Back in the mid-1990s, when oil companies were whining about cheap prices and low profits, Congress decided to waive the federal royalties to encourage new wells in the Gulf of Mexico. Now that oil profits are soaring and prices have jumped from under $12 to over $100 a barrel, do you think the oil companies are ready to lose that temporary incentive? No way. Instead, they’re spending millions on political contributions and lobbing to protect this tax break and a host of others worth billions. The Washington Post says the Gulf Coast royalty waiver has already saved oil companies $11 billion and will cost taxpayers another $15.5 billion in lost revenue over the next 10 years – a handsome sum in the context of the spending-versus-income debate in Washington. The top beneficiary of the royalty loophole is Chevron-Texaco, which has sucked up $1.5 billion in extra profits so far. Chevron used its inflated treasury to “give” (or kick back) $2.5 million to the Congressional Leadership Fund, a Super PAC that promotes the election of Republican House members. See the advantage of the Citizens United decision? You can easily see the quid pro quo of a fattened corporate treasury with a pay off to government officials.
Category: Political News