Secretary of the Treasury Discusses Energy and Climate Change Policy? Seems Odd.

By Tom Doggett
WASHINGTON, March 4 (Reuters) - U.S. oil and natural gas producing companies should not receive federal subsidies in the form of tax breaks because their businesses contribute to global warming, U.S. Treasury Secretary Timothy Geithner told Congress on Wednesday.

It was one of the sharpest attacks yet on the oil and gas industry by a top Obama administration official, reinforcing the White House stance that new U.S. energy policy will focus on promoting renewable energy sources like wind and solar power and rely less on traditional fossil fuels like oil as America tackles climate change.

"We don't believe it makes sense to significantly subsidize the production and use of sources of energy (like oil and gas) that are dramatically going to add to our climate change (problem). We don't think that's good economic policy and we think changing those incentives is good for the country," Geithner told the Senate Finance Committee at a hearing on the White House's proposed budget for the 2010 spending year.

The Obama administration's budget would levy an excise tax on oil and natural gas produced in the Gulf of Mexico, raising $5.3 billion in revenue from 2011 to 2019.

This new 13 percent tax on all oil and gas production in the Gulf would only affect those companies enjoying a loophole that allows them to avoid paying royalties on the energy supplies they drill. Companies already paying royalties would get a tax credit.

Obama's budget would also place a $4 per acre annual fee on energy leases in the Gulf that are designated as nonproducing. The budget proposal projects the fee would generate $1.2 billion from 2010 to 2019

My Thoughts:

I am absolutely convinced that Obama intends to have oil prices back up to the levels of this past summer. Why? Tax revenues and tax on windfall profits from big oil. The funny thing is that during the campaign Obama constantly criticized big oil for their greed. Here we see the greedy one is sitting in the White House in Washington.

As unemployment levels stay stagant, as Washington keeps printing currency, and as energy prices increase only one thing will happen.....double digit inflation. A double whammy on the backs of the middle class, who have seen the devaluation of their assets by almost 50%, now will pay a second time as prices rise, stealing more money from our pocketbooks.

Is this what Obama wants? I have to think he does, why would he have the Secretary of the Treasury discussing energy and global warming policy? Doesn't Giethner have enough to worry about with nationalizing the banks?