House Votes to Void $14 Billion in Oil Tax Breaks

Discussion in 'Politics' started by ZZZzzzzzzz, Jan 18, 2007.

  1. January 18, 2007
    House Votes to Void $14 Billion in Oil Tax Breaks

    WASHINGTON, Jan. 18 -- The House voted this evening to rescind $14 billion worth of tax breaks and subsidies for oil drillers and channel the money into a fund that would finance renewable energy projects and new technologies for conserving energy.

    Despite opposition from the oil industry and the Bush administration, which contended that the bill would unfairly single out oil companies for higher taxes and could increase the nation’s dependence on foreign oil, the measure passed, 264 to 163, with overwhelming support from Democrats and a considerable number of Republicans as well. But the measure may face a tougher time in the Senate, where the Democrats’ margin is much narrower.

    The bill would rescind $7.6 billion worth of tax breaks for oil drillers that the Republican-led Congress had passed in 2004 and 2005, and it would raise another $6.3 billion in royalties from companies that pump oil and gas in publicly owned waters of the Gulf of Mexico and off Alaska.

    One key provision is aimed at correcting errors in offshore drilling leases signed by the Interior Department in the late 1990s that would allow oil companies to escape billions of dollars in royalties over the next decade. The provision, hotly opposed by the White House as well as the oil industry, would punish companies that refuse to change their leases by imposing a new “conservation fee” on each barrel they produce or by barring them from acquiring additional leases.

    “Big Oil is hitting American taxpayers in three ways,” said Representative Nick V. Rahall, Democrat of West Virginia and chairman of the House Resources Committee. “They are hitting them at the pump. They are hitting them at the Treasury, through the tax code. And they are hitting them through royalty holidays.”

    The oil vote marks the completion of a first wave of measures that House Democratic leaders wanted to pass in their first 100 hours of legislative activity after taking control of Congress.

    Senate Democrats are moving more cautiously, but they have made it clear that they support most of the provisions and predicted that most would pass the Senate in one form or another.

    The White House said it “strongly objects” to much of the bill, but President Bush has himself opposed additional tax breaks and subsidies for oil companies and stopped short of threatening a veto.

    At a hearing of the Senate Energy Committee several hours before the House vote, investigators and Democratic lawmakers sharply criticized the Interior Department’s response to the bungled offshore leases.

    Earl E. Devaney, the Interior Department’s inspector general, told lawmakers that midlevel officials apparently failed to inform top officials in the Clinton administration about the problem with the leases and that senior officials in the Bush administration decided in 2004 they were powerless to fix the mistake.

    “This, at a minimum, was a shockingly cavalier management approach,” Mr. Devaney said, after noting that the director of the Minerals Management Service, Johnnie M. Burton, had been told of the problem nearly three years ago.
  2. Hopefully the Democrats try and renogotiate the contracts the Clinton Administration signed with big oil to drill in the Gulf of Mexico and forgot to include royalty payments in the contract.

  3. I wonder why chimp's people tried to hide this...

    "While the faulty leases were issued during President Bill Clinton's administration and not on her watch, Burton knew about the mistake with the drilling contracts sooner than she previously told Congress.

    A new report from the Interior Department's inspector general found that Burton was told about the faulty leases as early as 2004. Burton had testified at a House hearing that she became aware of the contract error in early 2006 or late 2005."
  4. Lay the blame on the people who made the mistake.

    Everyone knows the republicans are in bed with big oil but what is the Democrats excuse?

  5. Arnie


    This is one of those "feel good" bills where they stick it to the man. Of cource the outcome will be far different from what they expect. All this bill does is make domestic oil more expensive.
  6. As if...

    14 Billion is nothing to the oil industry...and will have virtually no impact at all on oil prices.

    Now, your boy Bush, and his impending needless attack of Iran, that will impact oil prices...

    Yes, the vote is a feel good story, because for nearly 6 years we have had a bunch of corrupt republiklans in congress who did nothing but look after themselves...paying attention primarily to where their lobby money was coming from.

  7. I can't see how you can enact a law to punish companies because they refuse to renegotiate a valid contract with the government. It is clearly unconstitutional.

    As with Iraq, social security, health care and other pressing issues, the Democrats have no rational plan. We'd be better off with Hugo Chavez.
  8. Rescinding tax breaks is not punishment, it happens all the time. With a democratic controlled congress, they are lucky we didn't see a windfall profits tax bill.

    Why did the oil companies get those tax benefits in the first place? If $50 buck or higher oil is not enough profit incentive for these pigs, then they deserve to go bust.

    Oh yeah, Bush and Cheney are oil men...and for 6 years congress were their yes men.

  9. TGregg


    Are you going on record saying Bush will attack Iran?
  10. I believe he wants to.

    Whether or not Congress can or will do anything about it, who knows?

    I believe Bush has a woody for Iran, yes.

    #10     Jan 19, 2007