This material was published by the Center for American Progress.
By Daniel J. Weiss, Valeri Vasquez
View Big Oil's cash assets and profits (.xls)
On September 19 President Barack Obama announced his plan to reduce the deficit by $4 trillion over the next 12 years, including raising $1.5 trillion by closing special interest loopholes and other revenue raisers. This includes eliminating $41 billion in tax loopholes for the oil and gas industry (p. 63) over the next decade.
Big Oil is predictably opposed to losing its unnecessary tax breaks. The American Petroleum Institute, or API, the oil industry’s lobbying muscle, quickly claimed that “the Administration plan would hurt jobs and investment.”
But this claim ignores the fact that the big five oil companies—BP, Chevron, ConocoPhilips, ExxonMobil, and Shell—have ample financial resources that dwarf the value of these tax breaks. These companies enjoy billions in cash reserves, made nearly $1 trillion in profits over the past decade, and at least one company (ExxonMobil) pays a lower effective tax rate than the average American family.
In other words, Big Oil can readily afford to contribute its “fair share” to reduce America’s debt.
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