Big Oil lobbies the Congressional Deficit Supercommittee

 

When the US debt ceiling debacle of the summer spawned a 12-person bipartisan Congressional Supercommittee tasked with coming up with a plan to reduce the nation’s debt, industry lobbyists got busy.

Lobbyists for the defense and health industries are particularly active, as the industries they represent have the most to lose, because the way it stands, if Congress is unsuccessful in passing a debt bill before Dec. 23rd (the agreed-to deadline), the default position is that Congress would make across-the-board cuts targeting Medicare and Pentagon spending.

However, the oil lobby, which sees its industry’s tax breaks on the chopping block, is also very active.

In the last few weeks (if my Twitter account is anything to go by) the public relations shops at major oil and gas companies and at the industry’s chief lobbying body, the American Petroleum Institute (API), have been actively coordinating a massive public lobbying exercise, putting out a simple message or two. Don’t handcuff the oil and gas industry. Investing in the exploration and production of US oil and gas will drive the government’s revenue growth and employ thousands of people

The argument goes like this, if the industry is offering both economic growth and an immediate jobs plan, it would be counterproductive to take away the tax incentives that would encourage this expansion. The industry is not only looking to keep its tax breaks, but also to cut back on clean air and other environmental regulations that block or slow projects and add to costs.

A couple of weeks ago Chesapeake Energy’s CEO was talking about America getting its swagger back by ramping up natural gas production. 

TransCanada is promising that its proposed Keystone XL pipeline (which will bring crude oil from Alberta to the Gulf Coast) will create 100,000 jobs and generate $600 million in new local and state tax revenue.

Last week Chevron’s CEO told reporters he was urging the Deficit Supercommittee to expand domestic oil-and-gas-leasing in order to grow revenues.

Also last week, API touted a petroleum industry-commissioned report by consulting firm Wood Mackenzie which found that increasing energy development would add $127 billion to the US Treasury by 2020.

A full court press is on as the pressure on the Supercommittee to make hard decisions will only intensify as the deadline nears, and Big Oil will keep pushing to the end.

~

Photo by ThatMakesThree used under a Creative Commons license.



Stuart Hampton

British editorial veteran Stuart Hampton has been covering oil and gas companies for Hoover's since the Neogene-Quaternary period. Well, actually, since the early 1990s. For the best overview of the oil industry and its history he recommends Daniel Yergin's "The Prize." You can also follow Stuart on Twitter.

Read more articles by Stuart Hampton.

Leave a Comment

// Hero Image Wrap