A dangerous addiction
Published: Wednesday, January 17, 2007 at 6:01 a.m.
Last Modified: Tuesday, January 16, 2007 at 11:18 p.m.
Gas prices are falling because it's been a warm winter. The cheaper gas becomes the more of it we'll buy and the more we'll drive and the more oil-derived greenhouse gasses we'll pour into the atmosphere...thereby helping to insure that next winter will also be a warm one.
For all practical purposes, domestic energy policy is designed to keep gasoline cheap and plentiful by encouraging oil companies to drill for more natural gas and oil in the Gulf of Mexico and other publicly owned offshore areas. To accomplish this, the federal government offers oil and gas companies billions of dollars in royalty relief and tax breaks, on the theory that companies won't voluntarily develop new sources of oil and gas unless the taxpayers make drilling as cheap and profitable as possible.
These lucrative incentives go to some of the most profitable companies in the world. The U.S. oil industry posted $207 billion in net profits over the last two years. That bottom line is being fattened considerably by an estimated $20 billion worth of royalty relief and tax breaks.
Beyond the question of whether it's proper for the taxpayers to reward companies for doing what they ought to be doing as a matter of corporate self-interest — developing adequate reserves to supply the market — there is the more troubling aspect of our current domestic energy policy.
These tax breaks and royalty exemptions are intended to keep oil cheap and plentiful. The connection between global warming and fossil fuel burning is absolutely clear. To the extent that oil and gas remain cheap, greenhouse gas emissions will continue to increase and global warming will continue to worsen. Cheap oil also discourages private sector investments in alternative energy research and development.
This week, the U.S. House will consider legislation to reduce or eliminate tax breaks and royalty relief grants for companies that drill on public lands. The billions of dollars that now reward already profitable oil and gas companies would instead be directed into research and development of renewable, non-polluting energy sources and into energy conservation programs. In other words, the money would help lessen America's dependence on fossil fuels, not deepen that dependence.
"Climate security and national security are inextricably linked," says Jerry Karnas, spokesman for the National Wildlife Federation, one of the groups supporting the tax and royalty rollback legislation. "Forty percent of the nation's global warming pollution derives from the use of oil."
It is not possible to "cure" America's dangerous addiction to foreign oil simply by producing more domestic oil. The addiction itself must be addressed through major investments in conservation and alternative fuels development.
Cheap gas is poisoning the earth's atmosphere and causing drastic and dangerous climate changes. Congress must fashion a more rational and environmentally sound energy policy, one that doesn't reward the world's most profitable companies for continuing to feed our dangerous addiction.
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