In a letter today sent to House and Senate leaders of both parties, President Obama called on Congress to end tax breaks for the oil and gas industry. While the American economy has grown steadily over the past 13 months, creating more than 1.8 million jobs, the rising cost at the pump is hurting families and has begun to threaten our recovery.
The President recognizes that no single policy will fix America’s energy problems overnight, but eliminating tax breaks for oil companies is a step we can take right now:
Our outdated tax laws currently provide the oil and gas industry more than $4 billion per year in these subsidies, even though oil prices are high and the industry is projected to report outsized profits this quarter. In fact, in the past CEO’s of the major oil companies made it clear that high oil prices provide more than enough profit motive to invest in domestic exploration and production without special tax breaks. As we work together to reduce our deficits, we simply can’t afford these wasteful subsidies, and that is why I proposed to eliminate them in my FY11 and FY12 budgets.
This might be an issue with bipartisan agreement. Recently, Speaker Boehner told ABC News that eliminating the tax breaks for oil companies is, “certainly something we should be looking at.” Boehner continued:
We're in a time when the federal government's short on revenues. They ought to be paying their fair share. Everybody wants to go after the oil companies and frankly, they've got some part of this to blame.
That's exactly why the President urged immediate action—something Congress is empowered to do.
Additionally, President Obama hopes to extend the discussion about our long-term strategy to create sustainable and stable energy future:
[W]e need to get to work immediately on the longer term goal of reducing our dependence on foreign oil, and our vulnerability to price fluctuations this dependence creates. Without a comprehensive energy strategy for the future we will stay stuck in the same old pattern of heated political rhetoric when prices rise and apathy and neglect when they fall again.
I recently laid out my approach to a comprehensive strategy in my Blueprint for a Secure Energy Future, which includes safe and responsible production of our domestic oil and gas resources and doubling down on fuel efficiency in the transportation sector while investing in everything from wind and solar to biofuels and natural gas. None of you will agree with every aspect of this strategy. But I am confident that, in many areas, we can work together to help show the American people that we can make progress on an energy policy that creates jobs and makes our country more secure.
Just as the President said, Democrats and Republicans may not agree on every aspect of America’s energy policy, but they should come together now to do what’s fair and end tax breaks for the oil and gas industry.
The President will continue to advocate for greater investment in renewable energy and the development of innovative technologies that make America more competitive.
Click here to read President Obama’s full letter to congressional leadership.