War Vs. Big Oil Goes Beyond Drilling Ban

The White House, along with certain members of Congress, has declared war on Big Oil. This animosity is evidenced not only by the current ban on offshore drilling, which may well force the industry to relocate to other parts of the world, it is also reflected in the myriad of proposals to hike the industry's taxes and use the additional revenues to pursue the administration's green agenda. President Obama's 2011 budget would do away with $4 billion in accelerated depreciation, depletion allowances and other long-established incentives for oil and gas drilling. Sen. Robert Menendez, D-N.J., has introduced a bill that would remove another $20 billion of industry "tax breaks." According to the American Petroleum Institute, over the next decade tax hikes on the industry could exceed $80 billion. Without question, hiking the tax burden on America's oil and gas companies will mean less, not more, domestic energy production. And though the "enemy" is Big Oil, according to the Independent Petroleum Association these tax increases will fall disproportionately on small drilling companies and could potentially reduce domestic oil and gas production by 20% to 40%. In exchange for at best a small reduction in greenhouse gas emissions, thousands of jobs will be destroyed, billions of potential investment dollars will flow overseas, imports of fossil fuels will increase, energy prices will rise, and many states and localities that derive revenue from oil and natural gas production will witness further declines in their tax receipts...more