Posted May 17, 2011
OK, which is it? First, Democrats said raising taxes on the oil and natural gas industry would do something about rising gasoline prices. Then they said it wouldn't. On Tuesday, Senate Majority Leader Harry Reid said both, almost in the same breath.
Talking on the Senate floor about a vote on a proposal to end standard business tax deductions just for the largest oil and natural gas companies, Reid said it "wouldn't affect gas prices at all." Then Reid did a 180: "We have to do something about exorbitant gas prices, and the best way to start with that is to do something about the five big oil companies getting subsidies they don't need."
Reid's issue spiel amused top Senate Republican Mitch McConnell. "Is it just me," he asked, "or is their message on their bill incredibly contradictory?"
Sen. Reid was right the first time. As Brian Johnson, API's senior tax advisor, explained recently, additional taxes on oil and natural gas companies would do nothing to lower prices. "They would not affect the global economics underpinning oil supply and demand, which explain today's gas prices," Johnson said. "They would, however, hurt the economy by reducing energy investment and the new jobs that would flow from that investment."
There's a clear choice before Congress: Move toward increasing access to America's domestic resources to help create jobs, raise government revenues and produce more energy - as the House of Representatives did with recent legislation - or continue pushing for higher taxes on energy companies, which a key study has shown would cost jobs, reduce government revenues and cut into energy production. When you think about it, it's not all that confusing.
ABOUT THE AUTHOR
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.