End oil & gas subsidies to stop corporate welfare

Lisa McCormick supports proposed legislation that would eliminate nearly a dozen of the most egregious tax breaks enjoyed by the oil and gas industry.

The progressive New Jersey Democrat said legislation was introduced by U.S. Reps. Earl Blumenauer (D-OR), a senior member of the House Ways and Means Committee, Sean Casten (D-IL), Donald McEachin (D-VA), and Katie Porter (D-CA) to achieve that goal and she would be co-sponsoring the measure with them if voters had sent her to represent New Jersey.

The oil and gas sectors are among the world’s most profitable industries, with billions of dollars in earnings each year.

Despite their financial success, these fossil fuel companies receive billions in tax breaks and subsidies annually, undermining the nation’s ability to invest in renewable energy sources and damaging our environment.

Lisa McCormick is leading the Column C Democrats United for Progress team in the June 4 2016 primary election in Union County.
Lisa McCormick is one of New Jersey’s leading progressives.

“Conservative estimates put America’s direct subsidies to the fossil fuel industry at roughly $20 billion per year; with 20 percent currently allocated to coal and 80 percent to natural gas and crude oil. European Union subsidies add another $65 billion to that figure each year,” said McCormick. “The cost of adverse environmental, climate, and public health impacts from burning fossil fuel was $5.3 trillion globally in 2015 alone, so our governments are making a terrible investment.”

The End Oil and Gas Tax Subsidies Act would eliminate 11 provisions in the tax code that unfairly benefit oil and gas companies.

“Not only would this legislation ensure the United States is no longer providing tax subsidies to oil and gas at the expense of clean energy, but it would also increase the competitiveness of the energy industry,” said McCormick.

“Oil and gas are the last industries that should be getting a tax break. In fact, it’s the planet that needs a break from the very companies that have contributed so much to the climate emergency,” said Blumenauer, the Oregon congressman who wrote the legislation.

“It’s unconscionable that we continue to spend billions in tax subsidies to line the pockets of big oil and gas companies and incentivize the extraction of fossil fuels,” said Blumenauer. “We should be investing in clean energy technologies and jobs that will put Americans to work and fight the climate crisis.”

The United States emitted more than 6.5 billion tons of greenhouse gases in 2019.

“The burning of fossil fuels, particularly in the power and transportation sectors, produces three-quarters of total U.S. carbon emissions, which trap heat in the atmosphere and lead to climate change,” said McCormick.

Moving away from oil and gas is a critical step to address the climate crisis.

“Forcing taxpayers to subsidize a failing industry that’s massively distorting energy markets and accounting for nearly 1 in 5 global deaths in 2018 alone isn’t just bad policy, it’s antithetical to free-market capitalism,” Casten said. “When Adam Smith wrote about the power of market capitalism’s ‘invisible hand’ to adequately ensure a fair and efficient exchange of goods and services, he probably didn’t envision the U.S. government subsidizing a sector that’s seen prices decline by 72 percent in the last decade.”

“With fossil fuels continuing to receive $650 billion a year in direct and indirect U.S. subsidies, Smith’s invisible hand functions as a marionette puppet’s pulled by the strings of big oil and gas at the expense of American taxpayers,” Casten said. “Our bill to end fossil fuel subsidies will unrig our energy markets, lower emissions, and protect public health.”

“For too long, dirty energy companies have enjoyed billions of dollars in federal tax breaks and subsidies each year – a direct attack on our nation’s health and ability to combat climate change. Instead of incentivizing the continued extraction of fossil fuels, we must end these subsidies and advance legislation, like the End Oil and Gas Tax Subsidies Act, to stop the federal government from rewarding dirty polluters,” McEachin said. “By prioritizing federal assistance away from fossil fuels and toward the continued growth and expansion of clean renewable energies, we can protect public health and our environment, and continue to bolster the green jobs and infrastructure America needs to power a better, more sustainable future.”

“It is anti-capitalist to give special tax breaks to oil and gas companies that other businesses don’t get—it restricts the competition we need for healthy capitalism,” Porter said. “Giveaways to Big Oil are bad for our economy, bad for our planet, and bad for American taxpayers, who pay their fair shares while polluters get a discount. I’m proud to help reintroduce the End Oil and Gas Tax Subsidies Act to bring a little more fairness to our tax code.”

The legislation is supported by Earthjustice, Earthworks, Food & Water Watch, Friends of the Earth, Oxfam America, and the Sierra Club.

“For far too long, the oil and gas industry has benefited by not paying its fair share. This legislation would eliminate nearly a dozen of the most egregious tax breaks from which the oil and gas industry disproportionately benefits. Lining the pockets of industry executives who are driving the climate crisis is unacceptable. Instead, we must build a sustainable future – not by investing in fossil fuels – but by protecting our environment and communities,” said Patrick Grenter, Associate Director at the Sierra Club.

McCormick believes in prioritizing strong science-based environmental protections that deliver on the promise of clean air, clean water, and safe drinking water for all communities across the nation.

She has railed against corporate welfare, particularly that which encourages harmful economic pursuits, such as causing climate change.

Full text of the legislation is available here.

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