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Oil And Gas Subsidies

Sen. Harry Reid

legislator photo

Mr. President, the Senate yesterday took the first step toward repealing wasteful taxpayer subsidies to oil and gas companies. I was pleased my Republican colleagues joined Senate Democrats to move this debate forward.

The country deserves to hear the truth about double dipping--double dipping--by oil companies. They take taxpayer money with one hand and raise gas prices with the other hand. There has never been a more perfect illustration of this than what has happened recently. The country deserves to hear the truth about these oil companies.

But do not be fooled by last night's bipartisan vote. Senate Republicans would never, ever side with American taxpayers against Big Oil. It is against their nature. It is against their political philosophy, as indicated by the numerous votes they have taken against this. They proved it yesterday with rhetoric. They proved exactly what I have said. They proved it last year with nearly a party-line vote against legislation to hold back handouts to oil companies that were making record profits then.

The records have been broken. There is a handful of those oil companies--one handful--that last year made $137 billion.

Despite this rhetoric of the Republicans, Americans understand it will take more than a bumper-sticker slogan to stop the pain at the pump. We have to reduce the Nation's reliance on foreign oil. But we cannot drill our way to energy independence. We are doing better. We have done so well during the Obama years. Every year he has been President, production has gone up and the use of oil has gone down.

We must continue looking for responsible new domestic oil sources. But we must also invest in the clean energy technologies of tomorrow to create good jobs for today.

Repealing almost $24 billion in wasteful subsidies to oil companies would pay for these clean energy investments--with money left over to do something about the deficit.

America has less than 2 percent of the oil reserves in the world but consumes more than 20 percent of the world's oil supply each year. So drilling on American soil alone will not solve our reliance on foreign oil.

Last year America used a lower percentage of foreign oil than at any time in almost two decades, thanks to President Obama's policies. Domestic oil production, I repeat, has increased every year during the Obama administration. Meanwhile, American dependence on foreign oil has decreased each year. Yet prices at the pump have continued to rise.

Here is why. For every penny the price at the pump goes up, the major oil companies--there are five of them--make an additional $200 million in profits each quarter. So let's say that again. For every penny you pay extra at the gas pump, these five oil companies make $200 million.

Well, it does not take a lot of math to understand that gas prices have risen 62 cents this year, so take $200 million times 62 and you have a huge amount of billions of dollars. Every time a penny is added to your purchase of a gallon of gas, oil companies make $200 million. So--62 cents--they have made billions this year.

Last year they raked in $137 billion in profits, and they are on pace for another record-breaking year of astronomical profits. So it is beyond ridiculous when Republicans argue oil companies need billions in taxpayer subsidies each year.

Middle-class families are struggling. Oil companies that last year raked in $261,000 a minute, 24 hours a day, 365 days of the year, are not struggling.

Mr. President, listen to this again. Oil companies last year raked in $261,000 a minute, 24 hours a day, no weekends off, no holidays. They did it 365 days of the year. They are not struggling at all and that, of course, is a gross understatement. That is why this matter is now before the Senate.