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Chris Prandoni

ATR endorses the Electricity Security and Affordability Act


Posted by Chris Prandoni on Friday, January 24th, 2014, 2:48 PM PERMALINK


Expected to pass out of the Energy and Commerce next Tuesday, Americans for Tax Reform President Grover Norquist had this to say about the Electricity Security and Affordability Act:

“The Electricity Security and Affordability Act is necessary legislation that repeals the EPA’s misguided greenhouse gas standards for new power plants and guides the EPA towards creating new, achievable standards. If this legislation is not adopted, it is possible that a new coal-fired power plant will never be built in the United States again. Congress never intended for the EPA to unilaterally determine what source of energy Americans consume. The Electricity Security and Affordability Act also reaffirms Congress's legislative duties by enacting numerous safeguards against EPA partisan overreach. In sum, this is essential legislation intended to rebut the Obama Administration’s war on affordable energy. I urge every Member of Congress to support the Electricity Security and Affordability Act.”

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Sen. Baucus Cost Recovery Tax Reform Draft Threatens American Energy Revolution


Posted by Chris Prandoni on Thursday, November 21st, 2013, 3:57 PM PERMALINK


Today Senate Finance Chairman Sen. Max Baucus (D-Mont.) released a tax reform draft that would severely hamstring America’s energy producers by reducing their ability to redeploy capital investments. The recent American energy boon, one of the few bright spots in the American economy, is predicated on large, successive capital outlays.

An IHS study estimates that just the development of unconventional oil and natural gas resources will:

  • Require $5.1 trillion in capital expenditures between 2012 and 2035
  • Create and support nearly 2.5 million jobs by 2015 and 3.5 million in 2035
  • Annually contribute $475 billion to GDP by 2035

These economic benefits are only possible if energy companies are allowed to recover their billion dollar investments in a timely manner. Unfortunately, Sen. Baucus’s draft inhibits domestic investment, killing thousands of American energy jobs.

Baucus’s Energy Tax hikes – a deduction delayed is a deduction denied

Lengthen Intangible Drilling Cost to 5 years: Currently, independent producers can deduct 100 percent of their intangible drilling costs in the year they are incurred while integrated oil companies may deduct 70 percent of their intangible costs in the year they are incurred. The Baucus draft, much like the Obama plan, would require energy companies to recovery these costs over 5 years. Wood-Mackenzie economists analyzed the effects of a similar proposal and found that:

  • Investment through the drilling and development of oil and gas resources will decline by $407 billion over the period 2014 to 2023
  • This is driven by a reduction in drilling by an average of 8,000 wells and over 400 rigs per year
  • The impact on employment is to lose an average of 225,000 jobs per year of which an estimated 65,000 would be direct oil and gas industry jobs
  • By 2023 we expect the IDC delay case production to be 3.8 mmboed (or 14%) lower than the current case

Lengthen Tertiary Injectants and Geological and Geophysical expenditures to 5 years: In 2005, geological and geophysical costs were available to be amortized over a two year period. Since then, Congress has twice extended the G&G amortization period to seven years for the largest integrated companies. Now Sen. Baucus is looking to require small, independent energy producers to move to a five year amortization period.

Repeal Last In First Out accounting method with 8 years to pay at a new lower rate: Since 1938, companies have had a choice between using “first-in, first-out” (FIFO) and “last-in, first, out” (LIFO) to account for the profit made on a good sold. The Sen. Baucus draft would eliminate the longstanding LIFO practice and force companies to pay the government billions of dollars in “unaccounted for profits” accrued over the last 60 years.  President Obama similarly proposed to end LIFO in his FY 2014 budget which would have raised taxes by a whopping $80 billion – $28.3 billion would be paid by oil and natural gas producers.

Repeal percentage depletion: For over a century, there have been two ways to calculate the income deduction coinciding with a mineral asset’s rate of depletion: percentage depletion and cost depletion. The preferred method of deduction, percentage depletion, allows the producer to deduct the gross income derived from extracting fossil fuels or other minerals.

Under President Obama’s comparable percentage depletion repeal proposal, oil and natural gas companies would see their taxes rise by nearly $11 billion over the next ten years and hard mineral producers (think coal) taxes rise by $2 billion over the same period. 

All business outlays should be fully expensed in the year they are incurred

Not only is immediate expensing fair and simple, but it would spur economic growth permanently increasing long-run GDP by 2.28 percent. Wages over time would rise by 2.07 percent.

Picking and choosing who is allowed to deduct what when invites politicians to reward parochial interests and punish disliked industries, in this case oil and natural gas producers. Instead of continuing to carve up the tax code like Sen. Baucus’s Cost Recovery Proposal does, a more prudent tax reform plan would level the playing field for all businesses by allowing companies to fully deduct all their expenses in the year they are incurred.

 

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Sen. Vitter's Environment and Public Works' staff skewer Obama Admin in brilliant top ten list


Posted by Chris Prandoni on Wednesday, October 16th, 2013, 10:02 AM PERMALINK


Crossposted in its entirety:

10.       Approximately 15,000 EPA employees are furloughed, making it less likely fake CIA agents at EPA will be ripping off the taxpayer

Last month, John C. Beale, a former EPA senior official in the Office of Air & Radiation of the U.S. Environmental Protection Agency (EPA), pled guilty to criminal charges for stealing nearly $900,000 from the Agency. For years, Beale claimed to work for the Central Intelligence Agency (CIA) to shirk his EPA work responsibilities. U.S. Sen. David Vitter (R-La.), top Republican on the Environment and Public Works Committee (EPW), has also been actively working on an investigation of Beale and the Agency's policies and processes that facilitated Mr. Beale's fraud. Vitter wants EPA can take to reform its management policies and has called for an EPW committee hearing. Click here to read more.

9.         EPA doesn’t have the manpower to raid Alaska mines with armed guards

In August, EPA agents conducted an armed raid against miners in Chicken, Alaska, following up on an alleged claim of violations of the Clean Water Act (CWA). One miner said of the raid, “Imagine coming up to your diggings, only to see agents swarming over it like ants, wearing full body armor….and all packing side arms. How would you have felt? You would be wondering, ‘My God, what have I done now?’” Click here to read more.

8.         Fewer bureaucrats at the EPA makes it less likely that they’ll make up science on new regulations

Vitter and EPW Republicans have pointed out the flawed science behind a number of EPA rules and regulations on the social cost of carbon, methanol, power plants, hydraulic fracturing, and the list goes on and on. Click here to read more.

7.         Former Secretary of Interior Ken Salazar is worried about oil production in the Gulf of Mexico

“The continued shutdown of the federal government will ultimately affect the government approval of activities in the Gulf of Mexico. [Given] the contribution the Gulf is making to the energy future of the United States . . . it’s not the kind of rollback we ought to have.” – Former Interior Secretary Salazar, October 1, 2013

Former Secretary of the Department of Interior (Interior) Ken Salazar was responsible for essentially shutting down all oil and gas production in the Gulf of Mexico when he implemented a moratorium on production in 2010. The Inspector General of the Interior Department during Salazar’s tenure is still under investigation for her role in turning a blind eye to the fudging of a National Academy of Engineers report related to the moratorium. The halt in production had a negative impact on energy production for several years. Salazar was also responsible for throwing out the previous 5-year plan for energy production and leasing on the outer continental shelf, which eliminated vast resources that should be available to the nation’s energy producers. Limiting Gulf of Mexico access, as well as access on the Atlantic and Pacific coasts perpetuated the Administration’s attempts to shut down offshore energy production.

Read more about Salazar’s incredibly ironic statement here.

6.         World War II veterans have stormed the Normandy beaches again. (Sadly, they had to, in order to gain access to their own memorial)

President Obama ordered that all national parks, monuments, and museums be shut down, even national parks that are fully funded by non-profit organizations and receive zero federal dollars for their operations.  He also had barricades placed around the National World War II Memorial in Washington, D.C., keeping out the visiting US World War II veteran forces and other visitors who could not get access to the memorial that commemorates the veterans’ sacrifices and commitment.  On October 8, 2013, the National Mall was opened for a rally to promote the Gang of 8 immigration legislation, which has been called an amnesty bill for illegal immigrants.

5.         EPA doesn’t have the manpower to unilaterally expand its jurisdiction under the Clean Water Act

EPA has perpetually taken steps to expand its own jurisdiction under the Clean Water Act. The now-withdrawn guidance document and new rule are symptoms of an agency unceasingly trying to broaden its reach and frustrate commerce. Vitter and EPW Republicans have been demanding a whole lot more transparency and to unequivocally withdraw the controversial draft guidance. Read more here.

4.         U.S. Sen. Sheldon Whitehouse (D-R.I.) still finds time on the Senate floor to make inaccurate claims about green jobs.  (This is a positive, right . . . NOT!)

“There are more jobs now in green energy than in the entire oil and gas industry.” – Senator Whitehouse, October 10, 2013

 A recent study by the American Petroleum Institute found that as of 2011 the oil and gas industry supports 9.8 million full-time and part-time jobs, while the Bureau of Labor Statistics reported that in 2011 there were only 3.4 million “green” industry supported jobs. Estimates from the National Renewable Energy Laboratory show that the federal government spent approximately $9 billion on green jobs, while only creating 910 new, long-term jobs. This means American taxpayers spent $9.8 million per job. A more thorough analysis of the dubious nature of such claims can be found here.

3.         Far-left environmentalists prove themselves hypocrites again: They criticize continuing oil and gas production on federal lands during the shutdown but issue no call to halt wind turbines

"It's disappointing that the public is shut out from national parks but oil companies get to drill in them.” - Alex Taurel, Deputy Legislative Director at the League of Conservation Voters

Vitter has repeatedly pointed out the hypocrisy of the Administration pursuing cases involving oil and gas producers, and not wind energy producers. The Administration has taken legal action against oil and gas producers whose operations have resulted in the death of birds. On the other hand, they have failed to pursue action against, and even offered waivers to, the companies who operate wind turbines that kill birds, including bald eagles, on leased federal lands. It was recently reported that “wind turbines kill over 600,000 birds annually.”

2.         President Obama has a temporary excuse for his stonewalling on FOIA and other transparency demands of the Administration

Currently over 90% of EPA’s employees are furloughed. EPW Republicans have focused on the lack of transparency within the Obama Administration, particularly at the EPA, but also at the Treasury Department who have refused to release their involvement in developing a carbon tax.

And the number 1 reason the government shutdown isn’t all bad…

1.         Richard Windsor has been furloughed—for good!

“Richard Windsor,” the now infamous email alias for former EPA Administrator Lisa Jackson, has been touted by the Administration as an example of standard procedure for high level employees. As it would turn out, from 2009 to 2012, EPA awarded ethics certificates to the employee “Richard Windsor” who was also described as a top student in the Agency’s ethical-behavior class. Click here to read more.

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America's Fracking Revolution Is Threatened By A New Report From The State Department


Posted by Chris Prandoni on Wednesday, October 2nd, 2013, 12:07 PM PERMALINK


This Article Originally Appeared on Forbes.com

Many on the left have long viewed hydraulic fracturing and low natural gas prices as a threat to their zero-carbon utopia. Affordable, clean burning natural gas not only undermines the economics of solar and wind, but also the justification for these fickle sources of energy.

Last winter, New York and a handful of other Northeast states announced they were going to sue the Environmental Protection Agency (EPA) to force stricter methane regulations. The New York Attorney General wrote:

    "EPA has found that the impacts of climate change caused by methane include “increased air and ocean temperatures, changes in precipitation patterns, melting and thawing of global glaciers and ice, increasingly severe weather events-such as hurricanes of greater intensity-and sea level rise.” In 2009, EPA determined that methane and other greenhouse gases endanger the public’s health and welfare."

    "The EPA’s decision not to directly address the emissions of methane from oil and natural gas operations-including hydrofracking-leaves almost 95% of these emissions uncontrolled."

It appears that these radical actors, New York is one of a few states that bans hydraulic fracturing, have the ear of our government. Included in the State Department’s just released 2014 Climate Action Report is a call for an interagency methane strategy and all but announces future EPA methane regulations:

   "Methane emissions will be addressed by developing a 40 comprehensive, interagency methane strategy, focusing on assessing current emissions data, 41 addressing data gaps, identifying technologies and best practices for reducing emissions, and 42 identifying existing authorities and incentive-based opportunities to reduce methane emissions."

Luckily for the EPA and State Department, a new study by the University of Texas and the Environmental Defense Fund (EDF) revealed that methane emissions associated with natural gas production are far less than previously thought. EDF, an organization that is often critical of the oil and natural gas industry, calculated that average emissions were almost 50 times lower than EPA estimates.

To Read More Click Here

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New McConnell Ad highlights EPA's War on Coal


Posted by Chris Prandoni on Thursday, September 19th, 2013, 1:31 PM PERMALINK


Later this week the EPA will announce new carbon emission standards for future power plants, the New Source Performance Standard regulation. All signs point to an unpredicted regulation that will effectively ban construction of coal-fired power plants.

The EPA has waged an all-out war on coal-fired electricity making good on President Obama’s promise to “bankrupt” the coal industry. This new carbon regulation, combined with the EPA’s retroactive 404c mining permit revocation, threaten America’s coal industry and the tens of millions that rely on the energy source for reliable, affordable energy.

McConnell’s ad:

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Coburn-Carper Postal Bill Misses The Mark


Posted by Chris Prandoni on Wednesday, September 18th, 2013, 5:00 PM PERMALINK


With the United States Postal Service’s (USPS) $8 billion deficit driving Congressional action, Sens. Carper and Coburn have put forth a bill that protects a bloated union workforce and paves the way for consumer rate increases.

Rightsizing the workforce
Compared to the private sector, over 80 percent of the Post Office’s costs are labor related while FedEx and UPS spend 20-40 percent less. For years the USPS has acknowledged its excess capacity, yet S. 1486 delays necessary attrition by placing a two-year moratorium on plant closings.

If the Postal Service is to become profitable, it will need to reduce labor costs. Unfortunately, S. 1486 kicks the can down the road by perpetuating excess postal labor that the USPS can no longer afford. Additionally, the bill claws back private sector work sharing language that could reduce Postal Service costs.  

Overpaid workers
USPS employees are paid far above expected market rates: 34% more than their private sector counterparts. The average annual compensation (including benefits) of a postal employee is well in excess of $80,000. While S. 1486 allows the Postal Service to establish a new retirement plan for new employees, the legislation does little to address inflated employee wages. It is the combination of too many employees that are paid too much that is dragging USPS into the red. The solution to USPS’s self-identified problems is to address these labor issues head-on, not look for more revenue through rate increases.   

Raising rates
Unable to save enough money through necessary cuts, the USPS will be forced to raise postal rates. S. 1486 changes and then permanently removes the CPI based annual cap on postal rates. Without such a cap, USPS will have little incentive to reduce its workforce and rein in its costs. Instead of duking it out with the union, the USPS will likely raise rates on consumers.

Ultimately, increasing postal service rates forces customers to prop-up the continued inefficient operations of the postal service.

Rate increases would only cause more customers to flee the mail system and could exacerbate the USPS’s most obvious problem – mail volume dropped by 25 percent from 2006 to 2012, from 213 billion pieces of mail a year to 160 billion pieces of mail a year.

The legislation then shifts rate setting responsibilities from the independent oversight of the Postal Regulatory Commission to the USPS Board of Governors, the same entity that has overseen billion dollar losses year after year.

Conclusion
The USPS has acknowledged that its problems lay in its excess capacity, including workforce and facilities. While S. 1486 takes some steps to address healthcare costs for USPS employees – no small achievement – it does not do enough to fix USPS’s unnecessary overhead. Burdening ratepayers with USPS’s labor costs is not only unfair, but could undermine the entire system by driving more users out of it.

Click Here for PDF Version

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Frank Kopyta

The USPS' labor costs are so much higher than UPS and FEDEX because... the USPS is mandated by congress to average out to a break-even status, that is NO profit! So comparing that is like comparing apples to cars.

Rates are not what have reduced the mail volume. Technology has. Texting and emailing instead of writing a letter. Receiving electronic bills and paying bills online. Those are the primary culprits as I see it. Why do you think malls are failing all over America, online shopping.

This is all my opinion and I have no facts to support them except what I know!


176 Democrats Support Obama-imposed Carbon Tax


Posted by Chris Prandoni on Friday, August 2nd, 2013, 10:35 AM PERMALINK


Passed with nearly all Republican votes, the House of Representatives today adopted Rep. Steve Scalise’s (R-La.) amendment to the REINS Act which would require a Congressional vote on any major regulation that taxes carbon. With President Obama explicitly ordering federal agencies to implement carbon reducing policies, the Scalise amendment provides taxpayers with a necessary safeguard against a carbon tax.
 
The non-partisan Congressional Budget Office described the negative effects of a carbon tax this way:
 
The higher prices it caused would diminish the purchasing power of people’s earnings, effectively reducing their real (inflation-adjusted) wages. Lower real wages would have the net effect of reducing the amount that people worked, thus decreasing the overall supply of labor. Investment would also decline, further reducing the economy’s total output.

An economic analysis by the National Manufacturers Association details how a carbon tax designed to reduce CO2 levels by 80 percent could:
 
•    Result in a loss of worker income equivalent to 1.3-1.5 million jobs in 2013 and 3.8-21 million jobs by 2053
•    Potentially raise gasoline prices by over $10 per gallon
•    Raise residential electricity prices by 40 percent
 
Yet, Democrats are willing to inflict these policies on the American people in order to fund a bloated government.  
 

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Even Obama's State Department Knows Keystone XL Is Not An Environmental Hazard


Posted by Chris Prandoni on Wednesday, July 31st, 2013, 12:55 PM PERMALINK


This Op-ed orginally appeared on Forbes.com

Kowtowing to radical environmentalists, President Obama has consistently ignored his own State Department’s analysis in an effort to kill the Keystone XL pipeline. Over the past month, President Obama has openly posited concerns about Keystone construction, concerns that the State Department has analyzed and answered.

The unnecessarily controversial Keystone XL project would carry over 800,000 barrels of crude oil from Alberta, Canada to American refiners in Oklahoma and Texas. Environmentalists have already pressured President Obama to delay construction of the Keystone pipeline for 1700 days. Given the President’s recent, misleading comments, it is looking increasingly likely that the White House will ultimately kill the project.

In a July 24 interview with the New York Times, President Obama pleads for an objective discussion about Keystone, and then immediately relies on partisan job estimates to undermine the project:

    My hope would be that any reporter who is looking at the facts would take the time to confirm that the most realistic estimates are this might create maybe 2,000 jobs during the construction of the pipeline…and then after that we’re talking about somewhere between 50 and 100 [chuckles] jobs.

Revealing the President’s hypocrisy, the depressed 2,000 job creation figure is likely pulled from the Cornell University Global Labor Institute, well-known opponents of the Keystone Pipeline. It is telling that President Obama goes out of his way to ignore his own State Department’s job creation estimates, presumably because they further justify construction of the project. In the fourth, and hopefully final, Environmental Impact Statement (EIS), the State Department writes:

    Including direct, indirect, and induced effects, the proposed Project would potentially support approximately 42,100 average annual jobs across the United States over a 1-to 2-year construction period.

42,000 jobs is not a number to chuckle about, as President Obama does in his interview with the Times. The American construction industry has been hit hard during this economic downturn, especially in the Midwest. With the unemployment rate hovering around 7.5 percent, the creation of tens of thousands of new jobs should be cheered, not belittled.

To read full article Click Here

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Americans Want Congress to Stop Obama's Job-Killing Carbon Regulations


Posted by Chris Prandoni on Thursday, July 18th, 2013, 12:25 PM PERMALINK


This aricle first appeared in Townhall

During President Obama’s Climate Speech at Georgetown University, the leader of the executive branch warned opponents of his just announced EPA regulations that “sticking your head in the sand might make you feel safer, but it's not going to protect you from the coming storm" and that “we don't have time for a meeting of the flat-Earth society."

As it turns out, President Obama was patronizing a plurality of Americans: more people think that Congress should stop the Environmental Protection Agency’s forthcoming regulations than think Congress should allow these regulations to become law, according to a new National Journal poll. Even 35 percent of self-identified Democrats think that Congress should intervene and stop new carbon regulations.

Given the Left’s utilization of the bully pulpit and introduction of false choices – you are either for EPA regulations or are sticking your head in the sand – it is encouraging that so many Americans doubt the Obama Administration’s ability to effectively and fairly implement incredibly costly regulations. The American people’s skepticism is evident in Congress’s strong aversion to pass legislation that would punish carbon-based energy, thereby increasing its cost. It is because of Congress’s explicit refusal to raise electricity prices that President Obama has subverted the legislative branch and unilaterally proposed EPA regulations.

I suspect that the more Americans hear about President Obama’s carbon regulations, the more they will urge Congress to overturn them. While President Obama only publically touted new carbon emissions standards for power plants a few weeks ago, the regulations date back to last year when the EPA proposed carbon emission standards that would effectively banned construction of new coal-fired power plants.

According to the EPA’s own analysis, their new carbon regulation banning coal power plants wouldn’t cost anything, since no new power plants would ever be built. Indeed, the EPA’s draft proposal states that “there will be no construction of new coal-fired generation without CCS [Carbon Capture Storage] by 2030.”

To read more click here

 

 

 

 

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House to overturn Obama's anti-growth offshore drilling plan


Posted by Chris Prandoni on Thursday, June 27th, 2013, 11:39 AM PERMALINK


On Tuesday, President Obama ordered the EPA to issue even more job-killing regulations, once again advocated for huge tax hikes on oil and natural gas producers, and announced he will try to impede coal exports. And you wonder why more than 11 million Americans are unemployed. Looking to actually solve this failure of Obama’s presidency, House Republicans have introduced legislation that would allow oil and natural gas producers to develop America’s Outer Continental Shelf (OCS), the aptly named Offshore Energy and Jobs Act.

Here’s what President Obama’s “offshore plan” looks like today:

Energy production is prohibited of a whopping 85 percent of offshore areas under President Obama’s plan. And there’s a lot of oil and natural gas locked up under those red “do not drill” regions: 2.5 billion barrels or 7.5 trillion cubic feet of natural gas.

Republicans rightly think that hundreds of thousands of new jobs, increased energy security, and billion-dollar investments are a good thing. That is why, under the House’s offshore energy bill, the OCS map will look like this:

The Offshore Energy and Jobs Act has the potential to create over a million jobs and should become law as soon as possible.

This week’s action is indicative of both Parties’ energy platforms: Republicans think Americans deserve affordable, reliable energy. Democrats cheer the subversion of Congress to punish producers of carbon-based fuel.

 

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