Unsurprisingly, President Barack Obama’s 2014 budget proposal hits oil and gas companies with excessive new taxes while also eliminating $4 billion in “subsidies” to the industry. It also makes good on his promise to use revenue from this sector to create an “Energy Security Trust” that would fund alternative energy research.

Fleecing the oil and gas industry might be a smart move politically. But new taxes on this sector will prove devastating to the economy, particularly here in Arkansas.

No doubt there are risks involved with oil and gas production, something Arkansas residents are all too keenly aware of in light of the recent Exxon Mobil spill. But just weeks after the incident, the Environmental Protection Agency is satisfied with the cleanup, and Exxon Mobil is taking responsibility, ensuring all valid claims from residents are honored.

The Obama administration has demonized this industry for years, but is essentially biting the hand that feeds it. In fact, of the 10 companies with the highest annual tax bill, three are oil and gas companies: Exxon Mobil, Chevron and ConocoPhillips.

Overall, the industry hands over a whopping $85 million per day to the U.S. Treasury, with an average effective tax rate of 44.3 percent-higher than any other industry in America.

Critics argue that these companies deserve high tax rates because they also enjoy government supports. In reality, most of this industry’s subsidies are actually just tax deductions available to most other business sectors. For example, the “Intangible Drilling Cost” deduction is essentially the same as the “Research and Development” deductions afforded almost every industry in the country.

Eliminating these deductions and increasing the tax rate on the oil and gas industry would have destructive economic consequences. At a time when many businesses are still struggling, the oil and gas industry has been generating needed growth and lucrative jobs.

The industry is proving especially promising due to successful efforts to extract oil and gas from shale formations in places like North Dakota, Texas and Pennsylvania. Monthly domestic crude-oil production is on track to exceed oil imports this year for the first time since 1995, according to the Energy Information Administration.

Oil and gas also supports 9.2 million jobs throughout the country, and accounts for almost 8 percent of gross domestic product. Here in Arkansas, the industry is responsible for over 76,000 jobs. In 2009, oil and gas companies comprised $6.4 billion-or 6 percent-of this state’s economy. And in 2010, the sector contributed $436 million to state tax revenue.

On top of that, employees of oil and gas companies enjoy a high standard of living. Excluding gas-station workers, the typical salary at these companies is almost $93,000. That’s 93 percent higher than the average salary in the private sector overall.

If new taxes strain the industry, we can expect to see many of these jobs disappear. In fact, the energy-consulting firm Wood Mackenzie predicts that, by 2025, as many as 250,000 jobs could be eliminated.

And it’s not just jobs that are at risk. Higher oil taxes would be felt by consumers around the country. Faced with new costs, oil companies would likely scale back production, raising prices at the pump.

The Energy Information Administration expects worldwide oil and liquid fuels consumption to increase by 1.05 million barrels per day in 2013.

But if the president decides to levy new taxes on the industry, U.S. oil supply could decrease by as much as 800,000 barrels a day.

These inverse trajectories of supply and demand would send gas prices-which already average about $3.30 per gallon here in Arkansas-into the stratosphere. If you think this is a far-fetched scenario, just look at California, where prices already hit $5 per gallon this year.

Let’s hope that President Obama recognizes that hitting up oil and gas companies for more cash is the last thing our struggling economy needs.

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J. Kelly Robbins is the executive vice president of the Arkansas Independent Producers and Royalty Owners Association.

Editorial, Pages 13 on 05/02/2013