The Key to Environmental Progress while Reducing the National Debt: Eliminating Oil Subsidies

Hello, my name is Kyle Bransky from Agoura Hills, California. I have recently been assigned a project in my AP Government class in which we must affect public policy through a variety of methods.  My project’s goal is to inform the public about the wasteful and unneeded oil and fossil fuel subsidies that our national government currently provides to multi-billion dollar oil companies. I chose to achieve this goal by writing an opinion article describing the economic and environmental benefits of eliminating oil subsidies. 

The Key to Environmental Progress while Reducing the National Debt: Eliminating Oil Subsidies

By Kyle Bransky

            To begin, I want to define the term “oil subsidies” as any form of government effort that decreases oil production and refinement costs, increases the price received by oil companies, or decreases costs for oil product consumers.

            In a world increasingly threatened by environmental concerns and a growing national debt, we have a responsibility to our posterity to protect the planet and leave them with a fiscally stable budget. While initially perceived to be conversely connected, there is a solution that offers a step in the right direction that is both eco-friendly, and financially responsible: eliminating oil subsidies.

            Each year the U.S. provides between 12 billion and 50 billion in tax cuts, giveaways and other forms of subsidies. This range is so large due to the discrepancy in what each perspective estimate considers to be an oil subsidy. Regardless of which estimate is considered, this is squandered money. As of the end of Q2 of 2013, U.S. oil companies have raked in a combined total of 47.4 billion dollars in profits, clearly proving there is no need to subsidize these astronomically profitable companies that abuse our environment, take our national resources free of charge, and then receive special treatment and tax breaks for their trouble. If we eliminated these subsidies, we would take the first step in responsibly reducing our ever-increasing debt.

            In 2004, Congress passed an act that would provide tax breaks and other benefits to companies that operated factories and processing facilities within the U.S. Through bureaucratic saturation of the bill, oil companies were included. These drilling and refining jobs were never threatened by the international migration due to their stationary nature. Once again oil companies abused the legislative system and received nonessential subsidies.

            In addition to economical motives, terminating oil subsidies could substantially reduce our greenhouse gas emissions. According to the Environmental Protection Agency (EPA), 32.1% of U.S. CO2 emissions are connected to petroleum. Continuing these present oil subsides would support the industry that is the leading polluter in the U.S. Rather than continuing to subsidize the fossil fuel companies, I suggest that we eliminate them completely, and direct a small portion of that money into clean energy. With natural resources declining, the U.S. need invest in clean energy today.

            As the oil industry has increased over the years, it has outgrown the need to be subsidized by the government. Eliminating these tax cuts and breaks will decrease our national deficit, without risking valuable jobs. In addition, some of this money could be put back into improving renewable energy sources and creating a sustainable powered U.S. We have nothing to loose, and everything to gain by removing these subsidies that have long outlived their use.