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Tuesday, May 26, 2015

Yes, we really DO subsidize fossil fuels

US Taxpayers Spend Billions On Fossil Fuel Subsidies

Presidential candidate and Vermont Senator Bernie Sanders with Rep. Keith Ellison (D-MN) recently proposed the End Polluter Welfare Act, saying it would cut $135 billion in subsidies to fossil fuel companies over the next decade. The duo points out that “between 2010 and 2014, the oil, coal, gas, utility and natural resource extraction industries spent $1.8 billion on lobbying, much of it in defense of these expensive giveaways.”

“At a time when scientists tell us we need to reduce carbon pollution to prevent catastrophic climate change, it is absurd to provide massive taxpayer subsidies that pad fossil-fuel companies’ already enormous profits,” said Senator Bernie Sanders.

The reason those industries are heavily subsidized by United States taxpayers is simple and simply disgusting.



Despite the knowledge that fossil fuels are contributing to rapid climate change, despite the fact that those companies are making money hand over fist and don’t need those subsidies, there are members of Congress and elected officials in states who have been bought by the fossil fuel industry and they have no intention of relinquishing the monetary benefits afforded to them by cutting off those subsidies.

The Guardian took a look at some of the biggest subsidies benefitting specific projects.
Shell’s proposed $4 billion plant in Pennsylvania is set for tax credits of $66 million a year for the next 25 years. Shell purchased the site and has ten supply contracts in place that will extend for up to 20 years.

Those contracts include hydraulic fracturing of the Marcellus Shale. Even though it has been proven that fracking has caused quakes along the Ohio Pennsylvania border, even though it has been proven that fracking has contaminated drinking water in the state hundreds of times, and even though Shell doesn’t need all that money, Republican Governor Tom Corbett just couldn’t walk away from $1 million in campaign contributions from the oil and gas industry.

The Guardian’s analysis of data compiled by Common Cause shows Shell has spent $1.2 million on lobbying in Pennsylvania since 2011. Takeaway: money trumps the welfare of the citizens.

A Shell spokesman responded: Shell supports and endorses incentive programs provided by state and local authorities that improve the business climate for capital investment, economic expansion and job growth. Shell would not have access to these incentive programs without the support and approval from the representative state and local jurisdictions.”

ExxonMobil’s refinery in Baton Rouge, LA is the second largest in the United States. Since 2011, the Good Jobs First database found that the corporation has been exempted from industrial taxes, which over a 10 year period add up to $118.9 million. Of course, Governor Bobby Jindal has expressed pride over the accomplishment of attracting investment from ExxonMobil to Louisiana. 

I’d say it was the other way around, since Jindal was attracted to the $1,019,777 he received from oil and gas companies and executives during state elections campaigns between 2003 and 2013.

The ExxonMobil spokesman said: “ExxonMobil will not respond to Guardian inquiries because of its lack of objectivism on climate change reporting demonstrated by its campaign against companies that provide energy necessary for modern life, including newspapers.” (emphasis mine) Well, I guess Exxon told them!

Marathon Petroleum is getting a subsidy worth $78.5 million in Ohio via a 15 year tax credit for keeping 1,650 jobs and a 10 year tax credit for creating 100 new jobs. Republican Governor John Kasich said “All we’re doing is helping them.” In 2011, Kasich helped himself to $213,519 in contributions from the gas and oil industry – the top recipient in the state – and promptly appointed Marathon Petroleum’s CEO to the board of Jobs Ohio, a semi-private group “in charge of economic growth in the state of Ohio.”

Not surprisingly, the Marathon spokesperson had this to say: “The tax credit recognized the enormous contribution we make to the Ohio economy through the taxes we pay and the well-paying jobs we maintain. We have more than doubled the 100 new jobs we committed to create.”

Stephen Kretzmann, executive director of Oil Change International has a different idea. He said, “Subsidies to fossil fuel companies are completely inappropriate in this day and age.”

No kidding! In 2014, it was determined that US taxpayers have shelled out $21 billion per year for fossil fuel exploration and production alone. And despite President Obama’s call in 2009 for the G20 to eliminate fossil fuel subsidies, those subsidies have grown by 45%.

This past April, the president of the World Bank called for an immediate end to the subsidies, charging that poorer countries are feeling “the boot of climate change on their neck.”

The most recent figures compiled in 2013 show that the oil, gas and coal industries have had the benefit of a whopping $550 billion in subsidies – that’s over half a TRILLION dollars. Meanwhile, subsidies to renewable energy enterprises have been a mere quarter of that sum.

I can’t imagine that the Sanders-Ellison End Polluter Welfare Act will gain any traction in the current Congress. It certainly won’t act as a roadmap for Republican run states. But I hope the Senator and Representative keep on bringing it up and slapping Republicans in the face with it. 

The truth is, this is no time to remain silent on climate change and the dangers it poses to the entire planet. This is the time to fuel the fire of clean, renewable energy that will provide good paying jobs, help to reverse the disaster of climate change and provide a better, safer and more eco-friendly environment for us, our children and generations to come.
  • FACT: the renewables industry is providing jobs at a faster clip than oil and gas.
  • FACT: renewables will not pollute our air, our water and the earth beneath our feet
  • FACT: there will always be enough wind, sun and water to provide all the energy we need
  • FACT: prices on renewables are rapidly becoming cost competitive with fossil fuels
Ann Werner is a blogger and the author of CRAZY and Dreams and Nightmares. You can view her work at AnnWerner.info