"Subsidies for oil and gas companies make up 88 percent of all federal subsidies. Just cutting the oil and gas subsidies out would save the U.S. government $45 billion every year."
Keith Olbermann, July 6, on MSNBC's Countdown with Keith Olbermann
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The ruling: FALSE
The oil spill in the Gulf of Mexico has renewed attention on oil and gas industry subsidies. Olbermann, host of Countdown, took on the issue July 6,citingCenter for American Progress reports of "nine different subsidies that the U.S. government gives ... including refunds for drilling costs and refunds to cover the cost of searching for oil. Subsidies for oil and gas companies make up 88 percent of all federal subsidies. Just cutting the oil and gas subsidies out would save the U.S. government $45 billion every year."
The last two sentences stuck out to us. Given the wide range of government subsidies, do those for the oil and gas account for 88 percent of the total? And could they amount to $45 billion per year, equivalent to more than 2 percent of all federal revenues?
We found the Center for American Progress paper the statistic came from, "Pumping Tax Dollars to Big Oil: Getting Government Priorities Right on Tax Subsidies for Oil Companies," published April 14 by Sima J. Gandhi, an economic policy analyst.
In it, she wrote, "Tax expenditures are government spending through the tax code ... distributed through deductions, exclusions, credits, exemptions, preferential tax rates, and deferrals. ... These tax expenditures can amount to a significant portion of federal subsidies for oil and gas. The cost of tax expenditure programs for oil and gas companies made up about 88 percent of total federal subsidies in 2006."
It sounded like Gandhi was saying 88 percent of all oil and gas subsidies were accomplished through the tax code, not that 88 percent of all federal subsidies went to the oil and gas industry. We contacted Gandhi, and she confirmed our suspicion.
As for the claim: "Cutting the oil and gas subsidies out would save the U.S. government $45 billion every year," another paper by Gandhi says ending nine subsidies would save "$45 billion over 10 years," not one year, as Olbermann said.
Olbermann muffed it twice, giving viewers the impression that oil and gas subsidies are 10 times more than they are. So we'll give him a rating of False.
Edited for print. For more, go to PolitiFact.com.