U.S. fossil fuel companies took billions in pandemic tax relief but still cut nearly 60,000 jobs

At least 77 U.S. fossil fuel companies claimed $8.2 billion in tax benefits greenlit by the CARES Act but still laid off nearly 60,000 workers, according to a recent data analysis by BailoutWatch, a nonprofit with a liberal bent. "Chris Kuveke, a BailoutWatch analyst, said the data shows that the aid to the industry failed to deliver the benefits that Congress had intended," Nicholas Kusnetz reports for Inside Climate News. The analysis comes as the oil and gas industry warns that Biden administration efforts to transition the economy to renewable energy will cost American jobs.

"These companies did not use that money they received through the CARES Act to maintain payroll," he told Kuznetz. Unlike with the Paycheck Protection Program, companies that claimed the new tax benefits weren't required to maintain employment. "Kuveke said that if companies had been focused on maintaining jobs, they could have chosen to cut costs elsewhere," Kusnetz reports. "Marathon, for example, increased its dividend in January 2020, and maintained it at that level as the pandemic spread, rewarding shareholders instead of maintaining employment."

Thornton Matheson, a senior fellow at Urban-Brookings Tax Policy Center, said the tax benefits weren't meant to keep jobs, but to help companies improve their cash flow even as revenues tanked, and that the U.S. spent more pandemic relief on this type of corporate aid than it did to keep people employed, compared to other developed nations. 

"You can question both the size of those measures and how effective they were," she told Kusnetz. "Are these tax breaks something that we want to give to large corporations, or do we want to focus them on small businesses?"