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Effort to strip big oil subsidies fails

May 5, 2011

NEAL P. GOSWAMI
Staff Writer
BENNINGTON — Vermont Rep. Peter Welch on Thursday accused House Republicans of looking the other way as oil companies “line their pockets.”

Welch and other Democrats sought to strip big oil companies of federal subsidies Thursday through an amendment offered by Welch to an energy bill passed by majority Republicans.

“While oil companies are doing quite well, Vermonters are not. They simply can’t afford to fill their gas tanks,” Welch said on the House floor. “Congress should be taking steps to cut gas prices, not look the other way while oil companies line their pockets with taxpayer support.”

Republican leaders rejected the amendment, however. It would have repealed 10 oil industry tax breaks and saved taxpayers more than $40 billion over the next decade, according to Welch.

“We’ve got to take away these tax breaks for the oil companies,” he said in a telephone interview. “It’s $40 billion … to an industry that had record profits this last quarter. Why are we asking the American taxpayers to subsidize a profitable industry?”

Large oil companies have reported large profits from the first quarter as gas prices continue to rise. Exxon Mobil reported profits of about $11 billion, a 69 percent increase. Meanwhile, Shell reported profits of $7 billion, ConocoPhillips reported profits of $3 billion, Chevron reported $6.2 billion and BP reported $5.5 billion.

Welch said lawmakers should be focused on driving down fuel prices by cracking down on speculators and tapping the nation’s strategic oil reserve.

“Consumers are getting hammered at the pump and it’s brutal and threatening our economy,” he said.

Meanwhile, the underlying legislation, H.R. 1230, known as the Restarting American Offshore Leasing Now Act, requires the Secretary of the Interior Ken Salazar to reopen lease sales for drilling in the Gulf of Mexico and off the Coast of Virginia that were canceled in response to last year’s Deepwater Horizon disaster that devastated
the Gulf coast. Those leases would rely on environmental reviews done by the Bush administration prior to that spill, the largest in history.

“The leases in the gulf are under review as we speak,” Welch said. “This bypasses the review process and you’ve got to be apprehensive that it short-changes the safety process.”

Additionally, drilling will not offer near-term relief to consumers at the pump, he said.

House Speaker John Boehner hailed the bill’s passage, despite opposition from majority Democrats in the Senate and the Obama administration.

“With families and small businesses caught in the grip of rising gas prices, the House has voted to restart job-creating energy projects the Obama administration has either delayed or canceled. The very need for legislation to move forward on projects that have already been approved shows just how far behind Washington is when it comes to expanding American energy production,” Boehner said in a statement. “Unfortunately, the administration remains fixated on raising taxes, which would only drive up prices further and push our economy backwards.”

Contact Neal P. Goswami at ngoswami@benningtonbanner.com

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