Obama ad calls for return of windfall profits tax

[August 04, 2008]  CHICAGO (AP) -- Barack Obama's campaign will begin running a television ad Monday that attacks Republican John McCain's energy policies.

"After one president in the pocket of big oil we can't afford another," says the ad, referring to President Bush's previous work in the oil industry.

Obama hoped to emphasize energy and the economy in campaign stops this week in Michigan, Ohio and Indiana, beginning with a speech Monday in Lansing, Mich. Gas prices over $4 a gallon have become a top issue in the presidential contest.

Obama's spot trumpets his proposal to revive a windfall profits tax on energy companies and asserts that McCain favors tax breaks for the oil industry.

"A windfall profits tax on big oil to give families a thousand-dollar rebate," an announcer in the ad says.

Obama has pushed for such a tax to fund $1,000 emergency rebate checks for consumers besieged by high energy costs.

Congress enacted a windfall profits tax in 1980, during an earlier era of high oil prices, but repealed it in 1988 amid concerns the tax was discouraging domestic oil development. Last year, the House approved $18 billion in new taxes on the largest oil companies, but they were blocked by Republicans in the Senate.

The new Obama ad opens with a driver pumping gas. The announcer says, "Every time you fill your tank, the oil companies fill their pockets."

Obama has said recently that he would reluctantly consider accepting some new offshore oil drilling. Obama previously opposed any offshore drilling.

Lately, however, he has cited "very constructive" talks between Senate Republicans and Democrats on this issue. He praised a plan unveiled by a group of Republican and Democratic senators to permit drilling while supporting an effort to convert most vehicles to alternative fuels in 20 years.

McCain's campaign accused the Democrat of flip-flopping. However, the Arizona Democrat recently reversed his own former opposition to drilling on the Outer Continental Shelf.

Both candidates have energy proposals to reduce U.S. dependence on oil. Obama's was first, and its centerpiece is a 10-year, $150 billion spending plan focusing on clean coal technology, further development of plug-in hybrid cars, commercialization of wind and solar power and other measures.

McCain's, which is called the Lexington Project, includes building 45 new nuclear power plants; offering a $300 million prize for major advancement of low-cost, plug-in hybrid or electric car technology; and "encouraging the market" in wind, hydroelectric and solar power. Both he and Obama would cut use of fossil fuels to combat climate change.

[Associated Press; By TOM RAUM]

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