April 20, 2005

Entitlement Programs

The many hidden entitlements in the federal tax code for big corporations are getting less hidden everyday. Ways and Means Committee Chairman Bill Thomas (R-CA) has pushed through tax breaks worth about $8 billion over 10 years that go straight to big energy companies. An underwhelming 6% of that total is aimed at encouraging development of renewable resources.

Now, even the President understands that doing this under the guise of offering incentives to the industry makes no sense. Last week, before an audience of newspaper editors, Bush had this to say:

I will tell you with $55 oil we don't need incentives to oil and gas companies to explore. There are plenty of incentives. What we need is to put a strategy in place that will help this country over time become less dependent.

Enough to make environmental activists tear up, right? We sure do need "a strategy in place that will help this country over time become less dependent" on crude oil. Sadly, the House Bill has nothing to do with that. Instead, the bill gives more tax breaks to companies, like ExxonMobil, that had record-setting boom years in 2004. In recent years, big business, and energy companies in particular, have seen their tax bills on the decline-- and this bill would only exacerbate this trend.

How does this all fit together? Well, next time a right-winger tells you that we can't afford Social Security and Medicare and that progressives don't have a plan to fix that, laugh them out of the room. Their boys on Capitol Hill are giving away the farm.

We've witnessed a deadly trend over the last five years: Deficits mount, funding for key programs reach the "crisis" point, and Republicans provide billion dollar kick-backs to the biggest corporations and richest citizens. For more details, see Jim Bunning's Social Security scheme and the House on the Estate Tax.

Update: Bill Thomas raised about $126,000 from people and PACs from the energy and natural resource extraction industry in the last election cycle. That amount is especially impressive when you consider that he wasn't facing an opponent.

Even in these uncertain times, big energy (ok, this isn't limited to just one industry) can count on Bill Thomas to provide solid returns on their investments.


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