Republicans sent a letter to Interior Secretary Sally Jewell. Senate Energy and Natural Resources Committee Chairwoman Lisa Murkowski (R-Alaska) led the letter. The lawmakers asked that the department make all offshore oil and gas resources in the Outer Continental Shelf available for development.

Now, contrast that with Alexander’s opposition to popular, effective pro-wind policies, which he calls a…yes, you guessed it, “wasteful taxpayer subsidy.” Even more internally inconsistent and illogical, Sen. Alexander claims that we shouldn’t be subsidizing a “mature technology,” which he argues “should stand on its own in the marketplace.”  Yet here he is again, pushing to do exactly that: subsidize one of the most mature technologies known to man — drilling holes in the ground and pumping out oil, something we’ve been doing for well over a century now, and something that certainly doesn’t require government tilting the playing field in its favor at this point.

Posted in Oil, subsidies
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New Study: Large Oil and Gas Companies Pay Miniscule Tax Rate

Posted By Lowell F. on August 3rd, 2014

Recently, we noted an analysis on The Great Energy Challenge blog by Bill Chameides, Dean of Duke’s Nicholas School of the Environment, which found an incredible 30 to 1 ratio in favor of fossil fuels when it comes to political contributions in the 2011-2012 campaign cycle, as well as a 7:1 ratio for lobbying expenditures in favor of fossil fuels. At the time, we asked what all that money bought. Our theory: all those campaign contributions and lobbying expenditures purchased a great deal of policy influence in Congress for the fossil fuel industry. In turn, that influence helped ensure that the taxpayer-funded corporate welfare gravy train to the fossil fuel industry continued, while simultaneously slowing down momentum towards a clean energy transition, heading off a price on carbon; etc.

Now, a new study by Taxpayers for Common Sense confirms our theory — in spades.

From 2009 through 2013, large U.S.-based oil and gas companies paid far less in federal income taxes than the statutory rate of 35 percent. Thanks to a variety of special tax provisions, these companies were also able to defer payment of a significant portion of the federal taxes they accrued during this period.

According to their financial statements, 20 of the largest oil and gas companies reported a total of $133.3 billion in U.S. pre-tax income from 2009 through 2013. These companies reported total federal income taxes during this period of $32.1 billion, giving them a federal effective tax rate (ETR) of 24.0 percent. Special provisions in the U.S. tax code allowed these companies to defer payment of more than half of this tax bill. This group of companies actually paid $15.6 billion in income taxes to the federal government during the last five years, equal to 11.7 percent of their U.S. pre-tax income. This measure, the amount of U.S. income tax paid regularly every tax period (i.e. not deferred), is known as the “current” tax rate.

Four of the companies in this study – ExxonMobil, ConocoPhillips, Occidental, and Chevron – account for 84 percent of all the income and paid 85 percent of all the taxes for the entire group. These four had an ETR of 24.4 percent and a current ETR of only 13.3 percent. The smaller firms paid an even smaller share of their tax liability on a current basis. When the top four companies and those with losses are excluded from the analysis, the remaining companies reported a 28.9 percent ETR on U.S. income, but only a 3.7 percent current rate. They deferred over 87 percent of their tax liability.

The bottom line is that the fossil fuel industry invests a lot of money into our political system, and receives a healthy return on that investment. How healthy?  According to Oil Change International, during the 111th Congress (2009-2010), fossil fuel lobbying expenses amounted to a whopping $347 million, but the reward was $20.5 billion in taxpayer dollars, for a 5,800% “return on political investment.” And that’s not even counting the low tax rate paid by fossil fuels, just the subsidies doled out to this super-wealthy industry every year.  Also, see this report by the Center for American Progress, which found that despite the five big oil companies “earn[ing] a combined total of $93 billion” in 2013, they still fought to maintain – and even expand – “their $2.4 billion-per-year tax breaks.”

So, next time you hear the fossil fuel folks claiming that it’s actually clean energy which is heavily subsidized, and which supposedly can’t survive without government support, point them to this article and tell them to…well, have a nice day.

Posted in Oil, subsidies
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InsideClimate News: Koch Brothers Built Their Fortune on Super-Dirty Tar Sands Oil

Posted By Lowell F. on July 22nd, 2014

In light of the attacks on Tom Steyer from sources linked to the Koch Brothers, InsideClimate News posted a story the other day providing a detailed account of how the Koch brothers made their money. To put it mildly, it’s not a pretty picture.

Steyer’s turnaround took moral courage, they argued, and asked: What about the Koch brothers? What is their history with global warming emissions?

It turns out the Koch brothers built their first fortune on the particularly dirty form of oil mined in Alberta’s tar sands, where they have been major players for 50 years, and remain deeply invested.

The key moment came in 1969, when Charles Koch secured full ownership of a heavy oil refinery in Minnesota that his father had a stake in.

In his 2007 book Charles Koch called that acquisition “one of the most significant events in the evolution of our company.” The refinery was a doorway that permitted Koch Industries “to enter chemicals and, more recently, fibers and polymers,” he said.

If you want to know more about the Koch brothers and how they built their fortune, InsideClimate News has a helpful timeline with detailed information. It’s well worth checking out, just so we all know exactly what we’re up against with these folks.

Posted in Fossil Fuels, Oil
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Video: Exxon Hates America

Posted By Lowell F. on July 1st, 2014

The following video will definitely get no argument from us. For more, see here:

The ad, from green groups Oil Change International, The Other 98% and Environmental Action, is a follow-up to last year’s “Exxon Hates Your Children” video.

The original ad was slated to air on Fox News in the Houston and Denver markets during the 2013 State of the Union address, but it was pulled at the last minute after Exxon Mobil Corp. gave a cease-and-desist order to Comcast.

The new ad was released Tuesday and accompanies a crowdfunding campaign to buy airtime across the country.

Posted in Fossil Fuels, Oil
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Instead of Wasting $1.1 Trillion on Dirty Oil Exploration, How About Investing It in Clean Energy?

Posted By Lowell F. on May 9th, 2014

So, in addition to polluting the environment and fighting a rapid transition to clean energy, a new article adds yet another reason why we’re not fans of the oil industry.

The oil industry could waste up to $1.1 trillion in the next decade on unnecessarily expensive drilling projects, such as those in the Arctic and deep water, according to a new study.

That’s the total that oil explorers would have to spend through 2025 on projects that would require oil prices of at least $95 a barrel just to break even, Bloomberg News reported, citing a study by the Carbon Tracker Initiative.

Oil companies do not need to spend that money, because the amount of oil that the world could consume without warming the planet to dangerous levels is available from less expensive places that can be developed for $75 a barrel, the study said.

So here’s an idea for the oil industry: instead of wasting $1.1 trillion trashing the environment, how about investing that money into energy efficiency, solar power, wind power, and other forms of clean, renewable energy? Come to think of it, perhaps investors in these companies should start demanding that.

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