One month after dumping 500,000 gallons of tar sands crude oil from a ruptured pipeline in Arkansas, the most valuable and profitable corporation in the world ExxonMobil announced higher first quarter profits. Exxon earned $9.5 billion in the first quarter, compared to $9.45 billion last year, and Exxon’s total oil and natural gas production declined 3.5 percent.

Meanwhile, Exxon is exempt from paying taxes toward the oil spill liability fund that helps clean up spills like in Arkansas, where wildlife have been killed and covered by oil. The 1980 law exemption applies to diluted bitumen so companies escape paying the 8-cents-per-barrel fee to the fund that helps clean up hundreds of spills each year. At the federal level, Exxon’s tax rate comes to only 13 percent.

Here is how else Exxon spends its dollars, and what it receives in return:

– Exxon spent $12,970,000 on lobbying in 2012 to protect low tax rates and block pollution controls and safeguards for public health. In the first three months of 2013, Exxon spent $4.84 million lobbying.

– The company sent $3.6 million in total political contributions to PACs, candidates, and outside groups for the 2012 election cycle, and 89 percent of contributions went to Republicans. It has spent over $76,000 for the 2014 cycle so far.

– Exxon receives an estimated $600 million in annual federal tax breaks. In 2011, Exxon paid just 13 percent in taxes. The company paid no federal income tax in 2009, despite $45.2 billion record profits.

– In the first quarter, Exxon bought back $5.6 billion of its stock, or 59 percent of its profit, which enriches the largest shareholders and executives of the company.

– This year, Exxon CEO Rex Tillerson received a 15 percent raise to a $40.3 million salary.

So the American Petroleum Institute is out with more ads that feature “person on the street” interviews with ordinary Americans. You know, the kind of folks that go to bed at night worried about those mean people in Washington threatening to take away the billions in tax breaks currently enjoyed by the fossil fuel industry.

Leaving aside the substance — that high gas prices are already enriching oil companies on top of their tax breaks, and the industry has enjoyed hundreds of billions in government support for a very long time — you have to wonder how ads like this get made in the first place. Do those folks really walk around on the street, and a camera pops up in front of them, and they blurt out deep-seated and authentic desires to protect aggrieved mega-corporations?

Greenpeace investigated this in 2011, and got some audio evidence of the direction these “people on the street” receive from the directors.

The people who appear in the ads are assured that : “... all they do is the director feeds them the lines and he talks them through it.” As a result, they end up saying crazy things like “I think taxing the oil and gas industry does nothing but harm the country” on national television.

So keep that in mind when you see the people in these ads: It’s more profiteering through puppeteering than any genuine concern about energy costs.

House Budget Committee Chairman Paul Ryan (R-WI) released his fiscal year 2014 budget yesterday. Once again, he offers a path to prosperity that is limited to corporate special interests like Big Oil.

Despite nearly two-thirds of Americans echoing President Obama’s push to tackle climate change through regulation, Ryan decided to concentrate his energy strategy on “restoring competition to the energy sector” and “stopping the government from buying up unnecessary land.” Unsurprisingly, Ryan has multiple cases of misinformation and at times, blatant lies.

Let’s break down the eight biggest falsehoods from Ryan’s energy vision:

1. “The construction of the Keystone XL Energy Pipeline would create more than 20,000 direct jobs and 118,000 indirect jobs while battling the high cost of gas.”

Contrary to Rep. Ryan’s claims, the Keystone XL pipeline would actually only support 35 permanent and 15 temporary jobs after construction is complete, with “negligible socioeconomic impacts,” according to the State Department’s revised draft environmental impact assessment.

2. “Once it was in operation, the pipeline would contribute an additional $5.2 billion in property taxes to communities along the route during the life of the pipeline.”

The TransCanada assessment that claims that the six states crossed by the pipeline would receive an additional $5.2 billion in property taxes fails to account for the likely damage caused by oil spills along the pipeline route. “In the past five years, more than half a million barrels of oil and other hazardous liquids have been spilled from U.S. pipelines, killing 76 people and causing some $2.4 billion in property damage, according to the U.S. Department of Transportation.”

3. “The administration continues to penalize economically competitive sources of energy and to reward their uncompetitive alternatives. On the one hand, it pours money into its favored industries.”

According to an analysis by DBL Investors, the oil and gas industry has received a total of $446 billion in government subsidies from 1918 through 2009. Meanwhile, the renewable energy industry received just $5.5 billion from 1994-2009. U.S. taxpayers have invested $80 in oil for every $1 invested in clean, renewable energy. Moreover, the big five oil companies –BP, Chevron, ConocoPhillips, ExxonMobil, and Shell — made a combined profit of $118 billion in 2012 while Reuters reported that the three American companies’ tax payments were “a far cry from the 35 percent top corporate tax rate.”

4. “In 2012, the Congressional Budget Office found total energy subsidies were $24 billion, of which $16 billion were spent on ‘green’ energy programs and $2.5 billion on fossil fuels.”

Ryan actually misquoted the report, which actually refers to subsidies from 2011. Furthermore, the Congressional Budget Office found that the government only spent $3.6 billion on energy efficiency and renewables in 2011.

5. “Many of the administration’s loan-guarantee projects have failed.”

Independent analysis of the Department of Energy’s loan guarantee program has shown that that these investments were not only successful, but cost-effective. Despite the hysteria behind Solyndra, the program will cost $2 billion less than initially expected, for a total cost of $2.7 billion. To put that in perspective, the fossil-fuel industry got a whopping $70 billion in government subsidies from 2002 to 2008. The Loan Guarantee Program has allowed extremely important projects to move forward, including the world’s largest wind farm and our country’s biggest concentrating solar power project. Critically, the program created jobs for nearly 60,000 people.

6. “Beyond Solyndra, the latest ill-fated ventures include a $737 million loan guarantee to Solar Reserve for a 110-megawatt solar tower on federal land in Nevada and a $337 million guarantee for Mesquite Solar 1 to develop a 150-megawatt solar plant in Arizona.”

Politico reported that both of these projects are either already generating power or are on schedule with construction.

SolarReserve’s 110-megawatt Crescent Dunes project, near Tonopah, Nev., has inked a 25-year agreement to sell electricity to the power company NV Energy. The project is on track for completion later this year…. Ryan’s other target, the Mesquite Solar 1 project west of Phoenix, flipped the switch to electricity generation earlier this year. Media reports described it at the time as a success story of the DOE loan guarantee program.

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Automatic across-the-board budget cuts will take hold on Friday, affecting job growth, state education programs, environmental agencies, and women’s health programs. The sequester actually shares an important anniversary — with Big Oil tax breaks. It is not as well-known a date, but one type of deduction, the percentage depletion allowance, celebrates its 100-year anniversary today.

Depletion allowances let oil companies treat the oil in the ground as capital equipment, and thus allows them to write off a certain percentage for each barrel that comes out. (See more here.)

The year 1913 marked the first time a Big Oil subsidy was written into the tax code. The Revenue Act of 1913 allowed oil companies to write off 5 percent of the costs from oil and gas wells beginning March 1 of that year. (For reference, see pages 172-174 of the Act.) A century later, oil companies can now deduct three times this rate, at 15 percent, although the very largest companies no longer qualify. The percentage depletion subsidy also increases when prices are high, at the same time that oil companies enjoy greater profit. It can even eliminate all federal taxes for independent producers.

A Center for American Progress report estimated that closing this tax break would save $11.2 billion over 10 years.

President Obama has called on Congress to eliminate the percentage depletion allowance, along with a series of other tax breaks totaling $4 billion annually. Even Ronald Reagan once asked for the same in a 1985 speech on tax reform:

“Under our new tax proposal the oil and gas industry will be asked to pick up a larger share of the national tax burden. The old oil depletion allowance will be dropped from the tax code except for wells producing less than 10 barrels a day. By eliminating this special preference, we’ll go a long way toward ensuring that those that earn their wealth in the oil industry will be subject to the same taxes as the rest of us.”

However, congressional Republicans taking the lion’s share of oil and gas industry contributions have refused to close century-old loopholes in order to raise revenue. A number of specialized Big Oil tax breaks allow the top oil companies to cut their tax bill dramatically, sometimes half (or less) of the top corporate rate. It is not as if Big Oil is struggling: Last year, the five largest oil companies — BP, Chevron, ConocoPhillips, and ExxonMobil — earned $118 billion profit at a time when consumers paid record-high gas prices. This haul follows after a year the companies earned a record $137 billion profit.

While 2012 might not be a banner year for Big Oil profits, it wasn’t a bad one either. With just BP left to announce 2012 earnings, Big Oil earned well over $100 billion in profits last year, while the companies benefit from continued taxpayer subsidies. Average gas prices also hit a record high last year, showing how a drilling boom may help oil companies’ profit margins, but not consumers’ wallets.

ExxonMobil — now the most valuable company in the world, passing Apple — earned $45 billion profit in 2012, a 9 percent jump over 2011. Meanwhile, Chevron earned $26.2 billion for the year. In the final three months of the year, the companies earned $9.95 billion and $7.2 billion respectively.

Here are the highlights of how Exxon and Chevron spend their earnings:

ExxonMobil

Exxon received $600 million annual tax breaks. In 2011, Exxon paid just 13 percent in taxes. The company paid no taxes to the U.S. federal government in 2009, despite 45.2 billion record profits. It paid $15 billion in taxes, but none in federal income tax.

Exxon’s oil production was down 6 percent from 2011.

In fourth quarter, Exxon bought back $5.3 billion of its stock, which enriches the largest shareholders and executives of the company.

Exxon’s federal campaign contributions totaled $2.77 million for the 2012 cycle, sending 89 percent to Republicans.

The company spent $12.97 million lobbying in 2012 to protect low tax rates and block pollution controls and safeguards for public health.

Exxon CEO Rex Tillerson received $24.7 million total compensation.

Exxon is moving ahead with a project to develop the tar sands in Canada.

Chevron:

In October, Chevron made the single-largest corporate donation in history. Chevron dropped $2.5 million with the Congressional Leadership Fund super PAC to elect House Republicans.

The bulk of Chevron’s federal contributions came from the super PAC donation, for a total of $3.87 million for the 2012 cycle. 85 percent went to Republicans.

Chevron spent $9.55 million lobbying Congress in 2012, according to the Center for Responsive Politics.

Chevron paid 19 percent U.S. taxes last year (half of the top corporate tax rate of 35 percent), and received an estimated $700 million in annual tax breaks last year.

Chevron was fined $1 million for a refinery fire that sent 15,000 Richmond, California residents to the hospital. Though the company faces $10 million in medical expenses, Chevron earns it back in a couple of hours.

With Royal Dutch Shell and ConocoPhillips reporting $35 billion in combined profit in 2012, BP is the last company left to announce its profits for the year.

Despite ranking among the most profitable corporations in the world, Big Oil benefits from $4 billion in annual tax breaks. It fights to maintain them through aggressive political donations, lobbying, and heavy ad spending, but also employs another tactic: Pretending these tax breaks don’t exist.

“The oil and gas industry gets no subsidies, zero, nothing,” API President Jack Gerard said on Tuesday. “We get cost-recovery benefits, much like other industries. You can go down the road of allowing economic activity, generating hundreds of billions to the government, or you can take the alternative route by trying to extract new revenue from industry by increasing their cost to do business.”

Tax deductions are indeed subsidies, as API admitted in a document that labeled “subsidies for alternative fuels” as “preferential tax treatment.” And the oil industry’s $4 billion preferential treatment is written permanently into the tax code. These include:

Percentage depletion allowance: lets companies deduct the costs of an oil or gas well, about 15 percent, from its taxes.

Domestic manufacturing tax deduction: Allows oil companies to collect $1.8 billion each year, even though there are vast differences between oil and traditional U.S. manufacturing. It is a benefit that was never intended for them, according to Sen. Bob Corker, a Tennessee Republican, who said Congress included oil producers “almost inadvertently.”

The foreign tax credit: Oil companies overwhelmingly fall into the category of companies that can claim credits for payments to foreign governments.

Expensing intangible drilling costs: For over a century, oil companies have written off wages, fuel, repairs, and hauling costs.

ExxonMobil, Chevron, and ConocoPhillips have paid federal tax rates well below the 35 percent top corporate rate, a far cry from paying “more than our fair share”. ExxonMobil, for instance, paid a 13 percent tax rate in 2011, after drilling deductions and benefits, and 14 percent on average between 2008 and 2010.

The record-high gas prices of 2012 reinforce the decades of data showing domestic drilling has very little impact on gas prices. At the same time, the Big Five companies are on track to collect more than $100 billion profit this year.

Big Oil subsidies have maintained a relatively low profile during fiscal showdown negotiations. But there is some chance the oil industry’s $4 billion annual subsidies could be on the chopping block in a deal. The first indication Republicans may possibly budge, after repeatedly blocking votes on the issue, came late in the election when House Energy and Commerce Committee Chair Fred Upton (R-MI) said, “Let’s look at the oil and gas subsidies, let’s take them away. Let’s let them compete just like everyone else at the same level.”

Like many of his GOP colleagues, the oil and gas industry is one of Upton’s top industry donors. He has received nearly $450,000 from the oil and gas industry over his career in the House, according to the Center for Responsive Politics.

Interestingly, when Upton said he would look at oil subsidies, Big Oil sent last-minute contributions to the candidate. New campaign filings show that since Upton made his comment early in October, he received several new donations from oil companies:

– ExxonMobil PAC gave $5,000 on 10/23, bringing its total for Upton this cycle to $10,000.
– Valero Energy gave $5,000 on 10/24.
– Petroleum Marketers Association of Americas gave $4,000 on 11/5.
– Marathon Oil COO Dave E. Roberts gave $2,500 on 10/29.
– ConocoPhillips PAC gave $1,000 on 11/5, bringing its cycle total to $8,000.

Upton’s leadership PAC raised another $47,000 from the oil and gas industry this cycle, drawing $25,000 from Valero Energy and $10,000 from Koch Industries, among other oil and gas companies. Overall, he raised $4 million and spent more than $4.5 million to defeat his challenger Mike O’Brien.

There are a few clues indicating how seriously to take Upton on ending oil subsidies: Post-election, Upton hired America’s Natural Gas Alliance lobbyist Tom Hassenboehler as a senior aide, who has also served as counsel for the Senate’s infamous climate denier James Inhofe (R-OK). And polluter groups like the U.S. Chamber of Commerce also campaigned on Upton’s behalf, touting his record of protecting Big Oil and its tax breaks.

In 2009, world leaders at the G20 summit agreed that phasing out fossil fuel subsidies should be a top priority. Three years later, with very little progress on actually repealing those subsidies, promises for reform ring hollow.

Now, as diplomats gather in Doha, Qatar for an international climate summit — an event that experts say will bring very few meaningful commitments — groups are stepping up the pressure on fossil fuel subsidy reform.

Rich countries spent $58 billion on fossil fuel subsidies in 2011. That’s roughly five times the amount they spent on “fast start” financing for climate adaptation and mitigation in developing countries, according to an analysis released today at the Doha climate talks by Oil Change International.

Established at the Cancun climate talks in 2010, fast-start finance is designed to help the most vulnerable countries fund renewable energy, efficiency, water access, and climate change adaptation projects. The goal is to raise $100 billion a year for these projects by 2020.

The Oil Change International analysis is derived from OECD figures on fossil fuel subsidies and World Resources Institute data on international commitments for climate-resiliency projects in developing countries. It found that the average yearly commitment from developed countries for climate financing over the last three years was $11 billion — a fifth of what they spent to support the fossil fuel industry.

“What this analysis shows is that governments gathered in Doha to supposedly fight climate change need to put their money where their mouths are,” said Oil Change International’s Executive Director Stephen Kretzmann in a statement. “It should be plainly obvious that you can’t solve a problem when you’re spending vastly more to continue creating it than you are to fix it.”

Fossil fuel subsidies have become an important fight in the climate advocacy world. With very little movement on an international plan to price greenhouse gas emissions, campaigners are now pushing countries to drop their support of dirty energy. But progress in this area has been stubborn as well. Although the issue is widely discussed in international negotiations as an option, there is very little appetite within individual countries to repeal subsidies for coal, oil, and gas.

Even the International Energy Agency — an organization set up in the 1970′s to counter the power of OPEC in the oil markets — strongly agrees that fossil fuel subsidies must be eliminated in order to seriously address climate change.

Earlier today, IEA Executive Director Maria van der Hoeven released a very strong statement on the importance of fossil fuel divestment that happened to coincide with the Oil Change International analysis:

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On election night, polluter-backed candidates lost in some of the most expensive races targeted by polluters, despite outside ad spending that tallied to $270 million.

The American Petroleum Institute already has 2014 in its sights, and it is spending aggressively to protect the oil industry’s multi-billion-dollar tax breaks. Three weeks since election day, API has spent $3 million on TV ads, according to a ThinkProgress analysis of Kantar Media’s CMAG data. That is already $1 million more than what API spent in the final two months of the election, as part of its “I’m an Energy Voter” campaign.

A bulk of the spending, $600,000, targets specific senators over Big Oil’s $4 billion annual tax breaks, all of whom are up for reelection in 2014. All but two voted in March to end oil subsidies, a vote blocked by 47 senators who have taken more than $23.5 million from the oil and gas industry.

Here is an example of one ad directed at Sen. Mark Warner (D-VA):

NARRATOR: America spoke loudly. Clearly, we want a commonsense plan to help people succeed. Senator Mark Warner can make energy a big part of improving our economy. He can choose economic growth and American jobs, not slow them with job-killing energy taxes. Let’s take advantage of America’s energy resources to power growth. American energy – not higher taxes on energy – will create jobs. Let’s get to work.

Ending the industry’s tax breaks would not affect Americans’ gas prices, or kill jobs. Factcheck.org writes that “nonpartisan congressional analysts and industry experts say higher taxes would have little or no effect on gasoline prices.” And at the same time oil enjoyed low tax rates and earned high profits, Exxon, Shell, and BP still shed 17,500 jobs.

ExxonMobil, Chevron, and ConocoPhillips have paid federal tax rates well below the 35 percent top corporate rate. ExxonMobil, for instance, paid a 13 percent tax rate in 2011, after drilling deductions and benefits, and 14 percent on average between 2008 and 2010.
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