Washington, D.C.– Rep. Raúl M. Grijalva, the co-chair of the Congressional Progressive Caucus (CPC), today highlighted provisions in the CPC People’s Budget proposal that end taxpayer subsidies for oil drilling and create a new tax on speculation in oil or other commodities as increasing gas prices dominate the economic headlines. Grijalva pointed out that Goldman Sachs recently “named ‘excessive speculation’ the culprit for inflating oil prices ‘$20 higher than supply and demand dictate,’ and advised its clients to sell off their oil-related assets because they were being overvalued due to speculation,” according to an item from the Center for American Progress.
Grijalva questioned why, if Republicans are truly committed to the “all-of-the-above” energy strategy they routinely cite in public statements, the House Republican majority has continued to focus on opening more of the Gulf of Mexico to drilling. Republicans’ push comes despite a Department of the Interior report released in late March finding “more than two-thirds of offshore leases in the Gulf of Mexico and more than half of onshore leases on federal lands remain idle, neither producing nor under active exploration and development by companies who hold those leases.”
Domestic oil production is already at its highest level since 2003. Even former President George W. Bush’s economic advisor has agreed that more domestic production alone would have no impact on global demand and would not make gas cheaper for consumers. An economist for the American Petroleum Industry recently said U.S. oil companies “still have plenty [of oil] available for export” after selling to the domestic market.
“Republicans’ story on gas prices is that unnamed ‘regulations’ are strangling the poor oil industry, and that’s why multi-billion dollar companies have to charge American families more at the pump,” Grijalva said. “The reality is much different: wealthy oil speculators are gaming the system for a profit while BP, Shell and their competitors all post record profits boosted by public subsidies at taxpayer expense. The People’s Budget proposal puts an end to these tricks; Republicans seem happy to put all the power in a few companies’ hands while everyone else pays the price.”
Grijalva pointed out that Republicans “have controlled the House since January and have had plenty of time to show us their energy plan. So far all we’ve heard is the need for more drilling. It’s awfully convenient to pretend that letting the oil industry have its way is the quickest path to cheaper gas, but I suspect Republicans know that’s not really the case. We need economic and tax reforms that stop rewarding the ‘drill now, avoid taxes, offshore jobs’ agenda the industry has pursued for years, and that’s what the People’s Budget offers. What’s the Republican offer? More of the same?”