Senate Democrats are expected to push for a vote this week on the Close Big Oil Tax Loopholes Act of 2011, a bill to cut tax subsidies for Exxon Mobil, BP, ConocoPhillips, Shell and Chevron.

The money saved by closing these loopholes — estimated at $21 billion over 10 years — would be used to pay down the deficit.

“At a time when families are feeling the pain at the pump and our deficit keeps growing at an alarming rate, we simply can’t afford to keep giving away billions in taxpayer handouts to oil companies that are doing nothing to help lower prices,” said bill sponsor Sen. Robert Menendez (D-N.J.) “The ‘Close Big Oil Tax Loopholes Act’ is based on a simple premise: we need everyone to do their share to lower the deficit, not just working families and the elderly.”

The bill would eliminate five special oil company exemptions.

In a Senate committee hearing last week, the leaders of Exxon Mobil, BP, ConocoPhillips, Shell and Chevron called the proposal anti-completive and discriminatory and warned that it would threaten American jobs and harm innovation.

But with gas prices over $4 per gallon in much of the country, many Americans are most concerned with high fuel costs.

A report prepared for Sen. Harry Reid (D-Nev.) by the Congressional Research Service says that eliminating tax breaks for large oil companies is unlikely to have much affect on gasoline prices, because crude oil is the largest factor in the price of gas, and the price of crude oil is set by world market.

The tax changes are unlikely to affect oil output, the price of oil and, consequently, the price of gas, CRS found in an analysis of five breaks targeted by Democrats.

The Domestic Manufacturing Deduction

Oil companies get a 6 percent deduction in net income for domestic production.

Ending this would be equivalent to an increase on the tax on corporate profit, CRS said.

It is widely accepted that a proportional change in taxes on profit affects neither the firm’s incremental costs or revenues, and therefore does not change its behavior with respect to output. Since output does not change, there is little reason to believe that the price of oil, or gasoline, consumers face will increase.

The price of oil is high enough to provide incentive for continued production in the U.S, CRS said.

With current oil prices at, or near, $100 per barrel in the United States, it is unlikely that firms will slow production, or close wells as the result of the loss of the Section 199 deduction.

Intangible Drilling Costs

For nearly a century, oil and gas companies have been allowed to take immediate deductions for costs associated with exploring for oil. This was designed to enhance investment returns for financing risky exploration activities. But with oil prices high, companies don’t need incentives to explore. CRS:

Repeal of the immediate expensing of intangible drilling costs provision and replacement with a form of cost amortization more consistent with depreciation methods common in other industries likely will have no effect on current U.S. oil production, and hence no effect on current gasoline prices.

Dual Capacity Rules

Since the 1950s oil companies have been allowed to deduct the tax payments they make to other countries.

These tax payments are broadly defined, and, according to the Center for American Progress, companies have been allowed to claim credits for payments in countries that have little or no business tax.

CRS said that since elimination of this break amounts to a tax on profit it should have no effect on output or pricing decisions, and therefore no effect on the price of gasoline.

“The incidence of the tax would appear to be on shareholders.”

Oil companies are allowed to deduct a flat percentage of revenues from a well. This break is called “percentage depletion.” CRS says that it has been eliminated for most companies and should not be a factor in investment and pricing decisions by the five major oil companies.

The companies are also allowed to deduct the cost of tertiary injectants used in drilling. CRS found that the cost of ending this tax break would be very small for industry.

“[T]he five major oil companies, to which repeal would apply, earned over $32 billion in net income in the first quarter of 2011. Repeal of the [tertiary injectant] deduction for the industry is estimated by the Obama administration to yield only $6 million in revenue in 2012.”

The tax revenue generated by ending these five exemptions is expected to be 5 percent of the earnings of the largest oil companies, the report found.

He traces the oil spill narrative roughly like this: Outcry about the environmental effects of the spill turned into concerns about the moratorium on drilling, which, when the moratorium was lifted, turned into everybody moving on to something else.

At first, it seemed like an inevitability that the oil spill would become a major issue in the midterm elections. And in some cases it was — Grimm points to Florida Gov. Charlie Crist’s early Senate campaign rhetoric on the environmental impacts of the spill, and I’ve written before about how Sen. David Vitter (R-La.) and Rep. Charlie Melancon (D-La.) zeroed in on the drilling moratorium.

But oil spill rhetoric has faded significantly for a number of reasons. The first is time. It’s been more than six months since the spill, and the incident rarely gets front-page billing these days. The second, as Grimm points out, is the administration’s decision to overturn the moratorium. The decision took some of the wind out of arguments that the administration was destroying the Gulf economy, though Sens. Vitter and Mary Landrieu (D-La.) have both raised concerns that new drilling rules will slow the pace of new drilling.

The third is a little more complicated. On the one hand, many Democrats seem reluctant to make the oil spill an election issue, because in doing so, they would have to acknowledge one embarrassing little detail: The Senate has failed to pass an oil spill response bill. On the other hand, many Republicans would have to reconcile their support for expanded offshore drilling with the obvious safety concerns. At the end of the day, it’s a thorny issue for both sides of the aisle.

After the midterms, once our elected officials trek back to D.C. to do the less glamorous job of legislating, the big question is this: How will Congress deal with offshore drilling? Right now, it’s unclear. The momentum to pass an oil spill response bill is gone, and with it go the prospects that we’ll see stand-alone legislation on the issue. While it could come up in the lame-duck session, it seems more likely that oil spill response provisions will make their way into a broader energy bill next year that will focus on low-hanging fruit issues like electric vehicles and efficiency, possibly paired with a renewable energy standard. Of course, the outcome of the midterm elections will likely determine the lame-duck agenda.

Just how stringent oil spill response provisions will be depends largely on the outcome of behind-the-scenes liability negotiations between, among others, Sens. Robert Menendez (D-N.J.), who would prefer unlimited liability on any company responsible for a spill, and Sens. Landrieu and Mark Begich (D-Alaska), who are trying to devise a mechanism by which companies can pool their liability in the event of a large disaster.

“Immigration reform is not a Republican or Democratic issue: Both parties have failed the Latino people on this issue,” Roberto DePosada, who heads Latinos for Reform, said in the video. “The Republican Party’s rhetoric on this issue has been irresponsible, but so has the Democratic Party’s inaction on this issue in the past two years. … Don’t just give your vote away because it’s expected.”

Here’s the video:

On the one hand, this could be a convincing point: Democrats assumed support from Latino voters but failed to deliver on their promises, and polls show some fallout. But few expect Congress would take on immigration reform during a lame duck session. Even Sen. Robert Menendez (D-N.J.), who introduced a comprehensive immigration reform bill just before the pre-election recess, seemed unconvinced it would go anywhere.

But immigration advocates argue the failure of reform during Obama’s two years is not a reason to stay home from the polls, and they remain highly critical of DePosada’s effort to run the ads in Nevada. “This is overt voter suppression, and it’s ugly,” Frank Sharry, Executive Director of America’s Voice, said in a press release earlier this week. “It’s precisely because of Sharron Angle’s nasty attack ads on immigration and this latest voter suppression tactic that Latino voters in Nevada should vote. They comprise 12% of the Nevada electorate, and a large turnout could prove to be fatal for Angle.”

Rep. Luis Gutierrez (D-Ill.), a longtime supporter of comprehensive immigration reform and a member of the Congressional Hispanic Caucus, seemed to make a similar “lesser of two evils”-style point in an op-ed he released today at Latinovations (emphasis mine):

On immigration, the question is not whether you are a Pelosi-Obama Democrat, but whether you are a Lamar Smith-John Boehner-Steve King Republican.  When it comes down to it, putting people like Smith-Boehner-King at the helm of national immigration policy is a guarantee of more gridlock and chaos. Rep. Steve King of Iowa — who makes Jim Sensenbrenner look like Dolores Huerta by comparison — has called for electrified fencing on the border because he has found it effective for controlling “livestock.”  And if the recent past is any indication, we can expect any number of anti-Latino voter intimidation dirty tricks in the coming weeks in addition to the ads telling Latinos not to vote.  We need to make it crystal clear to voters who favor a fair and humane immigration system that a vote for any GOP House or Senate candidate is a vote for the status quo on immigration or worse.

Although the bill may not go anywhere, it contains some measures that could be aimed at finding bipartisan support, including its first section on border enforcement. Republicans have made a call for border security a central part of their message on immigration reform. From the summary:

• Expands Customs and Border Protection (CBP) and Immigration and Customs Enforcement (ICE) staffing, in line with this review.
• Improves training and accountability for DHS border and immigration officers.
• Enhances cooperation with Canada and Mexico, as well as local law enforcement agencies, to improve border security and coordinate crime fighting.

The bill specifically places immigration in the hands of federal authorities, clarifying the legality of state immigration enforcement efforts such as Arizona’s SB 1070 immigration law.

The next section focuses on interior enforcement, attempting to make the system less exploitable and more humane toward legal and illegal immigrants:

• Requires DHS to track the departure of noncitizens to ensure that individuals do not overstay their visas.
• Denies “visa waiver” privileges to countries whose citizens attempt to overstay visas.
• Refines existing law on illegal entry, illegal reentry and voluntary departure of noncitizens to ensure enforcement of those provisions and heighten penalties for those who commit serious offenses. [...]
• Improves detention conditions to meet basic standards; expands secure alternatives to detention.
• Ends the waiting period for refugees and asylees to obtain green cards.

Third is a section on workplace enforcement. Like the blueprint created by Sens. Chuck Schumer (D-N.Y.) and Lindsey Graham (R-S.C.) this spring, the Menendez-Leahy bill calls for a fraud-resistant, tamper resistant Social Security card:

• Mandates the use of an employment verification system for all employers within five years. [...]
• Requires the Social Security Administration to create a reliable and secure way of verifying Social Security numbers and work authorization.
• Adds criminal penalties for fraud and misuse of Social Security numbers.

The remainder of the bill focuses on reforming the legal immigration system, which both sides agree is badly in need of improvement. The fourth section focuses on how visas will be determined and distributed, including the AgJOBS and Uniting American Families Act to improve the process for farm workers and foreign partners of gay and lesbian citizens:

• Creates a Standing Commission on Immigration, Labor Markets, and the National interest to evaluate labor market and economic conditions and recommend quotas for employment? based visa programs that Congress and the President would act on. [...]
• Creates the structure for a new nonimmigrant visa program (H?2C) to address gaps in existing worker programs that have lead to undocumented migration. [...]
• Significantly expands labor protections in current H?2A, H?2B, H?1B, and L?1 visa programs.
• Ensures that the number of family and employment green cards authorized by Congress do not expire because of processing delays; expands the share of visas that each country can access within existing quotas that limit overall immigration.
• Incorporates the AgJOBS bill, which provides a path to permanent residency for farm workers and revises agricultural employer sponsorship requirements.
• Incorporates the Uniting American Families Act, which allows permanent partners to access the family?based immigration system.

The next step is legalization for some of the 11 million illegal immigrants living in the U.S., which the Obama administration argues is necessary to maintain the economy, communities and families:

• Creates Lawful Prospective Immigrant (LPI) status for non?criminal undocumented immigrants living in the U.S. since 9/30/10. Requires applicants to submit biometric and biographical data, undergo security and law enforcement checks, and pay a $500 fine plus application fees. LPI status lasts four years and can be extended. It includes work authorization and permission to travel abroad; immediate family members are also eligible for status under the program. [...]
• Incorporates the DREAM Act, which creates a path to legal status for individuals who were brought to the U.S. illegally as children, provided they meet age and other criteria and enroll in college or the U.S. military.

In its final section, the bill establishes several programs to better integrate immigrants into American society and provide humanitarian aid to those who cannot enter:

• Enhances programs and policies to help immigrants learn English and U.S. civics, such as: tax credits for teachers of English language learners and businesses who provide such training for their employees; a revamped DHS Office of Citizenship and New Americans to assist with immigrant integration; and grants for states who work to successfully integrate newcomers. [...]
• Evaluates the factors that drive undocumented migration from key sending countries and requires the State Department to develop a strategy to reduce migration pressures.

Cornyn argued immigration “hasn’t been a priority” for Obama and said Sen. Robert Menendez (D-N.J.) was wrong to wait until yesterday to introduce his comprehensive immigration reform bill:

“I think this kind of serious subject matter bears much more consideration than simply to be filed the day we adjourn or to be taken up in a lame duck session…

Plenty of immigrants rights advocates make the same argument, arguing Obama and Democrats in Congress put immigration reform on the back burner while pushing for other legislation.

But Cornyn is part of the reason for these failures, making his statements fairly disingenuous. Congress could not pass reform efforts without Republican backers, and Obama cannot sign laws without Congress. Once Sen. Lindsey Graham (R-S.C.) removed his support from Sen. Chuck Schumer’s (D-N.Y.) comprehensive immigration reform effort this spring, finding Republican backers for immigration bills became next to impossible.

Even the DREAM Act, which had bipartisan support at other periods since its 2001 introduction, was pushed out when Republicans voted to filibuster the defense authorization bill set to host it as an amendment.

Adam Serwer sums it up best in a post titled “Republican Strategy on Immigration”:

Step one: Obstruct all efforts at immigration reform, accuse the president of holding the border “hostage” even as he deports a record number of illegal immigrants.

Step two: Remind everyone how the president broke his promise to pass immigration reform.

The Uniting American Families Act establishes rights of same-sex couples to bring their foreign partners to the U.S. Under the current system, straight couples can petition for their foreign-born husbands or wives to move to the U.S. as legal residents, but gay and lesbians are denied the ability to petition for foreign partners — even in states that allow gay marriage.

There was some question over whether comprehensive immigration reform would include the measure. Reps. Luis Gutierrez (D-Ill.) and Mike Honda (D-Calif.) have pushed for the Uniting American Families Act to be included in comprehensive reform legislation, claiming it could broaden the support base for the bill.

But while many Catholic and other religious organizations support immigration reform, some argue they cannot support a bill with gay rights measures. “That would be a deal-breaker,” J. Kenneth Blackwell, a senior fellow at the evangelical Family Research Council, told the New York Times in July when asked about including same-sex family reunification in an immigration bill.

While it’s unclear whether this bill will go anywhere, advocates of gay rights and immigration reform applauded the inclusion of the Uniting American Families Act to Menendez’s bill.

“Senator Menendez’s bill will set the stage, in this Congress and the next, for a serious debate on fixing our broken immigration system,” Steve Ralls from the pro-LGBT Immigration Equality told The Advocate.

Menendez claims its a matter of good policy, and will demonstrate the differences between the two parties’ stances on immigration before the election:

“If you look at all of the polls, overwhelmingly, people want to see a resolution of the problem. They want to see our system reformed,” Menendez told POLITICO Tuesday. “So clearly, you see the difference between those who are willing to move forward and get a reform and [those who are] not, and for the Hispanic community, clearly they understand who stands on their side and [who does] not.”

It’s a message immigrants rights groups have pushed, too, in hopes that Democrats will win enough seats to pass comprehensive immigration reform down the line.

But even if it energizes the base for the future, many don’t expect it to go anywhere now. “Given the timing, given the lack of bipartisan support, I think it’s hard to get excited about it,” Marie Gonzalez, a DREAM Act supporter, told Politico.

Republicans, for their part, said they would not support a bill that included what they dismiss as “amnesty”: paths to citizenship for any of the 11 million illegal immigrants already in the country. “That’s a nonstarter,” Rep. Brian Bilbray (R-Calif.), chairman of the conservative House Immigration Reform Caucus, told Politico.

Menendez’s bill will likely be similar to a bill Sen. Chuck Schumer (D-N.Y.) offered this spring. Schumer’s bill included paths to citizenship and temporary worker program as well as an enforcement measures such as border security and employee verification.

“I think the White House, the Democrats, and the allies that support serious immigration reform are going on offense and the President is our quarterback,” Gutierrez said in a press release. “I have been pushing hard to get us all pointing in the same direction on this issue and now with the White House standing with us and the Senate poised to act, I think we are seeing that effort begin to bear fruit.”

Politico has more from after the meeting:

“The president committed to talk to senators,” she said. “We will encourage the community at large to help us, because next week is going to be a crucial week.” Echoing Obama, she called for an “up or down vote.”

Rep. Luis Gutierrez (D-Ill.) added that Obama made it clear that he would “leave no stone unturned.” He said they asked Obama to use the “full weight, the full might of the White House.”

“Let’s have a victory next week,” Gutierrez said.

Sen. Robert Menendez (D-N.J.) advocated for the defense authorization bill, in which the DREAM Act is contained. “I trust that Republicans will join us,” he said, noting that the issue has been bipartisan in the past. “A clean vote without amendments to it.”

“Now, I know that many of you campaigned hard for me, and understandably you’re frustrated that we have not been able to move this over the finish line yet,” he said. “I am too.”

He said he will continue to push for comprehensive immigration reform and pledged his support for the DREAM Act, a bill to help some undocumented young people gain legal status, which will be added to a defense authorization bill next week.

The administration has been vague on its timetable for pushing immigration reform. “This is in the hands of the Congress, and they will need to address this in a bipartisan way,” Department of Homeland Security Secretary Janet Napolitano said in August. “The timetable question should be addressed to them.”

It’s a fair point, of course — Obama can’t force Congress to pass legislation. But the White House could also put more pressure on Congress to focus on immigration-related issues.

Either way, it could have major implications for Democrat success among Latino voters this fall, and in the future, according to a July report. Latino voters want to see comprehensive immigration reform, and some said they would stay home from the polls in November if it doesn’t happen this year.

“You have every right to keep the heat on me and the Democrats, and I hope you do. That’s how our political process works,” Obama said last night. “But don’t forget who is standing with you, and who is standing against you. Don’t ever believe that this election coming up doesn’t matter.”

Obama will meet with Sen. Bob Menendez (D-N.J.) and Reps. Nydia Velazquez (D-N.Y.) and Luis Gutierrez (D-Ill.) today to discuss the DREAM Act and a comprehensive immigration reform bill Menendez plans to unveil in the Senate.

“Don’t all immigrants deserve the respect and relief that the Dreamers will get?” Velazquez, chairwoman of the Congressional Hispanic Caucus, said. “Definitely. And we won’t stop until we get comprehensive immigration reform.”

At a pro-reform meeting today, Menendez announced he will unveil a comprehensive reform bill, which the lawmakers said they hope to pass as soon as possible. (Prospects for passing a bill, of course, remain bleak, particularly with the current anti-immigrant fervor.) The three politicians said they will meet with President Obama tomorrow to discuss immigration issues.

“We need the president to speak loudly that when Bob Menendez introduces that bill, he will stand behind that bill,” Gutierrez said.

Gutierrez said he plans to ask Obama to freeze non-criminal deportations — particularly of parents of U.S. citizen children — until comprehensive immigration reform passes. This could provide security from deportation for a large number of illegal immigrants: There are 4 billion U.S.-born children of illegal immigrants, according to the latest estimates.

The DREAM act, which should go up for a vote as part of the defense bill next week, is “a step in the right direction,” Velazquez said. First, though, it needs to pass. “We need Republicans to stand up and say ‘yes’ to the DREAM Act next week and allow a vote,” Gutierrez said.

Advocates of comprehensive immigration reform were once wary of supporting the DREAM Act as a standalone measure because it could scare off future votes for comprehensive immigration reform. Mary Giovagnoli, director of Immigration Policy Center, told TWI recently that it is no longer clear how the DREAM Act’s passage would impact comprehensive reform efforts.

“We don’t have a good measure anymore of what will happen once we get something discreet like the DREAM Act passed,” she said. “But when the sky doesn’t fall in and if people still get re-elected after supporting DREAM, it may show members of Congress that leaning into the immigration issue and voting for comprehensive immigration reform could help them politically.”