With petroleum prices through the ceiling, and cries about global warming and climate change in the news, it's interesting to see how politics-as-usual plays a role in America. Campaign contributions reveal how the game is played.
If you look at the
statistics (gathered and tabulated by the Center For American Progress) for the November 2006 elections, you'll see some provocative revelations.
The politicians in both the House and the Senate who won close races (gaining 55% of the vote, or less), and who voted with Big Oil (against a bipartisan-proposed clean energy tax package) received a whopping ten times more in contributions than elected officials who voted for the clean energy tax amendment when it came up in Congress last June.
Keep in mind that the clean energy bill was developed in cooperation with Finance Committee member Chuck Grassley and Energy Subcommittee chairman Jeff Bingaman. The Senate Energy Committee is also led by Bingaman. These legislators represent both Republican and Democratic parties.
If it had passed, the tax laws would have changed to set up some nice incentives for developing alternative energy technologies. At the same time, long-standing tax loopholes for Big Oil would have snapped shut. The clean energy amendment also had provisions to regain unpaid drilling royalties in the Gulf of Mexico.
For the average man on the American street, the wording of the bill was practical, optimistic, and futuristic. It would have promoted the development of renewable energy. It would have helped establish a better electricity infrastructure in the United States (have you forgotten the Northeast and California power outages of a few years ago?). It would have set up incentives to secure the domestic fuel supply. It would have supported alternative energy vehicle development and deployment.
To advance the development of renewable electricity and abet the development of a more reliable electricity infrastructure, the tax package had a five-year extension of the clean energy production tax credit. It would have also established tax credits to encourage sequestration of carbon emissions from projects such as coal gasification plants. It would have created some fine tax incentives for solar, wind, and so-called
microturbine energy projects. If you sent renewable energy into the power grid, you would have gotten a nice tax write-off.
The bipartisan package also had a production tax credit to encourage development of alcohol, ethanol, and bio-diesel, especially that churned out by small producers. Tax incentives for increasing refinery capacity, and for refining fuel from non-conventional resources (oil shale and tar sands) were in there, too.
To support alternative vehicles, the bill would have extended tax credits for consumers buying alternative fuel cars and trucks, with a new credit for plug-in hybrid purchases and for those buying equipment to convert a standard hybrid vehicle to a plug-in.
The bill would have extended tax credits for reducing energy costs in existing homes, too, and for reducing energy costs in new homes and commercial buildings. It would have also extended and improved tax credits for energy-efficient appliances.
Sounds practical and good, right? Sure, unless you're from Texas. For Big Oil, there was a repeal of the manufacturing deduction for major oil and gas domestic manufacturing (as with other oil and gas incentives, the manufacturing deduction had been left intact for smaller independent domestic producers).
Revenue raisers would have also included a severance tax on the removal price of any taxable crude oil or natural gas produced from leased Federal lands in the Gulf of Mexico. There would have been simplifications to foreign tax credit rules for oil and gas activities, and anti-fuel-fraud excise tax provisions, and an extension of the excise tax on oil that's dedicated to a trust fund used to clean up oil spills.
At the time, Finance Committee chairman Max Baucus stated: "These tax incentives blaze a trail toward new energy solutions for tomorrow, and more responsible use of the energy resources we rely on today."
"The Finance Committee is sending a forward-focused, fiscally-responsible tax package to the full Senate," added Baucus. "This combination of incentives and offsets provides a new and proper balance to our tax code's treatment of energy issues. With the right emphasis on renewable fuels and alternative energy, we can turn the corner toward energy independence for our country."
Yeah. Right. Now, follow the money. As you read, recall that the $32 billion cost to do the above would be fully offset by changes to tax laws affecting Big Oil (including gas companies).
The senators that voted against the tax bill received an average of $161,000 in contributions from the oil and gas industry. The majority of senators that voted for the tax plan got an average of only $57,000.
As such, the tax package fell two votes short of the majority it needed to overcome a filibuster. Elizabeth Dole, Mary Landrieu, Pete Domenici, Lindsay Graham, and John Sununu, all senators likely to run very close races in next year's election, voted against letting the measure go to vote.
Sadly, in this first part of the 21st century, Texas oil money still talks in America. Just
ask ex-press secretary Scott McClellan’s father.
