The FINANCIAL -- The U.S. Chamber of Commerce raised alarm over legislation introduced by Senator Harry Reid to repeal tax incentives for oil exploration, impose a 25% windfall tax on oil companies, and allow consumers to sue nations that supply oil to the U.S.
"Higher taxes and more lawsuits won't lower the price of gas at the pump or make America more energy secure. If this legislation is enacted, Americans must be prepared for potential oil supply disruptions and higher prices for gasoline, home heating oil and natural gas," said Bill Kovacs, vice president of Environment, Technology and Regulatory Affairs at the U.S. Chamber of Commerce. "It is time for honest discussion with the American people about the impact of these proposals at the gas pump and on their pocketbooks."
America enacted a crude oil windfall profits tax in the 1980s. According to the Congressional Research Service, from 1980 to 1988 the tax reduced domestic oil production by as much as 8% and dependence on imported oil grew from 3 percent to 13 percent, and the tax did not ease oil prices in any material way. If our true goal is less pain at the pump, a windfall profit tax is hardly the direction America should be taking at this time.
"This proposal is a patchwork of failed policies of the past. As currently drafted, this legislation would undermine our nation's competitiveness, drive away good American jobs and subject US companies to punitive action abroad," said Karen Harbert, Executive Vice President of the Chamber's Institute for 21st Century Energy. "If Congress wants to get serious about addressing high energy prices and our overdependence on foreign oil, it should embrace a comprehensive plan to produce more domestic energy from traditional and renewable sources and promote a more resilient and efficient energy infrastructure."
The United States has 39.5 billion barrels of proved oil reserves (plus recently-discovered potential reserves of 175 to 500 billion barrels of oil shale in the Bakken oil formation) and 244 trillion cubic feet of natural gas that have been put off limits to U.S. energy companies. The United States has not built a new nuclear plant in over 30 years, and our demand for energy will increase by 30 percent over the next 20 years.
"This nation has massive supplies of energy, but the federal government has restricted the ability of the private sector to produce that energy from reserves from our oceans to our heartlands. We now have the technology to produce this energy more cleanly than ever before. How high does the price of oil have to go before we admit that limiting access to this energy is a mistake?" added Kovacs.
The U.S. Chamber is the world's largest business federation, representing more than 3 million businesses and organizations of every size, sector, and region.
Related Stories
