House jacks up fuel prices

Hoping to scoop out some of those profits that oil companies have been reaping lately, the House passed what they named the “Renewable Energy and Energy Conservation Tax Act of 2008”. The stated purpose was not to give consumers and US taxpayers some relief from high fuel prices. Let Steny Hoyer explain (Reuters/Yahoo link);

“We simply must begin to break our addiction to fossil fuels, particularly our addiction to foreign sources of oil,” said Rep. Steny Hoyer of Maryland, the House Democratic majority leader.

“We”? Got a mouse in your pocket, Steny? Better yet; got an alternative fuel in your pocket, Steny?

House Democrats said oil companies that have earned record profits off $100-a-barrel oil did not need the tax breaks, and the money could be better used to promote alternative energy supplies for the future.

First of all, how is drawing more taxes off from oil profits going to “promote alternative energies for the future”? That always gets me – the solution is always give money to the government, not give money to people who’ll actually do something worthwhile.

All that happens when government jacks up taxes on oil companies, oil companies pass the burden on to consumers. Oil profits won’t suffer, just the poor working folks who have to fill their fuel tanks up everyday to schlep off to work will suffer. But try and explain that to Congress.

But guess who doesn’t get hit with the higher taxes – Hugo Chavez. From CQ Politics (h/t Michele Malkin) ;

The tax package (HR 5351), which passed 236-182, repeals subsidies for five major oil and gas companies to offset $13.7 billion of the $18.1 billion in renewable-energy tax breaks contained in the bill.

Meanwhile, Citgo Petroleum Corp. would continue to receive a 6 percent deduction for domestic manufacturing that the largest firms would lose.

Citgo, which refines oil and markets and transports gasoline in the United States, is owned by a subsidiary of the government-owned Petróleos de Venezuela, S.A., or PDVSA. Because Citgo does not drill for oil and gas domestically or abroad, it does not fall under the bill’s definition of companies that will lose a major tax break.

The five big companies targeted by the bill — Chevron, BP, ExxonMobil, Shell and ConocoPhillips — all produce and refine oil and sell gasoline in the United States, and therefore under the bill would lose the domestic manufacturing deduction they received as part of a corporate tax law in 2004 (PL 108-357).

Now how do we get independence from foreign oil producers by giving them a tax break and more heavily taxing our domestic producers? Huh? Can one of you rocket scientists on the Left explain that to me?

Back to the Reuters story;

Under the bill, energy companies would no longer be able to exclude a certain portion of their oil and gas production income from U.S. taxes and would also have to pay U.S. taxes on some foreign income that also was taxed in the country where it was earned.

Makes tons of sense doesn’t it? Don’t allow domestic exploration for fuels, and tax domestic producers – sometimes double taxation.

Right now, the Bush Administration has threatened to veto this garbage, but just wait until Democrats have both ends of Pennsylvania Avenue again. We’ll all be riding bicycles in no time – well, we’ll have no jobs to get to, so we might as well ride bikes around.

Category: Economy, Hugo Chavez, Politics