April 22, 2005
GOP To Raise Taxes 85%
The House just passed an energy bill that gave away more of our taxpayer dollars to the energy industry than even President Bush wanted.
I actually like what I hear from President Bush on the subject, and if I believe he’s truly interested in solving the country’s energy problems rather than lining pockets in the oil industry, then I can only come to the conclusion that he has no idea what the energy bill actually does.
Urging passage of the bill, President Bush said,
"Over the past decade, America's energy consumption has increased by more than 12 percent, yet our domestic production has increased by less than one-half of 1 percent. That means that our nation is more and more reliant on foreign sources of energy.At the same time, the global demand for energy is growing faster than the global supply, which has contributed to a steep rise in the price of crude oil, which is the feed stock for gasoline.
...Our dependence on foreign energy is like a foreign tax on the American Dream -- the tax our citizens pay every day in higher gas prices, higher cost to heat and cool their homes -- a tax on jobs. Worst of all, it's a tax increasing every year."
As a piece of rhetoric, I can't fault it at all. Unfortunately, the energy bill doesn't solve our supply problem in the short term OR the long term.
As far as domestic oil production goes, drilling in the ANWR only reduces our dependency on foreign oil by 4%. New coastal drilling helps just a little more. The hard fact is, the United States is sitting on less than 3% of total global oil reserves. Unless you count Iraq, we're not going to drill our way to energy independence.
But the bill does help increase supplies in one way: It subsidizes foreign oil exploration by US oil companies. According to a report from the Bush administration's Energy Information Administration, the bill will increase our supplies of foreign oil by 85%. If, as President Bush says, "our dependence on foreign energy is like a foreign tax on the American Dream," then this bill raises our taxes by 85%.
Contact your Senators and tell them to scrap this crappy bill, and come up with a plan that really reduces our dependence on foreign oil.
Posted by American Pundit at April 22, 2005 03:05 AMThis is just another example of “WHY” I did not vote for BUSH. Maybe if only those who did elect a president with his “American Dream” intelligence were the ones who had to pay for the debt and/or consequences of this president, maybe the responcibility of endorsement resting on only them - they would learn to be more “informed” and “responcible” voters. There are a lot of “nice” christian men out there but that doesn’t mean that they are “qualified” to run a country or “intelligent” “enough” to balance the economy. For those of us who were more informed at the time of the election we only read this kind of crap and count the days, wondering “HOW BAD DOES IT HAVE TO GET” BEFORE IT’S OVER FOR THE BUSH AND CONDALICSA RICE TEAM…I CRINGE EVERY TIME I HEAR WHAT THEY’RE DOING TO OUR “AMERICAN DREAM”… THE END OF THAT PRESIDENCY WON’T COME SOON ENOUGH… Personally, I have respect for him as a man…BUT AS A PRESIDENT…HE FAILED all of us and “The American Dream”…it’s only worse every day…
Posted by: A Bullock at April 22, 2005 04:28 AMOur dependence upon foriegn oil can only be solved by developing alternatives to petroleum use. Unfortunately, most people are very reluctant to change. I say, let the cost of gas keep skyrocketing. Eventually, when it cost $150.00 to fill up at the pump; people will be willing to try some of the alternatives.
Posted by: M Price at April 22, 2005 08:10 AM If we use the same amount of oil, but with a higher percentage coming from domestic sources the price remains the same. Oil is a global market, and the price is tied to global supply and demand.
As for the Energy Bill, here are a few provisions:
About $1.8 Billion For Research And Development Into Renewable Energy Sources
Increase In LIHEAP [Low-Income Home Energy Assistance Program] Funding To $5.1 Billion
$60 Million A Year For Five Years … To Install Solar Paneling On 20,000 Federal Buildings.
$6.1 Billion … For ‘Natural Gas Pipelines, Electricity Transmission Facilities, Qualified Air Pollution Control Facilities For Coal-Fired Generation Plants, Nuclear Decommissioning And Small Refiners
$1.8 Billion Towards Incentives For Business & Residential Solar Use [And] Tax Credits For The Installation Of Energy-Efficient Products
Recommendation “That Federal Agencies Reduce Energy Consumption In Government Buildings, Purchase Energy-Efficient Products And Utilize Fuel-Efficient Vehicles
I haven’t gotten to read the all of it, but those are a few of the highlights. Certainly, the bill is far from being a comprehensive answer for the energy question that faces the country.
If A. Bullock had read the Washington Post article, he would have realized that the bill provides for “less to alternative energy and efficiency than President Bush had proposed” and not have been so critical of President Bush.
Don’t get me wrong. I look forward to the day we no longer have to rely on foreign countries for energy needs.
If we use the same amount of oil…
But we won’t, we’ll use more - and so will China and India and Europe and Japan etc. Just like President Bush says,
…the global demand for energy is growing faster than the global supply, which has contributed to a steep rise in the price of crude oil, which is the feed stock for gasoline.
And you’re absolutely right that this bill does nothing to address that. In fact, it makes it worse and raises the “foreign tax on the American Dream” that President Bush rightly brings to this country’s attention.
It’s a bad bill. Tell your representatives you don’t want an 85% tax increase on gas. Tell them to give us an energy bill that significantly reduces our dependence on foreign oil. It’s an economic and strategic necessity, and it’s vital to our national security.
this is just another way for bush to control things. they wont help anyything because the oil industry does whatever they want, they could raise the gas prices even if they didn’t need to. and the only reason that we have these oil and gas prices is becuase we are in this war and what is the war all about? OIL.
Posted by: seth at April 22, 2005 10:29 AMGreat article AP. I agree 100%
We really must call our Senators and tell them to scrap this bill!
Not only because it will NOT reduce our dependence on foreign oil, and will be FISCALLY IRRESPONSIBLE at time when we are so heavily in debt, or because only 7 PERCENT of the entire bill will go to renewable energy, with 93 PERCENT going to the Energy Behemoth’s and nuclear energy, but because it truly is a POLLUTERS PARADISE.
This bill will give:
“new loopholes that could reduce gas mileage requirements; weaker protections for coastal communities; tax breaks to promote more coal burning.”
And also:
“shield major oil companies from federal and state product liability lawsuits for the widespread contamination of the nation’s drinking water supplies with the gasoline additive MTBE.�This chemical leaks out of underground gasoline storage tanks and from gasoline spills, dissolves and spreads readily in groundwater, does not degrade easily and is difficult and expensive to remove.�
At least 29 states have reported MTBE contamination, according to Environmental Working Group.� The American Water Works Association, representing 4,700 U.S. water systems, estimates nationwide MTBE cleanup and water replacement costs at $29 billion.� Under the House energy bill, the public would be stuck with the cost.
As has been widely noted, the biggest defenders of MTBE—and the proposed legal shield—are Barton and Rep. Tom DeLay, both recipients of MTBE cash.
The bill also would give MTBE makers (small companies like ExxonMobil) $1.75 billion for transition costs.� It would also allow the White House to overturn a suggested ban on the chemical’s use. No wonder Rep. John Dingell, D-Mich., �called the MTBE provisions “a direct assault on the nation’s safe drinking water supply.”
If that’s not enough potential damage to the water, the bill also would exempt from the Safe Drinking Water Act a process called hydraulic fracturing, in which chemicals are pumped into coal beds in order to coax out methane gas.�Many fear this process could harm groundwater.�One prominent company that uses hydraulic fracturing: Halliburton, Vice President Cheney’s old firm.”
And this bill will:
“weaken the Clean Air Act and threaten to prolong smog problems in much of the nation.� Under current law, states must devise air quality improvement plans which demonstrate they will meet smog standards by a set deadline (in most big-population areas, the deadline is 2010 under the 8-hour smog standard which went into effect last year).�
The dirty-air provision would say that if an area is affected by pollution coming from somewhere—and virtually every state in the eastern half of the country falls in this category—it doesn’t have to meet the deadlines or adopt stricter local pollution controls until the “upwind” area does.�This creates the potential for a dirty-air domino effect, as each state blames another for its pollution problem.�”�
And the bill also:
“includes a provision that would give new advantages to power companies that own dams. �It would give the companies a procedural edge when seeking licenses for hydropower—and would undermine the ability of natural resource agencies to protect fish and wildlife.�
A separate section of the bill would put unprecedented new limits on the National Environmental Policy Act, which requires federal review of the environmental aspects of major energy projects.� Under the bill, federal agencies would not be required to identify or analyze the environmental effects of alternative locations or actions to proposed renewable energy projects.
The Natural Resources Defense Council notes this could create a bad precedent that could be used later to promote even more environmentally destructive projects. Developers could use this precedent to lobby in the future, for example, for similar exemptions for gas, oil, coal or nuclear energy projects.”
�
Here’s the link to the story I’ve been quoting from.
I just think it is soo cute that someone still thinks that maybe poor old Bush just doesn’t understand how it all works. At some point, it really doesn’t matter if he understands or not. He is still responsible for his actions.
I just think it is soo cute that someone still thinks that maybe poor old Bush just doesn’t understand how it all works. At some point, it really doesn’t matter if he understands or not. He is still responsible for his actions.
Yeah, right, that’ll be the day. I thought it was the fault of Sadam and that terrorist John Kerry.
=)
At some point, it really doesn’t matter if he understands or not.
But, it does matter, it matters to all of us present, and future, who have to pay the price for ignorance, and incompetence, and mismanagement. The Peter Principle bears a very heavy price paid by far more than most people realize.
Posted by: David R. Remer at April 22, 2005 12:11 PMGood posting, AP.
None of the alternative energy sources is really feasible at this time. Not solar, not wind, not biomass, not anything. In light of today’s technology, we could drastically change the way we live by having smaller, lighter vehicles, but we would also need those vehicles to go slower because of greater safety problems inherent in smaller, lighter vehicles. I don’t think society is ready for those changes yet.
Or, we could do the things that we have the ability to do, but oth of these options get people riled up quickly because of NIMBY - “Not In My BackYard”:
1) Build more oil refineries in the US. It has been years since a new refinery was built, but our demand has risen. Trying to squeeze more oil through our existing refineries is a factor in our rising gas prices.
2) Build more nuclear power plants. Nuclear power is the cleanest, safest energy source we have today. While this will not help with gas prices, it will help with many other energy demands.
Also, the oil companies cannot just raise prices even if they don’t need to. The simple economics of competition will prevent that. If the oil companies make excessive profits, then other people or companies have an incentive to enter the field. That increased competition will drive prices down again.
Posted by: Troy at April 22, 2005 01:49 PMJeff and Troy make some good points.
As Jeff says, oil is fungible. When President Bush says that foreign oil is a tax on the American dream, he is being more poetic than practical. The key is using oil and at what price. Increasing domestic supply will be a good thing because Americans will be making the money, but even if we imported no oil at all, we still would be subject to the world price because oil is fungible. Somebody gave an example sucking the water out of one side of a swimming pool. The water just won’t stay on one side.
Oil matters only as a component of energy. Oil has a natural ceiling of about $60 a barrel in today’s dollars and the long-term trend is down, not up. That is because as the price rises, so do the attractiveness of alternatives and other sources. Alberta is full of oil sand. The stuff can be extracted for about $65 a barrel. Nobody bothers with it at a lower price. The same is true of the various renewables.
You can’t think about any resource in isolation. Whether or not something is a resource depends on the price, available technology, cultural factors and political will around it. Anyone finding oil on his land before 1800 would consider himself cursed. It wasn’t a resource back then at all and the oceans of oil under Arabia were not a resource to the people living on the sand above until modern technologies permitted them to be tapped.
We will never run out of oil. At some point, we just won’t need or want much of it any more as other sources take over. An interesting statistic is that in 1979, United States had only 30 billion barrels of oil left in the ground (according to the estimates at the time) and that we’d run out by the 1990s. Instead, over the past 25 years, we have pumped out 67 billion barrels and there are still more than 30 billion barrels left. They weren’t wrong in 1979. It is just that the price/technology/politics equation changed and came up with a different answer.
And the energy policy? It is best not to have much of one, besides allowing market forces to take their course. Our previous energy policies have been less than successful and the more ambitious they were, the more trouble they caused. Energy policies are like rain dances. They don’t make it rain, but it keeps the witch doctors (politicians) in business.
Also, on the ANWR drilling:
1)Not only would it take 10 years for any oil from ANWR to reach the market, it won’t be coming to the U.S. The majority of oil developed in Alaska is headed for the nearest users: Asia.
2) There is a difference between the amount of oil technically recoverable, as opposed to economically viable recovery. While there may be X amount of oil technically recoverable in the Refuge, the amount recoverable in economic terms is X - Y.
3) Even taken at the most generous numbers of recoverable oil, it will not amount to more than 3-4% of our needs at current consumption (which will, of course, increase) and would last approxiamtely 6 months if we relied only on that oil. In other words, it’s a quite small drop in the bucket.
4)The so-called “2000 footprint” will actually create a network that covers most of the Reserve, since the oil is in “pockets” not in one large deposit. For more info check out the NRDC website.
Troy said: “None of the alternative energy sources is really feasible at this time. Not solar, not wind, not biomass, not anything. “
That is a negative perspective that does not hold up under other points of view. Is space exploration feasible? It is possible, yes. So are alternative energy sources. Feasible?
Well, implied in your assessment is the cost. You appear to be saying the cost of alternative energy is not low enough to be born by the free market of supply and demand.
But, I have to ask, is NASA feasible by the same standard? Of course not. NASA’s expeditions are not born out of free market supply and demand issues percolating up from taxpayers demands.
Alternative Energy is feasible. Just as government investment in space has yielded consumer benefits the vast number of which few realize exist, so too, would government investment on a large scale in alternative energy yield similar returns.
Housing alone is a hugh potential for savings using biomass. Berm 3 sides of a home or building with earth and you have cut its energy requirements by 2/3. Not only that, but, the materials required to build and maintain the structure are seriously reduced, again reducing the need for energy to make and transport such materials. This is just one a great many examples. To say it is not feasible however, factually is both false and reflective of a narrow perspective defined by free market supply and demand of innovation. There are other perspectives, much broader and far more positive in their potential to produce results, than this view you have propounded.
Posted by: David R. Remer at April 22, 2005 04:32 PMAP,
“Unless you count Iraq, we’re not going to drill our way to energy independence.”
See? Bush’s plan is finally beginning to pay dividends :P
Posted by: Zeek at April 22, 2005 04:36 PMDavid,
While I agree that this word usage was not the best, let’s get at the heart of it…
The main arguement is against fossil fuels in driving out automobiles. What alternative do we have now that will help in that area?
Hybrids are nice but they don’t really address the problem, fossil fuels are still used and the increased cost of the current automobiles will not save anyone money. They will save some on how much fuel is used and I support that effort, but it’s not really an alternative.
Electric automobiles are also nice but don’t address the problem. The amount of dirty fuel that is required to create the electricity for automobiles would severely damage the ecology of the northeast. Coal plants would have to increase output in order to compensate. We haven’t built new nuclear plants in decades and hydro-electric is not supplying enough of our energy needs to handle the increase in demand.
Hydrogen Cells are the best way to go, IMO, but they still require fossil fuels to create the hydrogen, but at a much reduced rate and ways are being developed to further eliminate its need. In fact, GM has jumped on this method with gusto, but it will probably be 20 years from now before we see the infrastructure in place to support these vehicles. I do see a day in the near future where we have very few ‘gas’ cars, but it’s not going to be overnight no matter how much money is thrown at it.
So, what alternatives do we have to lower our dependancy on fossil fuels and how are they not included in this energy plan?
Posted by: Rhinehold at April 22, 2005 04:43 PMRhinehold,
Hybrid vehicles are a very good near term solution to the problem: Excess consumption of energy and excess production of pollutants. Detroit doesn’t want them because they simple do not want to make the investment of retooling their lines. For that matter a Diesel-Electric hybrid would be far more efficient and powerful (to the tune of 70+ mpg).
Hydrogen fuel cells are another good example of stalled technology by unwilling companies. The fuel cell GM is working on has been prototyped and revised many times over. They already have models that could be introduced into production lines, but the investment is just too scary. Until one of those things is specifically designed as a production model, there will be no fuel cells on wheels.
Regarding the logistics to the fuel cell; Hydrogen is made by electrolysis, which needs electricity. This electricity could be produced by alternative sources (solar, wind and nuclear) other than fossil fuels. Currently only 4% of the 50 million metric tons of hydrogen produced today is made this way, but mass production of fuel cells would help increase that number. Distribution over long distances is the biggest problem, as it is the one that drives the most cost. I read an article a few months back that the natural gas distribution grid was being studied to move hydrogen at a local level, but I’m not aware of any positive or negative results coming from that. I’m missing the link for this article, but I will post it as soon as I find it.
You are correct in saying that hydrogen fuel cells are not going to happen overnight, but they are not 20 years away. If consumers demand them, I bet we could se one in less than 10 years. In the mean time, sign me up for a Prius!!
David,
I am not sure I can agree with your NASA analogy. NASA is in the business of government-run space exploration. It got into that because the thinking was that private enterprise could not do it, plus the venture started out as an extension of our missile program. Many of today’s conveniences came, directly or indirectly, from the space program. That does not mean that space travel is feasible as a means of travel at this time.
The same applies to the alternative energy sources I mentioned. At present, we don’t have the technology to build batteries to store the electricity necessary to run autos, etc. at the same speed for the same distances to which we have become accustomed. That is partly why solar and wind power will not work at this time on any great scale.
If you mean we should have a NASA-like agency to push the envelope of alternative energy, as NASA did for space, then I can possibly agree with you. I still think that private enterprise does almost everything better than government, though. Perhaps some sort of tax incentives would help propoel companies into doing the necessary research without adding to our ever growing bureaucracy.
Posted by: Troy at April 22, 2005 09:45 PMThank you Genaro. You’re absolutely right.
None of the alternative energy sources is really feasible at this time.
Why not?
Hydrogen Cells are the best way to go… but it will probably be 20 years from now before we see the infrastructure in place to support these vehicles.
Why?
Seriously, alternative energy and hydrogen power are absultely “feasible”. And they can be available in the short term. In fact, there are pilot programs successfully running all over the world - including the ol’ USofA.
The problem, as Rhinehold points out, is the market. Just like the market didn’t put a man on the moon, the market won’t reduce our dependence on foreign oil - at least, not until it’s too late, creating hardship for Americans (the poor and middle class, of course) while we scramble for an alternative.
And believe me, when the shit hits the fan, America will be burning forests and coal to stay warm and keep their refrigerators running. It will be cheaper than a crash development of clean alternatives or even nuclear.
When President Bush says that foreign oil is a tax on the American dream, he is being more poetic than practical.
No, Jack. President Bush is absolutely right. And I can’t believe you’d sit there and say President Bush is… what’s the polite euphemism you used for lying to us? …waxing poetic?
You’re saying: Don’t worry. Nothing needs to be done. When we run out of the cheap oil (very soon - years, not decades), we’ll just use the more expensive oil - from Alberta Canada. That’s just irresponsible, and it exacerbates this country’s economic, strategic, and security problems.
“Our dependence on foreign energy is like a foreign tax on the American Dream — the tax our citizens pay every day in higher gas prices, higher cost to heat and cool their homes — a tax on jobs. Worst of all, it’s a tax increasing every year.” - President George W. Bush
Tell your Senators that President Bush is right (on this particular issue). That you don’t want an 85% increase in “foriegn” taxes. Tell them to kill this bill and put your tax money where President Bush’s mouth is. Give us an energy plan that will decrease our dependence on foreign oil.
Posted by: American Pundit at April 22, 2005 10:17 PMBTW, the administrations own Energy Information Administration concluded that it’s totally affordable to immediately mandate significant fuel efficiency increases in our cars and trucks.
PS - It also turns out that complying with Kyoto would only cost us one tenth of one percent of our GDP. Chump change.
PPS - I’m off to Indonesia for a few days. Make a difference while I’m gone. ;)
Posted by: American Pundit at April 22, 2005 10:21 PMTroy, as I read through your reply, I was making mental notes to debate you on. Then, in your last paragraph I realized we are in general agreement. You said:
If you mean we should have a NASA-like agency to push the envelope of alternative energy, as NASA did for space, then I can possibly agree with you. I still think that private enterprise does almost everything better than government, though. Perhaps some sort of tax incentives would help propel companies into doing the necessary research without adding to our ever growing bureaucracy.
Yes, and Yes. If the gov’t would help subsidize research both in the private sector and universities, we could move things along faster. And tax incentives are an excellent way to shift market demand. Want to see demand for hybrid vehicles jump dramatically? Simple. Offer a tax incentive both at the pump and the inspection station. If the public gets to deduct a portion of their federal fuel taxes off their income taxes and can show proof of a vehicle inspection which passed and deduct let’s say 10 times that amount for keeping the car running efficiently, demand would spike. As demand grows, so will supplies, and at a certain threshhold number of saturation of households owning hybrids, the government can ease back on the tax incentives phasing them out altogether. By then, a better technology would probably be available anyway.
But all this requires disinvesting by public officials from oil. With so much money flowing into campaign coffers from the oil industry, it is going to be hard to wean Congress off the black milk and honey which helped them get elected.
Posted by: David R. Remer at April 23, 2005 02:15 AMGlad you didn’t let this escape the attention of WatchBlog AP!
However, I had a more visceral reaction to reading the same kind of bulls**t in an Op Ed piece by Denny Hastert on the Energy Bill, in the Wednesday Chicago Sun-Times. And, when he did his gas station photo op in Washington the next day, this time he walked to the press conference instead of pulling up in his huge, gas guzzling SUV!
Posted by: Bert M. Caradine at April 23, 2005 05:09 AM
Why in the world can’t we harness the power
that’s in such great supply? Hot Air!
I often wonder if I can harness the energy generated by my 3 year old boy for good instead of evil.
I hope you’re all writing your Senators and telling them not to vote for this crappy energy bill.
I’ve been all over Asia and one thing is the same everywhere: When people can’t get cheap energy, they burn anything they can get their hands on, coal, wood, animal dung, whatever.
It’s past time to “research” alternatives to ever more expensive oil. Giving taxpayer money as incentives to oil giants to explore foreign oil fields will not reduce our dependency on foreign oil. This should be a ‘duh’ issue.
The energy bill that just passed the House and is being considered in the Senate does not reduce our dependence on foreign oil, nor does it reduce gasoline prices in the short or long term. It sucks, is what I’m saying.
Tell your Senators to go back to the drawing board and submit something that will reduce our dependence on foreign oil. If, as President Bush says, “our dependence on foreign energy is like a foreign tax on the American Dream,” then this bill raises our taxes by 85%.

