The American Petroleum Institute is pulling out all the stops to protect over $100 billion in subsidies, tax breaks, and royalty "relief" for the oil and gas industry. The latest gambit is to link oil company profits with pensions for teachers and public employees. The message is textbook toxic stupidity: support our tax cuts or your pensions will suffer.
WASHINGTON — With several major oil companies poised to report big first-quarter profits this week, the oil industry's largest trade group on Monday rolled out a study revealing that those gains translate to big benefits for teachers, firefighters and other state pensioners.
In other words, what is good for the oil and gas industry is good for America. Another word for it is bullshit.
Here is the turd blossom bouquet from the American Petroleum Institute (API).
Kyle Isakower, the group's vice president of regulatory and economic policy, said API would "educate Americans about the study's findings" and will "provide this information to policymakers."
The message, Isakower said, is that "everyday Americans," including teachers at public schools, firefighters and state government workers, benefit from oil and gas industry profits - and stand to lose from federal policies that hurt the companies' bottom lines.
"As proposals are raised that would hurt the economic viability of the oil and gas industry in the United States, it is important for policymakers to understand who it is that gets hurt," Isakower said.
The fight over corporate welfare comes as the oil and gas industry is about to report record profits. Meanwhile, every government program that benefits the most vulnerable in our society has been slashed or targeted by so-called fiscal hawks. Austerity is good for the poor but not the rich.
The report neglects to mention how profits from fossil fuel corporations have been used. For example, enormous campaign contributions have been given to lawmakers that are pushing for draconian cuts in salaries and benefits for teachers and public employees. Oil, gas, and coal companies were the largest contributors to the election of Scott Walker in Wisconsin, John Kasich in Ohio, and Tom Corbett in Pennsylvania. In fact, money from fossil fuel corporations powers the US Chamber of Commerce, American Legislative Exchange Council, and libertarian "think tank" chainsaw aimed at cutting public sector jobs in favor of privatization. It is funny how the "free market" requires generous taxpayer support for the most profitable corporations in history while budgets must be balanced on the backs of public employees.
And let's not forget the other glaring deception in the American Petroleum Institute report. Less than 4% of public sector pension funds that formed the basis for the report were invested in the oil and gas sector.
According to the report commissioned by the American Petroleum Institute, oil and gas stocks were less than 4 percent of the holdings in public pension funds in Michigan, Missouri, Ohio and Pennsylvania, but generated 8.6 percent of the funds' returns from 2005 to 2008.
The pension funds are not going to go bust from any trimming of oil and gas profits by eliminating subsidies, tax breaks, and royalty loopholes for the industry. Given how those profits are being used, it might be wise for public sector pension funds to divest themselves of fossil foolishness.
The Obama administration has framed the issue quite well:
“I think most Americans would agree with the president that it is simply crazy and unsustainable to continue to subsidize the oil-and-gas companies when we need to reduce our deficit and invest elsewhere."
Those crazy and unsustainable subsidies do not include the equally crazy and unsustainable offshore asset shell-game that allowed Exxon to pay nothing in taxes to Uncle Sam last year.
In other news, the persistent drought gripping Texas from what appears to be a changing climate created power outages in all the big Texas City refineries yesterday, forcing the closure of public schools and government services. Perfect timing. I am sure the American Petroleum Institute has been as strong a supporter of climate change legislation as they have been of public sector employees.