Weekly Address: Taxpayer Subsidies for Oil Companies are Neither Right, nor Smart, and They Should End

WASHINGTON – As oil and gas companies make tens of billions in profits and the government scours the budget for savings, President Obama called on Congress to stop handing them $4 billion annually in taxpayer subsidies. America’s oil production last year reached its highest level since 2003, but we need to invest in the energy of the future, instead of subsidizing the energy of the past.

Remarks of President Barack Obama
Weekly Address
Saturday, April 30, 2011
Washington, DC

After the worst recession since the Great Depression, our economy is growing again, and we’ve gained almost 2 million private sector jobs over the last 13 months. But I also know that a lot of folks aren’t feeling as positive as some of those statistics might suggest. It’s still too hard to find a job. And even if you have a job, chances are you’re having a tougher time paying the rising costs of everything from groceries to gas. In some places, gas is now more than $4 a gallon, meaning that you could be paying upwards of $50 or $60 to fill up your tank.

Of course, while rising gas prices mean real pain for our families at the pump, they also mean bigger profits for oil companies. This week, the largest oil companies announced that they’d made more than $25 billion in the first few months of 2011 – up about 30 percent from last year.

Now, I don’t have a problem with any company or industry being rewarded for their success. The incentive of healthy profits is what fuels entrepreneurialism and helps drives our economy forward. But I do have a problem with the unwarranted taxpayer subsidies we’ve been handing out to oil and gas companies – to the tune of $4 billion a year. When oil companies are making huge profits and you’re struggling at the pump, and we’re scouring the federal budget for spending we can afford to do without, these tax giveaways aren’t right. They aren’t smart. And we need to end them.

That’s why, earlier this week, I renewed my call to Congress to stop subsidizing the oil and gas industries. Understand, I’m not opposed to producing oil. I believe that if we’re serious about meeting our energy challenge, we need to operate on all cylinders, and that means pursuing a broad range of energy policies, including safe and responsible oil production here at home. In fact, last year, America’s oil production reached its highest level since 2003.

But I also believe that instead of subsidizing yesterday’s energy, we should invest in tomorrow’s – and that’s what we’ve been doing. Already, we’ve seen how the investments we’re making in clean energy can lead to new jobs and new businesses. I’ve seen some of them myself – small businesses that are making the most of solar and wind power, and energy-efficient technologies; big companies that are making fuel-efficient cars and trucks part of their vehicle fleets. And to promote these kinds of vehicles, we implemented historic new fuel-economy standards, which could save you as much as $3,000 at the pump.

Now, I know that in this tough fiscal environment, it’s tempting for some in Washington to want to cut our investments in clean energy. And I absolutely agree that the only way we’ll be able to afford the things we need is if we cut the things we don’t, and live within our means. But I refuse to cut things like clean energy that will help America win the future by growing our economy and creating good-paying jobs; that will help make America more secure; and that will help clean up our planet in the process. An investment in clean energy today is an investment in a better tomorrow. And I think that’s an investment worth making. Thanks for listening, and have a great weekend.