Fosters Daily Democrat
By Tim Phillips and Corey R. Lewandowski
Sunday, June 17, 2012
In a sound free-market economy, taxes should be easy to understand and applied in a neutral manner; the code should only be used to raise revenue, not to meddle in the economy. This spring, nearly every Republican in Washington supported Chairman Paul Ryan's budget that embraced these principles, yet now some of these same lawmakers are pushing policies that will do the complete opposite.
Recently, a group of over twenty House and three Senate Republicans-including New Hampshire Representative Charles Bass (NH-2) and neighboring Massachusetts Senator Scott Brown-signed on to the American Renewable Energy Production Tax Credit Extension Act (H.R. 3307 & S. 2201). The bill would extend several targeted tax credits for renewable energy, including wind power. If we actually want a simpler tax code and a free-market energy policy, these subsidies must be allowed to expire at the end of this year as currently scheduled.
Policymakers have been using the tax code to steer Americans' energy choices for decades. It has only recently come under public scrutiny thanks to the loss of millions of taxpayer dollars to "green" companies like Solyndra. But oil, natural gas, nuclear energy, ethanol, wind and solar energy have regularly enjoyed lucrative subsidies to promote production and stability, create jobs, and lower prices for the consumer — or so Americans have been told. In reality, the subsidies keep taxes high on productive companies while politicians get to pursue their favorite pet projects, all while energy prices continue to rise.
This holds true for wind energy as well. In order to get a foothold in the energy market, many backers of extending the subsidies claim wind companies should receive the same support that fossil fuels were given in their infancy. They say that if wind is just given a chance to develop, it will grow into a self-sustaining, cost-efficient industry.
But what they don't tell you is that the wind industry has been receiving subsidies for nearly 20 years and has yet to show any signs of such growth. In fact, in the three years that the subsidies were allowed to lapse, the growth of the industry fell by 93%-proof that the industry isn't viable unless it is able to gain special exemptions from our overly-burdensome tax code.
Obviously it's time for lawmakers to realize that if a new technology truly has worthwhile benefits for American consumers (lower cost, higher efficiency, environmental benefits, or otherwise) then that technology will demonstrate its value by competing for consumers' dollars in the open market-not by gobbling up special handouts from their pals in Washington.
Energy subsidies, including the Wind Production Tax Credit, must be eliminated to enable true competition. This forces companies to become more innovative and efficient in order to make their energy source attractive to consumers. It's time for Republicans to live up to their professed free-market principles and get rid of these special giveaways.
Tim Phillips is president and Corey R. Lewandowski is the New Hampshire state director of Americans for Prosperity, which bills itself as "the nation's leading free market grassroots organization."
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