Chris Prandoni

Obama Drags Out Democrats' Geriatric Energy Policy During State of the Union


Posted by Chris Prandoni on Wednesday, January 26th, 2011, 2:00 PM PERMALINK


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President Obama doubled down on his party’s energy policy during the State of the Union. Typical of Democrats, he demonized America’s oil and natural gas producers and looked to subsidize inefficient, alternative sources of energy.

Obama: With more research and incentives, we can break our dependence on oil with biofuels, and become the first country to have a million electric vehicles on the road by 2015

If Obama’s endgame is energy independence, it is impossible to accomplish this goal without increased access to America’s outer continental shelf and vast natural gas deposits. America currently imports around 60 percent of its oil and is yet to find a viable domestic biofuel that could supplement this import/export disparity.

The President’s second goal, a million electric vehicles on the road by 2015, is achievable only through the extension of massive taxpayer subsidies. The stimulus package allocated $2.4 billion in grants for advanced battery and vehicle manufacturing. The 2007 Energy Independence and Security Act guaranteed a $25 billion direct loan program aimed at electric vehicles. Furthermore, the $2,500–$7,500 tax credit available to electric car purchasers should be repealed and replaced in a revenue neutral way.

Obama: I'm asking Congress to eliminate the billions in taxpayer dollars we currently give to oil companies.

President Obama is referring to is Section 199 and dual-capacity deductions, two tax rules employed by nearly every domestic manufacturer. If the president wants to eliminate these policies, he should do so for all industries in a revenue neutral way. Raising taxes means higher energy bills and fewer jobs.

Obama: So tonight, I challenge you to join me in setting a new goal: By 2035, 80 percent of America's electricity will come from clean energy sources. Some folks want wind and solar. Others want nuclear, clean coal and natural gas. To meet this goal, we will need them all — and I urge Democrats and Republicans to work together to make it happen.

A Clean Electricity Standard is not a novel idea and is nothing more than a mandate for Democrat’s preferred sources of energy. Forcing utilities to purchase energy from less efficient sources will raise Americans’ energy bills and further disadvantage American companies.

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After Consistently Losing Elections, Unions Ask Feds for Help


Posted by Chris Prandoni on Tuesday, January 4th, 2011, 3:10 PM PERMALINK


This article was originally posted at BigGovernment.com

With public sentiment turning against organized labor, unions have enlisted obscure federal bureaucrats to help bolster their ranks. The Department of Labor has been busy rolling back transparency initiatives put in place during the last decade; the National Labor Relations Board is considering rules which would guarantee union organizers access to private property; the National Mediation Board (NMB) is easing union election rules for unions.

Of the three agencies charged with administering different facets of labor-employer relations, none has been more blatantly pro-union than the NMB over the past two years. Founded in 1934, the National Mediation Board is charged with overseeing labor-management disputes in the railroad and airline industries. The three member board—currently comprised of two former union officials and a Bush holdover—showed its true colors soon after its members were assembled. In its first major decision, the NMB ruled that transportation unions only needed to receive a majority of votes cast as oppose to a majority of all workers votes for the union to be certified.

From the union’s perspective, transportation workers are ideal union members. Workers are required to pay union dues if they want to keep their job—right to work laws are not applicable to this industry. Compounding workers’ problems, once a transportation union is elected it is virtually impossible to get rid of union representation. It is so difficult under the NMB’s rules that it has never been done in a group with more than 1000 employees. Coupled together, these policies make transportation workers a golden goose for unions—workers have to pony up hard earned cash, indefinitely.

The NMB’s move to facilitate union organizing was thought to have huge implications in looming union elections. One such showdown is between Delta’s flight attendants and the Association of Flight Attendants (AFA). 

When AFA called for an election, more then 94 percent of Delta flight attendants—nearly 19,000 employees—cast votes in what was sure to be a highly contested election. Of the 18,760 ballots cast, the National Mediation Board certified that 9,544 workers cast ballots for no representation, while 8,760 votes cast for AFA. But the NMB also counted 430 write-in votes – including 189 blank votes – as votes for union representation, so the AFA officially fell short of a majority by 300 votes.    

This was no anomaly; unions have lost seven of the seven Delta employee elections they’ve called for. Delta's below-wing airport customer service workers, cargo warehouse employees, simulator technicians, meteorologists, passenger service employees, stock clerks and flight attendants all rejected unions at the ballot box. The simulator technicians rejected unionization twice.

In two other groups, the unions voluntarily decertified without an election after it became apparent they couldn’t get majority support.  Thus, among nine groups, involving 56,000 employees, none has chosen to have union representation.

Unable to persuade Delta employees on the merits of their argument, unions have run to the NMB crying foul play. Unions are hoping that a sympathetic board will invalidate the democratically conducted elections, arbitrarily penalize Delta, and then call for another election. Revealing how baseless the union’s case before the NMB is, unions have challenged Delta for encouraging voter participation.

Senator Johnny Issakson (R-Ga.) and a group of 37 senators sent a letter to the National Mediation Board expressing similar concerns:

“While the Board Majority’s past actions with regard to the Delta-Northwest merger makes us question its impartiality in this case...a clear majority of voting flight attendants had to vote for no union representation for the AFA not to represent Delta flight attendants following the representation election. That is precisely the choice Delta flight attendants made.”

A similar letter from Americans for Tax Reform and nineteen other conservative groups and activists concludes:

“Despite the threats and bullying of the unions, it is the will of the people – the will of these employees democratically expressed through these elections – that should be honored.”
Initially unable to unionize Delta’s workers, the National Mediation Board eased election rules moving the goal posts at the behest of Big Labor. Now, after every union couldn’t persuade Delta’s workers to elect them, unions are yet again knocking on the NMB’s doors looking to avail themselves by superseding democratic elections. This is special interest politics at its worst—selling out workers for politically connected groups.

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Obama Administration Regulates Bad Times, Mandates Unemployment


Posted by Chris Prandoni on Tuesday, December 14th, 2010, 1:13 PM PERMALINK


Two years into the Obama administration, one of its recurring themes has been regulatory overreach. The Environmental Protection Agency is looking to implement cap-and-trade after Congress failed to do so. The Department of Labor, National Labor Relations Board and National Mediation Board—the three bodies which oversee union-employer relations—have overturned legislation, rescinded rulemakings, and reinterpreted eighty-year-old statues in order to facilitate unionization for Big Labor.

The latest iteration of this unfortunate narrative is the appointment of trial lawyer J. Dudley Butler to the United States Department of Agriculture (USDA) and the subsequent self-serving regulations he implemented. If you missed our previous posts (here, here, and here) about Butler, this should catch you up to speed:

Mr. Butler is now serving as the Administrator of the Grain Inspection, Packers and Stockyards Administration (GIPSA), an agency of the USDA tasked with regulating the trade of poultry, livestock, and other agricultural products.

Prior to his appointment, Mr. Butler worked as a trial lawyer in the Canton, Mississippi “Butler Farms and Ranch Law Group.” His specialty was suing the poultry industry for alleged violations of USDA regulations; these suits met with limited success. In May of 2009, he was picked by Agriculture Secretary Tom Vilsack to head the very same agency responsible for those regulations: GIPSA. In a move that should come as a surprise to absolutely nobody, Butler has taken his new position as a mandate to make his once and future profession a far more lucrative one.

While Mr. Butler’s appointment raises all kinds of ethical issues—ATR called for him to resign—more important is the impact of his regulations on Middle America. The American Meat Institute calculated that the Mr. Butler’s new regulations will result in 104,000 people losing their jobs and would reduce national GDP by $14.0 billion. The majority of these layoffs will be in the Midwest and rural communities where unemployment is disproportionately high.

It should come as no surprise that 115 Congressional Representatives from rural districts signed a letter to the USDA saying that new regulations were onerous and went too far. Similar measures were taken to prevent regulatory overreach when earlier this year Senator Murkowski proposed SJ Res 26 to reprimand the EPA. Legislators have spent unprecedented amounts of time and effort this year pushing back against unaccountable federal regulators.

Given our current economic stagnation, the last thing the American economy needs is to be handcuffed by regulators beholden to special interests. Given Mr. Butler’s history and the weight of his decisions, he is thoroughly unfit to serve the USDA.

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Koch Brothers Targets for Leftist Paranoia


Posted by Chris Prandoni on Wednesday, December 8th, 2010, 5:13 PM PERMALINK


In the dark annals of conspiracy theories, a few names are instantly recognizable. The Knights Templar. Freemasons. Illuminati. The Koch brothers.

Wait, what?

If recent media hype is to be believed, libertarian billionaires Charles and David Koch are the prime architects of the Vast Right-Wing Conspiracy.  From Tea Parties to TSA protests, it seems that there is no political cause that cannot be tainted by the hint of financial or ideological association with the Kochs, however tenuous it may be.  The thinking among liberal pundits seems to be that popular conservative initiatives are rendered illegitimate if one can conjure up an image of the Koch brothers stroking Persian cats and using their evil corporate funds to buy the allegiance of the duped masses.

For example, take a recent article from The Nation written Yasha Levine and Mark Ames (the former has called Tea Partiers “big government whores,” the latter thinks that school shootings like Columbine are forms of political protest), who attempt to discredit the recent movement against “enhanced” airport screening techniques.  Their piece begins by admitting that the issue is “certainly important—and offensive—to Americans,” and then proceeds to smear anyone who has come to prominence in opposing and exposing the TSA.  The authors accomplish this by heavily implying that individuals such as John Tyner III of “don’t touch my junk” fame are nothing more that Koch-funded pawns.  These claims are so unsubstantiated that Ames and Levine have to rely so heavily on innuendo that they border on bald-faced lies.  

Their oft used formula is this: suspect is libertarian/knows libertarians, the Koch brothers are also libertarians, thus the suspect and the entire “grassroots” movement he represents must be controlled by those dark puppet masters.  Someone should tell these guys how a syllogism works.

While Nation Editor Katrina vanden Heuvel penned an apology to Tyner, she tacitly defended the Left’s new axiom that the Kochs compel all critics of liberalism.

Along the same lines, a blog post for The Nation by Leslie Savan reveals that ordinary Americans wouldn't be opposed to food and beverage taxes without the influence of Big Bad Food Inc.  Savan’s main argument is to note conservative positions (consumer freedom is good, the nanny state is bad) and grunt derisively in a style reminiscent of Kristen Wigg’s “Aunt Linda” character from Saturday Night Live.  Toward the end she slips in the required jibe:

“In fact, AAFT might be nicknamed Coke and Koch: while it bills itself as "a coalition of concerned citizens—responsible individuals, financially strapped families, small and large businesses," those businesses include the Tea Party–supporting front groups Americans for Prosperity and Americans for Tax Reform, both of which are funded by the rightwing Koch brothers.”

This information is supposedly meant to prompt the invalid conclusion that “front groups” like Americans for Prosperity and Americans for Tax Reform are merely acting on the behest of the Koch family.  After all, it couldn’t possibly be that Americans for Tax Reform was abiding by a mandate it has followed since the 1980’s, namely, opposition to all net tax hikes.  Normal Americans couldn’t have a problem with giving away money to a government that thinks it knows better than they do.  No, this must all be the work of that nefarious duo, Charles and David Koch.

The truth is that the Left operates on a double standard when it comes to political activism of the wealthy.  The Koch brothers are demonized along with like-minded organizations, while George Soros and his ilk get a free pass.  With all the howling about this season’s campaign contributions by American Crossroads and the Chamber of Commerce, massive public-sector union financing remains sacrosanct.  It’s time for the liberal establishment to stop these ad hominem attacks on conservative benefactors and start defending their own positions.  Perhaps they are unable to.   

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Response to Bob Barr's Characterization of the ATR Pledge and Ethanol Tax Credit


Posted by Chris Prandoni on Wednesday, December 1st, 2010, 1:48 PM PERMALINK


Yesterday, Bob Barr ran a piece in the Hill outlining the politics surrounding the proposed extension of the Volumetric Ethanol Excise Tax Credit (“VEETEC”). In his piece, Mr. Barr misinterprets the Americans for Tax Reform Pledge writing:

"The highly influential taxpayer watchdog group, Americans for Tax Reform, has advised the more than 200 members of Congress who are signatories to its “Taxpayer Protection Pledge,” that voting against extending VEETC could be considered a violation of their pledge."

The pledge has two components, both are important in this VEETC case study. The pledge reads: 

"....I will ONE, oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses; and TWO, oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates."

The misunderstanding of the pledge usually has to do with the second clause calling signers to oppose any net reductions or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates. In the past, calls to eliminate the ethanol tax credit without offsetting the increased revenue were clear violations of the pledge. However, the current debate is not whether to eliminate a tax credit (which is a clear violation) but whether or not to renew an expiring tax credit. This is an important distinction.

With the VEETC set to expire, baseline projections assume that the government will garner additional revenue in 2010. In essence, the VEETC’s expiration is expected and creates a new benchmark by which to judge legislation. Using the expected 2010 baseline as our metric to determine whether or not a piece of legislation (in this case the extension of the VEETC, or said another way, the reissuing of a tax credit) is in violation of the pledge, we can see that reauthorizing the VEETC would be a tax cut. Thus, if legislators choose not to reauthorize the tax credit, they are not in violation of the pledge as they are keeping revenue consistent with current 2010 projections.

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The Paycheck Fairness Act Compounds Businesses' Problems


Posted by Chris Prandoni on Tuesday, November 16th, 2010, 4:06 PM PERMALINK


Couched in the vernacular of equity and transparency, the Obama administration has enacted or proposed policies that divert small businesses’ energy and resources from job creation to bureaucratic compliance. The effect of these policies is to hamstring America’s small businesses through onerous reporting requirements, punitive penalties, and higher taxes. Often touted as the anchor of America’s economy, small businesses have generated 65 percent of the net new jobs created over the past seventeen years.

Globalization has transformed the American economy from an industrial one to an idea-based one. America’s success is now tied to entrepreneurs’ ability to innovate. Given this reality, the Obama administration has done a poor job of fostering job growth, instead choosing to regulate and tax America’s small businesses.

First there was the now infamous 1099 reporting mandate in the health care bill. Under this law, businesses will be forced to issue paper-filed 1099 IRS information reporting forms to any person or company from which they purchase at least $600 in services or goods. This provision requires small business owners to collect tax information from and issue tax forms to the restaurants where they have business meetings, local office supply stores, airlines, rental car companies, and so on. This is the equivalent of raising taxes on small businesses by $17 billion over the next decade.

Equally disconcerting is the impending tax increase on small businesses if Congress does not extend the current rates. Unlike corporations, small businesses usually don’t pay their own taxes; rather, a small business’ profits are included on its owner’s income tax form. In 2008, $457 billion of small businesses’ $631 billion in total profits faced taxation in households that are in the top two income brackets. Thus, a majority of small business profits will face a tax hike if the current tax rates aren’t extended. These small businesses employ a majority of everyone who works for a small business and are responsible for much of the nation’s job growth. Raising taxes on these most successful small businesses will further delay our economic recovery.

The latest piece of legislation set to weigh down small businesses is the House-passed Paycheck Fairness Act, scheduled for a vote in the Senate on Wednesday. The bill looks to close the gap between the amount of money men and women earn by facilitating litigation and burdening small businesses with new paperwork.

Proponents of this legislation have created a false problem by over-exaggerating the pay disparity between men and women. When hours of work, overtime, education, and experience are accounted for, the difference between men and women’s wages is about five cents on the dollar.

This innocuous-sounding bill would require employers to submit data on sex, race, national origin, and earnings to the Equal Employment Opportunity Commission (EEOC). If this database is made public, trial lawyers will be able to comb through every employer’s books searching for instances of pay disparity.

Further stacking the deck against employers accused of gender discrimination, small businesses would be able to justify pay differences between male and female employees exclusively on the grounds of education, training, and experience. While these are important metrics for measuring a worker’s earnings, they do not take into account productivity, drive, and other intangible attributes which undoubtedly play a roll in employee compensation.

Inevitably, small businesses will hire lawyers to ensure compliance with new paperwork and to defend themselves against unwarranted lawsuits. Both of these unintended but very real consequences will starve small businesses of capital when they need it most.

These reporting requirements, tax increases, and new regulations will stop small businesses dead in their tracks. Unable to tell what tomorrow will bring, small businesses will have no choice but to sit on their hands. Reducing potential profits and increasing paperwork will do little to stimulate new businesses, whose success America’s economy depends on.

Pro-growth senators should first oppose the Paycheck Fairness Act and look to solidify the current tax rates — and then rollback unnecessary regulations. Providing certainty to businesses would be the best use of Congress’ time this winter.

Christopher Prandoni is the Executive Director of the Alliance for Worker Freedom, an affiliate of Americans for Tax Reform.

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Simpson-Bowles Gas Tax Neither Warranted Nor Necessary


Posted by Chris Prandoni on Thursday, November 11th, 2010, 4:25 PM PERMALINK


ATR’s warnings, that the Obama Deficit commission is a plan to raise taxes cloaked in the veil of bipartisanship (more on that here), were validated yesterday when the co-chairs of Obama’s deficit commission released their preliminary plan. The Simpson-Bowles plan includes billions in spending cuts—many of which were not actual reductions in spending—and raises taxes by a very real $100 billion a year.

Seemingly taking cues from the retiring Senator George Voinovich (R-Ohio)
, Simpson and Bowles included in their plan one of the most unpopular taxes in the country—a 15-cent increase of the federal gasoline tax. Proponents of this tax argue that it has not been raised since 1993 (heaven forbid!) and that the revenue would be spent on our nation’s infrastructure.

One school of thought is fearful that the highway trust fund will go belly-up. They accurately claim that the trust fund will be insolvent unless it continues to receive infusions of cash from the general fund or is the beneficiary of additional revenue. This is a red herring. The federal government will keep funneling money to the inefficient highway trust fund thereby preserving the status quo and effectively preventing reform or the implementation of cost saving measures.

People interested in saving the trust fund should first look to make it more efficient. One measure that would save taxpayers hundreds of millions of dollars would be to repeal the Davis-Bacon law. This holdover from the New Deal mandates that federal projects pay workers the “prevailing wage” in a region. When actually implemented, Davis-Bacon ends up inflating usually unionized workers wages, thus, raising the price tag on federal projects.

Repealing this law would bring down construction costs and give the federal government more bang for its buck. Furthermore, to focus on the $36 billion the CBO predicts the highway trust fund will need over the next six years misses the point—our government is currently spending a trillion dollars more than it takes in so nearly every program is technically insolvent.

Instead of lobbying for higher taxes, Simpson, Bowles, and Senator Voinovich should first look for ways to build America’s highways at lower costs. Once new projects are sufficiently scrutinized and deemed necessary, sponsors should look to cut spending from our current three trillion dollar budget and allocate new reductions towards necessary projects.

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Democrats Decry the Business Community After Enjoying Contribution Advantage in 2008


Posted by Chris Prandoni on Monday, November 1st, 2010, 10:37 AM PERMALINK


Looking to discredit potentially huge Republican gains tomorrow, Democrats have manufactured the narrative that Republicans and their supposed Wall Street/corporate puppet masters have united to steal the election and disenfranchise the American people. While decrying amorphous businessmen and non-profit’s independent expenditures makes for good campaign rhetoric, Democrats surely must blush when they look in the mirror.

It was only two years ago, during the 2008 election cycle, that Obama benefited from $65 million in independent expenditures from organizations which, by and large, do not disclose their donors. They also must have forgotten that it was the finance, insurance, and real estate industry which donated $39 million to Obama, $10 million more than the same industry gave to McCain. Or perhaps it was the $19 million Obama received from the healthcare industry—whose product we will be required to purchase by law, mind you— that Democrats forgot to mention during the health care debate (McCain received $7.5 million from the healthcare industry). While busy demonizing the Chamber, Democrats must have accidentally omitted that the business community gave the President $37 million and McCain a measly $16 million.

It would appear that the Democratic Party was the party of Big Business, Big Pharma, Wall Street, and those evil insurance health insurance companies that want nothing more than to cut your coverage when you need it most. The straw men Democrats have erected this cycle were close allies two years ago. It is only since the business community has become disenchanted with the current Administration that Democrats have begun to attack it.

These disingenuous attacks on the Chamber of Commerce make Democrats look like fickle opportunists at best and whiny toddlers at worst. The woe-is-us narrative makes even less sense when one compares Party expenditures in competitive races. David Brooks writes that “in the most competitive House races, Democrats have raised an average of 47 percent more than Republicans, According to the Center for Comparative Politics. Similarly, Democrats have spent 66 percent more, and have about 53 percent more in their war chests. According to the Wesleyan Media Project, between Sept. 1 and Oct. 7, Democrats running for the House and the Senate spent $1.50 on advertising for every $1 spent by Republicans.”

Interest groups, the business community, and individual citizens should be free to donate to and advocate for whomever the like—that’s what the oft cited First Amendment is all about. The persistent, suffused attacks by Democrats in office on those they disagree with is a disconcerting and inappropriate use of power. Americans would do well to reprimand them tomorrow.

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Wind and Solar Energy: A Bad Deal for Taxpayers


Posted by Chris Prandoni on Tuesday, October 26th, 2010, 4:01 PM PERMALINK


[PDF Document]

The wind and solar industry, politicians, and environmentalists have spent the past decade perpetuating the belief that these sources of energy are cost-free and investment in this sector would result in job growth. Contrary to this narrative, wind and solar are less efficient, more expensive sources of energy whose implementation is predicated on government mandates and subsidies.

Energy costs

Wind and solar, at this point in time, are significantly less efficient than coal—the most common source of energy in the US:

Cost per megawatt hour

  • Coal power—$78.10
  • Onshore wind power—$149.30
  • Offshore wind power—$218.00
  • Thermal solar power—$256.50
  • Photovoltaic solar power—$396.10

Tax Credits

The federal government facilitates wind production by providing a $0.022 production tax credit for each kilowatt-hour of electricity produced by wind. Similarly, individuals may employ a 30 percent individual tax credit to alleviate installation costs. These tax credits should be repealed and replaced in a revenue neutral way as this is bad energy policy.

State Mandated Renewable Portfolio Standard (RPS)

Twenty-seven states have implemented Renewable Portfolio Standards which require a percentage of a state’s energy to be derived from wind or solar. An RPS effectively forces consumers to buy wind and solar power artificially raising the cost of their energy bills. There have been ample proposals to create a national RPS, usually referred to as a Renewable Electricity Standard (RES).

Effects of a national RES

If states are forced to use more expensive sources of energy for production, transportation, and everyday consumption, American families will see their energy bills rise and their disposable income fall. The Heritage Foundation found that a 35 percent federal RES would:

  • Raise electricity prices by 36 percent for households and 60 percent for industry;
  • Reduce the income for a family of four by $2,400 per year
  • Reduce Gross Domestic product by $5.2 trillion between 2012 and 2035
  • Reduce employment by more than 1,000,000 jobs

Conclusion

State governments create artificial demand for solar and wind energy that is then subsidized by the federal government. Tax credits should be repealed and replaced in a revenue neutral way and RPSs eliminated. Doing so would alleviate taxpayers from the burden of unnecessarily inflated energy bills.

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East Coast Wind Farm's Success Predicated on Government Mandates


Posted by Chris Prandoni on Tuesday, October 12th, 2010, 2:26 PM PERMALINK


An above-the-fold New York Times article, Offshore Wind Power Line Wins Praise, and Backing, has reinvigorated the debate over renewable sources of energy, in this case, offshore wind. The article outlines plans for a wind farm off the Atlantic Seaboard which would provide energy to a handful of East Coast states. With projected costs around $5 billion, Google and a New York financial firm have agreed to take a 37.5 percent equity share in the project in hopes of encouraging additional investors.

After laying out the finances for the plan, the Times article interviews a slew of environmentalists or Administration officials who, unsurprisingly, are jumping head over heels for the proposed wind farm. “These kinds of audacious ideas might just be what we need to break through the wretched logjam,” said Melinda Pierce, the deputy director for national campaigns at the Sierra Club.

But it’s not all and sunshine and rainbows for taxpayers. “Generating electricity from offshore wind is far more expensive than relying on coal, natural gas or even onshore wind. But energy experts anticipate a growing demand for the offshore turbines to meet state requirements for greater reliance on local renewable energy as a clean alternative to fossil fuels,” the Times reminds us.

To extrapolate, offshore wind costs $218 per megawatt hour compared to coal which costs $78 per megawatt hour. As such, wind companies, investment firms, and environmentalists lobby state and federal legislatures to increase the price of coal or subsidize the price of wind, a practice called corporatism. When Wall Street banks lobbied Congress for TARP funds they were decreed parasites; yet, environmentalists employ the same rent seeking practices and are given a free pass—the inconsistencies from the Left are laughable.

On the East Coast, the artificial demand for wind turbines is brought about by the Regional Greenhouse Gas Initiative (RGGI), or more commonly know as a Renewable Electricity Standard (RES). RGGI is a plan by ten states to reduce their CO2 emissions from the utilities sector by ten percent by 2018. Forcing residents to consume expensive energy, the impetus behind an RES, inevitably leads to higher costs for consumers: In states where a RES is enforced, residents saw the cost of electricity rise by 39 percent.

Furthermore, the federal government facilitates inefficient wind farms providing a $0.022 tax credit for each kilowatt-hour of electricity produced by wind. This is bad tax policy. These tax credits should be repealed and replaced in a revenue neutral way.

Essentially, the government subsidizes wind production and then forces taxpayers to buy the expensive, already subsidized energy. Who wouldn’t want to invest in a market where the government pays you to make something and forces other people to buy it? Sounds like easy work if you can get it.

This gargantuan wind farm’s success is predicated on government skewing the energy market in favor of renewable sources. So while investment firms cash huge checks and liberal politicians appease their base, taxpayers get stuck paying higher energy costs.

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