President Trump’s Interior Secretary David Bernhardt opened the backdoor for taxpayer-backed big oil bailouts. The ex-oil and gas lobbyist’s former clients are bellying up to the taxpayer trough, calling for sweeping royalty rate cuts on public oil and gas leases, which could derail Trump’s tenuous global oil production deal.
“Interior Secretary Bernhardt is more focused on green-lighting bailouts for his former lobbying clients begging for special treatment than on the tenuous deal President Trump brokered to cut global oil production,” said Jayson O’Neill, Director of Western Values Project. “It should tell you everything you need to know about the Trump administration that they are willing to saddle American families with higher gas prices and acquiesce needed revenue just to bail out their billionaire big oil corporate pals.”
Just last week, President Trump flip-flopped on his support for royalty rate cuts for big oil because the tenuous agreement to cut global oil production hinges, in part, on the Trump administration curtailing domestic production. However, Trump’s Interior Department has already begun the process of reducing royalty rates for oil production and told members of Congress that oil and gas corporations should begin applying for royalty reductions and lease suspensions through existing procedures.
Secretary Bernhardt’s former client, National Ocean Industries Association (NOIA), an offshore oil and gas lobbying association, urged President Trump to ‘utilize his full policy toolkit’ and called for ‘offshore royalty relief’ in order to bail out the notoriously boom-bust industry. A recent analysis found that much of the industry was in trouble long before the economic slowdown caused by the coronavirus pandemic.
Whether Secretary Bernhardt’s backdoor big oil bailout derails Trump’s ‘creative math’ oil production deal that will raise gas prices on already struggling American consumers and businesses is yet to be seen. But many analysts see the desperate measures attempting to prop up the fledgling industry as ‘too little and too late’ after Trump’s ‘energy dominance’ policy flooded the global market with crude.
Congressional members pushing for big oil bailouts have taken millions in campaign donations from the oil and gas industry and recently cited an outdated 2015 study commissioned by the American Petroleum Institute that claimed the oil and gas industry accounts for some 10.3 million jobs. A more recent study that uses government energy employment data found that approximately 6.7 million Americans were employed across the sector in 2018.
Meanwhile, America’s outdoor recreation industry, also reeling from the economic impacts of the pandemic, contributes more to the U.S. economy than mining, oil, and gas combined and directly supports 7.6 million American jobs but has received little attention from the Trump administration or Congress.
Trump’s Interior Department is still plowing forward with oil and gas leasing, with leases often going for less than a cup of coffee, and major policy decisions despite repeated requests for a pause during the pandemic.