Blocking oil companies’ ability to benefit from two key tax relief provisions could drive up the deficit and the national debt, according to a study released Tuesday by Louisiana State University professor Dr. Jospeh R. Mason (PDF).

The study, sponsored by the American Energy Alliance, focuses on two tax relief provisions: dual capacity (foreign tax credits) and the Section 199 deduction, currently available to nearly all American businesses.  It concludes that while eliminating the availability of the provisions to oil companies would increase revenue by tens of billions in the short term, it would cost the country hundreds of billions in economic output, provoke about 155,000 job losses (with consequent impacts on wages and employment-derived tax revenues), and ultimately result in a net fiscal loss of $53.5 billion in tax revenues.

“The administration’s proposal to eliminate tax deductions on U.S. oil and gas companies is grossly counterproductive toward the goal of increasing federal revenues,” said Dr. Mason in a statement. “Such a move would have a net negative impact on revenue, thereby increasing federal deficits.”

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Obama administration policies have caused “irreperable harm” to the Gulf Coast economy, stifling the energy sector and culling employment within it to a degree previously underestimated by the administration itself.

That is the conclusion drawn by Louisiana State University economics professor, Dr. Joseph Mason, author of a new critique of the Obama administration’s Inter-Agency Economic Report released last week estimating losses due to the deepwater drilling moratorium currently in effect.  According to Dr. Mason, that report understated the ban’s impact on job losses by as much as 60 percent.

During a conference call Tuesday, Mason criticized the administration’s methodology for calculating the economic effects of the ban, and said the administration used inflated, flawed logic to calculate its valuation of economic offsets—such as unemployment wages—and their counter effects on the economic downturn. He said the report was inaccurately rosy in describing the Gulf States’ economic recoveries following the BP spill.

“Those states have been irreparably harmed,” Mason said. “Essentially all of these economies have taken the summer off and are trying to get back to the baseline.”

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Pelican Institute reporter Steve Beatty has a new story demonstrating that hundreds of jobs allegedly “saved or created” in Louisiana may be incorrect or exaggerated:

The issue of phantom Congressional districts listed in the national stimulus database recently created a stir. But the tally of Louisiana jobs allegedly created or saved by President Obama’s signature domestic policy program raises more serious questions about this database.

A review of the self-reported information may inspire a chuckle or a sneer, particularly when less-than-savvy recipients of federal money don’t know what Congressional district they’re in, or that the state only has seven such districts. That unsophisticated approach made headlines when money was listed as being spent in various districts that just didn’t exist. In the end, though, those reports are likely to be modified and will land in the appropriate district.

A greater concern is the 475 jobs listed as created or saved in Louisiana, even though the related projects aren’t started. And the 171 jobs chalked up when small raises were given to Head Start workers. And the over 100 low-paying work-study jobs on college campuses that count just as much as, say, a full-time architect for a major building program. Other entries indicate what could be an under-reporting of jobs.

These are just some examples of questionable figures in the statewide data analyzed by The Pelican Institute for Public Policy.

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