Fighting oil’s billions in breaks. Fueling their profits

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>>> today, it was another simple but dramatic test for all those on the right who brag about cutting spending. this time it was a giveaway to the nation’s oil giants worth billions of dollars. congressman ed markey and ore house democrats put forward an amendment today. it would close a loophole in the law that allows oil companies to drill in the gulf of mexico without paying any royalties. the loophole would cost taxpayers about $53 billion over 25 years. i want to pause here to explain something to you guys. all the stuff about bildrill, baby, drill. okay, then we get the oil herement. we don’t get the oil here. we don’t get royalties? the gulf of mexico. $53 million, gone. some of that is going to bp, a foreign oil company. markey introduced a bill to end tax breaks. that’s worth over $40 billion of five years. by the way, that’s separate. that’s outside of the $53 billion, okay? all going to the companies that are the most profitable in the world. take that $40 billion, plus the money saved over the next five years, put those two together, just over the five-year period, and you would put about $51 billion back into the pockets of taxpayers. $51 billion. you might say oh, but the poor oil companies, they need the money, too. really? let’s find out. you know what the profits were for exxonmobil in 2009? $19.3 billion. it looks looic they’re doing pretty fine without us. chevron, $10.5 billion, conoco phillips, $4.9 billion. that’s not revenue. that’s profit! okay? now, how about them giving back to us. are they giving us any taxes? exxon mobile in 2009 got back $156 million from the u.s. government. they paid nothing. they got $156 million back. chevron got $19 million back. but you think well, okay, 245 must have been their tax — no. to other country, exxon paid $15.2 billion in taxes and chevron paid $7.8 billion. you know that means? yeah, they pay taxes. they just don’t pay it to us. they don’t give us the royalties, they don’t give us the taxes. the whole thing is outrageous. whether you’re a conservative or a liberal, it shouldn’t matter. why would you want our money going to the most profitable companies in the world? it’s basically a bailout for big oil. it makes no sense. now luckily, there’s some people in congress fighting back on this. with me now is democratic congressman ed markey of massachusetts. great pleasure to have you on. seems like a lovely bill you put together. soo so i — you know, some people have to be incredulous about this. are you saying if we’re drilling in the gulf of mexico, the united states taxpayer — drill, baby, bill, baby, drill, we get zero dollars for that?

>> that’s right. because of a glitch in leases put out thereto in the late 1990s, bp and other huge multinational oil companies are drilling for free. they don’t pay the american people anything to drill in public waters for the oil, which is owned by the american people. so what my amendment will do is to remove that loophole because, oil companies who are making $100 a barrel don’t need tax breaks or loopholes to make sure they make the $100 billion a year, which they made last year, and the $1 trillion which they made over the last ten years.

>> we have republicans telling me every day, hey, we have to drill over here so we can have the oil. but you’re saying we’re not getting a dime for that oil. and bp is a foreign company, and then — okay, do i have this right? bp can then sell it to anyone in the world, the oil they got from our gulf of mexico and they don’t have to sell it back to the u.s. at cheap prices or anything like that. is that right.

>> there’s no requirement at all. all they have to do is drill for the oil, sell it, make a profit and they don’t have to give anything back to the american people at all. we’re making cuts to the american broadcasting system, but the republicans don’t have to put out any cuts to the oil. we have to reduce the size of the federal deficit, but we have to be smart about it. who doesn’t need a subsidy? you don’t have to subsidize oil companies to drill for oil any more than you would have to subsidize a bird to fly or a fish to swim. they’re already making so many profits that they don’t need an extra $50 billion from the american tax payer.

>> so i want the viewers to understand, the next time you hear drill, baby, drill, or anything about drilling in the u.s., we don’t get any of it. we don’t get any of it, right?

>> well, for certain leases, y e. yes that are out in the gulf of mexico. it’s about $50 billion that the tax pair will not get back. and there are another set of tax breaks that give the industry $43 billion in breaks that are 100 years old at their oldest, and at $100 a barrel, why are we providing tax breaks for the oil industry when people are being tipped upside down at the gas pump, having money shaken out of their pockets to give to the oil companies for their profits right now.

>> congressman markey, here’s the last point. this has got to be the easiest bill in the world to pass. give me names, name names. who’s holding this up?

>> i’m telling you what, we will have the vote sometime in the next 24 hour, and then i will have the list of names and you will know who believes the oil industry, while they’re reporting record profits still believe that they need american taxpayers money as they’re cutting the programs for the poorest people in our society. free lunches for the oil industry they say? okay. free lunch for grandma. uh-uh. that’s an extravagance the federal government cannot afford. we’re going to have a vote on that in the next 24 mourps.

>> — hours.

>> i’m going to be very curious which of the so-called conservatives are going to vote for bailouts for the oil

About William Brighenti

William Brighenti is a Certified Public Accountant, Certified QuickBooks ProAdvisor, and Certified Business Valuation Analyst. Bill began his career in public accounting in 1979. Since then he has worked at various public accounting firms throughout Connecticut. Bill received a Master of Science in Professional Accounting degree from the University of Hartford, after attending the University of Connecticut and Central Connecticut State University for his Bachelor of Arts and Master of Arts degrees. He subsequently attended Purdue University for doctoral studies in Accounting and Quantitative Methods in Business. Bill has instructed graduate and undergraduate courses in Accounting, Auditing, and other subjects at the University of Hartford, Central Connecticut State University, Hartford State Technical College, and Purdue University. He also taught GMAT and CPA Exam Review Classes at the Stanley H. Kaplan Educational Center and at Person-Wolinsky, and is certified to teach trade-related subjects at Connecticut Vocational Technical Schools. His articles on tax and accounting have been published in several professional journals throughout the country as well as on several accounting websites. William was born and raised in New Britain, Connecticut, and served on the City's Board of Finance and Taxation as well as its City Plan Commission. In addition to the blog, Accounting and Taxes Simplified, Bill writes a blog, "The Barefoot Accountant", for the Accounting Web, a Sift Media publication.
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