power plant

What will the GOP do about the Latest Cap and Trade Scheme?

Tuesday, June 3rd, 2014 and is filed under Blog, Economy, Taxes

It is has been noted in recent years that a good percentage of Americans do not pay income taxes.  However, we must remember that all Americans incur the cost of the hidden tax of regulations.  According to the Competitive Enterprise Institute (CEI), burdensome regulations drain $1.86 trillion from the private economy every year.  The tab is $15,000 per family, more than many families pay in federal income taxes.

The cost of the regulatory state is paid for in the form of higher costs for food, energy, transportation, and healthcare.  It is also actualized in the form of lower wages and less job opportunities.

As CEI notes, just last year the administration finalized another 3,659 regulations. It’s no surprise that five years into the most tepid economic recovery in recent years, the economy is actually contracting again.

Naturally, the Obama administration is planning to rub salt on the wounds of the American economy by implementing Cap and Trade style regulations that will shutter American manufacturing.  The EPA has released a 645-page plan forcing all power plants to reduce “greenhouse gas emissions” by 30 percent below 2005 levels by 2030.  Much like Obama’s administrative Dream Act, this devastating version of Cap and Trade never passed Congress.

So after creating a permanent part-time economy and driving up the cost of healthcare with Obamacare, this administration seeks to crush the average family with higher energy costs, which in turn, jack up the cost of most other vital goods and services.

In recent months, a slew of Republicans have introduced policy proposals attempting to appeal to middle class families.  There is no better way to advocate reducing government than by promising to reduce the regulatory state.  Along with repeal of Obamacare and opposing open borders (which hurts workers and taxpayers), the crushing burden of energy regulations must play prominent in any general election campaign.

On the surface, this is an issue for which all Republicans can unite and fight with a coherent message.  After all, the Chamber of Commerce is actually on the right side of the issue.  But there are two important observations that cannot be overlooked.

It’s easy for the Chamber and establishment Republicans to act outraged over the regulatory state when the EPA announces crushing regulations.  But what these people fail to see is that they are responsible for growing government and interjecting it into every aspect of the economy – to the point that they now feel that can control entire industries, such as energy, healthcare, and financial services.  People like Thad Cochran can’t have it both ways.  They can’t embrace the federal hand that subsidizes private enterprise and then complain about the hand that regulates them into submission. It is years’ worth of bipartisan work from the Chamber and pay-for-play Republicans to expand the role of government that has allowed the bureaucracies to grow large and brazen enough to regulate anything that moves.

The other point to consider is that although all establishment Republicans claim to be outraged over the latest Cap and Trade scheme, what are they going to do about it?  Remember, even if Republicans win control of the Senate, it will not change the balance of power.  They will not have control over the executive agencies, and Obama will be as truculent as ever in ruling by administrative fiat during the lame duck of his presidency.  Republicans already have control of the purse-string in the House – the last recourse to check against abuse of executive power – yet they sabotaged our only attempt to use it.

At some point, Republicans need to look beyond the next election to solving the constitutional crisis that is upon us.

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Madison Project Supports the Cruz/Bridenstine Energy Expansion Bill

Thursday, March 27th, 2014 and is filed under Blog, Economy

What can Republicans do when they only control part of the federal government?  Well, for one thing, they can start by not passing bad legislation.  But more importantly, they need to begin communicating with the American people about their plan to grow the economy and fundamentally restore America – if and when they are privileged to control all levers of power in Washington.  Although Republicans lack the votes to pass positive legislation this year, proposing bold conservative solutions will help win back the Senate and the White House.

Senator Ted Cruz (R-TX) and Representative Jim Bridenstine (R-OK) understand that energy is the foundation for economic growth, prosperity, jobs, a cheaper cost of living, and national security.  Increasing our capability to produce more energy is the best jobs plan, the best anti-poverty measure, and the best way to protect American and our allies from petro-authoritarianism.   That’s why he has introduced a new bill that identifies almost all of the impediments to energy production within our economy, and seeks to eliminate them.

Here are some of the key elements of the bill, the American Energy Renaissance Act (S. 2170 and H.R. 4286):

Eliminate Federal Regulations on Fracking: Shale technology coupled with horizontal drilling has created the biggest oil and natural gas boom in recent years. But up to 30% of all fracking wells are on federal lands and would be encumbered by new regulations the Obama administration is trying to foist on the fracking industry.  Cruz’s bill would explicitly grant states the sole authority to regulate, process, and issue permits for hydraulic fracking, even on federal lands within its boundaries.

This bill would also grant states the authority to issue permitting for other energy exploration and development activities if they choose to exercise that prerogative. If states fail to act, this bill streamlines the permitting process for the federal government to issue those permits on federal lands.

Expand exploration and drilling: This bill expands drilling everywhere – ANWAR, Indian lands, Outer continental shelf, and other areas offshore.

Energy Exports:  Energy production is a worldwide market and expanding our energy exports will not only create more jobs and wealth at home, it will weaken the power of the petro-tyrants across the world.  This bill ends the ban on crude oil exports and streamlines the process for permitting exports of LNG and coal.

Permitting:   This bill streamlines the bureaucratic process that encumbers projects and drilling permits and sets hard deadlines on issuing permits.  Authority for approving projects would be consolidated and handed over to one authority instead of multiple agencies.   It also sets deadlines on approving construction of new oil refineries, which haven’t been built since the ‘70s.  Not only does this bill strip away the president’s authority to block the Keystone pipeline, it prevents future projects from being obstructed under any auspices of the Endangered Species Act.

Judicial Review: One of the big obstacles to expanding and utilizing our energy resources is the environmental legal defense industry, which has the ability and funding to encumber vital projects in endless lawsuits.   This bill prohibits payment of court costs by the federal government and also charges a fee for the filing of an administrative protest to a permit application.  It also sets hard deadlines on filing lawsuits and the length of time for the entire judicial review process.

Regulations and Mandates:  The bill incorporates the REINS Act, which triggers a congressional vote to approve any major regulation that impacts the economy.  It also bans the EPA from promulgating global warming regulations and treating greenhouse gasses as a pollutant.  Most importantly, the job-killing, price-hiking ethanol mandate is phased-out and repealed after five years.

All Republican members of Congress and candidates for federal office should embrace this bill as our plan to create jobs and grow the economy.  This is something that should unite all Republicans as we head into the midterm elections and ask the American people to entrust the GOP with control of the Senate.

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GOP House Passes Big Government Energy Bill

Thursday, March 6th, 2014 and is filed under Blog, Economy

The reason many of us don’t trust the current crop of Republicans to actually downsize existing federal programs is because they often agree to create new government interventions into the private sector.

Case in point?  Yesterday’s obscure vote to create a new program within the Department of Energy.

It has become clear this year that House Republicans have no interest in forcing a fight on must-pass legislation nor do they have the stomach to pass stand-alone bills that draw a sharp contrast on contentious issues, such as illegal immigration, religious liberty, and gay marriage.  They don’t want to address other conservative solutions, such as devolving transportation and education to the states or repealing the pernicious ethanol mandate, which raises the cost of food and fuel – all great issues to promote during an election year.  Instead, they want to run out the clock and squander their time in the majority passing the most innocuous bills.

To that end, they have spent most of their time pushing these “non-controversial” suspension bills, which need a two-thirds majority to pass.  One of those bills that passed the House yesterday was H.R. 2126 – Energy Efficiency Improvement Act of 2014, sponsored by liberal Republican David McKinley (WV) and Reps. Peter Welch (D-VT).  Here is a synopsis of the bill from CRS:

Amends the Energy Independence and Security Act of 2007 to require the Department of Energy’s (DOE) Assistant Secretary of Energy Efficiency and Renewable Energy to study the feasibility of: (1) significantly improving energy efficiency in commercial buildings through the design and construction of separate spaces with high-performance energy efficiency measures, and (2) encouraging owners and tenants to implement such measures in separate spaces. Requires the Secretary to publish such study on DOE’s website.

Requires the Administrator of the Environmental Protection Agency (EPA) to develop a voluntary Tenant Star program within the Energy Star program to recognize tenants in commercial buildings that voluntarily achieve high levels of energy efficiency in separate spaces. Requires DOE’s Administrator of the Energy Information Administration to collect data on categories of building occupancy that consume significant quantities of energy and on other aspects of the property, building operation, or building occupancy determined to be relevant to lowering energy consumption. Prohibits the impact on climate change from being a factor in determining energy efficiency of commercial building tenants.

Talk about picking winners and losers!  This opens the door to the government collecting data on construction of private buildings and incentivizing specific behavior through green venture socialism.  As always, these things start out as voluntary propositions, but quickly morph into full-blown mandates.

Also, like most green energy programs, the DOE will carefully craft the grant programs to benefit liberal crony capitalists who can’t sell their sub-par product or service in the free market without the extra boost from government.

Moreover, why are we adding another program to a department that Republicans [were supposed to] believe serves no constructive purpose?

At some point we need to ask why Republicans feel so uncomfortable being in the majority that they have to fill their time passing Democrat bills.

And unlike some of the other suspension bills, this is not an isolated measure that will stall out in the Senate.  The Welch/McKinley bill overlaps with a broader Shaheen-Portman bill that has been percolating through the Senate for the past few years.  They recently introduced another iteration of the bill and can now point to the fact that 86 percent of House Republicans supported much of the foundation for their legislation.  Rep. Welch has already said that passage of this bill “provides a clear path to conference” with the Senate.  They might take up this bill as early as next week.

Passage of this bill marks a new milestone for the GOP establishment. First they gave Senate Democrats a de facto super-majority with a number of Republicans voting with them on key issues.  Then House Republicans began rubber-stamping some of their bad bills, often in violation of the Hastert Rule.  Now they are pre-emptively passing Senate Democrat legislation in the House even before Reid takes up the bill!

At some point we are going to learn that a GOP majority does not have much utility unless we replace the current roster of failed leaders.

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No Better Time to Slay Ethanol Beast

Tuesday, November 19th, 2013 and is filed under Blog, Economy

There is nothing that exemplifies the feckless and deleterious effects of government intervention in private enterprise more than the Renewable Fuels Standard.  Using the boot of government to mandate that private enterprise use an inefficient product of a special interest to the detriment of consumers and job creators is the worst form of tyranny.  James Madison is rolling over in his grave.

Yet, much like Obamacare, the ethanol mandate has become unworkable even from a liberal perspective.  Given that most car engines cannot handle more than a 10% ethanol blend, there is simply not enough demand to fill the targeted quota of 18.15 billion gallons in 2014 as prescribed by the 2007 Energy Independence and Security Act (EISA).  As such, the Obama administration was forced to lower the standard to 15.21 billion gallons.

Many conservatives are heralding this as the first victory over the intractable ethanol lobby.  However, rather than celebrate an infinitesimal decrease in the mandate, we should work to repeal the remaining 15 billion gallons worth of statism.

Last year, PricewaterhouseCoopers published a study detailing the harmful effects of the ethanol mandate.  They found that the increase in food prices from the ethanol mandate costs a restaurant $18,000 per year.  Needless to say it hurts the average consumer at the grocery store.  When you take 40% of the corn crop and shove it into our engines, it creates an undeniable inflationary effect down the food chain.  Had food prices continued on the same downward trend-line since 2005 (when the ethanol mandate was enforced), families would be paying $2,055 less for food every year, according to a study cited by the Heartland Institute.

Only in Washington can the prevailing wisdom dictate that corn be used in our engines instead of on our kitchen tables.  Only in Washington can they raise the cost of food for the average family by over $2,000, and then increase spending on food stamps to cover the poverty they engender.

It’s time to kick the ethanol beast while it’s down.  If ethanol is really God’s gift to the world, as industry lobbyists suggest, why do we need a government mandate to push their product?  Fuel blenders would clamor for it on their own.

The House is considering several good energy bills this week.  They should add in a full repeal of the RFS.  Do they stand with free markets, consumers, and small businesses or do they stand with Soviet-style central planning and special interests?

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Bill Shuster Flip Flops on Another Spending Cut

Wednesday, July 10th, 2013 and is filed under Blog, Elections, Issues, News

Wow – what a difference a primary challenge makes.

Yesterday, conservative Rep. Tom McClintock offered an amendment to the FY 2014 appropriations bill funding the Energy Department which would cut $1.5 billion from energy subsidy programs.  If Obama has taught us anything it is that government should never distort the energy sector and pick winners and losers (usually losers) in the market.

Amazingly, Shuster voted the right way.  He didn’t join the 50% of Republicans who helped vote down this commonsense free-market spending cut.

The only problem is that when a similar amendment was proposed by Mr. McClintock to last year’s energy appropriations bill, Shuster voted against it…along with his RINO buddies.  Additionally, Mr. McClintock offered another amendment last year to eliminate the Office of Fossil Energy and save taxpayers $428 million in special interest handouts to green energy social engineering.  Shuster voted no.  In 2011, Shuster voted against cutting $3.25 billion from the Innovative Technology Loan Program, which was responsible for Solyndra and some other Obama venture socialist activities.

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Lamar Alexander Fishing for Distraction from Amnesty Vote

Friday, July 5th, 2013 and is filed under Blog, Immigration, News

What happens when you bring a Lamar Alexander to a Chuck Schumer fight?  He turns around and becomes a weapon for Chuck Schumer and his allies, albeit an ineffective one.

In 2007, before running for a second term, Alexander rightfully noted that “to regain the public’s confidence, we ought to scale it back and fix the problem step-by-step by absolutely securing our borders first, then enforcing our laws without amnesty.”  Now, after years of voting for more spending, higher taxes, more debt, expanded government healthcare, massive energy regulations and subsidies, and liberal judicial nominees, the former third ranking Senate Republican has become a Chuck Schumer Republican.  He led the fight, along with Bob Corker, to push a fledgling amnesty-first bill across the finish line.

Naturally, his constituents in Tennessee  – a state where Obama lost 91 of 95 counties – are not too happy with him.  So he’s going up on the air with a $180,000 media campaign featuring Rand Paul.  What is he touting?  His fishing bill:

In an apparent effort to boost conservative support, Sen. Lamar Alexander (R-Tenn.) has launched his first TV ad campaign of the 2014 cycle with a spot featuring footage of Sen. Rand Paul (R-Ky.) that touts a measure Alexander spearheaded to protect fishing access.

“We don’t want a government that’s strong enough to make our lives risk-free. We can do that for ourselves,” says Alexander in the ad, which touts his work to pass a measure that placed a two-year moratorium on efforts to restrict fishing access in certain areas in the state.

The spot includes footage of Sen. Rand Paul (R-Ky.), who co-sponsored the measure, saying: “Nobody wants to say no to Lamar Alexander.”

Fish?  Really?  After voting for mass amnesty and new red tape on ICE agents with the hollow promise of enforcement 10 years from now, I don’t think we will have to worry about free fishing.  The entire country will be voting like California, and fishing will be the least of our problems.

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Obama’s Anti-Fracking Policy in One Chart

Thursday, February 7th, 2013 and is filed under Blog, Issues

When Obama is directly challenged on a national stage over his anti-fracking and drilling policies, he gets defensive and denies that he is clamping down on oil and natural gas exploration.  He often touts the recent increase in the use of fracking as a way of deflecting attention from his war on fossil fuels.

As we all know, most of the drilling has occurred on state and privately owned land.  In fact, there has been less drilling on federal lands.  Do you want to know why?  Take a look at this chart from the Institute for Energy Research detailing the number of days it takes to obtain a permit for drilling on federal lands vs. state lands:

A Call to Our Brothers and Sisters in Coal Country

Monday, November 5th, 2012 and is filed under Blog, Elections

Americans often exude an apathetic attitude regarding the importance of elections.  Many people feel as if their lives will be the same the day after the elections, irrespective of the outcome.  As such, they are not enthusiastic about voting.  Well, in this case, if Obama is reelected, our country will never again resemble the Constitutional Republic that it once was and should continue to be.  However, for all of our brothers and sisters in coal country, here is what you have waiting for you immediately following an Obama victory.

The Washington Examiner has the details about Obama’s final strike in the war on coal later this month:

President Obama’s Environmental Protection Agency has devoted an unprecedented number of bureaucrats to finalizing new anti-coal regulations that are set to be released at the end of November, according to a source inside the EPA.

More than 50 EPA staff are now crashing to finish greenhouse gas emission standards that would essentially ban all construction of new coal-fired power plants. Never before have so many EPA resources been devoted to a single regulation. The independent and non-partisan Manhattan Institute estimates that the EPA’s greenhouse gas coal regulation will cost the U.S. economy $700 billion.

The rush is a major sign of panic by environmentalists inside the Obama administration. If Obama wins, the EPA would have another four full years to implement their anti-fossil fuel agenda. But if Romney wins, regulators will have a very narrow window to enact a select few costly regulations that would then be very hard for a President Romney to undo.

Environmentalists at the EPA pulled this trick before in 2000 when the Clinton administration rushed out a finding that Mercury emissions from power plants were a growing public health threat pursuant to the Clean Air Act. That finding did not regulate power plants itself, but it did force the Bush administration to begin a lengthy regulatory process. The Obama EPA has estimated that this regulation alone will cost the U.S. economy $10.9 billion a year.

Remember, there were already 9,000 mining jobs eliminated in October, according to the BLS.

Folks, it boils down to this.  Do you want to keep your jobs and self-respect or not?  Do you want to sacrifice your careers and hard-earned income on the alters of Obama’s rich oleaginous environmental parasites?  Do all Americans want to “necessarily” pay more for energy.

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Obama’s “Consistent” Record on Coal

Thursday, October 18th, 2012 and is filed under Blog, Issues

Obama employed a useful strategy during Tuesday night’s debate.  When pressed about the failures of his record, even on policies that he once openly flaunted, Obama denied that his policies ever existed.  Nowhere is this more evident than when he spoke about energy policy.

OBAMA: “So what I’ve tried to do is be consistent. With respect to something like coal, we made the largest investment in clean coal technology to make sure that even as we’re producing more coal, we’re producing it cleaner and smarter.” (President Barack Obama, Presidential Debate, Hempstead, NY, 10/16/12)

Reality: During the 2008 campaign, Obama openly bragged that his cap and trade bill will bankrupt coal-fired plants. “So, if somebody wants to build a coal plant, they can — it’s just that it will bankrupt them, because they are going to be charged a huge sum for all that greenhouse gas that’s being emitted.” (Sen. Barack Obama, Interview With The San Francisco Chronicle’s Editorial Board, San Francisco Chronicle, 1/17/08)

Also, never forget Joe Biden’s moments of candor:

No Coal Plants Here In America.” (Joe Biden, Remarks At A Campaign Event, Maumee, OH, 9/16/08)
We’re Not Supporting Clean Coal.” (Joe Biden, Remarks At A Campaign Event, Maumee, OH, 9/16/08)

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Obama’s Tax Deduction Lie

Friday, October 5th, 2012 and is filed under Blog, Debt, Taxes

Obama thinks the American people are stupid.  Throughout the debate, Obama regurgitated his talking points about a balanced solution to the debt crisis.  In the process he insulted the intelligence of every voter by intimating that the budget can be balanced by eliminating a few tax credits.  No, he didn’t commit to tackling the tens of trillions in unfunded liabilities to Medicare and Social Security.  He declined to confront the ballooning cost of all the welfare programs.  The only thing he wanted to discuss was eliminating a few tax credits for oil companies and corporate jets.

In May 2011, the Senate took up a bill to eliminate $2 billion worth of tax credits for the gas and oil industry.  Let’s overlook their fallacious charges that these are unique handouts to the industry – and treat them as if they are expenditures.  We are slated to spend over $3.6 trillion this year, yet Obama is obsessing over $2 billion in tax credits.  Here are some of the major expenditures for last fiscal year, including the so-called handouts to big oil (in billions):

Yes, these tax credits barely register among our major ‘expenses.’

Using a 10-year budget frame, we are expected to spend another $46 trillion.  Democrats claim that their plan to cut the oil tax deductions would save us $21 billion over 10 years.  That amounts to .00045% of our estimated outlays.

What about the much beleaguered corporate jet tax deduction?  That would save $3 billion over ten years – $300 million per year.

Mitt Romney rightfully lambasted Obama for overlooking the $90 billion in subsidies for green energy while focusing on a few billion in deductions he feels he could demagogue.

But there’s more to the story than just the dollar figure comparison.  For Obama, a universal tax deduction to those who already pay a lot of taxes is a handout, while a parochial handout to a sectarian interest that pays no taxes is a tax cut.  And the fact is that green energy companies have no tax liability.  Perforce, their tax credits are nothing more than refundable handouts.

The green energy sector is even more parasitic when scrutinized by performance.  Consider this chart detailing our energy usage by source for 2009; solar, wind, and biomass are barely on the map, even though they are almost completely subsidized.  Here is a chart from the Institute for Energy Research comparing federal subsidies per unit of production of different energy sources:

As you can see, Solar is being subsidized by over 1200 times more than fossil fuels, while Wind enjoys over 80 times more in taxpayer cash.  The reality is that no amount of subsidy can compensate for the impotence of green energy.

Moreover, while most of the government’s investments in green energy are in the form of direct subsidies, Oil and Gas companies don’t receive subsidies; they enjoy universal credits and deductions that are afforded to all businesses.    Additionally, oil and gas companies pay an effective corporate tax rate about 55% higher than that of most other industries.  All the while, the renewable-energy sector is ostensibly kept afloat by the taxpayer, offering nothing in terms of revenue.

Earlier this year, the Wall Street Journal laid out the facts about who pays taxes and who doesn’t.

The federal Energy Information Administration reports that the industry paid some $35.7 billion in corporate income taxes in 2009, the latest year for which data are available. That alone is about 10% of non-defense discretionary spending—and it would cover a lot of Solyndras. That figure also doesn’t count excise taxes, state taxes and rents, royalties, fees and bonus payments. All told, the government rakes in $86 million from oil and gas every day—far more than from any other business. […]

Exxon Mobil, the world’s largest oil and gas company, says that in the five years prior to 2010 it paid about $59 billion in total U.S. taxes, while it earned . . . $40.5 billion domestically. Another way of putting it is that for every dollar of net U.S. profits between 2006 and 2010, the company incurred $1.45 in taxes. Exxon’s 2010 tax bill was three times larger than its domestic profits. The company can stay in business because it operates globally and earned a total net income after tax of $30.5 billion in 2010 on revenues of $370.1 billion.

Now let’s contrast that with green energy companies:

For comparison, nuclear power comes in at minus-99.5%, wind at minus-163.8% and solar thermal at minus-244.7%—and that’s before the 2009 Obama-Pelosi stimulus. In other words, the taxpayer loses more the more each of these power sources produces.

If Obama wants his green-energy campaign donors to be on equal footing with oil companies, maybe they should begin producing something useful and actually incur a tax liability before they receive tax credits.