Stop the Waste of Taxpayer Money
|April 28, 2007||Posted by Staff under Progress Report, The Progress Report|
Stop the Waste of Taxpayer Money
Hinchey Introduces Bill to Stop Oily Corporate Welfare Scandals
Corporate welfare handouts to big oil corporations are immoral, unneeded, expensive, increase dependence on foreign oil, and reward pollution. So let’s stop them.
Here is one Congress person leading in the right direction.
In the wake of news that World Bank Group lending for oil projects increased more than 75 percent over the past year, Congressman Maurice Hinchey (D-NY) on April 17, 2007, introduced a bill to help end international subsidies to Big Oil.
In order to focus global aid on reducing poverty and establishing renewable energy infrastructure in developing countries, Hinchey’s bill, the End Oil Aid Act, would direct the U.S. Treasury Secretary to instruct the U.S. Executive Director of the World Bank to use the United States’ voice and vote to prohibit additional spending on international oil development.
“Each year, billions and billions of dollars that should be spent on ending poverty around the world and improving the environment are being used to subsidize oil and gas projects in developing countries that lead to debt traps for those countries and an increase in greenhouse gas production,” Hinchey said. “It is unfathomable that the U.S. and other wealthy countries would spend billions of dollars on subsidies for Big Oil when those energy companies are reaping record profits while billions of people around the world are living on less than $2 a day. There is no justice in that. Instead of alleviating poverty, most oil and gas projects have exacerbated corruption, worsened economic inequality, increased local conflict, and intensified global climate change.
The World Banks lending for fossil fuels has been controversial since the Extractive Industries Review (EIR) — a three year, multi-stakeholder process which examined the poverty alleviation impacts of projects in the oil and gas sectors — recommended that all international oil aid end by 2008.
In 2005, public institutions such as the World Bank and U.S. agencies such as the Export-Import Bank provided more than $3 billion to the international oil and gas industry. Over the April 14-15 weekend, finance ministers representing the World Banks 185 member countries met to discuss the Banks strategy for clean energy development and combating climate change. The members failed to address the need to end international oil aid.
Despite the EIR recommendation to phase out of financing oil projects by 2008, the World Bank Groups investments in oil increased by more than 75 percent from 2005 to 2006. Furthermore, its investments in gas projects shot up by at least 50 percent over the same time period.
“We have an important choice as we help to establish an energy infrastructure in developing countries around the world,” Hinchey said. “Either we follow the current policy and create an oil-based infrastructure that will result in these developing countries producing harmful greenhouse gases, or we establish a renewable energy infrastructure that will make these countries clean energy leaders. It is absolutely critical that we choose the latter and create a renewable energy infrastructure in these developing countries so that we can shift the world away from oil consumption and towards alternative, clean energy solutions.
“Oil is not a long-term energy solution anymore, which is why it makes no sense to establish an oil-based infrastructure in these countries. All future global aid for energy should be invested in renewable energy infrastructure and production.”
Additional information on ending international oil aid is available at http://www.endoilaid.org
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