Mr. President, I rise in support of S. 2204, which is my legislation to repeal Big Oil subsidies. This bill is pretty simple. We end wasteful subsidies to the big five oil companies, and we use those proceeds to invest in clean energy, in…
Mr. President, I rise in support of S. 2204, which is my legislation to repeal Big Oil subsidies.
This bill is pretty simple. We end wasteful subsidies to the big five oil companies, and we use those proceeds to invest in clean energy, in creating jobs, and reducing the deficit. I think the American people are sick and tired of paying ridiculously high gasoline prices at the pump and then paying Big Oil again with our collective taxpayer subsidies. I think that money is better spent keeping our economy going and developing alternatives to oil that will create competition in the marketplace and help to reduce gas prices.
We are poised to waste $24 billion over the next 10 years subsidizing only five companies that are poised to make
over $1 trillion in profits--not proceeds, in profits--over the same time frame. And as we all pay more at the pump, Big Oil rakes in more money.
Exxon boasts in its Securities and Exchange Commission filings that for every $1 increase in the price of oil, their profits rise by $375 million. For every $1 the price of oil goes up, they boast in their filings that their profits--not proceeds, profits--rise by $375 million. The American driver's pain is Big Oil's profit.
What is Big Oil doing with its profits? Well, the answer is not useful. As you can see in this chart, the profits from the big five oil companies were $137 billion in 2011. That is an impressive 75-percent increase from 2010. Did they use that extra money to produce more oil, as some of my colleagues here would suggest? No, they didn't. They took your money and actually in that time frame didn't produce a drop more of oil. As you can see, despite the fact that overall U.S. production is higher now than it has been in the last 8 years, last year these five companies actually produced 4 percent less oil.
So it is fair to ask: If they did not invest to produce more oil, then what are they doing with this $137 billion in profits, this 75- percent increase in profits in 1 year? Well, they spent about $38 billion repurchasing their own stock to enrich themselves, and they spent nearly $70 million on campaign contributions and lobbying to protect their billions of dollars in subsidies. As you can see here, it was a pretty smart investment. For every $1 they spent in lobbying, they got about $30 in subsidies. One might say that is not a bad return on their investment.
So instead of giving these subsidies to Big Oil so they can enrich themselves and seek to affect and control our political system, I think we could use some of those funds to reduce the deficit. I think we can all agree we need to reduce the deficit, but there seems to be some considerable disagreement on how to do it. Last week, those on the other side of the aisle came out with what I call the Romney-Ryan budget, their proposed budget, and it would drastically cut funding for wounded soldiers, for seniors, for students, but it leaves in place these wasteful subsidies even though we have this enormous profit.
Through some political sleight of hand they defy reality when they tell us with a straight face that we have to make tough choices, and then they cut funding for wounded soldiers, for seniors, and students but won't touch the subsidies for Big Oil.
Somehow, in this Republican parallel universe, logic is turned on its head and we are asked to believe that fairness doesn't mean treating everyone equally. It means more for the very rich and more for Big Oil. But we don't live in a parallel universe. We live in the real world. Fairness means that working families should not be the only people sacrificing. And we can't lower the deficit while we give taxpayer dollars away to Big Oil companies that are making record profits and not producing more energy. It is amazing to me that anybody can come and make that argument.
What makes these subsidies even more ridiculous is that when we pressed those who have supported the industry or those who have come from the industry, everyone seems to admit that oil companies do not need these subsidies. Former President Bush, who was very good with the oil industry, said that oil companies do not need incentives to drill when oil hits $55 per barrel. Those were his remarks. Now it is over $100 a barrel. So if they didn't need incentives to drill when it was at $55 a barrel, how does anybody come to the floor and suggest they need incentives now when it is over $100 a barrel?
Then the former CEO of Shell said that subsidies are not necessary for drilling and production. That is pretty much probably clear when they are making $137 billion in that 1 year, and where they will make $1 trillion over the next decade.
Of the $24 billion we save by cutting these subsidies to the big five, we can use over $11 billion to extend a series of critically important expiring energy tax incentives. These clean energy technologies will cut demand for oil, they will drive economic growth, will create jobs, and will allow America to lead the global clean energy market.
Despite Big Oil's rhetoric--let me tell you, it is amazing. I see they are spending a lot of that money, all this money here not making oil, but they are spending it on television to scare everybody and to say that, Oh, if you take any of those subsidies away, somehow prices will rise. Well, we know that, despite Big Oil's rhetoric, cutting subsidies will not raise gas prices. We know that. Why? Because experts from the U.S. States Treasury Department, from the nonpartisan Congressional Research Service, and from oil executive testimony that came before the Finance Committee that I sit on, made it very clear that is not the case.
But more than that, some of the most important tax policies that will be extended in this bill will help drive down gas prices by creating competition for oil as a transportation fuel. These incentives include the one for biofuels such as cellulosic ethanol, biodiesel, also incentives for natural gas and propane used as a transportation fuel. There are also incentives for alternative fuel refueling infrastructure and for electric vehicles. Taken together, these incentives are laying the groundwork for a truly competitive market where we are not beholden to one type of fuel to power our vehicles. But the good news doesn't even end there. There are also tax incentives that will help the United States compete for the renewable industries of the 21st century.
For example, the section 1603 Treasury grant program has helped finance renewable energy projects around the country. It has leveraged over $35 billion in investments to create tens of thousands of energy projects. In my home State of New Jersey alone, 750 grants were given for solar, geothermal, landfill gas, hydropower, wind projects. These projects are worth over $350 million, creating many jobs, and will help New Jersey on energy bills for decades to come.
Another important renewable energy incentive is the production tax credit for wind. Since the last reauthorization of PTC in 2005, wind power capacity has more than tripled. But if that production tax credit is not extended, it is estimated that annual installations of wind will drop by more than 75 percent and wind-supported jobs will decline from 78,000 in 2012 to 41,000 in 2013, and total wind energy investment will drop by nearly two-thirds. So it is time to get back to reality. It is time to tell middle-class families struggling to make ends meet that fairness means everyone--everyone--pays their fair share when it comes to reduce the deficit. It means ending ridiculous taxpayer giveaways to the five most profitable companies in the world.
I cannot understand how the oil industry is spending money on radio and other forms of media to say, Oh, my God, If you take any of our subsidies away--and these aren't even all of the subsidies they have. These are just a couple, the $24 billion over 10 years. They are going to make $1 trillion over 10 years. So you are telling the American people that when you are going to make $1 trillion over 10 years, we collectively as taxpayers must still give you $24 billion or else somehow $1 trillion minus $24 billion wouldn't be enough for you in profits that you would gouge the consumer at the pump? I don't think the American people are going to accept that.
It is time for us to stop wasting taxpayer money on oil subsidies and use this money to invest in clean energy, in jobs, in lowering the deficit. All of that can be done on this opportunity when we vote in favor of moving forward on S. 2204, the Repeal Big Oil Subsidies Act. It is time to put the interests of the American people ahead of the money interests in this Congress with this vote, and then moving forward.
I hear my colleagues may very well vote for us today to have a debate--which I more than welcome. I am looking forward to it. I have got a lot more to talk about in this regard--but then won't vote at the end to repeal the subsidies. So I guess what we will hear is a chorus of voices that will speak about defending Big Oil and defending its $24 billion in subsidies, and justifying that even with $1 trillion in profits they still need to get their hands into the pockets of taxpayers and take another $24 billion in addition to what they get at the pump so they can make even more profits. And, somehow, there will be a justification to that. I hope
the American people will be watching, because that type of justification is beyond comprehension. I know it as I hear it from families in New Jersey.
I hope we will have this debate. I hope we will be able to move forward. I want to be able to talk about how I hear my colleagues talk about drill, baby, drill. Well, I was incredulously amazed that actually we are now exporting from the United States millions of gallons of gasoline and refined petroleum products every day to other places in the world. It seems to me that if we drill it here, particularly on Federal lands and water, we should keep it here because obviously the bigger the supply we have, the more we are going to create downward pressure on prices. But I think most Americans would be pretty shocked to know that we are actually exporting. They think everything that is created here is kept here, which is why I found it interesting--I keep hearing my colleagues talk about the Keystone Pipeline. Well, there are those of us who said, You know what. If you will make it with materials made in America so that we can ensure American jobs are created with it, and if you keep the energy here and not export it someplace around the world, then there are a lot of people who would say: Yes, along with the right environmental safeguards, let's consider it. But overwhelmingly that was voted against. So so much for American jobs. So much for securing American energy. Because what is the use of a pipeline to bring an energy source and then have it sent to other places in the world? That doesn't help us.
I am a big believer if we are going to drill it on Federal lands and water, we are going to keep it here, we are going to help us lower prices. I am a big believer if we are going to do something such as Keystone, let's make sure it is made with American materials and made with American hands and, at the end of the day, the energy is kept in the United States. I am a big believer in saying at a time of shared sacrifice, it is wrong to ask working families to do more and yet give the oil companies $24 billion, when they will make $1 trillion in profits. It is wrong to say to a wounded soldier we are going to cut programs in his long-term health care that will ultimately help him get back on his feet, but we are going to give Big Oil $24 billion. It is wrong to tell students who are trying to determine their future and get access to that college education and who will encumber themselves with significant costs along the way, no, they pay more, but we are going to give Big Oil $24 billion. It is wrong to tell seniors we are going to end Medicare as we know it, but we are going to give Big Oil $24 billion. That is beyond my comprehension.
I look forward to the debate because it is going to be very interesting to see some of the remarkable ways in which people are going to have to explain that. I don't think it is explainable to the American people. Tonight's vote starts a process: Which side are we on? Are we on the side of the American taxpayer or are we on the side of Big Oil? I hope an overwhelming number of our colleagues will, starting tonight and moving toward final passage, say we are on the side of the American taxpayer and the American consumer. If we do that, we can create some justice in this process. We can help create competition in the energy market to drive down prices, we can reduce the deficit by another $12 billion, and we can be a lot more fair to working families in this country. That is the choice before us. That is a choice the Senate will make in a positive way.
I yield the floor and suggest the absence of a quorum.