I was on my way home from an evening event and had the radio on around 8:45 CST, when I heard about three minutes of the speech. It was an unfortunate three minutes. It was about taking away the unfair subsidies from the oil industry. Well, this is Houston; everyone here is either in the oil industry or knows many people in the oil industry. Mr. Political Sphere works for a drilling support company. So I was surprised to learn there were subsidies.
So when I got home, I did a little Google search. And I was right; there are no oil subsidies. This article from last May, by Randall Hoven in The American Thinker, spells out the details, and is worth reading if you want to understand what Obama is distorting. Here’s the summary of the so-called subsidies:
• They are all tax "breaks," or earnings that oil companies get to keep, not money paid out from the US Treasury.
• The amount of earnings not collected in taxes is about $4.3 billion per year—about 0.2% of this year's deficit and enough to fund about 10 hours of current US government spending.
• A full $3.55 billion of that amount (82%) is due to the way taxes are treated for all industries or manufacturers. To change these tax laws only for oil companies would require singling them out among all industries for special mistreatment. (I'm not a lawyer, but that sounds like a bill of attainder to me, something our Constitution forbids.)
• The only tax in which the oil industry seems to get special treatment compared to other industries is intangible drilling costs. The amount of that subsidy? That would be $0.78 billion per year—enough to fund less than two hours of federal spending in 2011, and not even half the amount we are lending a foreign-owned and state-owned oil company for drilling offshore Brazil.
• Oil companies already pay tax rates of 40-50% of income. For one company, Exxon, in one quarter of one year, that amount was over $8 billion, or almost double the so-called tax "subsidy" for all oil companies for an entire year.
If you’d rather not read (or listen to) the SOTU speech, I came across a rather useful summary. It made me laugh, rather painfully. It’s called “SOTU: Did I Hear That Right?” by Clark Judge. Here’s the beginning:
It sounded like such a soft, even conservative speech.
But let me get this straight: 1) banks will be punished (do I understand this right, by a committee headed by Eric Holder?) if their lending is too risky, 2) and they will be required (by the same committee) to give more home loans (meaning, it must be, to people who would otherwise not qualify for the loans, or else the government would not have to be involved) at lower rates (which means rates that do not compensate them as much as the market says they need to be compensated for the risks they are taking, all of which sounds like a new edition of the policies that brought on the financial collapse)….
His interconnected list goes on through 21, ending with:
…20) meanwhile he is going to tell states and localities what their budget priorities should be, 21) and make them adopt his policies for running their schools, leaving me to wonder, when he’s through, what won’t he control?
I believe that’s what I heard the president advocate last night. But one term I didn’t hear, maybe I missed it: “The Constitution.” Then again, wasn’t he suggesting that, in brave times like these, we need to put aside those old rules. Do I have this straight?
Yes, I think he’s got it straight; our president is warped, and is trying to warp our great nation into something unrecognizable to Constitution loving people. We must speak up and stop him.
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