President Joe Biden criticized Big Oil companies for using record profits to pay for stock buybacks, calling for the tax on such buybacks to be quadrupled in his State of the Union address Tuesday.
Biden described the record profits oil companies generated in 2022, a number he pegged at $200 billion, as “outrageous” considering the “global energy crisis.” In August 2022, Biden signed a 1% tax on stock buybacks into law, but multi billion dollar buybacks from major corporations like Apple, Meta, Chevron and ExxonMobil have continued relatively unabated, CNBC reported.
“If they had in fact, invested in production, it would have kept gas prices down.” Biden said. “Instead, they used the record profits to buy back their own stock, rewarding their CEOs and shareholders. Corporations ought to do the right thing.”
U.S. oil giant Chevron announced plans for a $75 billion stock buyback on Jan. 27, an industry record, after posting a record-breaking annual profit of $33.5 billion, driven in part by high gas prices. The company also announced plans to increase its budget for new production to $17 billion from $15 billion, and is reportedly in talks with the Algerian government to look for sources of shale in the country, building off technology it developed from its investments in the U.S. market.
ExxonMobil told the Daily Caller News Foundation in July 2022 that it was undergoing its largest capacity addition since 2012, and that several of its factories had set records for throughput.
The President also criticized oil companies for claiming that he might shut down oil investments, claiming that he told oil companies that the U.S. would need oil for at least ten more years. In his first 19 months in office, Biden’s Department of Interior leased the least amount of federal land for oil drilling since a 19 month period from 1945 to 1946 under President Harry Truman.
Biden repeated his “ten year” claim at the State of the Union Tuesday, drawing laughs and derision from the crowd.
Quadrupling the tax on stock buybacks would “encourage long term investments,” Biden said.
“They’ll still make considerable profit,” said Biden. “Let’s finish the job and close the loopholes that allow the very wealthy to avoid paying their taxes.”
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