In April the Federal Court ordered the oil and gas multinational Chevron to pay $340 million in tax. For the past few years this company has gotten away with paying no company tax at all by claiming that it did not make a profit.
The truth is it made billions, but the company inflated its expenses by having its Australian operation take a loan from a US subsidiary with an interest rate 25 times higher than the market norm.
While it is good news that this rort has been stopped, the truth is that the oil and gas majors are still robbing us. First, their five newest off-shore oil and gas projects make no royalty payments whatsoever for the resource that they extract and sell. They get that for free.
To compound the problem a report commissioned by the Australian Petroleum Production and Exploration Association predicts that these projects will pay nothing via the Petroleum Rent Resource Tax over the next 40 years based on current oil prices. All the while these companies also benefit from a range of tax deductions and the relentless campaign by the Coalition to lower the corporate tax rate.
For many of us the story of a resource rich country being stripped of its wealth by big oil companies who have the local government in their pocket conjures up images of neo-colonial exploitation somewhere in sub-Saharan Africa. However nowhere is it more true than Australia, but we are blinded to this reality by a few factors.
Australian corporations are willing partners in this plunder of our resources at home, and are among the ones pillaging countries in Africa and Asia.
While there have been concerted attempts to bring in overseas seafarers to work the gas fields, for the most part the industry employs Australians. Unlike operations in some less developed countries where the mines and wells are staffed by expatriates living in a barbed wire compound and backed up by death squads, here the mining and oil companies bribe us with a few crumbs and colonise our minds.
This is so omnipresent in Perth that you stop noticing it, which is the whole idea. Sporting and arts events are sponsored by these companies, they have naming rights to the venues and whole wings of universities as they infiltrate the education system. Every film screening at the Perth International Arts Festival is preceded by an insidious and creepy Chevron "We Agree" advertisement.
If you had seen only these ads you would think that Chevron's core business was solar panels. If only it were true. In a rational society we would be using the revenues of the fossil fuel industry to fund the renewable energy infrastructure to wean us off them. But that is not happening. Rather than help us keep global warming below 2°C, these companies have their foot to the floor and are trying to expand fossil fuel consumption.
More than 2°C of warming threatens to unleash positive feedback loops and even more warming on a scale that is hard to fathom. It is something no current ecosystem or agricultural system will survive.
We are not just subsidising the oil and gas companies’ profits, but the destruction of the very basis for life on Earth as we know it. We have to pull back from the brink.
The first step is to put these companies on a leash and then bring the industry under public ownership. We have to break its vice-like grip over Australian politics and society. There is no possibility of serious wealth redistribution or a sustainable future without it.
This is no easy task, but we have no other choice, and we see the seeds of such a transformation in the community opposition to the Adani coalmine and the unconventional gas industry. Lend your support to Green Left Weekly to promote these vital struggles, our future depends on it. Please dig deep and make a donation to our fighting fund. You can donate online here.
Direct deposits can also be made to Green Left, Commonwealth Bank, BSB 062-006, Account No. 00901992. Otherwise, you can send a cheque or money order to PO Box 515, Broadway NSW 2007 or donate on the toll-free line at 1800 634 206 (within Australia).
Like the article? Subscribe to Green Left now! You can also like us on Facebook and follow us on Twitter.