Is there any end in sight to this criminal act? My previous blog focused on the fact that this was a case begging for a criminal indictment. I neglected to mention the fact that BP Oil, along with the entire oil industry, has figured out methods of living off the public dole.
As reported in the New York Times recently the platform were the oil rig was sitting on is owned by a company called Transocean a company that had moved its corporate headquarters from Houston to the Cayman Islands and then to Switzerland, in order to reduce its taxes. Simultaneously, BP was leasing the rig and thereby reducing its own taxes — a 70% write-off at $225,000 per day.
The Times also reports that “oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.” The Times also noted that a study by the Congressional Budget Office found that “oil field leases and drilling equipment are taxed at an effective rate of 9 percent, significantly lower than the overall rate of 25 percent for businesses in general and lower than virtually any other industry.”
Congress is trying to reduce these tax breaks (amounting to $4 billion per year to BP alone). The oil industry is resisting (with the help of lobbyists who have spent $340 million since 2008 on behalf of the industry) claiming that it would eliminate jobs (a constant argument by big corporations on the public dole). But a study by the Treasury Department in 2009m found that eliminating subsidies would decrease output by less than one half of one percent. Eliminating most of these subsidies would help with the cleanup and possibly save thousands of jobs.
It is almost like a an organized crime group trying to buy off police and prosecutors to avoid an arrest and prosecution.