Supercommittee: Follow the Money
November 4, 2011
There are tons of ideas out there to help out the Supercommittee decide which services to cut and revenues to raise. Their report is due on November 23 when we expect that Congress will get to have an up or down vote (that is, no amendments allowed) on their recommendations.
Some of the ideas are better than others. The better ones look at the low hanging fruit: government subsidies of incredibly successful industries-especially the oil, gas, and mining companies. Here are a couple of the good ones.
Congressman Ed Markey (D-MA) sent a letter to the Supercommittee describing fourteen separate oil, gas, and mining tax breaks or subsidies totaling $20 billion over ten years. Another letter, authored by Congressmen Welch (D-VT) and Blumenauer (D-OR), describes policies that would save $122 billion over ten years. Not a bad start, really. The Supercommittee is looking for around $1.2 trillion in cuts; the Welch/Blumenauer plan alone gets them better than 10% of the way there without having to look toward ending food stamps or Medicaid or closing our National Parks.
So, the other day I was wandering by the Capitol when I happened by a press conference with Congressmen Labrador (R-ID) and Pompeo (R-KS) and famous tax reform advocate Grover Norquist. They have their own initiative to end subsidies for the energy industry. Their arguments echo many of the messages we’ve often heard about cutting spending or discouraging the government from picking winners and losers in the marketplace.
Now, the Pompeo/Labrador/Norquist plan only goes after clean energy subsidies while the Markey/Welch/Blumenauer plan targets dirty energy subsidies. My point is not whether the government should or should not encourage some investments rather than others. My point is that the former plan only gets at $90 million over ten years, as opposed to the billions saved by the latter. Don’t get me wrong. If the government were subsidizing me to the tune of $9 million a year, I’d think it pretty important.
But in the grander scheme of subsidies, tax expenditures, revenues, debts and deficits, $9 million a year is a drop in the bucket. It also just strikes me as disingenuous to listen to fiscal conservatives complain about spending relatively little taxpayer money to encourage plug-in electric vehicles when the real taxpayer money is with the oil, gas, and mining companies. It can’t really be about the money, since we’re not talking about all that much. I think instead it’s more about picking winners and losers.