Polls: strong support for ending oil subsidies. What America wants.

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>>> are subsidizing the most profitable industry. in our nbc/” wall street journal” poll 74% said it would end oil subsidies. our next guest is the author of the book “why we hate the oil company.” you are the former ceo of shell and you’re saying we should end the oil subsidies? that’s interesting, why?

>> in a high oil price environment, the actual subsidies are so small, they’re have very incidental to the business the size of the one i was formerly with and other major oil companies basically testified the same thing. but that’s when the oil price is high. when the oil price is low, subsidies make a big difference, because it may keep people drilling who would otherwise stop drilling but i also distinguish that smaller oil companies are different. so making a right decision is not putting all the oil companies you should the same paint brub, there has to be some distinctions made.

>> when oil is at $100, does it make sense to literally give the most profitable companies in the world an incentive to drill for oil? i mean, doesn’t that sound crazy? shouldn’t we craft a law at the bare minimum that says all right, if it’s low prices then we give yo a subsidy, if it’s high prices, no way.

>> i think there should be that kind of a bargain. but here’s an even more bargain. because i believe we need more oil produced domestically, so we don’t suffer the volatility we do, how about a discussion of raising the royalty rates in return for more drilling. that’s a discussion that i think would be great for the government and the american people. the oil companies wouldn’t mind because they would have more production. that would be a solution to the kind of problem we have right now.

>> all right, another thing is — why are we giving them a subsidy at all. if you can make money drilling oil, have at it, hoss. it’s a free market.

>> just about a decade ago, oil was $10 a barrel and we were shutting down the rigs in the gulf of mexico because nobody would drill. the clinton administration is the one who put the insentives in place.

>> they did it wrong, absolutely. thank you for your time. really appreciate it. appreciate your

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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