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Friday, January 26, 2007

Democrats Vote to Increase American Dependence on Arab Oil

Hooray! Finally those nasty and obscenely profitable oil companies will get their just desserts. The Democrat-controlled House Of Representatives just recently voted to repeal tax breaks that were in place to encourage domestic oil exploration and drilling.

Wait a minute. Why would they repeal tax breaks that are designed to free us from foreign (mostly Arab) oil? Why, to encourage the use of Biofuels, of course. The same Biofuels that most experts now admit cost more energy to produce and transport than they contain – the same Biofuels that Brazil, formerly a leading user of fuel produced from sugar cane, just celebrated not having to use any more since they discovered their own oil reserves? Give me a break.

House votes to repeal oil tax breaks (Excerpt)
Friday, January 19, 2007
Sabrina Eaton
Plain Dealer Bureau

Washington -- Democrats in the House of Representatives voted Thursday to repeal roughly $14 billion in oil industry tax breaks and use that revenue to support renewable-energy research and alternative energy.

It was the last measure in a legislative package that Democrats pushed through in their first legislative hours to make good on campaign pledges they made in the 2006 election.

"This serves as a fitting end to our first 100 hours agenda," said Illinois Democratic Rep. Rahm Emanuel. Government "handouts to energy companies" at a time of record profits exemplified corruption that Democrats want to end, he said.

Foes of the bill said raising taxes on domestic oil companies will cost U.S. jobs and boost reliance on foreign oil. They argued it would increase energy costs and discourage investment in domestic energy production.

"If the problem is foreign oil, why increase taxes and make it harder to produce American oil and gas?" asked Alaska GOP Rep. Don Young, whose state gets 85 percent of its budget from oil production.

The bill was adopted, 264-163, with support of all Ohio's Democrats and opposition from all its Republicans
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Clinton Shills For Bad Energy Policy (Excerpt)
INVESTOR'S BUSINESS DAILY
Posted 10/27/2006

Clinton is hawking the idea that taxing offshore oil drilling companies, from 1% to 6% — a 600% hike for some — and then turning the spoils into a new government bureaucracy for ethanol development is the way to end California's dependence on imported oil.

"Imagine if we stop being dependent on foreign oil. Brazil did it. They made a simple switch to their cars. Switched to ethanol, grown from their own crops. And it's 33% cheaper than gas," Clinton said, neglecting one key detail: cars must use three times as much ethanol as gas.

"With Proposition 87, we can switch to cleaner fuels, wind and solar power," he says in a political ad, "and free ourselves from foreign oil. If Brazil can do it, so can California."

But as a matter of fact, that's not what Brazil did. It launched a crash program of offshore oil drilling in the late 1990s, working with a Manhattan Project-like determination to develop its own natural resources.

In 1997, Brazil opened its oil sector to foreign competition, encouraging companies like Royal Dutch Shell to explore and drill for oil in its offshore waters for the first time. It offered incentives — like tax cuts. It also turned its inefficient state oil company, Petrobras, into a for-profit company run like a real business instead of a government cash cow, forcing it to compete on an international-standard level. In short, it got out of the way
.


Net result, lots more oil for Brazil — enough to enable the once-oil-dependent country to actually export some, all from fewer energy reserves than the U.S.
Brazil's new P-50 rig has boosted output to an average 1.9 million barrels of oil a day, a bit more than the 1.85 million Brazil consumes.

By contrast, ethanol output in Brazil, the world's biggest producer, is only a small share of its energy consumption.

Last year, the country squeezed out just 282,000 barrels a day mostly using sugar, a more efficient and clean-burning energy source than the corn-based stuff produced in the U.S. But sugar-based ethanol still isn't as efficient as gasoline
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1 Comments:

At 9:29 AM, Anonymous steve said...

I'm not a democrat fan, but I don't really think that big oil needs more tax breaks.

Also, on the biofuels, sometimes initial costs ARE higher until the technology and process are refined. Initial support is not a bad thing if it can lead to any future breakthru on reducing dependance on crude.

 

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