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originally posted by: grey580
a reply to: loam
money.cnn.com...
When it comes to oil production. The USA is right behind Saudi Arabia.
Why do we need to buy oil from them?
originally posted by: Skywatcher2011
originally posted by: grey580
a reply to: loam
money.cnn.com...
When it comes to oil production. The USA is right behind Saudi Arabia.
Why do we need to buy oil from them?
Watch for US relations with Canada increase for oil production.
originally posted by: Aazadan
originally posted by: yuppa
US based companies can be held for treason if they go against their countries interest. And..freezing their bank accounts works wonders to get them to see it your way. You make their lives hell they will not be so powerful. Its not like we cant claim imminent domain on their rigs and refineries and nationalize it.
So you want to nationalize the oil companies?
originally posted by: yuppa
originally posted by: Aazadan
originally posted by: yuppa
US based companies can be held for treason if they go against their countries interest. And..freezing their bank accounts works wonders to get them to see it your way. You make their lives hell they will not be so powerful. Its not like we cant claim imminent domain on their rigs and refineries and nationalize it.
So you want to nationalize the oil companies?
As a last resort if they refuse to comply.
Over the past century, the federal government has pumped more than $470 billion into the oil and gas industry in the form of generous, never-expiring tax breaks. Once intended to jump-start struggling domestic drillers, these incentives have become a tidy bonus for some of the world's most profitable companies.
Taxpayers currently subsidize the oil industry by as much as $4.8 billion a year, with about half of that going to the big five oil companies—ExxonMobil, Shell, Chevron, BP, and ConocoPhillips—which get an average tax break of $3.34 on every barrel of domestic crude they produce. With Washington looking under the couch cushions for sources of new revenue, oil prices topping $100 a barrel, and the world feeling the heat from its dependence on fossil fuels, there's been a renewed push to close these decades-old loopholes. But history suggests that Big Oil won't let go of its perks without a brawl.
There Will Be Subsidies
How the oil companies hit a gusher of tax breaks
Writing Off Drilling Expenses: A century ago, drilling for oil was risky business. Start-up costs were high, and prospectors couldn't be sure they'd find crude. To encourage the nascent industry, in 1916 Congress approved the expensing of "intangible drilling costs"—pretty much any equipment used or work done—in the first year of a well's life. Today, prospectors rarely hit dry holes, but the century-old tax break remains a gusher. Oil companies can expense 70 percent of their drilling costs and depreciate the rest. Annual cost to taxpayers: $700 million to $3.5 billion
The Depletion Allowance: When you sunk a well 90 years ago, you didn't know how much it would yield or for how long. That was the idea when oil producers argued that the tax code should account for the "depletion" of their reserves. In 1926, Congress introduced the "excess of percentage over cost depletion deferral," a.k.a. the depletion allowance. Since 1975, only small companies may claim it, but the price tag is still big. Under the allowance, an oil producer may deduct 15 percent (originally 27.5 percent) of any gross income from a well. And unlike normal depreciation, this deduction may be claimed indefinitely. Annual cost to taxpayers: $612 million to $1.1 billion
Timeline: A brief history of oil subsidies, 1916-2013
Domestic Manufacturing Deduction: In 2004, ostensibly to prevent jobs from being shipped overseas, Congress extended a tax break for stateside manufacturers to cover the oil industry. Never mind that most US oil jobs are nearly outsourcing-proof, since a well in Alaska or a refinery in Louisiana can't be sent to China. Annual cost to taxpayers: $574 million
originally posted by: Aazadan
originally posted by: yuppa
originally posted by: Aazadan
originally posted by: yuppa
US based companies can be held for treason if they go against their countries interest. And..freezing their bank accounts works wonders to get them to see it your way. You make their lives hell they will not be so powerful. Its not like we cant claim imminent domain on their rigs and refineries and nationalize it.
So you want to nationalize the oil companies?
As a last resort if they refuse to comply.
So if the government mandates that private industry build something, they should have the ability to nationalize the companies if they don't comply? That's going down a very steep slippery slope.
The normal way to do this without being authoritarian is to offer tax breaks for the companies to make the investments. The government doesn't want to subsidize the oil companies in that way though. So it's tough to say who is right.
Personally, I think we should subsidize them, pay for it with a tax increase, and make the company pay it off through a price break at the pump for x years on oil refined and sold domestically.
originally posted by: marg6043
www.motherjones.com...
The problem with the US is that we don't have enough refineries, due to the environmentalist complains.
originally posted by: luthier
a reply to: Aazadan
We do subsidize the process of refining by giving subsidies to oil and gas (up to 43 billion yearly)
So in Deer Park or other areas in East TX or LA companies like exxon who do own refineries get massive tax relief and grants.
Also refining isn't only related to gas and energy products. We have loads of companies getting government welfare that refine oil into synthetic products.
originally posted by: marg6043
a reply to: Aazadan
The problem with the US is that we don't have enough refineries, due to the environmentalist complains.
originally posted by: RedCairo
originally posted by: marg6043
www.motherjones.com...
The problem with the US is that we don't have enough refineries, due to the environmentalist complains.
See my note above on the CA moratorium of offshore drilling.
We'll end up with a lot more environmental damage, because instead of doing things gradually with oversight, the hysteria blocked it utterly, and then it will be kicked open utterly and happen fast.
Unfortunate, to say the least.
RC