Biden’s budget ignores fiscal responsibility while attacking fossil fuels, critics say

President Joe Biden's recently released proposal budget for fiscal 2025 as a price tag of $7.5 trillion, which as expected has a plethora of subsidies for renewable energy programs and plans to diminish support for fossil fuels.

The proposed budget, the president wrote in his attached message, “would cut wasteful subsidies to Big Oil.”

“In the 30 plus years I have been in Washington, the budget process has devolved to the point where presidential budget statements are more like poorly written fan-fiction than actual fiscal documents. Tim Stewart, president of the U.S. Oil and Gas Association, told Just The News, after the proposal was released last week.

"The fiscal year 2025 Biden budget is a narrative that kind of exists in an alternate reality.”

Biden was elected in 2020 on promise to promote so-called green energy development like more electric cars on the road and expansion of wind power. So the release of a green-energy-minded budget in a reelection year is no surprise. 

 

Roughly $8.5 billion will go to the Energy Department to support the development of clean energy technologies for sustainable aviation fuel, industrial energy, grid infrastructure and offshore wind.

Under Biden’s plan, $6.5 billion will go to rural clean energy projects, and it provides funding to expedite the permitting process for renewable energy projects.

In addition, the president proposes increasing the Environmental Protection Agency’s budget by 20% to 12.1 billion.

These are just a few points in the entire budget that contains a support for environmental programs and green energy to combat the "climate crisis."

End fossil fuels

The budget proposal is largely seen as symbolic and is not expected to be adopted with a Republican-controlled House. The proposal however contains rhetoric targeting oil and gas.

“President Biden’s budget is a direct attack on American energy production,” American Exploration & Production Council CEO Anne Bradbury said in a statement.

According to the American Exploration & Production Council, the budget contains $45 billion in tax hikes specific to the oil and gas industry.

Current federal law allows producers to deduct what are called “intangible drilling costs.” These deductions, according to the AXPC, do not reduce total taxes a company pays. Rather, they allow oil and gas companies to more quickly recover costs that cannot be easily quantified or estimated, which they can then reinvest in development.

“By specifically targeting American oil and natural gas producers with massive tax hikes, President Biden’s budget would harm American families and businesses by increasing their energy prices, threaten our energy security by discouraging investment into the future, and empower our adversaries around the world, who would rush to fill the void left by America, to meet global needs for oil and natural gas,” Bradbury warned.

Stewart said the attacks on fossil fuels are nothing new for the Biden administration’s budget proposals.

“For the third year in a row, President Biden has attacked our industry as ‘Big Oil’ not paying its fair share and proposes to tax us even more. The oil and gas industry contributes almost $50 billion a year to the federal treasury in royalties and taxes which are then used to fund roads and bridges, wetlands protection and local parks,” Stewart said.

Biden’s previous budget proposal also targeted oil, gas and coal for increased taxes. The Tax Foundation in an analysis of the fiscal year 2024 budget proposal said the intentional targeting of a specific industry was a departure from neutral tax policy.

It also found that the oil and gas industry pays a relatively high tax level, and raising taxes on the industry would favor foreign suppliers, who would become more competitive in the global market. That would mean giving an advantage to Russia and Iran, among other oil-producing countries.

Stewart said that calling these increased taxes on “Big Oil” misses that the hardest hit are the smaller producers. Independent oil and gas companies, he said, bring online 80% of the new oil and gas production each year.

“Attacking ‘Big Oil’ really means an attack on small family-owned businesses,” Stewart said.

Budget ‘performance’

The House Republicans released their own budget proposal, which would gut Biden’s “green corporate welfare” by dismantling $129 billion in renewable energy subsidies from the 2022 Inflation Reduction Act.

“The price tag of President Biden’s proposed budget is yet another glaring reminder of this Administration’s insatiable appetite for reckless spending and the Democrats’ disregard for fiscal responsibility. Biden’s budget doesn’t just miss the mark — it is a roadmap to accelerate America’s decline,” the House Republican leadership said in a statement announcing their proposal.

As with the president’s budget, the House Republicans’ budget is not likely to pass muster.

The Senate Budget Committee held a hearing on the president’s budget proposal Tuesday, one day after its release.

Sen. Mitt Romney, R-Utah, called the proposal a “performance.”

“It's appropriate that this hearing is being held during Academy Award season. I'm afraid what we do here is more ‘Barbie’ than it is ‘Oppenheimer,’” Romney said.

Romney said the committee had 28 hearings in the 118th Congress, of which 14 were about the climate. Only two were about the federal budget. He said he’s concerned about climate change and considers it an important topic. But he said it doesn’t belong in a budget committee that should be focused on out-of-control spending.

“This is a committee that's about performing, getting on stage and acting like we care about these things. But there's actually no work being done by this committee to deal with our budget and to deal with federal spending,” Romney said.

Sheldon Whitehouse, D-N.Y., chair of the committee, argued that climate change was a budget matter.

“My God, if there is ever a crisis looming that we're not responding to that is going to smash into the budget, it’s climate change. So I have no hesitancy about continuing to do that work,” Whitehouse said.

National debt

Other Republicans on the committee raised concerns about the president putting his Democratic agenda over fiscal responsibility.

Sen. Chuck Grassley, R-Iowa, citing figures from the Congressional Budget Office, said the interest on the $34.5 trillion national debt will cost $870 billion this year — more than the national defense budget.

“Now comes his fourth budget, offering more of the same radical agenda at a time when we need real solutions to put our fiscal house in order. This budget offers nothing but false promises, and a far-left wish list,” Grassley said.

Stewart agreed that, while the president is focused on an anti-fossil fuel agenda, a larger crisis looms with the growing expense of servicing the national debt.

“The proposed Biden budget has the taxpayers paying $1 trillion in interest payments per month in 10 years. We have much, much bigger problems than your gas stove or my gas-fired water heater,” Stewart said.