Repeal Big Oil Subsidies

With gas over $4 per gallon and big oil companies raking in record profits, why are politicians pitching complicated ideas like a windfall profits tax? Wouldn’t it be easier to just repeal the billions of dollars in oil subsidies?

I’m not very up on any of this which is why I’m asking the question. But it just seems silly to me that American consumers are whining about paying $4.09 per gallon at the pump, politicians are wringing their hands about gas prices and coming up with silly ideas like a gas tax holiday—yet all the while we’re shoveling billions of dollars worth of subsidies directly into the pockets of oil companies.

One thought on “Repeal Big Oil Subsidies”

  1. I’ve also wondered about why they don’t repeal the oil subsidies rather than introducing a new tax. This is just an amateurish guess as to why (nothing to back it up other than my modestly informed understanding of how government works).

    Chances are, the subsidies were part of bills that have already been passed and won’t be up again for a while. The operating budget is approved every year, but that will happen to late for the election cycle. Or perhaps it is part of one of the less-often bills, like the farm subsidy bill which only comes up every five years. Basically, you have to wait it out. So that’s one possible reason.

    Here’s another. If you introduce a special tax, it’s easier to specify how that money will be spent. So for instance, the windfall tax could go toward improving highways or subsidizing public transportation or giving free lunches to seniors. It’s much harder to include that sort of earmarking when the oil company subsidy is an amendment to an amendment to a barely related bill. By doing it this way, you can say, we took that money from the big evil corporations and put it to *this* use.

    I do wonder (politically) why Obama is pushing a new tax, since it can revive old stereotypes of tax-and-spend Democrats – an immensely inaccurate label, but a persistent one.

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