With national gas prices topping $4 a gallon, the Senate Finance Cmte. held a hearing on tax breaks for the nation's top five oil companies. On Tuesday, Committee Chairman Max Baucus (D-MT), introduced a bill ending the $21 billion in tax subsidies for Chevron, Shell, ConocoPhillips, BP America and Exxon Mobil.
Oil company executives who testified at the hearing included: John Watson, Chairman and CEO of Chevron Corporation; Marvin Odum, U.S. President of Shell Oil Company; James Mulva, Chairman and CEO of ConocoPhillips; H. Lamar McKay, Chairman and President of BP America; and Rex Tillerson, Chairman and CEO of Exxon Mobil.
Republican Senators insist that the tax breaks encourage energy exploration and development while leading to lower prices for consumers. On Wednesday, GOP House members, in fact, passed legislation to expand off-shore oil exploration.
But Democratic Senators are calling on the oil companies to share record-breaking profits with taxpayers. They don't agree amongst themselves, however, on what to do with the estimated $2 billion-a-year savings over the next decade. Some would redirect the funds towards Green Energy development while others would apply them towards deficit reduction.
Not all Senate Democrats support cutting tax breaks for the oil companies. Sen. Mary Landrieu (D-LA) spoke on the Senate floor yesterday in opposition to another anti-subsidy bill being submitted by Sen. Robert Menendez (D-NJ).
With gasoline prices expected to drop by the end of the summer, Republicans suggest that support for the Baucus and Menendez bills will fall away as well.