WASHINGTON - Yesterday, President Obama asked Congress to raise taxes on oil and natural gas producers in a supposed effort to tackle American’s long-term energy issues and lower gas prices. As the New York Times reports, the President stated, “You can either stand up for the oil companies, or you can stand up for the American people.”
The reality, however, is that 95 percent of U.S. oil and natural gas wells are developed by independent producers — small businesses who employ an average of 12 employees and stand at the heart of America’s energy base. While the President believes his proposed tax hikes target ‘Big Oil’, they instead will burden the countless small businesses responsible for producing 85 percent of U.S. natural gas and 54 percent of U.S. oil. As gas prices continue to rise — now averaging $3.72 — the need for increased production at home has never been clearer. As the Washington Times reports:
- “It’s a basic economic principle: If you want less of something, tax or charge more for it,” Barry Russell, president and CEO of the Independent Petroleum Association of America.
U.S. Senate Minority Leader Mitch McConnell (R-Ky.) echoed this message yesterday in the Boston Herald, stating, “‘If someone in the administration can show me that raising taxes on American energy production will lower gas prices and create jobs, then I will gladly discuss it, [but] nobody can – and the president doesn’t’.”
The fact remains that increased oil and natural gas production at home is the answer for American’s economy, national security, and job growth. Along with providing the energy our nation needs, independent producers reinvest 150 percent of their cash flow back into new job-creating production efforts. Yet every increased tax hike on the oil and natural gas industry limits new production, hurts job growth, and weakens the health and safety of our nation.
IPAA Chairman Virginia “Gigi” Lazenby echoed these key facts in an American Press op-ed this week:
- “We have the energy reserves on-hand and at the ready to fuel, power and light our economy for generations. In fact, we have enough domestic natural gas supplies to meet our nation’s needs for greater than 100 years. Our offshore oil and gas reserves are significant, too. Responsibly producing these resources will help stabilize prices for American families as we continue to develop alternative and renewable energy forms, and invest in commonsense conservation initiatives. … Producing oil and gas here at home will also help break our deep dependence on foreign nations to meet our nation’s energy needs. And it will continue to create thousands of jobs. Louisiana has demonstrated this for years. Now it’s time for the rest of the country to start taking notice.”
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