Senate blocks proposed end to oil company tax breaks

An attempt to roll back oil company tax breaks was blocked in the Senate, despite a Rose Garden push by President Obama, who said the big five oil companies are doing “just fine” as consumers struggle with painfully high gas prices at the pump.

Republicans led opposition to the measure, but several Democrats from oil-rich states joined the GOP in a filibuster to prevent the legislation from advancing. The vote was 51-47, failing to reach the 60-vote threshold.

Senate Majority Leader Harry Reid said the GOP was “poised to pick the pockets of American taxpayers to line the pockets of these oil executives.”

But the GOP leader, Sen. Mitch McConnell of Kentucky, ridiculed the Democrats’ energy policy as doing little to ease the pain at the pump.

“Their brilliant plan on how to deal with gas prices: raise taxes on energy companies,” the GOP leader said.

Both parties have sought to deflect voter anger at steep pump prices, with Democrats pointing to oil company profits as evidence that the federal government no longer needs to subsidize the industry. The legislation would reinvest the savings in tax breaks for green energy development.

Republicans argued that subsidies for the so-called big five oil companies are needed for continued oil drilling development. They said the measure unfairly targets the industry.

Obama stepped into the fray Thursday in a White House address from the Rose Garden before the morning vote.

“Right now, the biggest oil companies are raking in record profits,” Obama said. “On top of these record profits, oil companies are also getting billions a year in taxpayer subsidies.”

The president noted that domestic oil drilling is at highs not seen in the past eight years, and the nation is importing less from foreign sources.

Members of Congress can either “stand with the big oil companies,” Obama said, “or they can stand with the American people.”

But the president faced detractors from within his own party who have long been hesitant to halt subsidies for the oil companies. Four Democrats joined Republicans in blocking the measure from advancing. Two Republicans joined Democrats in trying to advance it.

The legislation would end more than $2 billion in annual tax subsidies to the so-called big five oil companies -- BP, Chevron, Exxon, Shell and Conoco-Phillips.

Part of the $24 billion in savings over a decade would be reinvested in renewed tax breaks for biodiesel, cellulosic ethanol and energy efficiency programs.

The remainder, about $11 billion, would go for deficit reduction, according to Sen. Bob Menendez (D-N.J.), the bill’s author.

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Original source: Senate blocks proposed end to oil company tax breaks