Back in 2008, the CEO of Shell Oil, John Hofmeister, testified in Congressional hearings that when oil and gasoline prices are high that big oil companies do not need the subsidies they get from the government. He also noted that executives of major oil companies agree.
These federal subsidies were originally designed to encourage exploration for oil, but Hofmeister says that there is more than enough incentive to drill when oil prices are above $70 a barrel, which they have been since the middle of 2007. In fact, oil is well over $100/bbl now.
Fast forward to now. Hofmeister is now retired as the CEO of Shell, but last month he repeated his statement that the big oil companies do not need these subsidies to Congressman Edward Markey (D-MA), who then introduced legislation to eliminate $5 billion a year in subsidies to major oil and gas companies.
The Republicans claim that they are trying to reduce government spending. They are more than willing to cut teacher pay, eliminate firefighters, and other drastic measures that will hurt us as a country. But when House Democrats offered a Motion to Recommit to the Republican’s short-term spending bill to end subsidies to large oil companies, the Republicans voted against it. Unanimously.
This should come as no surprise. Republicans have received three times as many campaign contribution dollars from big oil companies as do Democrats. So of course Republicans are not going to reduce the deficit by billions of dollars a year, even though the oil companies are hugely profitable and in fact admit they don’t even need these subsidies.
I guess some spending is more equal than other spending. They are more than willing to reduce the deficit on the backs of the middle class, the poor, and the elderly, but won’t spend a penny less for their friends in big multinational corporations.