Distributive Policy and Energy Subsidies

The Obama administration would like to end tax breaks for oil companies including, “deductions for certain drilling costs, tax credits for low-volume oil and gas wells and a manufacturing tax deduction for oil and gas companies.”  Oil companies argue that ending tax breaks would reduce domestic oil drilling which would in turn cost jobs and decrease oil independence. Opponents of oil subsidies cite the desirability of increasing renewable energy sources, decreasing greenhouse gasses, and increasing tax revenues from oil concerns.  While pushing for increased taxes on the oil industry under the guise of fiscal and environmental responsibility, the Obama administration increased renewable energy funding by $460 million.

Under Lowi’s description of distributive policy, the corporation is clearly evident as the primary political unit in energy subsidies.  These policies are decided in Congressional committees. The Department of Energy is heavily involved in the push for renewable energy.  For the most part, the power structure is a stable relationship between the elite and support groups for both the oil industry and renewable energy interests.

http://www.reuters.com/article/idUSTRE6103RM20100201