Oil Companies' Tax Breaks Under Fire: Senate Hearing Sheds Light on Industry Practices

Senators Charles Schumer (D-NY) and Debbie Stabenow (D-MI) appeared on MSNBC's "Hardball with Chris Matthews" to discuss the contentious issue of tax breaks for the oil industry. The Senate Finance Committee hearing, which took place on Thursday, May 12, 2011, saw oil company executives defend their need for tax breaks, citing record profits and claims of shared sacrifice. However, the senators argued that these breaks are unnecessary and amount to 1% of the oil companies' profits. They also pointed out the lack of competition in the industry, which allows prices to fluctuate rapidly and makes it difficult for consumers to benefit from lower oil prices.

Key Takeaways:

• Senator Schumer stated that the oil companies' tax breaks are unnecessary and amount to 1% of their profits, which is a paltry amount considering their record-breaking profits.
• The senators argued that the oil companies' lack of competition in the industry allows them to control prices and profit from their agreements.
• The hearing highlighted the industry's criticism of those who advocate for cutting these subsidies as "un-American," with some oil company executives refusing to apologize for this language.
• Debbie Stabenow emphasized that the auto industry is not advocating for higher prices or these subsidies, citing the success of electric vehicles and the creation of new jobs in the industry.
• Senator Schumer compared the oil industry executives to being part of a "petroleum club," implying that they are out of touch with the reality of the world they operate in.

Statistics:

• Oil prices have risen significantly, from $17 a barrel to over $100 a barrel.
• The oil industry's profits have increased, with some companies reporting record-breaking profits.
• The tax breaks being debated amount to 1% of the oil companies' profits.
• The auto industry in Michigan is experiencing a resurgence, with companies like General Motors announcing 4,200 new jobs and Ford announcing 7,000 new jobs.

Sources:

• Federal News Service, Inc.
• MSNBC "Hardball with Chris Matthews" Transcript, Thursday, May 12, 2011.