Right now, the federal government is on the verge of being shutdown due to an impasse in funding negotiations. Conservatives want deep cuts to programs for Main Street Americans like the Pell Grant and Head Start, claiming that they are necessary to rein in the budget deficit. Yet at the same time, House Republicans voted unanimously to protect taxpayer giveaways to Big Oil, even with major oil companies like Exxon paying absolutely nothing in federal corporate income taxes in 2009.
Rep. John Garamendi (D-CA) appeared on Fox Business Network yesterday and criticized the industry’s subsidies, asking why we they need billions of dollars a year from taxpayers. Host Eric Bolling attacked Garamendi for his criticism, saying that oil companies are paying the most taxes in the world and that their profit margins aren’t very high:
GARAMENDI: The wealthiest industry in the entire world, the oil industry … They’re going to see extraordinary profits yet about 12 billion dollars a year is used to subsidize the oil industry.
BOLLING: Sir do you know who’s paying the most taxes in the world? Do you know who’s paying the most taxes right now in America? Those oil companies you’re pointing the finger at. They’re paying taxes on the profits. Their profit margins aren’t high. By the way, they’re also paying royalties to be able to drill on the land.
GARAMENDI: So given all of that why do we subsidize them?
The U.S. federal corporate income tax rate of oil giant Exxon Mobil in 2009 was effectively zero. And its profits were far from low. In 2008, it was the world’s most profitable company; in 2009, it made $19 billion in profits.