High gas prices
are solved by raising taxes on oil companies? More on speculators unjustifiably raising prices? At least that what Obama was advocating in his weekly Saturday radio address. See my earlier post on his attacks on speculators available here
Now, whenever gas prices shoot up, like clockwork, you see politicians racing to the cameras, waving three-point plans for two dollar gas. You see people trying to grab headlines or score a few points. The truth is, there’s no silver bullet that can bring down gas prices right away.On Wednesday
But there are a few things we can do. This includes safe and responsible production of oil at home, which we are pursuing. In fact, last year, American oil production reached its highest level since 2003. On Thursday, my Attorney General also launched a task force with just one job: rooting out cases of fraud or manipulation in the oil markets that might affect gas prices, including any illegal activity by traders and speculators. We’re going to make sure that no one is taking advantage of the American people for their own short-term gain. And another step we need to take is to finally end the $4 billion in taxpayer subsidies we give to the oil and gas companies each year. That’s $4 billion of your money going to these companies when they’re making record profits and you’re paying near record prices at the pump. It has to stop.
Instead of subsidizing yesterday’s energy sources, we need to invest in tomorrow’s. . . .
, ExxonMobile will be announcing its profits for the latest quarter, and with the soaring gas prices its profits will be quite high
. Of course, higher profits are what you want if you want to encourage more energy being produced.
How does media coverage of the higher prices now compare to the higher prices under Bush? A couple discussions are available here
Meanwhile the Obama administration is doing everything it can to stop oil production in the US. EPA Rules Force Shell to Abandon Oil Drilling PlansProtecting lizard would put jobs at riskOil companies should pay their 'fair share'
UPDATE: "Obama pounces on Speaker's remarks, urges end to oil subsidies"
In a letter to the leadership of both chambers and both parties, Obama used House Speaker John Boehner's words against him, referencing the Ohio Republican's criticism of the oil companies in an interview with ABC News.
"I was heartened that Speaker Boehner [Monday] expressed openness to eliminating these tax subsidies for the oil and gas industry," Obama wrote. "Our political system has for too long avoided and ignored this important step, and I hope we can come together in a bipartisan manner to get it done."
The president also urged Congress to get behind his energy plan even though he acknowledged that Republicans won't agree with much of it.
"I hope we can all agree that, instead of continuing to subsidize yesterday's energy sources, we need to invest in tomorrow's," Obama said.
Sen. Charles Schumer (D-N.Y.) also seized on Boehner's remarks, saying his comment that large companies don't "need to have" some subsidies was "almost too good to be true." . . .
“The Speaker made clear in the interview that raising taxes was a non-starter, and he’s told the president that. He simply wasn’t going to take the bait and fall into the trap of defending 'Big Oil' companies," Steel said.
"Boehner believes, as he stated in the interview, that expanding American energy production will help lower gas prices and create more American jobs. We'll look at any reasonable policy that lowers gas prices. Unfortunately, what the president has suggested so far would simply raise taxes and increase the price at the pump."
In the interview with ABC, Boehner said: "I don't think the big oil companies need to have the oil depletion allowances, but for small, independent oil-and-gas producers, if they didn't have this, there'd be even less exploration in America than there is today." . . .
Further UPDATE: From Fox News
But Boehner's office pushed back Tuesday, suggesting the speaker wants to see a more comprehensive approach before signing on to any changes.
"The speaker wants to increase the supply of American energy and reduce our dependence on foreign oil, and he is only interested in reforms that actually lower energy costs and create American jobs," spokesman Brendan Buck said in a statement. "Unfortunately, what the president has suggested so far would simply raise taxes and increase the price at the pump." . . .
If Obama really wants to reduce the true cost of energy, stop subsidizing really costly alternative "green" energy. Part of the cost of energy are all these taxpayer funded subsidies for producing the energy.
Boehner's ABC interview is available here
Labels: Economics, Energy, Obamaantibusiness, speculation