Americansย want deficits cutย , and there is a new set of leaders in Congress who committed themselves last year to cutting wasteful government spending. And, while over 70 percent of Americans are unaware how much of their money is given in welfare checks to highly profitable dirty energy companies, when they find out,ย only 8 percent want it to stay that way.
After President Obamaโs State of the Union address calling for a modest cut of just $4 billion in welfare for oil companies, the focus on this insanely wasteful spending has intensified. Itโs the right proposal, but one that will encounter very stiff resistance for entrenched interests that still very much enjoy their century-long stay in the government incubator of tax breaks, subsidies, cheap access to public property, forgiveness for wrecking that property, and little meaningful oversight.
Ending their welfare queen status will take some very aggressive, strategic communicating โ and a lot of message discipline. For a good example of that, you need only look to the dirty energyย lobby.
Take the response to the Obama proposal by Big Oilโs top lobbying chieftain, ย Jack Gerard: โThe federal government by no stretch of the imagination subsidizes the oilย industry.โ
Clean energy advocates should look past the fact that people who actually count government largess to dirty energy would laugh at this Alice-in-Wonderland assertion. The thing to appreciate also is the tenacious message discipline it involves. Notice that Mr. Gerardโs fantastical assertion was followed in a few days by the pronouncement of the U.S. Chamber of Commerceโs โInstitute for 21st Century Energyโ President Karen Harbert.ย Her point?ย โSubsidies and tax advantages for renewable energy and fuels may need to phase out eventuallyย to level the playing fieldย for energy sources andย to curb spendingย [emphasis added],โ according toย Energy & Environment, an industryย newsletter.
โLetโs give the renewable industry some predictability, and let them have a certain defined period where they know there is going to be some support there, but it canโt go on for an undefined period of time. We can ill afford that,โ Harbertย added.
Itโs tempting to point to ask Ms. Harbert if โan undefined period of timeโ might be ohโฆ. Say, 100 years? But that would distract from the point here that is made so much better by another dirty energy welfare defender,ย Jack Coleman of Energy North America LLC.,
Before joining his pro-dirty energy โconsultingโ firm, we paid Mr. Colemanโs salary during his public โserviceโ ย as a General Counsel for the House Committee on Natural Resources, where he pushed to open up the Outer Continental Shelf to oil drilling, and to has us underwrite his current clientsโ dirty energy boondoggles, tar sands and oil shaleย projects.
Mr. Coleman displayed the same dirty energy messaging discipline we can expect when they are faced with growing demand they get off the dole. He was a guest onย earlier this week on the nationally syndicated Diane Rehm Show. Hisย points:
- Oil industry welfare is โstandard around the worldโ and โminiscule.โ If we eliminate them, it will be sort of unfair โpenalizingโ of the oil and gas industry vis-ร -vis otherย industries.
- The percentage depletion allowance for oil and gas is โnot a special subsidyโ for the oil and gasย industry.
- Then, the whopper: Oil company profits โpale in comparison to the taxes they pay.โย ExxonMobil just postedย profitsย of $9.25 billion in the final quarter of 2010, andย BP posted pre-taxย profitsย of $8.56ย billion.
- โHuge subsidiesโ go to renewables like solar andย wind.
Attempting to bring Mr. Coleman back into reality wereย Amy Harder of National Journalย magazine andย Kate Gordon, Vice President for Energy Policy at the Center for American Progress.ย Gordon responded to the wildest of Colemanโs distortions. Her points are worth cleantech advocatesย remembering:
- Some oil and gas subsidies have been in place for 100 years, from a completely different time in American history. Oil companies now make $80 for every barrel they produce from the Gulf of Mexico. These industries are mature, extremely profitable industry and donโt need taxpayerย help.
- The tax breaks for oil companies are not the same as for other industries. For instance, Gordon pointed out that oil and gas producers are allowed to take a larger deduction on each barrel drilled, meaning that the total deduction can exceed the amount of revenue the companies get from eachย barrel.
- The playing field is not level in the United States, but is tilted heavily โ in a wide variety of ways โ in favor of fossil fuels. Oil companies have business certainty in their welfare, while smart policies supporting renewables have to be renewed every fewย years.
- The largest oil companies made $1 trillion in profits in the last decade, they certainly didnโt pay $3 trillion in taxes. (Gordon was responding to Colemanโs assertion that Exxon Mobil made $11.68 billion in profits in one quarter, but paid $32.36 billion in taxesย โ 3 times the profits โ that sameย quarter).
- The United States is one of the only major world economies without a clean energy standard, and those other countries are โeating our lunchโ (including companies leaving the United States to go elsewhere). We have no national commitment to a transformation of our energyย system.
- Coleman isnโt taking into account the environmental costs to high-carbon fuels or that climate change is a crisis, while other countries increasingly are. We have unlimited renewables โ solar, wind, geothermal โ without blowing the tops off of mountains or fracking or drilling under the Gulf ofย Mexico.
- Thereโs also a human cost to fossil fuel reliance, which is one reason why the U.S. military is a leader in switching to renewableย energy.
Listening to people like Coleman, or Jack Gerard, for that matter, brings up a mix of feelings: A bit of pity for men who want to be like Sarah Palin โ obviously wrong, never doubt, rarely embarrassed โ but who canโt wink like her. Thereโs admiration for the professionalized gusto to get paid to say clearly wrong and manifestly stupid things. But thereโs also outrage that these guys pollute the public dialogue with propaganda when unemployed Americans want to work in the clean economy are led byย a Congress that coddles dirty energy lobbyists, rather than scaling a clean economy. China doesnโt suffer from these fools. Itโsย investing nearly $100 million a dayย in cleanย energy.
Cleantech advocates in this country need toย invest a lot more time and effort into advocacy and pushing backย onย dirty energy propagandaย thatโs aimed squarely at their investments and lifeโs work. We should look at how the other team is playing. Their game is message discipline. We should try it to. For busy cleantech companies who have more urgent things than public advocacy, that can be an unwelcome message. But the choice of inaction really isnโtย viable.
Look on the bright side. Unlike the dirty energy guys, we donโt have to lie to make ourย point.
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