While Harry Reid may have allowed the energy tax hikes to die on the floor of the Senate, liberals nationwide have continued their attacks on the energy industry. The Gulf oil spill is barely a fond memory of a moratorium and Democrats are already seizing on the incident to push a host of job-killing, industry-kneecapping taxes and regulations designed to do what they failed to do legislatively: take down the American energy industry.
First the regulations: starting in January, the EPA will begin enforcing a little known provision called the “Tailoring Rule” – a new series of regulations that allow the EPA to dole out permits to carbon-generating companies “allowing” them to pollute in certain amounts, strictly regulated by environmental watchdogs. These regulations don’t just touch the usual suspects, but also renewable energy sources that don’t immediately fall into the “green” category as defined by environmental groups – sources like Maine’s biomass industry, which creates usable energy from environmental waste. Under the EPA regulations, the biomass industry, which was viewed – and treated – up until now, as carbon neutral, would face a host of regulations directed at greenhouse gas producers – regulations that would greatly raise the cost of doing business and could have dire economic consequences for Maine and beyond.
And then there’s the taxes.
A recent op-ed penned by solar industry executive Tom Rooney sheds a little light on liberal plans for the energy industry:
Solar costs more than coal and oil and natural gas. But here is the truth: It just seems that way because other people pay many of the costs of fossil fuels…Oil subsidies are…extravagant.
“The web of direct subsidies includes billions in government-sponsored low-cost construction loans and tax breaks like the foreign tax credit,” said energy analyst Blaine Townsend in the San Jose Mercury News.
The International Energy Agency says fossil fuels are subsidized $550 billion a year around the world.
Let’s not forget nuclear: The federal government pays a large part of the insurance for nuclear power plants. If government subsidized insurance for solar companies, our costs would drop dramatically.
I’m not saying they should — I was just noting how subsidies create an advantage for one kind of energy.
According to Mr. Rooney, the oil, gas and coal industries are working hard to prevent the success of cleaner energy initatives, like solar power, eating up taxpayer subsidies – subsidies that don’t go to more environmentally friendly industries. If only the taxpayers would stop financing these industies – or better yet, also subsidize solar power – we’d have a cleaner, better world.
Here’s the catch, though. Unlike the solar industry, the oil and gas industry contributes about $165 billion into US revenue per year and employs about 9 million people. And not just that – to say that the renewable energy industry has received no help from the government is a misnomer: the massive stimulus program known as the American Recovery and Reinvestment Act provided “green” industries with nearly $20 billion in tax credits on top of over $45 billion directed to that industry through appropriations.
But that aside, the real root of Mr. Rooney’s complaint is more sinister and goes to the heart of a plan the Obama Administration has had since 2009. Mr. Rooney’s “subsidies” are actually the fruit of a provision called “Section 199” – a group of tax credits that are designed to encourage anyone in the manufacturing sector to employ American workers. It’s made available to all American manufacturing firms – including small businesses and entrepreneurships, and anyone who engages in construction, engineering or architecture in the United States, who sells American-made products or who develops software in the US – and repealing it would actually cost Americans around 600,000 jobs nationwide according to the Institute for Energy Research.
According to ATR, a plan to repeal Section 199 has been in the works for a while as a sort of roundabout tax increase designed to punish oil and gas producers and the recent Gulf disaster has given them a perfect excuse to resurrect the initiative. The propects of course, are terrifying: using tactical repeals of tax provisions to punish American companies whose well-being is connected to economic stability.