Jackson Free Press

U.S. Sens. Thad Cochran and Roger Wicker both voted May 18 to maintain $2 billion in annual tax breaks to the world's five largest private oil companies.

Wicker and Cochran, both Mississippi Republicans, voted "no" on a procedural measure requiring 60 affirmative votes to allow discussion of Senate Bill 940, a bill that would limit federal tax deductions oil companies may take on drilling and development costs, recouping losses on failing oil and gas wells.

The bill also would curb tax breaks to big oil companies for technology related to oil and gas well injecting, which includes carbon dioxide and other chemicals. The bill would have affected ExxonMobil, Shell Oil Co., ConocoPhillips, Chevron Corp., and oil-spilling industry bad guy BP America.

"The major oil companies have accumulated more than $1 trillion in net profits over the last 10 years and collected more than $40 billion in tax breaks during the same period, but have invested negligible amounts of those funds into research and development of the production of clean and renewable fuels made in the United States, leaving consumers with few if any choices at the pump," the bill states.

Cochran and Wicker, however, said they consider removal of the estimated $2 billion in annual tax breaks to be a tax increase on oil companies.

"The Senate should instead be considering serious ideas to reduce the deficit in ways that will not discourage investment in domestic energy production and, in the end, not place more of a burden on consumers and make our nation more dependent on foreign oil," Cochran said in a statement. Cochran received $2,000 from oil and gas companies in 2009 and 2010, according to Congress-monitoring non-profit opencongress.org.

Wicker, who took in $31,900 in campaign contributions from the oil and gas industry in 2009 and 2010, declared that the bill "would have increased (the nation's) dependence on the importation of energy from foreign countries, many who are not supportive of American interests."

"The suggestion that the appropriate response to soaring gasoline prices is greater taxation upon the companies that produce gasoline runs counter to common sense," Wicker added.

Both statements run counter to the findings of the non-partisan Congressional Research Service, which found that the high price of oil will encourage domestic oil producers to keep producing, despite the loss of some tax breaks. The service concluded that the repeal of other related tax breaks, such as the deduction for increasing oil production of aging wells, do not affect smaller oil companies, while the big five oil companies "earned over $32 billion in net income in the first quarter of 2011." The organization concludes that the repeal is likely to have more of a negative impact on companies "in periods of low oil prices" rather than these days of $100-a-barrel oil.

Both senators refused to allow discussion upon removing the tax break, despite both making deficit reduction the foundation of their GOP political platform. Wicker acknowledged in a May 16 statement that Joint Chiefs of Staff Chairman Mike Mullen called the growing debt the greatest threat to the nation's national security, and that credit rating agency Standard and Poor's issued America's first-ever negative credit outlook this year.

Wicker said the federal government is "borrowing 40 cents for every dollar it spends and is set to spend more than $1.6 trillion more this year alone than it takes in." He called on President Barack Obama to accept the fact that "spending cuts must begin now and be real and enforceable."

Both stopped short of allowing spending cuts to extend to federal hand-outs to oil companies, however, even when the legislation expressly steered savings toward the deficit. The bill outlined that the net amount of any savings gained from cutting taxpayer-funded subsidies to oil companies "shall be deposited in the Treasury and used for federal budget deficit reduction or, if there is no federal budget deficit, for reducing the Federal debt in such manner as the Secretary of the Treasury considers appropriate."

Senate Bill 940 died with only 52 votes favoring the motion that would have allowed the bill to be debated. Three Democrats from oil and gas supply states joined the GOP in voting "no."

U.S. Sen. Roger Wicker, of Mississippi, refused to debate ending tax cuts for five of the world's wealthiest oil-producing companies last week, despite the resulting savings easing the nation's deficit.

Previous Comments

ID

163662

Comment

C'mon man!? This country, or better yet - parts of this country is holding the rest of the country back with these kinds of decisions and/or votes. Any and every economist I have come across have said - in order to cut the deficit, you have to increase some taxes, cut some tax breaks and in all seriousness cut spending as well, in order to cut the deificit. What makes it so bad, we are not even talking about having a balanced budget anymore? These southern politicians from Lousiana, Alabama, Florida, South Carolina, Tennessee, Texas, and Arkansas - are doing anything and everything within their power to make this administration fail and not propel the country forward. It's sad when a handful of elected officials in our national government are only looking out for the interest of a select few and not the entire country! But yet, the one's getting screwed the most continue to re-elect the same trouble makers year after year

Author

Duan C.

Date

2011-05-27T08:32:00-06:00

ID

163664

Comment

This is the other Conservative War on Math I've hinted at for an upcoming blog post. Serious Americans, including Wicker and Cochran, need to rally around the idea that we have to increase revenues as well as cut expenses in order balance the Federal budget and, eventually, reduce the deficit. That could be done creatively and even experimentally -- flat tax, smart tax, whatever -- but it's gotta get done.

Author

Todd Stauffer

Date

2011-05-27T10:36:23-06:00

ID

163682

Comment

I find it really sad that our supposed representatives can see what happened on the Coast, see people loosing their businesses, their jobs and lifestyles, then vote to encourage taking higher risks of that happening again. The risk of such damage is not worth the limited reward. There are other and better options. Especially for Mississippi.

Author

BobbyKearan

Date

2011-05-29T10:02:54-06:00