Obama seeks end to oil subsidies; Congress says no

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President Obama used the bully pulpit of the White House on Thursday to condemn lawmakers for supporting billions of dollars in subsidies to oil companies, seeking to tap Americans' frustration with gas prices in a populist pitch that has become a centerpiece of his re-election strategy.

Obama implored Congress to either "stand with big oil companies or the American people," but just moments later, the Senate voted against ending tax breaks for the nation's five largest oil companies despite Democrats' attempts to paint the GOP as beholden to the petroleum industry.

Administration officials expected the legislative defeat, but the effort was yet another attempt by the White House to demonstrate concern for financially strapped families facing gas prices averaging about $4 a gallon nationwide.

"With record profits and rising production, I'm not worried about the big oil companies," Obama said from the Rose Garden. "I think it's time they got by without more help from taxpayers who are having a tough enough time paying their bills and filling up their tanks."

But just 51 senators voted to advance the bill for a final vote, well short of the 60 votes they needed.

Republicans countered that eliminating the tax breaks would in fact add to pain at the pump for drivers -- and said the bill's failure was representative of another knock against an out-of-touch president.

"That was their brilliant plan on how to deal with gas prices: raise taxes on energy companies, when gas is already hovering around $4 a gallon, then block consideration of anything else -- just to make sure gas prices don't go anywhere but up," said Senate Minority Leader Mitch McConnell, R-Ky.

House Speaker John Boehner, R-Ohio, cited a report from the nonpartisan Congressional Research Service that he said proved eliminating the tax breaks would increase gas prices.

"On what would likely be a small scale, the proposals [to end the tax breaks] also would make oil and natural gas more expensive for U.S. consumers and likely increase foreign dependence," the report concluded.

The president has been fending off Republican attacks on his energy policies, which the GOP said are helping to drive up gas prices. But few Americans -- just 26 percent in a Fox News poll -- approve of the president's handling of gas prices.

Obama wants to shift the money that now goes to oil companies in the form of tax breaks to go instead to nascent green-energy technologies that he said would lessen U.S. dependence on foreign oil. But as Republicans pointed out, Obama voted for the very tax breaks he is now decrying when he was in the Senate.

The president counters that times have since changed.

"I think it's curious that some folks in Congress, who are the first to belittle investments in new sources of energy, are the ones that are fighting the hardest to maintain these giveaways for the oil companies," Obama said. "Instead of taxpayer giveaways to an industry that's never been more profitable, we should be using that money to double down on investments in clean energy technologies that have never been more promising."

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