Posted by Matt Dempsey Matt_Dempsey@epw.senate.gov
Inhofe Floor Speech on Democrats' Oil and Gas Tax Increase Bill
"Democrats Have No Answer to Higher Gas Prices"
Mr. INHOFE. Madam President, we are going to be voting on a bill this afternoon to dramatically increase taxes on America's oil and gas companies. I only suggest that it is not going to pass. I can recall when the Senator from Vermont, just a few months ago, had a bill that would have done essentially the same thing--pass tax increases on these oil and gas companies. I remember coming to the floor at that time and giving my argument against it. It ended up that we voted on it, and we had 61 votes against it, so it worked out that about 30 were for it.
Afterward--and I have to say this about Senator Sanders--Senator Sanders said that was probably one of the healthiest and honest debates he had seen during the years he has been in the Senate. I agreed with that. The idea that we can somehow tax these people and accomplish something--let me just say that the Congressional Research Service--and when I talk about
CRS, it is nonpartisan and nobody argues with them.
We in the United States have the largest recoverable reserves of oil, gas, and coal of any country in the world. There is no reason we cannot be completely independent of the Middle East. All we have to do is explore our own resources--oil, gas, and coal.
This same Congressional Research Service has looked at the issues and told us that raising taxes on energy companies will do two things--decrease supply and increase our dependence on foreign countries. In other words, this vote we are going to have this afternoon, if it were successful, would decrease the supply and increase our dependence upon the Middle East.
In addition to the CRS, let's go back to the 1970s, under the Carter administration, when we had the windfall profits tax. The same exact thing happened. It decreased supply and increased our dependence on foreign competition. The interesting point is--and my wife is not the only one complaining about the price of gas, but she is certainly loud and clear in that position--nobody is saying that by increasing the taxes, with the vote we are going to have on oil and gas companies this afternoon, somehow that will have the effect of lowering prices at the pump. It will raise them. In fact, I think several Members have come down--Senator Menendez, the sponsor of the legislation, said:
Nobody has made the claim that this bill is about reducing gas prices.
If it is not about reducing gas prices, then what is it for? The answer to that is, they say--as the Senator from Connecticut just stated, this is going to be something that is going to be reducing the deficit. Our problem is, President Obama and his Democratic support in the House and Senate--in the first 2 years, they had a large majority in the House and the Senate--in his 3 years of the budget, they have increased the deficit and budget by over $5 trillion. I can remember coming to the floor of the Senate during the Clinton years, in 1995, saying this is outrageous. This was a $1.5 trillion budget. That was to run the entire United States. This last budget by President Obama was an increase of $1.65 trillion--just the deficit. Let's do our math. That is 365 days a year, and it works out to be $4 billion a day.
We have a President and his majority giving us a $4 billion-a-day deficit, and this says it is going to cut the deficit by $2 billion. So we can tax all these oil companies to come up with enough money to reduce the deficit just by $2 billion. That is worth one-half day's deficit of this administration. I know the majority of people understand that, and they will not be duped into doing that.
By the way, I have to say that fortifying me was this morning's editorial in USA Today. They talk about how ludicrous this idea is that we can increase taxes on oil and gas companies. They say it is an example of the sort of political gamesmanship that substitutes for serious deficit reduction. It says:
But the initiative is also government at its arbitrary worst, further complicating the tax code by singling out five companies--ExxonMobil, Chevron, ConocoPhillips, Shell, and BP--for special taxes not paid by smaller energy concerns. .....
So we have a little class warfare going along with it. Only yesterday, the same USA Today was criticizing me in their editorial policy because I don't want to pass a cap and trade--a tax increase. The same paper that yesterday was critical of a position I have taken is now strongly in favor of the position I have taken in avoiding any additional taxes on the energy companies or anybody else.
The last thing I will say--because I will stay within my timeframe is that people say if we want to do something about the deficit--and that is what they are saying they are doing--this is one-half day's deficit if they pass these tax increases, which they will not--they say there are only two ways to handle the debt; one is to decrease spending and another is to increase taxes.
I suggest there is a third way. That way is to go after all these regulations we currently are operating under as a result of this administration. We are talking about cap-and-trade regulations, greenhouse gas regulations, boiler MACT regulations, ozone, which could create over 600 nonattainment areas, and the cost of that is $90 billion. If we add all the costs of all these different regulations--greenhouse gas, $300 billion to $400 billion; ozone, $60 billion to $90 billion; boiler MACT, $1 billion; and utility MACT, $184 billion--when we add that, it is $1 trillion. If we take the $1 trillion, that is 7 percent of the $14 trillion that we would say the GDP would amount to.
CRS says that for every 1 percent increase in economic activity or increase in GDP, that translates into revenue of $50 billion. This is 7 percent, so that would be $350 billion. If we want to go after the deficit, deficit spending, and the debt, go after the regulations too. But to think we can tax oil and gas companies and somehow come up with $2 billion to reduce the deficit, that is just one day's deficit under the Obama administration. This body is not going to pass that.
With that, I yield the floor.