Friday, July 09, 2010

While the rest of America is worried about the Lebroncalypse

For the last week or so, it seems that every news organization, including CNBC, has been giving us hourly Lebron updates. For those not in America, people are living and dying according to the results of the World Cup. Well now that LeBron has gone to the Heat, Spain has won and Dan Gilbert has gone plum crazy we can go forward with life.

I am going to whip out my vuvuzela(sp?), if today's BP well cap works. I'm going to try to attend a pep rally with Adm. Thad Allen and his two top lieutenants, if the cap does what it is supposed to. I worry for the environment and the fishermen not the NBA or FIFA.

I hope the fisheries can be rebuilt and the way of life returns for those fishermen in Grand Isle and Venice (La.) is able to be recaptured. I pray that the environmental damage can be overcome. This is a great opportunity to turn something tragic into a step in the right direction. Focus on doing doing what's right by cleaning up the damage and then use some of that $20 billion dollar fund to rebuild the barrier islands. Use some of that money to push forward solar cell technology, or maybe better safeguards and regulation so that the blowout preventers are actually more likely to do they are supposed to do (perchance prevent... well you get the point).

As someone who appreciates the importance of oil related jobs to the state of La. I do not want to see that type of employment just disappear. However, it is important that we do not turn our natural resource (The Gulf) into a permanent cesspool of oil and tar. We should understand the necessity to drill in certain areas for fossil fuels. For environmental, food safety and even national security interests, however, we should use some of the petroleum revenue to promote safer energy options.

According to the most recent study by the Congressional Budget Office, released in 2005, capital investments like oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.

Other countries have much better regulation, and much more stringent taxing structures. Norway taxes their petroleum industry to the tune of 75%. We tax ours about 9%. Many of the big companies also have decided for tax reasons to relocate their respective headquarters offshore. Generally, if the company is headquartered in another country, their tax burden will be lowered,as will the regulation and oversight of their operation. These are legal and proper steps for a private company to take to maximize profits. By the way, British Petroleum made 14 billion dollars in profits last year. There is a bill on the floor of the Senate to change some of these loopholes.

Senate Bill 3405 as introduced by Senator Menendez, would close some of those loopholes. It would impose a 13% excise tax on oil extraction, and denies the tax benefits that oil companies get for moving their headquarters overseas. I have no problem with a fair profit, but the oil companies put our communities and our environment at risk. For those reasons, they should pay their fair burden. Please call your Congressmen and Senators to support S. 3405.

All of that being said my thought and prayers are focused on hoping this latest effort to cap the Deep Horizon well are successful, and that the cleanup can begin.

If you would like to see the articles I read for this piece:


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