When the drinks are flowing at the open bar, it's not a big surprise that patrons swarm for their free pints. Tax bills are the same, with amendments aplenty as the hours ticked on towards the Senate passage of a massive tax reform package last week. Hey, when you are spending somebody else's money and nobody has time to read what you are sticking in anyway, why not take a gander on a nice payout for your district friends?
In 2013, the U.S. federal and state governments gave away $21.6 billion in subsidies for oil, gas, and coal exploration and production.
Transocean continues to innovate to avoid taxes everywhere; forming tax-favored Master Limited Partnership
Transocean owns operates complex offshore oil rigs, including the one that blew out in the Gulf of Mexico back in 2012, killing 11 workers and despoiling the Gulf of Mexico. There do not appear to be any similar lapses in its continued effort to push its taxes down as close to zero as possible, however.
The pace and scale of oil sands mining continues to increase in Alberta despite a poor understanding of the environmental liabilities: costs associated with the environmental impacts throughout the life of a mine. In Toxic Liability, the Pembina Institute has compiled the first public estimate of these liabilities.
For the past decade imports of tar sands crude oil or bitumen have been increasing. Tar sands is stripmined and drilled in an energy‐and water‐intensive process from under the Boreal forests and wetlands of Alberta. In the process, Canada is destroying critical habitat while releasing three times the greenhouse gas emissions as conventional oil production.
The Keystone XL tar sands pipeline project, like all oil industry projects, benefits from substantial taxpayer subsidies. Some, like reduced property taxes, are directed at the pipeline itself. Others increase the viability of the pipeline by reducing the cost of the oil going into it, or the cost of processing it at the other end.
I guess if I'm to listen to Fareed Zakaria "The Case for Making it in the USA: Like it or not (and I don't) we need a manufacturing policy to stay competitive," subsidies up-and-down the Keystone XL pipeline should be viewed as just par for the course. Though Zakaria acknowledges the government isn't good at picking winners, he thinks that, overall, public funding of a portfolio of private companies is necessary for the country.
Like so many attempts to strip away senseless subsidies before it, the most recent Congressional push to eliminate at least a handful of expensive subsidies to the oil and gas industry was blocked in May. But the growing deficits remain, and with them the pressure for fiscal austerity and the need to demonstrate a competant bi-partisan ability to govern. The push to kill these subsidies may well rise again.
This May 2011 piece (What's an Oil Subsidy?) by Nick Loris and Curtis Dubay took the issue of subsidies to the oil and gas industry head-on. I've had discussions with Heritage over a number of years on the issue of energy subsidies, though primarily those dealing with nuclear and ethanol. I hope those discussions will continue, and broad support for eliminating expensive and damaging energy subsidies will require support across the political spectrum.
With pressure building in Congress to strip out at least the most obvious subsidies to oil and gas, Taxyapers for Common Sense has released a new tally of some of the major ones. The report is useful in providing updated cost estimates, and for going beyond the narrow set of provisions that the legislation has targeted. For example, they pick up the billions in losses due to negligence by the Minerals Management Service in structuring lease contracts for 1998 and 1999 that resulted