[tobaccoman]

TPM: http://tpmdc.talkingpointsmemo.com/2...-subsidies.php

"I'm going to vote with my party," said Sen. Lindsey Graham (R-SC) during a Senate vote Tuesday afternoon. "I just think oil subsidies have to be part of a bigger package. If you had expanded drilling, I would consider reducing the subsidies or eliminating them if you got more drilling as part of the package.

"I'm leaning against it because it looks like it's political," said Sen. Mark Kirk (R-IL). Both senators, and several others in the GOP, have publicly opposed the subsidies in recent years. Kirk voted as a member of the House to rescind most of them. But the Democrats have put the issue at the forefront of a broader debate about reducing long-term deficits and debt, to squeeze Republicans who have pledged not to raise taxes in legislation to increase the debt limit.

And so the GOP is closing ranks.

Ahead of Tuesday's vote, and to further wedge Republicans, Democrats are ratcheting up their campaign against the biggest companies in the industry. As gas prices have climbed and oil company profits soar, Democrats have been arguing that the tax subsidies should be repealed. Most of them now acknowledge that repealing the handouts won't impact fuel prices and instead have framed the issue on populists grounds as one of national priorities: if the government's most pressing issue this year is to reduce the deficit and spending, then gifts to major oil companies should be at the top of the list of things to cut.

On Tuesday, Democratic leaders in the Senate took this a step further, raising the question of whether oil refiners -- and particularly the big oil companies in the refining business -- have been engaging in collusive behavior.

"We write today to request the Commission begin an investigation into potential price fixing of gasoline by U.S. refiners," reads a letter from Senate Democrats to the chairman of the Federal Trade Commission. "Recent reports have indicated that U.S. refiners are cutting back on U.S. gasoline stockpiles in order to artificially keep prices high and inflate their bottom line."