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Townhall
Finance...
Some
Policy: Obama Spent $24 Billion on Energy in 2011
by Bob
Beauprez
March 12, 2012
The
Congressional Budget Office says that the government provided $24
billion of
tax credits and direct subsidies to the energy industry in 2011. Here’s how it
was divided up:
$2.5
billion in various tax credits to the fossil fuel industry
$6 billion
to the ethanol industry
$16 billion
to renewable energy and energy efficiency programs
So, the
industry that receives about 10 cents of each dollar of incentives the
government provides produces 85% of all the energy to keep America
going. And, yet it
is the industry that Barack Obama
demonizes and wants to punish with higher taxes.
It is
important to understand that the various government incentives do not
all come
in the same form. The
hydrocarbon
industry takes advantage of tax credits designed to incentivize more
investment
in exploration and production. Most
of
it is identical to the kind of depreciation and expensing credits
available to
every other business in America.
However, much of the support to ethanol and
green technology is direct
subsidies and grants; the government literally sends them a check.
Not only
does the oil and gas industry supply us with the vast majority of the
energy we
need, it returns an average of 41% of net income back to the government
in
taxes and fees amounting to $85 million every day of the year. Meanwhile, the media is
full of stories about
bankrupt and struggling green energy companies that are net “takers”
rather
than “payers” to the Treasury.
With
growing outrage over soaring gasoline prices, instead of approving the
Keystone
Pipeline and policies that would increase supplies, Barack Obama has
renewed
his attack on oil and gas calling for Congress to “eliminate this oil
industry
giveaway right away.” He
reportedly
wants to take the additional taxes from oil and gas and further
subsidize green
energy. Higher
taxes would of course
increase gas prices even more.
Perhaps
even more paradoxical is that the impact of rising gas prices is
extremely
regressive – higher costs disproportionately impact lower income people
who are
already struggling the most in the lagging economy.
Yet, Obama contends it’s the wealthy that he
wants to punish with higher taxes and somehow give lower income folks a
break. He can say
it all he wants, but
his policies produce just the opposite result.
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and other columns at Townhall Finance
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