Did someone at the The New York Times happen to read last Friday's blog? Today's front-page story is an indictment of the oil patch and its K Street cronies who have funneled millions of dollars to Congress specifically to turn what was supposedly a "cost-free [to taxpayers] incentive" into a multibillion-dollar break for an industry already making record profits.
In detailing how the boondoggle known as "royalty relief" has spun out of control, it's gratifying that the Times deems the news worthy of the front page -- even though it's old news to those of us at huffingtonpost.com. The March 24 blog "The Oil/Gas on Federal Lands Belong to Us!" recounts how the oil companies have been permitted to gain access to leases on federal lands and their underlying oil and gas rights for a pittance, and in the process snookering taxpayers out of their rightful compensation for the resources extracted. The entry argued that Congress and the executive branch had lost sight of the greater public good, and called for the creation of a national oil trust to develop and extract the oil and gas underlying such lands.
The Times story adds details of how a few House Democrats, notably Representative Edward Markey of Massachusetts, unsuccessfully fought to roll back the energy-drilling subsidies during last summer's debate over the energy bill. They were no match for the oiligopoly's friends in Congress. Joe Barton, a Texas Republican, won the day by assuring lawmakers that the new provisions wouldn't cost taxpayers a dime.
The story goes on to point out that even industry insiders admit that it's hard to make a case for royalty relief and other incentives, given the high market prices. Michael Coney, a lawyer for Shell Oil, was quoted as saying: "Under the current environment, we don't need royalty relief."
Nevertheless, the Bush administration has compounded mistakes made by the Clinton Administration, resulting in even bigger giveaways. Gale Norton, who recently stepped down as Interior Secretary, expanded energy drilling incentives further by raising the thresholds at which royalty relief would be allowed. The President, despite remarks last April that were critical of tax-funded drilling incentives, signed last August's huge energy bill that added another $2.6 billion of breaks for drillers and expanded the royalty relief program now exceeding $7 billions. So much for talk.
In the Times aricle Shirley J. Neff, an economist at Coumbia University and Senator Johnson's top legislative aide in drafting and spearheading the 1995 royalty law, was quoted as saying "There is no cost rationale. It is astounding to me that the administration would so blatantly cave in to the industry's demands."
I have posted other blogs on energy relevant issues that the Times and much of the rest of the media rarely touch, but which go to the heart of one of the greatest boondoggles the nation has known.
Among these "The Price of Oil, OPEC, and Our Laws," posted March 10th, arguing that price of oil is not a free-market price as postulated by the oil patch and, sadly, the executive branch of our own government.
Then, "OPEC to Bush 'Drop Dead'/ Texas to the Rest of Us, Say 'Please,'" posted February 3rd, dealing with OPEC's manipulation and Representative Joe L. Barton of Texas, mentioned earlier, who presides over Congressional negotiations in energy and related matters and was featured in today's Times article. He was cavalierly quoted some weeks back saying "America runs on energy that is both abundant and available at prices we can afford to pay." I kid you not, and have suggested we send our heating bills to his Texas office.
Earlier yet, a January 26 blog entitled "Oil Company Profits and our National Security" discussed the divergent interests between our national security and those of oil companies whose profits are generated by high oil prices -- prices that result in the massive transfer of wealth to nations who wish us ill.
Finally, the February 9 blog entitled "Tom Friedman Spells out 'OPEC'", while acknowledging Friedman's efforts, bemoans the lack of responsible reporting at the Times and the rest of the media on issues vital to the understanding of the oil markets, money, and government influence and how they affect each of us.
I know that's a lot, but this issue is key to our current history, and the greater our awareness, the better our chance of dealing with it.