Chris Prandoni

ATR will Keyvote against cloture on S. 782, the Economic Development Revitalization Act of 2011

Posted by Chris Prandoni on Tuesday, June 21st, 2011, 11:51 AM PERMALINK

Americans for Tax Reform today announced it will keyvote against cloture on S. 782, the Economic Development Revitalization Act of 2011. There are many amendments still pending on this bill which deserve a fair up or down vote. Among the most important of these is Senator DeMint’s SA 460, a measure which would repeal the Renewable Fuel Standard (ethanol mandate) and kill the death tax. When paired with SA 476 (the Feinstein/Coburn amendment repealing the ethanol tax credit and import tariff) the pair of amendments kills the government’s preference regime for ethanol without raising net taxes.

The ethanol mandate is the true impetus spurring non-free market ethanol consumption, since it alone is responsible for most government-induced production of ethanol. Any consideration of ethanol policy without a vote to kill the ethanol mandate is at best nibbling at the edges of the government’s ethanol regime.

S. 782  would almost double the funding for what has become a permanent “stimulus” office; the Economic Development Agency doles out hundreds of millions each year to politically well-connected localities and organizations under the guise of federal economic assistance.

Senators should have the opportunity to vote on killing all the government’s policies that prop-up the ethanol industry. Furthermore, they should have the opportunity to do so in a way that does not result in more tax dollars going to the Appropriation Committees which fund Obama’s supersized government. This is only possible if a vote is permitted on Senator DeMint’s amendment.

A vote for SA 476 (Feinstein/Coburn) combined with a vote for cloture on S. 782, is a vote in favor of protecting the ethanol mandate and proceeding to a vote on a net tax increase.

Senators that voted for Feinstein/Coburn and for cloture today will violate their Taxpayer Protection Pledge. A vote for cloture is a vote against consideration of the DeMint amendment (which would make S. 782 tax revenue neutral).

To keep faith with taxpayers in their state, Taxpayer Protection Pledge signers who supported the Feinstein/Coburn amendment must vote against cloture today to indicate an intent to vote for the DeMint amendment prior to final consideration of S. 782, and thereby keep their Pledge.

Click here for a PDF file.

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Conservative groups urge Senators to eliminate the ethanol mandate, tax credit and tariff

Posted by Chris Prandoni on Thursday, June 16th, 2011, 6:05 PM PERMALINK

Dear Senator,

We are writing this letter to urge you to end government support for the ethanol regime by supporting both Senator Coburn’s Amendment #436 and Senator DeMint’s Amendment to S. 782, the Economic Development Revitalization Act of 2011. Together, these two amendments would end the three policies that inflate American ethanol consumption—the Renewable Fuel Standard (ethanol mandate), The Volumetric Ethanol Excise Tax Credit (VEETC), and the import tariff.

Even after increasingly supporting the ethanol industry since the 1970s, ethanol consumption is still largely predicated on government programs, not consumer preference. Ethanol’s advantageous treatment has skewed America’s energy market and crippled the industry making it reliant on federal handouts.

Neither reducing national gasoline prices nor meaningfully mitigating greenhouse gas emissions, there is little justification for the American people to continue to prop-up the ethanol industry. For much of the past thirty years, a gallon of ethanol has been more expensive than a gallon of gasoline. Furthermore, ethanol contains one-third less energy than gasoline making it substantially less efficient.

Only in an energy market so convoluted with duplicative regulations and preferential laws could ethanol be so ubiquitous. What fuel Americans use should be dictated by the free market and consumer choice, not government mandates. It is imperative that we begin peeling back the numerous policies which facilitate certain types of energy while inhibiting others. Repealing the ethanol mandate, VEETC and import tariff would go a long way towards achieving this end.  

American Conservative Union, Al Cardenas, Chairman
Americans for Prosperity, Tim Phillips, President
Americans for Tax Reform, Grover Norquist, President
Competitive Enterprise Institute, Myron Ebell, Director
Citizens for Limited Taxation (MA), Chip Faulkner, Associate Director
Citizen Rep. Holmes Norton (D-DC) Waste, Tom Schatz, President
Freedom Action, Myron Ebell, Director
Human Events, Thomas S. Winter, Editor-in-Chief
National Center for Public Policy Research, David A. Ridenour
National Taxpayers Union, Andrew Moylan, VP of Government Affairs
Tea Party W DC, Lisa Miller, Founder

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ATR applauds Passage of Sens. Feinstein/Coburn Ethanol Amendment

Posted by Chris Prandoni on Thursday, June 16th, 2011, 2:47 PM PERMALINK

While eliminating these two policies that buttress the ethanol industry are an encouraging first step, Senators who truly wish to end the government’s favoritism towards the ethanol industry must also vote for Sen. DeMint’s forthcoming amendment.

Sen. DeMint’s amendment repeals the real policy distorting the energy market —the Renewable Fuel Standard (the mandate)—and eliminates the death tax. The tax cut contained within the DeMint amendment overwhelms the Feinstein/Coburn tax hike allowing Taxpayer Protection Pledge signers to freely vote to eliminate the ethanol tax credit and tariff so long as they also vote for the DeMint amendment.

Again, as long as Taxpayer Protection Pledge signers that voted for the Feinstein/Coburn amendment also vote for the DeMint amendment, they will be in keeping with the Pledge they made to their constituents. Taken together, this elimination of favoritism toward ethanol is not a violation of the Taxpayer Protection Pledge.

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What are the Taxpayer Implications of today's amendments in the Senate?

Posted by Chris Prandoni on Thursday, June 16th, 2011, 12:52 PM PERMALINK

16 June 2011

To: Pro-Taxpayer Senators
From: Grover Norquist
            Americans for Tax Reform

Cc: state and local taxpayer groups.

Republican Leadership is insisting that the DeMint amendment to end the death tax and to end the ethanol mandate be voted on before cloture is invoked on the underlying bill entitled S. 782, the Economic Development Reauthorization bill.

The DeMint amendment abolishes the death tax and abolishes the ethanol mandate.  The DeMint amendment is a significant reduction in taxes and a giant step towards full tax reform by eliminating the double taxation of lifetime savings caused by the death tax.  Ending the ethanol mandate is a significant move towards a free market in energy.

The Coburn amendment ends the ethanol tax credit that is already set to end on December 31 of this year.  It is a small one year tax increase and because it leaves the underlying ethanol mandate in place does little if anything to end government distortion of the energy market. However, coupled with the significant and useful DeMint amendment the Coburn amendment would help clean up the tax code and also ends a tariff on imported ethanol.  Tariffs are taxes.

Senators who have signed the Taxpayer Protection Pledge to their states’ voters have promised to oppose and vote against any and all efforts to increase net taxes. A vote for DeMint alone or a vote for Coburn and DeMint are both consistent with keeping one’s Taxpayer Protection Pledge to your voters.

There have been deliberate efforts to confuse both Senators and voters about what is and is not a vote for a tax hike.   The Tuesday vote for cloture was not a vote for higher taxes as it just opened the door to vote on both the Coburn amendment which was a small tax increase, but also moved towards the DeMint legislation which is a larger tax cut and a real improvement in removing government from controlling the production and consumption of energy.

Today, a Senator might choose to vote for the Coburn amendment to send a largely symbolic message of disapproval of government picking winners and losers in the energy industry. As long as that vote was followed by a vote for DeMint (or a vote to deny cloture if the offsetting tax cut and real energy reform in DeMint is denied a vote by Reid) a Senator will have voted consistent with his or her pledge to voters.

If a Senator wishes to vote for a small tax hike, and against ending the death tax and for maintaining the ethanol mandate, then one simply votes for Coburn and against the DeMint amendment.

As always, if the final bill has a net tax hike inside it a vote for the tax increasing bill would of course be a violation of a Senator’s pledge to his states’ voters.

Grover G. Norquist

Click here for a PDF file of the above letter

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Once Again: Feinstein/Coburn Amendment half-baked without DeMint Fix

Posted by Chris Prandoni on Thursday, June 16th, 2011, 12:10 PM PERMALINK

Americans for Tax Reform has always opposed the ethanol mandate, tax credit, and import tariff.

Today Senators will have an opportunity to chip away at the ethanol industrial policy. Senators Coburn and Feinstein have offered Amendment #476 which would repeal the ethanol tax credit—a tax increase of $2.5 billion—and the ethanol import tariff. While these policies interfere with the free market, they do little to prop-up ethanol consumption.

To fully eliminate the ethanol regime, Senator DeMint has proposed Amendment #460 which would eliminate the real policy forcing Americans to use ethanol—the Soviet style Renewable Fuel Standard (ethanol mandate)—and repeal the death tax. Together, Amendment #476 and Amendment #460 completely abolish the ethanol industrial policy. The tax cut contained within the DeMint amendment is substantially larger than the $2.5 billion tax increase contained within the Coburn/Feinstein amendment. Thus,

Taxpayer Protection Pledge signers should feel free to support the Coburn amendment provided they also vote for the DeMint amendment. Taken together, this elimination of favoritism toward ethanol is not a violation of the Taxpayer Protection Pledge.

Senators have been afforded this opportunity to clarify their position on taxes and American ethanol policy. Senators who wish to raise taxes and nibble at the edges of the ethanol regime can vote only for the Coburn/Feinstein amendment. Senators who wish to cut taxes and totally eliminate the ethanol industrial policy can vote for the Coburn/Feinstein amendment as well as the DeMint amendment. 

Click here for a PDF copy of this document.

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Did Senators Break Their Tax Pledge This Week?

Posted by Chris Prandoni on Wednesday, June 15th, 2011, 3:59 PM PERMALINK

Today ATR released the following letter (PDF).

15 June 2011

Dear Senator:

I wanted to clearly state the Taxpayer Protection Pledge implications of yesterday’s cloture vote on SA 436.

Senators who voted for cloture on SA 436 did not vote for a tax increase.  Nor did they violate the Taxpayer Protection Pledge which reads: 

I  pledge to the taxpayers of the state of _____and to the American people that 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.

Americans for Tax Reform made this crystal clear in its public statement of Friday, June 10 when ATR  recommended that those Pledge takers opposed to ethanol mandates and preferences should vote for cloture and vote for the Coburn Amendment and for the DeMint Amendment.  The vote for cloture failed and Senators did not have the opportunity to vote for or against Coburn and/or DeMint.

According to the Republican staff of the Senate Budget Committee, the Coburn amendment is a net tax increase of $2.4 billion. Because of this, a vote for the Coburn amendment alone would violate the Taxpayer Protection Pledge.

The Taxpayer movement repeatedly asked Senator Coburn to make this amendment consistent with the Taxpayer Protection Pledge signed by 233 members of the US House and 41 US Senators.  He refused to do so and actually wished to make his amendment a tax increase to provide the government with more money to spend.

In recent months, ATR has been in contact with taxpayer advocate and ethanol preference opponent Senator Jim DeMint. Senator DeMint expressed an interest in offering an amendment  which would end the ethanol mandate (something the Coburn amendment fails to do), and would provide a tax cut offset—death tax repeal—that was a  tax cut significantly larger than Coburn’s tax increase. Due to the manner in which the Coburn amendment was brought up for consideration, Senate rules prohibited the DeMint amendment from being offered as a second degree to the Coburn amendment. As a result, Senator DeMint offered his amendment as a standalone measure to the underlying bill.

ATR was assured by Republican leadership that should cloture on SA 436 receive 60 votes, a vote on DeMint—or at minimum a procedural vote to allow a vote on DeMint—would immediately follow the vote on the Coburn amendment.

As a result, ATR informed Pledge signers that voting for cloture (and subsequently voting for the Coburn amendment) would be consistent with the Taxpayer Protection Pledge, provided that the Pledge signer also voted for the DeMint amendment later in the process.

Any Senator could now make his or her positions on tax increases and ethanol industrial policy clear.  One could vote for ending ethanol industrial policy and for lower taxes by voting for both Coburn and DeMint.  Or, one could vote to maintain the ethanol industrial policy (the mandate) and raise taxes on mandated ethanol use and support high death taxes by voting for Coburn and against DeMint.

Coburn refused to write his amendment to end the ethanol mandate and he refused to include offsetting tax reductions. As such, advocates of lower taxes and opponents of industrial policy had to write their legislation around his flawed amendment.

While this scenario is unusual at the federal level, it is very common in state level considerations of tax legislation.

The Senate was forced into this Rube Goldberg set of votes by Senator Coburn’s twin objectives: tricking Republicans into voting for a tax hike and preserving the impetus for American ethanol consumption, the mandate.

Senator Coburn said on the floor of the Senate this Monday that he supports ethanol and supports the government mandate forcing Americans to purchase ethanol.  Senator Coburn said today that his true intention was to get Republicans used to voting for net tax hikes.

Senator Coburn failed.  He was not able to get Republicans to vote for a tax increase.  The procedural vote to move forward to the Coburn and DeMint amendments was only a vote for a tax hike in Senator Coburn’s mind.

Republican leadership in the House and Senate have clearly stated their opposition to any net tax hike now or in the future.

This letter should clear up any misunderstandings created by those hoping to use this rigmarole to push for tax increases.

Grover G. Norquist

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The Problem with Ethanol is the Mandate

Posted by Chris Prandoni on Wednesday, June 15th, 2011, 9:36 AM PERMALINK

After a decade of experimenting with mandates, tax credits and tariffs, a national consensus has been reached that ethanol is just not worth it. Late to arrive at this conclusion are farmers, their Congressional representatives, and presidential candidates eager to win over primary voters—a coalition that has made it nearly impossible to begin unwinding the various policies designed to prop-up ethanol.

The driving force behind U.S. ethanol consumption is the Renewable Fuel Standard (RFS), otherwise known as the ethanol mandate, which was established with the enactment of the Energy Policy Act of 2005.The RFS mandated that a minimum of 4 billion gallons of renewable fuels be used in 2006 and that Americans consume at least 7.5 billion gallons by 2012. Two years later, in the midst of the 2008 campaign cycle, Congress passed the Energy Independence and Security Act of 2007 greatly expanding the RFS mandate. Americans now must consume 36 billion gallons of “renewable fuels” annually by 2022—15 billion gallons of which will be corn ethanol.

This is bad for American consumers. Implicit in the ethanol mandate is the reality that without such a policy, Americans would not use nearly as much ethanol—and for good reason. During most of the past 30 years, ethanol has been more expensive than regular gasoline. Furthermore, ethanol contains one-third less energy than gasoline. This means that if you put one gallon of gasoline in your car and one gallon of ethanol in your friend’s identical model, you’ll go 15 percent farther than your friend. Responding to an increase in the RFS mandate, some automakers are even installing larger gas tanks in vehicles.

If ethanol is more expensive and less efficient, it is easy to see why the fuel necessitates a mandate but hard to understand Congress’s justification for doing so. Unable to stand on economic grounds, ethanol proponents make claims about reductions in foreign oil and greenhouse emissions. Upon closer scrutiny, these defenses of ethanol also fall apart. A seminal study by Princeton University’s Tim Searching and several co-authors found that corn based ethanol nearly doubles greenhouse emissions over 30 years. While burning corn ethanol may produce fewer carbon emissions, growing, harvesting, and refining corn ethanol is a carbon intensive process.
Supplementing the ethanol mandate is a tax credit and tariff on ethanol imports. Since the early 1980s, various tax credits have been available to ethanol refiners and import tariffs have been imposed on foreign ethanol (particularly Brazilian sugarcane). However, it was not until the RFS was enacted that ethanol became ubiquitous.

It is clear that ethanol has few merits to those not growing corn or using the issue to woo Iowa voters. As such, the tax credit, mandate, and tariff should all be eliminated. In order to eliminate the tax credit without giving Washington’s appropriators more money to spend, any ethanol tax credit repeal bill should be offset with an accompanying tax cut—the bill should be at least revenue neutral. Elimination of the tariff should be unconditional and done immediately.

Getting rid of the RFS mandate, the impetus behind ethanol consumption, is a much heavier lift. In pursuit of this goal, Senator Inhofe (R-Okla) and Representative Issa (R-Calif.) have introduced the Fuel Feedstock Freedom Act, legislation that would allow states to opt-out of the corn-based ethanol RFS program. The Fuel Feedstock Freedom Act allows for statehouses to pass legislation that withdraws the state from the corn ethanol portion of the RFS, assuming the governor ratifies this bill. Simple and clear, the Fuel Feedstock Freedom Act has the opportunity to garner broad, bipartisan support.

For too long Republicans have hid behind opposition to the ethanol tax credit while quietly supporting the ethanol mandate. The Fuel Feedstock Freedom Act—or more plainly, opposition to the RFS—should be the litmus test for real conservatives. It’s time for conservatives to make ethanol a thing of the past, just like they did Democrats’ huge majorities in 2010.

This article was originally published at

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Senate Denied Choice on Ethanol

Posted by Chris Prandoni on Tuesday, June 14th, 2011, 2:48 PM PERMALINK

Today the US Senate failed to invoke cloture on S. 782. This represents a lost opportunity for the Senate to vote on killing the government’s unfair myriad of ethanol preferences. Had cloture prevailed, through a series of amendments, the Senate could have voted to rip out ethanol, root and branch, from the federal government. Amendments offered by Senators DeMint, Thune, and Coburn, would collectively have ended the Renewable Fuel Standard (ethanol mandate), tax credit, and import tariff.

ATR alerted Taxpayer Protection Pledge signers that voting for ethanol tax credit repeal—which is a $6 billion tax increase—is consistent with their pledged commitment to their constituents provided they also supported a tax cut offset—such as the death tax repeal contained in the DeMint amendment.

There is a consensus conservative position that the government’s support for ethanol needs to end. Unfortunately, this view is not shared by Sen. Tom Coburn (R-Okla). On the Senate floor last night Sen. Coburn said the following: “I support ethanol…I support a mandated level of ethanol.” ATR and the overwhelmingly majority of the conservative movement support full repeal of the ethanol mandate, ethanol tariff, and the ethanol tax credit.

ATR looks forward to working with conservative allies on and off Capitol Hill to fully repeal the government’s buttressing of the ethanol industry.

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Coburn: "I Support Ethanol"

Posted by Chris Prandoni on Tuesday, June 14th, 2011, 6:46 AM PERMALINK

Perhaps tipping his hand too early, Senator Coburn announced on the Senate floor that he, in fact, supports ethanol and has no intention of getting rid of the Renewable Fuel Standard (ethanol mandate). So why would Sen. Coburn force a vote on his legislation to repeal the ethanol tax credit and tariff? Because he knows his amendment will do little to depress ethanol consumption but will put Republicans in the awkward position of voting for a tax increase. Sen. Coburn hopes his tiny ethanol tax increase works like a gateway drug and will make larger, more dangerous tax increases—the kind he has consistently supported—more palatable for Republicans.

Pledge signers are free to vote for Coburn’s amendment as long as they also vote for Sen. Demint’s Amendment.

Coburn and Thune on the floor:

THUNE:  “One of our colleagues from South Carolina has introduced an amendment to this bill which would end that, and I assume -- I don't know this for a fact -- that my colleague from Oklahoma would support that amendment. Which would do away with the Renewable Fuel Standard. Certainly.”
COBURN:  “You obviously didn't hear what I was saying as you were conversing. I said I support ethanol. I wouldn't support that. And I said that. And I’ve been very up front with you in the past. You know what my position is on that.

So the question is -- and I would ask him this question -- how do you fit what the people who get this $3 billion that you say it is going to have a negative impact -- the very people who get the $3 billion who say they don't want it -- why would they say that if it's going to have a negative impact on their industry?”
THUNE:  “I would say to my colleague from Oklahoma I was not aware that he supports the RFS. If there is an amendment to strike the RFS offered – which there will be, and my colleague from Oklahoma, if I’m wrong in saying that – that you would oppose that amendment to strike the RFS?”
COBURN:  “I will oppose that amendment but my worry is because of the process of the Senate, we may not get that amendment to vote on. And I think my colleague as part of the leadership on our side would recognize that we have a problem with amendments.”
THUNE: “I don’t disagree with that. I think there’s an issue here with amendments, and I would say that this, and I’m not arguing, it’s your prerogative to bring this up, it’s your prerogative to file cloture which you’ve done in this circumstance. But I think that the Renewable Fuel Standard, which creates the policy construct that we’re talking about here today, is one aspect of the biofuels policy going forward.”

(View the clip here on CSPAN)

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Coburn Amendment half-baked without DeMint Fix

Posted by Chris Prandoni on Friday, June 10th, 2011, 7:08 PM PERMALINK

Americans for Tax Reform today reiterated its support for full, tax revenue neutral repeal of all government granted advantages and preferences to the ethanol industry. To this end, ATR is pleased to support Senator Jim DeMint’s amendment which repeals the Renewable Fuel Standard (ethanol mandate) and kills the death tax. This amendment fills in the gaps left by Senator Tom Coburn’s ethanol amendment and overwhelms the Coburn tax increase with a more significant tax reduction. The Coburn amendment repeals the ethanol tax credit and tariff but in a way that raises net taxes and grows government spending. The DeMint amendment abolishes the death tax which is a significantly larger tax cut than the Coburn amendment’s $6 billion tax increase.

The DeMint amendment also cuts to the heart of the government’s support for ethanol by repealing the mandate that requires American families to purchase ethanol at the gas pump.

Taxpayer Protection Pledge signers should feel free to support the Coburn amendment provided they also vote for the DeMint amendment

The government’s mandate of ethanol usage distorts energy markets and raises prices for consumers. In order to fully repeal the government’s unfair, anti-free market support of ethanol, all three policies must be eliminated—the mandate, the tax credit, and the tariff. Only the combination of the Coburn and DeMint amendments completely kills the government’s support of the ethanol regime.  

The DeMint amendment which abolishes the death tax insures that repealing the ethanol tax credit is done in a way that prevents additional money from flowing to the appropriations committees. ATR has always opposed all forms of government support of ethanol. Our goal has been to repeal the ethanol tax credit, tariffs and the mandate totally…without raising taxes. The Coburn amendment, combined with the DeMint Amendment, accomplishes this longstanding goal.

Click here for a pdf file of this document.

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