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Friday, March 22 , 2019, 3:59 am | Fair 47º


Jim Hightower: New Outrages Keep Gushing From BP

The oil company reaps the benefits of a special tax break for using unpaid inmate cleanup crews

With BP’s well capped and CEO Tony Hayward exiled to Russia, perhaps you thought that surely there will be no additional revelations about BP to enrage you. But now comes this: prison labor.

Jim Hightower
Jim Hightower

In its national PR blitz to buff up its image, the oil giant has loudly been boasting that it has hired devastated, out-of-work local people to handle the cleanup. Many have been hired, but the people themselves say not nearly enough. The Nation magazine now reports a big reason for the shortfall — BP has been using inmates to do much of the shoveling and scooping to remove oil from Louisiana beaches.

In the early days of the cleanup, crews suddenly appeared wearing scarlet pants and white T-shirts with bold red letters spelling out “Inmate Labor.” Investigative reporter Abe Louise Young writes that the sight of prison laborers outraged the local community, so they were removed.

Not the inmates, the uniforms. Now they wear BP shirts, jeans and rubber boots with no prison markings, and they are moved to and from the job in unmarked white vans. No officials with BP or the feds could or would tell Young how many inmates are being used or what they’re being paid. However, a local sheriff’s official told Young, “They’re not getting paid — it’s part of their sentence.”

But guess who is getting paid for this convict labor? BP. It’s getting paid by you and me. Under a little-known tax provision passed during the Bush regime, corporations can get a “work opportunity tax credit” of $2,400 for every work release inmate they hire.

And that’s not all we’re subsidizing. For example, BP, which rented the drilling rig from Transocean Corp., used a special tax break to write off 70 percent of the rent it paid. Seventy percent! This added up to a savings of $225,000 a day for BP.

Also, back in 1999, Transocean deliberately moved its corporate address offshore in order to dodge its tax obligations to our country. It relocated from Houston to the Cayman Islands, then to Switzerland — slick moves that have allowed the giant corporation to avoid paying $1.8 billion it owed in U.S. taxes.

No industry gets the absurd array of subsidies that Big Oil now enjoys — subsidies at every stage of its operations, including the ones used by BP and Transocean to search for oil in our public waters. As one political leader put it in 2005, “With $55 oil, we don’t need incentives to the oil and gas companies to explore.”

That was George W. Bush talking! Five years later, oil is $80 a barrel and the industry is pocketing record profits — yet the giveaways continue.

Again and again, BP has promised that it would pay all cleanup costs for the mess it made. Now, however, the British-based oil giant has quietly told investors that it expects to get a $10 billion subsidy from Uncle Sugar to help cover the costs.

Say what? Not only did the company’s top executives assure us that this whole god-awful mess would be on their dime, but so did our top government officials.

As President Barack Obama flatly declared in May, “We will demand they pay for every dime they owe for the damage they have done.” Even Rep. Joe Barton — the GOP gooberhead who so obsequiously apologized to BP’s CEO for America’s insistence that he set up a corporate fund to compensate victims — was forced to backtrack and say that, of course, he expects BP to pay the tab.

So what is this $10 billion hit on us taxpayers? It’s another little corporate gotcha that lobbyists quietly got tucked into our tax code, allowing huge firms to grab a credit for up to 35 percent of their losses. The damages and cleanup being paid by BP, one tax expert says, are “just another cost of doing business,” so they qualify for all applicable corporate breaks. After all, according to another expert, while BP said it would pay the costs of the cleanup, it “never promised that it would not seek any deductions” to recoup those costs from American taxpayers.

Tricky, huh?

Jim Hightower is a national radio commentator, writer, public speaker and author of Swim Against The Current: Even A Dead Fish Can Go With The Flow. Click here for more information, or click here to contact him.

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