Congressional Democrats are proposing a new tax on oil companies as the price of U.S. crude oil climbs along with the prices at the pump.
Sen. Sheldon Whitehouse, D-R.I., introduced the Big Oil Windfall Profits Tax Act on Thursday, along with 11 other Democratic co-sponsors — the legislation is designed to “curb profiteering” by redirecting profits associated with higher crude oil prices to back drivers, according to the Washington Examiner.
In what amounts to a wealth redistribution scheme, the measure “would collect a portion of the profits companies are currently yielding with oil at its highest premium in more than a decade and return it to consumers as quarterly rebates, the newspaper reported.
In announcing the ban of Russian oil, President Biden floated the issue of price gouging while playing the blame game for soaring gas prices — he called prices that have been steadily rising since he took office the “Putin price hike.”
“It’s not time for profiteering or price gouging,” the president said Tuesday. “It’s not an excuse to exercise excessive price increases or padding profits or any kind of effort to exploit the situation.”
Whitehouse picked up that theme, calling oil companies “greedy” while faulting Putin alone for soaring gas prices.
“We’ve seen this script before, and we cannot allow the fossil fuel industry to once again collect a massive windfall by taking advantage of an international crisis,” the Democrat said. “I propose sending Big Oil’s big windfall back to the hardworking people who paid for it at the gas pump. Over the longer term, speeding up the transition to renewables will lower energy costs, insulate consumers from price spikes, and reduce Western nations’ dependence on foreign despots and greedy fossil fuel companies.”
As seen below, gas prices have been on a steady climb since Biden took office and immediately halted the Keystone XL pipeline, stopped new leases on gas and oil and blocked drilling on federal land:
— VAPOR★JOES (@vaporjoes) March 10, 2022
Sens. Elizabeth Warren, D-Mass, and Bernie Sanders, I-Vt., were among the co-sponsors who proclaimed Big Oil to be guilty of price gouging.
“While Putin’s war is causing gas prices to go up, Big Oil companies are raking in record profits,” said Warren. “We need to curb profiteering by Big Oil and provide relief to Americans at the gas pump — that starts with ensuring these corporations pay a price when they price gouge, and using the revenue to help American families.”
“We can no longer allow big oil companies, huge corporations and the billionaire class to use Putin’s murderous invasion of Ukraine and the ongoing pandemic as an excuse to price gouge consumers. It is time to enact a windfall profits tax,” said Sanders.
Frank Macchiarola, with the American Petroleum Institute, has denounced the claims along with calls to investigate oil companies.
“Those requests to investigate, specifically for the FTC, go back actually 100 years, and every time we have high-gas prices, some politician runs forward and says there should be an investigation about price gouging,” Macchiarola told Inside Sources. “They never bear fruit because there’s no reality to it.”
“The reason prices are where prices are is because of the imbalance in supply and demand, the pressures that have been put on by supply chain issues, the additional pressures that have been put on by labor shortage in the United States compounded by significant disruption as a result of acts of war perpetrated by the world’s third-leading producer in oil,” Macchiarola said. “That’s why we have high oil prices.”
Interestingly, Fox & Friends co-host Brian Kilmeade called on Big Oil to be more vocal and explain current circumstances to the public.
“I think it’s up to the oil companies, who have been scared to death to come public because they don’t want things to have more retribution their way; it’s incumbent on them to stand up and let everybody know,” Kilmeade said. “You know your industry inside and out.”
“I don’t have a problem with you earning a profit,” he added. “Number one, if you are not gouging, let everyone know you are not gouging. Number two is, tell us in very fundamental terms because we are not in the business what you are doing with those permits and those leases. And tell them the relation of potentially what you could be doing if the government would unleash it.”
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Tom Tillison grew up in Maryland before moving to Central Florida as a young teen. It is in the Sunshine State that he honed both his passion for politics and his writing skills. Tillison also contributes to BizPac Review.
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