For 77 days, some have been criticizing the U.S. government for not moving fast enough to contain the oil spill from the Deepwater Horizon platform in the Gulf of Mexico. It turns out the criticism has been misdirected.
According to an article in the New York Times, the Deepwater Horizon was flying the flag of the Marshall Islands when an explosion ripped through it, setting off the oil spill. Being registered in the Marshall Islands, which, of course, has no responsibility for cleaning up an oil spill in the Gulf of Mexico, is a tax savings for its owner, Transocean.
That’s only one of a number of tax avoidance schemes and outright subsidies boosting the profits of the oil companies, the Times said. BP, which is leasing the Deepwater Horizon, is using a tax break to write off 70 percent of the rent to the tune of $225,000 a day.
All of those are perfectly legal, the result of years of lobbying efforts by the oil industry. What’s annoying is that some of these same companies have been highly vocal in their criticism of tax credits and tariff protection for ethanol and biodiesel producers, just like the environmental groups that provide tax breaks to contributors and criticize subsidies for biofuels production.
Americans need to remember those oil company subsidies the next time one of their executives goes after the ethanol credits, which, by the way, are due to expire at the end of this year.