This was a vote on ending debate (known as invoking “cloture”) on a motion to bring up legislation (known as a “motion to proceed) that would have eliminated federal taxpayer subsidies for major U.S. oil and gas companies.
Specifically, the underlying bill ended federal taxpayer subsidies for the five largest U.S. oil and gas companies—Exxon, Shell, Chevron, BP, and ConocoPhilips. Democrats argued that oil companies were highly profitable and no longer needed such subsidies. They also contended that taxpayers should not have to support oil and gas companies given that the price of gasoline had reached well over $4 per gallon in many parts of the country. Republicans characterized the bill as “raising taxes” on oil producers, and argued that oil companies would simply make up for lost subsidies by charging higher prices to consumers.
Sen. Al Franken (D-MN) urged senators to vote to end debate on the motion to bring up the bill: “The bill before us would end $1.2 billion in subsidies to the five largest oil companies in fiscal year 2012 and $21 billion over the next 10 years. These companies make up three of the top five Fortune 500 companies and have had nearly $1 trillion in profit over the last decade. While high oil prices are gouging the pocketbooks of American families, these companies are on a pace for a record profit this year. In the first quarter alone, these companies collectively made about $35 billion in profits. I wish to ask my colleagues, how high do oil prices have to go--how big do the oil companies' profits have to be--before we can talk about doing away with their handouts? These companies have legacy wells that pump oil at a cost of about $10 a barrel--a little less. On average, oil production costs them $15 a barrel. When exactly don't they need these subsidies anymore? They are making record profits. At $100 a barrel, why do they need the subsidies? If oil goes up to $102 a barrel or $110, or $150, can they give us the subsidies back then? There is absolutely no rationale for these subsidies--none at all.”
Sen. Lisa Murkowski (R-AK) criticized the underlying bill: “I think it is important we remember we are speaking about five energy producers, five oil companies. We are not talking about a tax proposal that is broad and wide and encompassing. We are talking about a proposal to raise taxes on the five largest domestic energy producers….This proposal is designed to fail. But in failing, it is designed to score some political points, and it seems as if that is where we are today. But as a Senator who represents a state--Alaska; an oil and gas producing state, a state that would clearly be hurt by this proposal--I am obliged, obligated to outline why I feel this is so deeply flawed. I want to start by stating the obvious here. This legislation will not reduce energy prices, but, if anything, it will increase our energy prices. It will not substantially reduce our deficit or our debt, but, if anything, it will add to those burdens by shutting off production and forcing the government to forgo production revenues….So what exactly is it we are seeking to do, other than send a message?”
The vote on this motion to end debate on bringing up the bill was 52-48. While a majority of senators voted in favor of the motion, at least 60 votes are required to invoke cloture and shut off debate. Thus, the motion was rejected. Voting “yea” were 50 Democrats and 2 Republicans. 45 Republicans and 3 Democrats voted “nay.” As a result, the Senate failed to bring up a bill that would have eliminated federal taxpayer subsidies for major U.S. oil and gas companies.