Mr. BLUMENAUER. Mr. Speaker, in their agitation over the debt, our Republican friends have obstinately focused on program cuts alone, ignoring the harm to American families and the economic recovery. Their mindless slashing of the budget is costing jobs, while damaging communities. Yesterday's news about EPA cuts hurting local efforts at clean air and clean water is another example.
More than a quarter of the deficit growth since 2001 resulted from the economic downturn which reduced tax revenues and increased programmatic spending. You spend more on unemployment when more people are unemployed.
Our focus should be on job creation, which reduces unemployment costs and increases tax revenue. However, in their first 6 months in the majority, the Republicans have not passed any legislation to create jobs.
The government's budget is often compared to a household budget, but every family knows that expenses are just one side of the equation. How many Americans, in tough times, take on second or even third jobs to increase their income because some expenses just can't be cut?
As a Nation, we have the ability to increase our revenues, our income. An obvious place to look for additional income is closing tax loopholes and ending unnecessary subsidies, for example, for large oil companies would be one of the best places to start.
Tax incentives are intended to help businesses create vital American jobs or develop technologies to improve our way of life. We as Democrats support those tax incentives that increase domestic manufacturing and other American businesses which create jobs and aid the economic recovery. These tax breaks promote our national economic priorities and put people back to work.
But when a company's profits are $10.65 billion in just 3 months, such as ExxonMobil's were earlier this year, who can reasonably argue that that company needs expensive incentives to stay in business and make money?
The 10 most egregious tax loopholes enjoyed by the large oil companies have helped the five largest companies make a combined profit of nearly $1 trillion over the last decade.
The billions we spend every year on subsidies for the largest oil and gas companies are not moving us any closer to energy independence or a clean energy economy. The subsidies are not necessary and they're not useful for our economy.
In 2010, nearly 60 percent of big oil companies' profits went to stock buybacks and dividends, not job creation. With oil produced at $11 a barrel, and sold for $100, tax breaks for oil companies are simply wasteful handouts, transferring money from working families to corporate stockholders. The difference over what was sold for an average barrel of oil, $72 average production price; average production cost, $11.
No American family should be giving up their dinner to donate money to the millionaire next door. Removing these tax incentives will save taxpayers $40 billion over the next 5 years with only minimal impact in the profit, not in their operations. Cutting subsidies will not raise oil prices, which are set in a global market that this year will be in the range of $2 trillion to $3 trillion.
Subsidies in the Tax Code, instead, should be directed toward emerging technologies like wind and solar. That's where the real jobs are. A University of Massachusetts study found that incentives for clean energy create two to four times more direct and indirect jobs compared to investments in oil and gas production.
Another obvious place to cut is the ethanol tax credit. We don't need to subsidize something that industry is mandated to buy.
We cannot ask children and seniors to bear the brunt of sacrifice while we are simply giving more money to large corporate interests that don't need it. We must make tough choices to ensure we leave a sound economy to the next generation, but we have to make those choices wisely so we leave a Nation that is competitive, prosperous, healthy, and educated.