As the economy continues in
its downward spiral and talks in Congress about reducing spending have only
amounted to political theater, the subject of how the tax code treats energy
has become a topic of controversy. Specifically, should we subsidize, enforce
mandates, or give tax credits and deductions to industries like ethanol and
natural gas? Having a thriving energy market domestically is a good thing and
something the government should not hinder. Not only would decreasing our
dependence on foreign oil simplify our foreign policy, but it would greatly
enhance our anemic economy at home.
Of course, the government
should neither inhibit nor subsidize any particular type of energy. While
many people agree with that statement, there is much confusion over the
difference between government subsidies and tax credits or deductions. The
difference is night and day, yet so many times they are all lumped together as
evil government handouts. A subsidy IS a government handout. It amounts to
the government taking money from the people and giving it to a favored
interest. It is the worst sort of market manipulation and it is something I
can never support. This kind of government mischief is anathema to the
Constitution and the principles of freedom and the free market.
By contrast, with tax credits
and deductions, industries, business, and individuals simply get to keep more
of the money they have earned. Ideally, the tax code should not be used for
social engineering, but, until we have true tax reform, I will always support
tax credits and deductions that keep more dollars in the private sector where
they are spent, saved, or invested. This means I will support tax credits and
deductions for energy producers, farmers, homeschoolers, family child care
expenditures, expenses of evacuees from disaster areas, and even adoption
expenses. I've almost never met a tax cut, deduction, or credit I didn't
like. Any measure that keeps money in the private sector to spend, save or
invest, rather than allowing the government to waste or misallocate is a win
for the economy.
Inequities in the tax code
dealing with tax credits should be solved by giving all participants equal
treatment.
I oppose ethanol mandates
because I do not think anyone should be forced to use or buy ethanol. Ethanol
mandates often serve as corporate welfare for big agriculture ethanol
producers. The marketplace should decide whether or not to use ethanol, and
producers of ethanol have to discover if they can produce it at a price that
makes good business sense. No industry should be allowed to use legislation
to create a "market" for its products. The real reason ethanol
mandates continue to surface in federal legislation is that agribusiness
continues to have one of the most powerful lobbies in Washington.
Furthermore, while I do not
support providing federal grants to any industry, I do support the tax
credits contained in the NAT Gas Act, HR 1380. These credits reduce taxes for
the production or purchase of vehicles that run on American-made natural gas.
These credits are not subsidies. Of course, we should repeal federal barriers
to energy production and reduce taxes on all forms of energy. Therefore, I
have also introduced the Affordable Gas Price Act HR 1102 which would remove
governmental barriers to offshore drilling, encourage private investment in
new refineries and suspend taxes on gasoline when the price at the pump
reaches a certain threshold. Lowering taxes to encourage the domestic
production of energy and getting government out of the way of the American
energy market is not a government giveaway; it is the way it should be in a
free country.
