http://abcnews.go.com/Politics/obama-urges-congress-eliminate-oil-company-subsidies/story?id=13462559
House Speaker John Boehner talks exclusively with ABC’s Jonathan Karlin Hamilton, Ohio.ABC News
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By JONATHAN KARL (@jonkarl) and BENFORER
April 26, 2011
President Obama sent a letter toCongressional leaders today, saying he was “heartened” byHouse Speaker John Boehner’s statement that he was willing to considercutting multi-billion dollar subsidies to oil companies, and urginglawmakers to act.
The president said Congress should “take immediate action toeliminate unwarranted tax breaks for the oil and gas industry and usethe dollars to invest in clean energy.”
Boehner had stunned Washington on Monday when he told ABC News thatcutting the subsidies to oil companies is “certainly something weshould be looking at.”
“We are in a time when the federal government’s short onrevenues. We need to control spending, but we need to have revenues toget the government moving,” Boehner said. “They ought to bepaying their fair share.”
Congressional Democrats pounced on the issue today. Sen. ChuckSchumer, D-N.Y., applauded Boehner for “see[ing] the light”on the “insanity of providing subsidies to profit-soaked big oilcompanies.”
The topic dominated the White House press briefing.
“Immediate action means what it says,which is when Congress comes back, let’s take action legislatively toeliminate those subsidies,” White House spokesman Jay Carneysaid. “[It’s] hard to argue that given where the price of oil isnow that there’s a need for subsidies of the oil and gasindustry.”
Carney was referring to a statement earlier this year by former ShellCEO John Hofmeister, in which he said: “In the face of sustainedhigh oil prices, it was not an issue for large companies of needingthe subsidies to entice us into looking for and producing moreoil.”
In all, the tax breaks, many designed to encourage moreexploration, cost taxpayers more than $4billion a year in lost revenue — enough for 1.4 million Americans tobuy a tank full of gas every week for an entireyear.
However, the oil companies do have friends in Congress and thePresident’s letter demanding immediate action hit with a thud. Boehnerand Senate Republican Leader Mitch McConnell rejected the proposal.Boehner’s spokesman said the plan was insufficient because it would”only raise taxes and increase prices at thepump.”
ABC News asked the 10 members of Congress who received the mostcampaign contributions from the oil industry in the last election ifthey’d be willing to cut the tax breaks. Most have yet to respond, andSen. David Vitter, R-La., told ABC News that he’d only be open toeliminating tax breaks if tax rates were also lowered.
“I’m open to ending most tax exemptions, deductions and creditsif we use the resulting revenue to lower all rates, much as thepresident’s deficit commission suggested,” Vitter said in astatement. “Part of the reason for these provisions is that wehave the highest corporate tax rate in the world, which kills Americanjobs.”
House Speaker JohnBoehner Weighs in on Gas Prices Watch Video
Boehner: GasPrices Could Cost Obama Election Watch Video
Barack Obama on Howto Bring Down Gas Prices Watch Video
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http://www.csmonitor.com/Commentary/the-monitors-view/2011/0426/High-gas-prices-and-oily-political-rhetoric-don-t-mix
Christian Science Monitor
Editorial
The Monitor’sView
High gasprices and oily political rhetoric don’t mix
President Obamaand Republicans eye rising gasoline prices and think 2012. Too many oftheir responses aren’t aimed at weaning America offoil.
By the Monitor’s EditorialBoard / April26, 2011
Trying to tank up less often? GOP andDemocratic leaders are doing the opposite – filling up on politicalrhetoric to score points or deflect criticism at a time of risinggasoline prices.
Like a desert-highway mirage, the political back-and-forth couldmislead Americans as to what lies ahead.
Republicans, focused on gains to be made in 2012, see prices in the$4-a-gallon range as a reason to blame President Obama – just asDemocrats blamed President Bush for the record high price at the pumpin 2008, when the national average hit $4.11 in July.
One “mirage” lies in three House billspassed by the Republican-controlled Natural Resources Committee. Thelegislation expands offshore oil drilling. But backers convenientlyoverlook the fact that more offshore drilling wouldn’t change gasprices for at least 10 years, and even then marginally – by perhaps3 cents a gallon, according to studies by the Energy InformationAdministration.
In March, Republicans launched an attack ad against Rep. Nick Rahallover gas prices. The Democrat from West Virginia used to head theNatural Resources Committee, and last year pushed safety andenvironmental improvements for offshore drilling. He opposes theGOP’s three drilling bills.
House Speaker John Boehner says higher gas prices could cost PresidentObama his office, and this is not lost on the president. Mr. Obama’sratings have dropped as gas prices have risen. Seven in 10 Americanssay high gas prices are a financial hardship, according to aWashington Post/ABC News poll this week. Looking toward Obama’s 2012reelection bid, 53 percent of those who feel serious hardship from gasprices say they definitely won’t vote for Obama.
In the president’s weekly radio address on Saturday, he said he hadappointed a task force to root out fraud or manipulation in the oilmarkets. He pushed ending the almost $4 billion in annual tax breaksto the oil and gas industry – a populist idea that Mr. Boehnersuddenly embraced this week. Obama also blasted Republican plans tocut investment in clean energy by 70 percent.
But, sorry America, despite the promises of politicians, neitheroffshore drilling, nor a fraud investigation, nor an end to bigoil’s tax benefits will relieve gasoline prices any time soon, if atall.
Those are insignificant when you look at some of the causes of theprice surge, such as Middle East turmoil and global economic recovery.The Great Recession and slow recovery gave the world a three-yearreprieve from the broad trend that will inevitably sustain higherprices: emerging, gas-guzzling economies such as China and India vyingfor a limited supply of oil.
Neither the president nor Congress have much influence over thesetrends. The best thing to do, then, is for the country’s leaders tochange America’s fuel diet by encouraging less demand for oilthrough conservation and efficiency, and by supporting investment innonoil fuels.
President Obama got at this when he said “there’s no silver bulletthat can bring down gas prices right away.”
The harder truth is that high prices are likely to continue. They willactually help speed the coming and necessary transition from oildependence, because high prices make the status quo souncomfortable.
America’s drivers, especially those on a fixed income,understandably have a hard time with this truth. They want immediaterelief. There is a sure-fire way to get that, though: Drive less, evenbuy a more fuel-efficient vehicle.
Admittedly, that’s not possible for everyone. Yet 6 in 10 Americanssay they are cutting back on driving, according to the WashingtonPost/ABC poll. As a result of the last gas-price surge, Americanstelecommuted more, rode bikes more often, and used more publictransport – often with the assistance of their employers. Fromdriving more slowly to moving closer to work, there are many ways tocut fuel use.
Drivers can take these steps, while higherprices do their work to change the longer-term fuel mix.
Special thanks to Richard Charter