January 19, 2007

Hmm, Americans love their oil

An oil wellEvery so often a law gets changed in the United States and I think… you mean that law existed before?

Well, that’s happened again. Whereas over here we tax petrol to high heaven, in the U.S. they’ve been subsidizing the oil industry with ruddy great big tax breaks.

But not for much longer. The House has voted for $14bn dollars – that’s $14,000,000,000 – to be switched from tax breaks for fossil fuels to research into renewable energy.

It’s got to get through the Senate (likely, but not easily) and then get the stamp of approval from Mr Oil himself, good ole’ Georgey Bush. So far he’s not threatened to veto it. But can you imagine the look on his mates’ faces as he signs that bill into law? Ooh, you’d pay to watch, wouldn’t you?

There’s only one more thing. If this pushes domestic oil prices up, where do you think Bush might want to get some more cheap stuff from?


- 7 comments by 3 or more people Not publicly viewable

[Skip to the latest comment]
  1. Don’t Venezuala have some oil?

    19 Jan 2007, 11:30

  2. Matthew Jones

    Don’t Venezuala have some oil?

    Best response ever.

    I love the fact that Congress have essentially just said “Everything you did before was dumb and we’re gonna change it. Stem cells: check. Warw in Iraq: check. Tax breaks for oil companies…”

    It’ll be interesting to see what they go after next. What else did Bush do that everyone else thought was stupid?

    19 Jan 2007, 11:42

  3. exist?

    19 Jan 2007, 13:43

  4. Mathew Mannion

    Ah, Jeff suffers from the same disease as I, that when you write “War” with a capital W you always subconsciously and unavoidably add the “w” in preparation for the next syllable…

    21 Jan 2007, 01:48

  5. Matthew Jones

    Or my subconscious desire to have Warwick in Iraq. Oh wait, maybe not.

    21 Jan 2007, 12:31

  6. Juan

    I love how the government takes upwards of 60 cents for every dollar we spend on gasoline, yet the Democrats think the answer is more taxes on “Big Oil.” How about they lower the taxes, which in turn lowers their expenses, and results in lower prices? Or how about letting us drill in Alaska so we have less dependence on foreign oil? No, that would seem too easy and wouldn’t fit what they already think they know: that “big” corporations are out to screw everyone and taxing them is the way to solve that problem…

    29 Jan 2007, 02:08

  7. Don Kaufman

    The comment on tax credits for the oil companies is that started this deserves research from multiple sources, and a little “drilling” beyond the headlines. At the top of the list are two credits:
    —Tax breaks for refinery expansion and for geological studies to help oil exploration.
    —A measure passed two years ago primarily to promote domestic manufacturing. It allows oil companies to take a tax credit if they chose to drill in this country instead of going abroad.

    The first one is really R&D which we encourage of every country. The latter seems pretty reasonable too. If we go beyond the headlines, what we really find is that the oil companies made huge profits and the US government wants it. First off, I trust the oil companies more than the government with that money! Secondly, they did earn it. They also performed marvelously using the elasticity of demand when hurricanes wiped out a large proportion of their refinery capacity. Jacking up the price got folks to use less, and we never really RAN OUT. Yes, they made some money, but again, see the first comment.

    Cheers-
    Yank

    11 Mar 2007, 20:26


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