Grassley on crude…oil, that is

Senator Chuck Grassley (R-New Hartford, Iowa) holds a weekly teleconference with Iowa radio stations most every Tuesday morning.  In this week’s edition, Grassley talked about the federal tax on crude oil — not gasoline.

“I think the tax is going to be increased and it ought to be increased,” Grassley said.  “The extent to which it ought to be increased, since it goes into a trust fund, ought to be directly related to what we think the needs of that trust fund is going to be.”   Listen to the soundbite by clicking on this link: mkcg1

Grassley said he won’t support legislation to boost the federal tax on barrels of crude oil if it appears the money would be used for pork-barrel spending.

“It shouldn’t be a tax just to bring more money in to spend more money, so whatever the needs are of the trust fund, I will vote for an increase in that tax.”  Listen to the soundbite by clicking on this link:  mkcg2

The “fund” Grassley is referencing is the Oil Spill Liability Trust Fund.  According to the U.S. Coast Guard, the money in the fund comes primarily from a 5-cent-per-barrel tax.

…collected from the oil industry on petroleum produced in or imported to the United States. The tax was suspended in July 1993 because the Fund reached its statutory limit. It was reinstated in July 1994, when the balance declined below $1 billion, but expired at the end of 1994 because of the sunset provision in the law. The 2005 Energy Policy Act again reinstated the tax (effective April 2006).

Grassley’s statements on Tuesday (which you can see/can listen to above) prompted Roxanne Conlin, a Democratic candidate who hopes to challenge Grassley in the fall, to release the following statement just before noon on Wednesday.

(Des Moines) – Iowa Senator Chuck Grassley told Radio Iowa he supports an oil tax increase, “I think the tax is going to be increased and it ought to be increased,” said Grassley. 

“First Senator Grassley bailed out Wall Street, now he wants taxpayers to bailout oil companies,” said Roxanne Conlin.  “This is exactly what’s wrong with Washington.  Career politicians are sticking taxpayers with the bills when it should be the responsibility of oil companies.” 
 
The proposed oil tax would be passed onto consumers, forcing the cost of maintaining and growing the Oil Spill Trust Fund onto hardworking families. The US Chamber of Commerce claims the tax increase could be passed on to consumers.  “Senator Grassley seeks to raise oil taxes without protecting consumers from price gauging at the pump,” added Conlin.  “After 36 years in Washington, this is yet another glaring example of how out of touch Senator Grassley is with the needs of Iowa families.”

Conlin added, measures must be in place to assure this tax increase is not passed on to consumers at the pump before she would even consider it. “This is exactly what is wrong with Washington, our voices are not being heard. BP made this mess, they need to clean it up,” said Conlin. 

Prior to the oil spill, BP’s first quarter profits were up 135% over last year at $5.5 billion.

Shortly after one o’clock, Grassley’s senate staff issued the following statement.

Washington — Senator Grassley issued the following statement about his opposition to higher gas taxes.

“I’m not voting for pending legislation in Congress that contains an oil tax increase.  I oppose that bill.  It would add $134 billion to the federal deficit.  And, I’ve long opposed federal gas tax increases.  Given the disaster in the Gulf, new questions have arisen about the stability of the oil-trust fund, and I agree we need to look at how that can be addressed.  A gas tax increase is not the way to address that problem, at all.  As far as the oil spill clean-up, that’s the responsibility of British Petroleum.  BP will be held accountable for the clean-up costs, not American taxpayers.”

At 3:46 p.m., Grassley’s campaign issued a statement, too.

Statement of Bob Renaud, Grassley campaign manager
Conlin conflicted and confused on oil spill.  Whose side is she on?  Hers.
Wednesday, May 26, 2010
 
Roxanne Conlin’s statement today is another glaring example of her hypocrisy, lack of understanding of environmental law, and her bias toward litigation, even when it comes at the expense of those who suffer damages.
 
Conlin claims to be worried about the environment and claims to want to stick it to big oil.  Yet she personally owns stock in major oil companies like Chevron, Chevron-Texaco and, more appallingly, Transocean, the very firm whose oil rig blew up and caused the current disaster in the Gulf.
 
This is a continuation of Conlin’s pattern of do as I say and not as I do.  We saw it earlier this week when she had to admit that she’s personally pocketed at least $15 million in special tax breaks, despite being the wealthiest Iowan to ever run for public office and saying that she’s running for office because she’s “fed up with tax breaks for the very wealthy.”
 
Conlin’s statement today also shows her total lack of understanding of how the Oil Spill Liability Trust Fund works.  It was set up by the Oil Pollution Act of 1990.  It pays for research for oil spill prevention.  It is a source for immediate funds in the event of an oil spill, and is reimbursed immediately when a responsible party is identified as BP has been in this case.
 
On top of that, the Oil Spill Liability Trust Fund is designed to give people who suffer economic damages – in this case, fisherman, hotel workers, small businesses and many others – a place to go for due compensation, in a timely manner, without having to take on the legal teams of the big oil companies.  The Trust Fund in no way removes the liability of the oil companies, and Senator Grassley supports increasing the cap on oil company liability.  The Trust Fund makes it possible for all the people who lose their jobs and livelihoods to avoid having to rely on the court system, which sadly grinds on for years, with trial lawyers collecting big settlements and, all too often, claimants being left with a pittance.  Instead, the Oil Spill Liability Trust Fund does battle with the oil companies on behalf of those who suffered damages, and then seeks reimbursement from the oil companies.  The Trust Fund may cut into business for trial lawyers, but it actually helps those who have been harmed.