In a transparent attempt to blunt impending justified rage over this week’s profit reports from Big Oil, the latest piece of spin to emerge from the well-paid creative minds at the American Petroleum Institute is a real classic. The gist, in a nutshell, is that oil makes money — a lot of money. Really? You don’t say!

According to the press release:

While oil and natural gas stocks make up an average of 3.9 percent of public pension holdings in four key states, they accounted for an average of 8.6 percent of the returns in these accounts from 2005 to 2008.

I won’t bother quibbling with numbers here because the underlying specific point, that the oil companies are strong-performing blue chip stock,s is indisputably true.

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That, however, doesn’t mean that oil addiction is good for our economy and our future, or even your future 401k earnings. Far from it, in fact.

The relationship between rising oil prices and larger threats to the local and national economy, including recession, is well established. Ten of the last 11 recessions were preceded by oil price rises. So when the API points out that their returns are counting for twice as much of your total, they’re not mentioning that the increase in price, which drives the increased oil profits and returns, is also sending much of the economy, and much of your portfolio, into a tailspin.

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And is API actually trying to argue that we should subsidize stocks that perform well? “It’s the most ridiculous argument I’ve ever heard to justify subsidies for an industry,” Steve Ellis, vice president of Taxpayers for Common Sense, told Anne Mulkern of E&ENews PM.

If pension funds also hold Microsoft or Intel stocks, [Ellis] said, “does that mean the government should turn around and should subsidize Microsoft or Intel to boost the pension funds?”

“It’s really a preposterous sort of proposal,” Ellis added. “It makes no sense from a public policy standpoint.”

API’s new study can’t make the case that the small profits your 401k may enjoy from its slice of Big Oil makes up for the crushing impact of our nation’s dependence on oil. It doesn’t — it only means you’ll have a few more bucks to spend on gas in your twilight years.

Continuing to invest in oil is classic penny-wise and pound-foolish behavior. Once we stop using our tax dollars to support this folly, we’ll be one step closer to revealing the true price of oil.

[CORRECTION: This post initially neglected to credit Anne Mulkern of E&ENews PM.]