New energy bill needs to lose pounds of pork
In what could be the last chance for Congress to pass an energy bill before election-year politics paralyze the nation’s capital, Senate Republicans have been hacking away at some of the tax breaks, subsidies and other government giveaways that led to accusations the measure had much more to do with pork barrel than oil barrels.
Had they done this last year, we might have called it a step in the right direction. But at this late date, given how polluted the process has been by pandering and plundering, it strikes us as a pathetic act of desperation.
Stripping away some of the lard reportedly has cut the package’s sticker price in half, from $31 billion to $15 billion over 10 years. But that’s still considerably more than the $8 billion in spending and tax incentives in the Bush administration’s version.
And we tend to agree with the typically blunt assessment of Arizona Sen. John McCain, who, although all over the map on some issues, has remained admirably consistent on the subject of fiscal discipline. “It’s still $15 billion of pork,” declared Sen. McCain, who called another last-minute gambit to fold the energy package into a $318 billion highway bill also pending before Congress “disgraceful legislative behavior.”
Certain components of this package undoubtedly deserve salvaging, including those that would boost U.S. natural gas production, promote needed upgrades to an antiquated U.S. electric grid and cut through some of the red tape curtailing energy development on public lands. But any potential benefits have been all but obliterated by corporate giveaways and special interest sops.
It’s nice that some in Congress belatedly recognized the impropriety of including in the first energy bill a $1.1 billion program for beach improvements in oil and gas-producing states, much of which would be going, not coincidentally, to Louisiana, the home state of Energy and Commerce Committee Chairman Billy Tauzin.
And 11th-hour changes to federal production quotas for the corn-based fuel additive ethanol — an expensive favor to farm states — would reportedly save taxpayers another $5 billion. But we question whether the billions in remaining giveaways — divided evenly among oil and gas producers, renewable fuel subsidies and conservation programs — are really what Americans wanted in an energy bill.
Other provisions missing from the new energy bill include $3 billion for energy savings performance contracts and $1.5 billion in royalties for ultra-deep oil and gas exploration. But the favors, tax incentives and subsidies weren’t doled out exclusively to big oil and gas companies, as critics on the left contend. We’re not sure what might have become of the $1.74 billion in tax credits earmarked for alternative fuel and electric vehicles, $288 million in subsidies for energy efficient appliances or $447 million in tax credits for homeowners using solar power. But as long as we’re cutting out the pork, we hope these handouts, too, will be eliminated.
One controversial item removed from the new bill we actually think belongs there is limited liability protection for companies that manufactured the fuel additive MTBE. Those companies today face an estimated 100 lawsuits stemming from MTBE contamination of wells and aquifers across the country, after the substance seeped out of underground storage tanks.
Some, including Democratic presidential contender John Kerry, portray such liability protection as a Republican bailout of corporate fat cats. But we believe it’s the responsible thing for Washington to do, since it was Congress, not these companies, that approved federal clean-air mandates resulting in the widespread use of MTBE. If there was any negligence involved in an MTBE cleanup that could cost as much as $50 billion, and possibly bankrupt some of the companies being sued, it clearly lies with Congress.
About the best that can be said about the latest incarnation of the energy bill is it’s only half as bad as its precursor. Just pull the plug on it, for goodness’ sake. Congress can start over again — and perhaps in a more serious fashion — after the next round of regional power outages, or when oil and natural gas prices double or triple.