New Taxes And Less Domestic Energy: H.R. 6899

In case you missed it yesterday, the Dems in the House forced through a fake Energy Bill (H.R. 6899) which will simply not work. Congressman John Campbell breaks it down for us.

Lack of Incentive:

The bill allows offshore drilling, only for States that choose it, no closer than 50 miles from the coast, however it also prohibits revenue sharing of new oil and gas proceeds, thereby removing any incentive for States to “opt in” and allow drilling off their coasts. Nor does the bill offer any lawsuit protection, so companies that do search for oil will continue to be hampered with limitless litigation by environmental groups.

So the bill will allow extreme environmental groups to launch lawsuit after lawsuit making it cost prohibitive for oil companies to explore and produce. The Dems are clearly bowing to environmental extremists to the detriment of Joe and Jane Average American.

The bill will raise taxes:

This bill raises taxes on large oil and gas companies engaged in domestic energy production by nearly $13.9 billion over 10 years, all to provide tax breaks to favored energy projects and products. The bill also limits the use of foreign tax credits on the international operations of oil and gas companies, which pushes the overall tax hike in the bill up to $17.7 billion.

And the Dems are still living in a fantasy world where higher taxes on businesses are actually paid “out of pocket” by those businesses rather than the tax being passed on to the customer in the form of higher prices, as happens here in the real world.

Reduces Revenue:

The Congressional Budget Office [CBO] has estimated the government could initially receive $5 billion in additional revenue without raising taxes by opening the OCS and allowing drilling in the Arctic National Wildlife Refuge [ANWR]. Yet this bill continues to limit drilling in the OCS. According to CBO, it reduces revenue to the Treasury by $1 billion.

And when the revenues go down, what is the first reaction of the Dems? Raise taxes again! This bill is designed to destroy the American economy. The really sad part is that the Dems have their blinders on and can’t even see what is happening out here in Main Street America.

New Fees For Energy Companies

The bill raises $5.8 billion by imposing new fees on certain leases that currently pay no royalties. It also imposes $1.8 billion of new fees on non-producing Gulf of Mexico leases, and requires retroactive lease payments back to 1 October 2007 on certain leases.

Pop-quiz: If taxes get passed along to the consumer in the form of higher prices, who do you think is ultimately going to pay these fees? If you said: “The consumer,” then you are absolutely correct. So not only will prices be forced higher with higher taxes, they will be forced even higher with these new fees. It seems as though the Dems have somehow convinced themselves that everyone in the U.S. has a limitless supply of money and all of it should be confiscated by the government.

Higher Spending, No Deficit Reduction:

The bill increases the top line for appropriated spending by $6.6 billion, so that total 2009 nonemergency discretionary spending increases by 9.3 percent over 2008. All new revenue in the bill is set aside in a reserve fund to offset future appropriated spending increases. There is no guarantee this funding will be used to reduce U.S. dependence on foreign oil.

Remember all the talk the Dems did back in 2004 about how the deficit was a bad thing? Amazing how quickly they changed their tune when they took control of Congress in 2006.

More Earmarked Spending:

The bill restructures the New York Liberty Zone Program, making it a $2-billion earmark that can be used for any transportation infrastructure project in New York City. The measure also earmarks $25 million to establish a so-called “National Energy Center of Excellence.”

Yep. You can thank Charlie Rangel for that one. He can’t even figure out the tax code that he, above all, has the most influence on, yet he knows how to gouge the taxpayer for more money. I wonder if the “National Energy Center of Excellence” will actually have a grip on reality or if it will be some leftist fantasy world where everything is power by pixie dust and unicorn whiskers.

Exploiting the Fannie-Freddie Bailout:

The bill seeks to make Fannie Mae and Freddie Mac green when the problem is they are insolvent. It directs the two financially ailing firms to develop loan products and flexible underwriting guidelines to facilitate a secondary market for energy- and location-efficient mortgages on low- and moderate-income housing. The bill also calls for Fannie and Freddie to facilitate second and junior mortgages for energy-efficiency and renewable energy improvements.

And those “energy efficient” homes are among the most expensive in the United States. Let’s see if middle to lower income families can take on those loans without defaulting.

Congressman Campbell puts it into a nice little nutshell: “This bill is designed to fail.” But the Dems will wrongly claim they did something about the energy crisis while the reality is that they are simply trying to screw the American people with more of their old, tired-out, bound to fail Socialist agenda.

You can access the original article on-line here:

New Taxes For Energy That Won’t Produce
Congressman John Campbell
TownHall.com
Spetember 16, 2008

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One Response

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