Party of Ideas Watch
From the annals of overly-kind journalism, The New York Times informs us that "The Senate overwhelmingly passed broad energy legislation today, hoping its emphasis on both traditional and emerging sources of power could break a four-year Congressional stalemate over energy policy." Translation -- they passed a bill that subsidizes clean energy sources and also susidizes old school fossile fuels. Needless to say, that's nonsensical. The whole point of subsidizing, say, solar energy would be to decrease its cost disadvantage and encourage people to use it. And it's very hard to see as a general matter why you would respond to rising oil demand with new subsidies for oil producers.
But of course, there's no real policy rationale for any of it. Certainly the GOP's not suffering from an excess of small government zeal. Instead, it's just the same old policy auction with everything for sale.
While I share your general sentiment, I don't think it's quite as bad as you say. The subsidies for fossil fuels are for "oil and gas production." Since oil is sold in a much larger world market, the incentives probably won't have any significant effect on world oil prices, so they won't increase the cost advantages of oil. The main effect would be to substitute some domestic oil for some imported oil. (This may not be so true for gas, though.) On the other hand, the subsidies for solar, wind, and efficient appliances could still have real effects in lowering the costs of this technology.
June 28, 2005 11:28 AM | Reply | Permalink
Indeed, but it wouldn't be the first time. Currently I get a tax break on my public transportation costs: my employer deducts a determined amount each month and after I show my MBTA pass receipt, I get the pre-tax dollars back next paycheck. It sounds like one of those wonderful policies meant to encourage environmentally friendly commuting. Only you can get exactly the same tax break for parking expenses. Clealy, what might have started off as a green tax incentive ends up becoming a complicated, minor tax cut, nothing more.
June 28, 2005 11:32 AM | Reply | Permalink
It sounds just like when The Bankruptcy Bill was passed. It was hailed in the press as a bi-partisan effort to end the practice of people intentionally running credit card debt with the intention of declaring bankruptcy to avoid having to pay. Yeah...bi-partisan support, alright.
When the details are looked at closely I am sure there is very little for looking at alternatives and a cash cow for the energy companies to try to find more oil and coal. More corporate welfare subsidies...
June 28, 2005 11:42 AM | Reply | Permalink
Your point about the Republicans ignoring their "small government" approach with this bill is key.
It's not an energy bill...it's a jobs bill...one that is almost as pork-filled as previous versions.
Perhaps, with rumblings of potentially losing their senate majority in the mid-term elections, they're milking their power for all it's worth?
June 28, 2005 11:50 AM | Reply | Permalink
A "jobs bill" might be an overly generous description too. ;-)
June 28, 2005 12:05 PM | Reply | Permalink
Just a simple reminder:
What you subsidize you get more of;
What you tax you get less of.
June 28, 2005 2:12 PM | Reply | Permalink
What you subsidize you get more of;
What you tax you get less of.
So does this mean with this energy subsidy we will be getting more high gas prices?
June 28, 2005 2:45 PM | Reply | Permalink
Although it's a charming reminder of Matt's old site, it's 'fossil', not 'fossile'.
June 28, 2005 9:45 PM | Reply | Permalink
Pork is bipartisan. 36 Democrats voted for final passage.
Matt had this right. Everything is for sale - by both parties.
June 29, 2005 6:38 AM | Reply | Permalink