Subsiding Big Oil Like Paying Fish to Swim-$28Billion Taxpayer Loss

For more than a decade, lawmakers and administration officials, both Republican and Democrat, have promised there would be no cost to taxpayers for a program allowing companies to avoid royalties on oil and gas produced in publicly owned waters in the gulf.

But last month, the Bush administration confirmed that it expected the government to waive about $7 billion in royalties over the next five years, even though the benefits were expressly conceived of for times when energy prices were low. And that number could quadruple to more than $28 billion if a lawsuit filed last week challenging one of the program's remaining restrictions proves successful.

"It's hard to make a case for royalty relief, especially at these high prices," said Jack Overstreet, owner of an independent oil exploration company in Texas. "But the oil industry is like the farm lobby and will have its hand out at every opportunity."