According to news reports from The Hill, oil company tax breaks, a revenue source the oil industry has long defended in Congress, may be cut as part of a budget deal between House republicans, the president, and democrats in the Senate.
House Speaker John Boehner noted today that he wouldn’t rule out cutting the long-standing oil industry tax breaks which amount to more than a $40 billion dollar per decade subsidy for oil extraction and burning in the US.
The oil industry, which is now producing oil from fracked wells at a cost of 80 dollars per barrel, more than twice the cost to produce ethanol, is continuing its years-long campaign to shore up public support. Such actions come at a time of increasing impacts from global warming. A 75 billion dollar drought and a 50+ billion dollar superstorm Sandy have resulted in severe damage to the nation’s homes, waterfront, infrastructure, and food production capacity. Both events have been linked by scientists to climate change.
In addition, reports via both the IEA and PwC are showing that only 1/3 of the current world fossil fuel reserves can be burned without wrecking human civilization and kicking off severe climate feedbacks. Yet the oil industry appears to have ignored these reports and continues to push their dirty and damaging products.
So far, this year, oil companies have generated more than 100 billion dollars in profit selling a product they continue to campaign to enforce dependency on. A product that, even now, is causing serious damage to the nation’s ability to function and grow economically. These profits have been fattened by the very tax breaks that may be cut. Emphatically, these tax breaks need to be removed. They incentivize the extraction and burning of products that are now very harmful to the nation’s future. Indeed, the scale must be tilted against the use of these products and, from this point forward, we should no longer provide public financial incentive for their increasingly dangerous use.