With the Senate expected to vote on a bill ending billions of dollars in tax breaks for large oil companies on Thursday, President Barack Obama weighed in on the issue, indicating his strong support for ending the subsidies.
"Members of Congress have a simple choice to make," Obama said in remarks in the White House Rose Garden. "They can stand with big oil companies, or they can stand with the American people."
He added, "Right now, the biggest oil companies are raking in record profits - profits that go up every time folks like these pull into a gas station. But on top of these record profits, oil companies are also getting billions a year in taxpayer subsidies."
The Senate bill, sponsored by Sen. Robert Menendez, D-N.J., targets $24 billion in subsidies due to be paid to the largest oil companies over the next ten years.
Democrats want to use that money for clean energy investments and to reduce the deficit, while Republicans say ending the subsidies will not lower gas prices and would amount to a tax increase on an industry that is already being treated unfairly.
In his remarks, Obama noted that the three biggest U.S. oil companies earned more than $80 billion in profits in 2011, with oil giant Exxon Mobil making nearly $4.7 million every hour.
"And when the price of oil goes up, prices at the pump go up, and so do these companies' profits," Obama said. "In fact, one analysis shows that every time gas goes up by a penny, these companies usually pocket another $200 million in quarterly profits."
He added, "Meanwhile, these companies pay a lower tax rate than most other companies on their investments - partly because we're giving them billions in tax giveaways every year."
Obama said that the oil industry is doing "just fine," pointing to the industry's record profits and U.S. production at an eight-year high.
The president said, "I think it's curious that some of the folks in Congress who are the first to belittle investments in new sources of energy are the ones fighting the hardest to keep these giveaways for big oil companies."
"Instead of taxpayer giveaways to an industry that's never been more profitable, we should be using that money to double-down on investments in clean energy technologies that have never been more promising," Obama added.
While Obama said drilling for oil has to be a key part of the nation's energy strategy, he continued to push his "all-of-the-above" strategy that includes investments in biofuels, wind and solar power, and more efficient vehicles.
"As long as I am President, America will pursue an all-of-the-above energy strategy." Obama said, later adding, "As long as I'm President, I'll put my faith in the future."
by RTT Staff Writer
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