All around the world, the accusations have been flowing, that the U.S. war in Iraq is “all about oil.” One would think in this environment, Congress would want to show this isn’t so. Step one for doing that is proving it. That could start by promoting self-sufficiency at home by encouraging alternative sources of energy and less reliance on fossil fuels. Instead, the energy bill approved by the House last week, by a vote of 247 to 175, includes billions of dollars of subsidies for the oil and gas, utilities, nuclear, and other industries—all of which just happen to be generous campaign contributors.
The House energy bill provides $18.7 billion in tax breaks, according to analysis by the U.S. Public Interest Research Group (U.S. PIRG). Oil and gas companies alone receive 55 percent of the tax breaks in this bill, which amounts to a $10.3 billion windfall. The oil and gas industry contributed $24 million to federal candidates and parties in the 2002 elections alone, and more than $154 million since 1989, three-quarters of that to the GOP, according to the Center for Responsive Politics..
The details of the tax breaks can be mind numbing. The oil and gas companies, for example, would get to deduct many costs of exploration, and suspend some taxes on facilities that only produced marginal profits. Likewise, the utility industry, the source of $78.5 million in campaign funds since 1989 (62 percent to the GOP), would get a $2 billion tax break which would allow electric utilities a 15-year recovery period for some transmission properties. Nuclear plant owners, mostly owned by the same utilities, would get a $1.5 billion tax break by allowing utilities the same tax deduction given now to rate-regulated utilities in connection with nuclear decommissioning funds. While the details may be hard to follow, the intent is clear: to give special breaks to these industries, all of which are generous contributors.
Meanwhile, the sections of the bill on energy conservation fall far short. While there are some renewable energy incentives, in the form of a production tax credit, the provision actually excludes solar and geothermal energy sources and includes garbage incineration. Unfortunately, garbage incineration pollutes the air and causes public health concerns due to toxic emissions. Why would Congress choose to give taxpayers incentives to burn garbage rather than harness real clean energy sources? Maybe it's because the waste management industry has contributed nearly $14.5 million since 1989, with 59 percent to Republicans, the party in control of Congress.
In addition, the legislation does not do enough to promote energy savings for ordinary people. Consumers would see the difference in their checkbooks every month if their washing machines, dishwashers, and other appliances met tough efficiency standards. Unfortunately, the legislation does not include tough energy efficiency provisions. And late Thursday night, the House rejected an amendment by Rep. Sherwood Boehlert (R-NY) and Rep. Edward Markey (D-MA), to boost auto fuel economy by a vote of 268 to 162, which could have saved consumers money at the gas pump. Auto manufacturers are the source of $13.2 million to federal candidates and parties since 1989, 64 percent to Republicans.
In the Senate, where lawmakers have been working on their own version of the energy bill in committee last week, the situation isn’t any better. Already the committee rejected an attempt to eliminate large federal subsidies for new nuclear power plants.
It may seem bizarre that Washington should be pursuing a plan of reduced taxes, deep cuts in social services, and sundry other special interest provisions, during war-time. But it’s a perfect illustration of how big campaign contributors set the agenda in Washington, and how policy is skewed in their interest, even in a time of great national crisis.
If this makes you angry, go to www.howdarethey.org and tell your representatives in Congress and President George W. Bush that they should stop rewarding big campaign contributors and start passing legislation that helps working families. Most of all, tell them that you want them to change the campaign finance system so candidates aren’t dependent on wealthy contributors in the first place!
