Starting with his State of the Union address last month and carrying into his University of Miami speech, the President has been raising eyebrows and hopes with his seemingly pro-energy stances. From unconventional-gas exploration to adoption of the “all of the above” moniker Republicans have used to describe their approach to energy development, Barack Obama sounded downright, well, Republican. However, actions still speak louder than words, and despite the President’s rhetoric about turning over a new leaf, his administration is still playing the same old tune.
Think for a moment about the President’s praise in his State of the Union for domestic manufacturing: “If you’re an American manufacturer, you should get a bigger tax cut. If you’re a high-tech manufacturer, we should double the tax deduction you get for making products here. And if you want to relocate in a community that was hit hard when a factory left town, you should get help financing a new plant, equipment, or training for new workers.”
Considering the hit American manufacturing has taken since the start of the 2008 recession, it seems reasonable that the author of the $800 billion Economic Stimulus would want to stimulate some American jobs this way. That’s why it is somewhat puzzling that he continues to rally for the repeal of so-called “incentives” for oil companies. In truth the U.S. oil and natural gas industry does not receive taxpayer-subsidized payments. They utilize the same tax credits and deductions available to other American companies – regardless of industry – designed to encourage economic growth and expansion.
However, the President’s latest proposals would deny these long-standing deductions to only one industry – and in some instances, only selected companies. This punitive tax policy will discourage domestic production – which means fewer jobs – and, put American companies and energy industry workers at a disadvantage compared to foreign competitors.