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Oil Companies and the Budget Dealby: Robert CruickshankTue Jul 21, 2009 at 14:30:00 PM PDT |
| We've been focusing a lot here on Calitics in the last day or so on the losers in the recent budget deal. But who are the winners? Pretty high on that list would have to be Big Oil. They were able to convince Democrats to drop their demands for an oil severance tax, and were able to convince Democrats to agree to allow the first offshore oil drilling in 40 years to begin off the unspoiled coast of Santa Barbara County near Point Conception. Every other oil-producing state in the union taxes the extraction of oil from its lands - including Texas and Wyoming. Even Sarah Palin raised the oil severance tax in Alaska to 25% in 2007. Instead, as Paul Hogarth pointed out, California is defining itself to the right of Sarah Palin by refusing to embrace such a tax. The California Budget Project estimated a 9.9% oil severance tax would bring it at least $1 billion to state coffers. If oil prices rose again above $100/bbl then we could see $2 billion in revenue per year. Given the high likelihood of such increases, an oil severance tax would be a significant long-term boon to the state's coffers, since oil companies can't exactly shift production out of state, since oil is only going to become more valuable over time. And that money could help prevent the most egregious human services cuts that were agreed to in the budget deal - the cuts to healthy families that will cost 500,000 children their health care coverage, the cuts to in home supportive services that people like Nori need to survive. There are many possible responses to the budget deal. The Courage Campaign is asking our members to zero in on the oil severance tax and ask their legislators to vote "no" on a budget that does not include that tax. We will collect signatures to our letter and deliver it to every legislator in the Capitol ahead of the Thursday budget vote. Californians are being asked to make a choice: give the oil companies a sweetheart deal unprecedented in the United States, or demand that oil companies pay their fair share and help prevent a humanitarian catastrophe that budget cuts will cause. The Courage Campaign thinks the choice is clear. Let's let make sure our legislators hear about that clear choice before the vote on Thursday. Over the flip is the email we sent to our members, which includes the California Closed video produced by community organizers Marta Evry and Laura Velkei. |
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