http://www.heritage.org/Research/Ene...nment/1950.cfm

The Consumer-First Energy Act of 2008 Will Only Increase Gas Prices and Energy Costs

by Ben Lieberman
WebMemo #1950
Good energy policy is easy to distinguish from bad energy policy: Good policy leads to more supplies of affordable energy and bad policy leads to less. A few recently proposed bills, such as the American Energy Production Act of 2008 (S. 2973), introduced by Senator Pete Domenici (R-NM), and the Affordable Fuel for Consumers Act of 2008 (H.R. 6009), introduced by Representative Phil English (R-PA), seek to free up domestic energy supplies by undoing past constraints , including eliminating restrictions on domestic oil production. Unfortunately for consumers, the energy bill on the fast track right now is the Consumer-First Energy Act of 2008 (S. 3044), introduced by Senate Majority Leader Harry Reid (D-NV), which repeats the mistakes of the past by adding constraints that will discourage domestic energy supplies, including:

1 )Raising taxes on domestic oil production,
2 )Picking winners and losers among energy alternatives, and
3 )Imposing price-gouging legislation.

Simply put, the Consumer-First Energy Act is an anti-energy bill that will only add to already-high energy costs.

Fewer Restrictions on Domestic Oil Production

We need fewer restrictions on domestic oil drilling. America remains the only oil-producing nation that has placed a substantial amount of its energy potential off-limits. This includes a few thousand acres of Alaska's 19.6 million acre Arctic National Wildlife Refuge (ANWR). This small portion of ANWR is believed to contain 10 billion barrels of oil—an amount equivalent to 15 years of imports from Saudi Arabia.[1] Even more oil is located in other restricted areas throughout the United States, and even more still in the 85 percent of America's Outer Continental Shelf (OCS) that is off-limits.[2] Environmental concerns militate against drilling, but improvements in technology have greatly reduced the above-ground footprint and the risk of offshore spills.[3] Any new drilling would be subject to the world's strictest standards.

The American Energy Production Act and Affordable Fuel for Consumers Act allow for leasing of ANWR. This would bring more domestic oil online several years from now, and generate hundreds of billions of dollars in revenues. These bills would also allow leasing in most of the OCS, provided the relevant state governor approves. Each participating state would get a share of the leasing revenues generated by energy production. This would provide more oil and more natural gas, which is also badly needed.

The Consumer-First Energy Act contains no such provisions. In effect, it is an energy bill without any energy in it.

Avoiding the Mistakes of the Past

The Consumer-First Energy Act of 2008 might as well be called the Repeat-Every-Energy-Policy-Blunder-From-1970-to-1980 Act. Among other mistakes from that period, the government increased the taxes levied on domestic oil producers. The result of this windfall profits tax, according to the Congressional Research Service, was "reduced domestic oil production from between 3 and 6 percent, and increased oil imports from between 8 and 16 percent. This made the U.S more dependent upon imported oil."[4]

There were also many attempts by the federal government to pick winners and losers among emerging energy alternatives—synthetic fuels, solar, ethanol and others—and tilt the playing field in their favor. Virtually all turned out to be big disappointments.

The government also instituted price controls, which only served to create the gas shortages that remain one of the unpleasant memories from that era. Yes, price controls meant consumers could get cheaper gas—but only after waiting in long gas lines, and only if stations didn't run out first.

No rational energy policy maker should want to repeat the mistakes of that era, yet the Consumer-First Energy Act of 2008 tries to do just that. There are new proposals to increase the effective tax rates on U.S. oil companies, both by bringing back a windfall profits tax and by repealing certain deductions against income for expenses related to domestic oil drilling. As happened before, this will discourage domestic oil drilling, which is the exact opposite of what an energy bill should be doing.

The bill allows oil companies to avoid the windfall profits tax if they invest in congressionally approved alternative energy sources. Though renewable energy sources should be a part of America's energy mix, their pursuit should be done by the private sector without direction from Washington. The federal government has never been adept at picking winners and losers among such alternatives, as the burgeoning problems with the corn ethanol mandate attest.

There are also price-gouging measures, which act the same way as price controls in that they try to make high prices illegal. Like tax hikes, such measures discourage badly needed supply increases, and thus end up doing more harm than good. Even the Federal Trade Commission, the agency charged with implementing this scheme, has warned that it is a bad idea.[5]

Conclusion

Its no coincidence that, despite the massive 2005 energy bill and another big one in 2007, the price at the pump continues upward. Both measures did little to create new oil and gasoline supplies, or untangle the red tape afflicting existing supplies. America needs less of the laws, regulations, taxes, and other government-created impediments to a more affordable gasoline supply. Most of the provisions in the American Energy Production Act and Affordable Fuel for Consumers Act seek to liberate Americans from that morass. In contrast, the Consumer-First Energy Act of 2008 contains just about everything we don't want or need.

Heheheh

I'm just going to wait here for the first liberal to say yes to show up and then rip their words to pieces.

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Thats exactly why I posted this poll. Its simple. Its not mileading. And It shows no agenda other than the negative effects of taxing oil companies. However I fear that most liberals eather have little understanding of economics or choose to ignore them in ther promotion of socialism.

Save some liberal azz for me to spank.

This is an equal oppertunity thread where we can all state the obvious in the light of ignorant liberal thought!

Either the supply has to go up, or demand has to go down.

If it had to be one way or the other, I would go with lowering demand. Is that realistic, considering our (domestic) thirst for oil (not to mention increasing international demand for oil)? Probably not.

As nations develop, they all appear to follow the same path (agriculture to industry to service), and two of the planet's giants - India and China - are just now hitting their stride when it comes to the consumption of oil.

We need to turn away from fossil fuels at some point - sooner rather than later.

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"Just because you can, doesn't mean you should."
-- Author Unknown

In other words supply must go up b/c demand won't drop until the price is extreme and it isn't gov't business anyway to control demand. how about lowering taxes?

If after reading this, the libs still think these high prices have anything to do with Bush, then all I can say is that they're not using their brains.

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http://www.nosocialism.com
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America is not a Socialist country, this is why the only democrats who ever win, are democrats who SOUND like Republicans (Hello Bill Clinton - "Low taxes, Free Trade, Welfare Reform, Era of Big Government Over" - Sounds Republican - Hello Barrack Obama - "My Tax Cut is Bigger than yours, Your Health Care Plan is Big Government, Parents need to take responsibility for their kids schooling]").

At least their doing something about it, China has increased oil production by over 50%, and with this new deal they have with Cuba to get Oil right off the Florida Coastline (about 45 miles south of the Keys) they will increase it another 10% or so. India has increase their Oil production by an impressive 385%. The U.S.? We've increased our demand by 20%, but lowered output by 40%! Wow, that was smart.
Of course, EVERY single law passed by the Democrats on Oil production, has been to halt it or bring it to a standstill. Nice Move Boneheads.

__________________
http://www.nosocialism.com
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America is not a Socialist country, this is why the only democrats who ever win, are democrats who SOUND like Republicans (Hello Bill Clinton - "Low taxes, Free Trade, Welfare Reform, Era of Big Government Over" - Sounds Republican - Hello Barrack Obama - "My Tax Cut is Bigger than yours, Your Health Care Plan is Big Government, Parents need to take responsibility for their kids schooling]").

Soooooo? Before I look for other opinions, are we saying that not having this will decrease prices to the consumers?