New York Times: The Senate Shills for Big Oil
One of the major shortcomings in last year’s admirable energy bill was its failure to extend vital tax credits to producers of wind, solar and other renewable fuels. This was entirely the doing of the Senate, which caved in to the oil companies and their White House friends.
The House had approved the credits but insisted — under the Democrats’ pay-as-you-go rules — that they be paid for by eliminating the same amount in tax credits for oil and gas producers. Industry (which is rolling in cash these days) howled, President Bush lofted veto threats, and the Senate caved.
The damage was immediately apparent. New investment in clean, non-fossil-fuel energy sources — which need the help until they become competitive with older, dirtier energy sources — began to shrivel.
The Senate now has a chance to redeem itself. Last week, the House approved a new $17 billion package of credits, spread over 10 years, to encourage the development of renewable energy sources and to promote energy-efficient buildings and appliances.
As before, the House insisted that the credits be paid for by terminating an equivalent $17 billion in tax breaks over 10 years for oil and gas companies. And right on schedule, Senate Republicans began complaining that increasing industry’s taxes would discourage investment in domestic oil and gas production.
What will it take to wake the Senate up? It should be clear to even the most obtuse members that a country that consumes one-fifth of the world’s oil but has only 3 percent of its reserves cannot possibly drill its way to energy independence.
It should be equally clear that an industry whose five biggest producers generated $145 billion in profits last year can easily sacrifice $1.7 billion in annual tax breaks it does not need to help develop the cleaner fuels the country does need.
If those arguments aren’t enough, we offer the Senate some words from President Bush. In a 2005 address to the American Society of Newspaper Editors, Mr. Bush spoke forcefully of the need for an energy strategy that looked to the long term and emphasized conservation and renewable fuels.
Of the oil and gas industry, he said pointedly: ‘I will tell you with $55 oil we don’t need incentives to the oil and gas companies to explore. There are plenty of incentives. What we need is to put a strategy in place that will help this country over time become less dependent.’
The question for Mr. Bush and the Senate is clear: If that was true at $55 a barrel, why isn’t it even more valid and urgent at $100 a barrel?