With summer on the proverbial doorstep, there’s always a certain nostalgia that accompanies the onset of warmer climes. For me, it’s for a childhood spent in a red 1962 Bel Air station wagon as it ambled to various vacation spots in the Northeast. Back then, a gallon of gas hovered around a quarter, and the only concern my parents had during those annual excursions was breaking up the backseat fights that erupted between my brother and me about every 100 miles. I can still envision my father’s free hand reaching back in an effort to slap any body part within reach.This year, trips like those will be a whole lot more expensive, since it now nearly requires a home equity loan to fill up. But lately, I’m not the only one dusting off the scrapbook.
I offer up the recent proposal put forth by Senate Democrats to roll back $17 billion in tax breaks for oil and gas companies and impose a 25 percent windfall profits tax on the companies. The measure invests the money in improving consumer price protection, renewable energy development and energy efficiency technology through a designated Energy Independence and Security Trust Fund.
Apparently some Democrats have a yearning to return to the days of Jimmy Carter. Why else would they attempt to resurrect one of the worst policies of his administration? And trust me, that’s a fairly lengthy list.
Carter’s 1980 windfall profits legislation was not so much a tax on oil profits, as some have noted, but more of an excise tax on oil production. What happened is that it succeeded in raising the price of domestic oil, thus prompting greater purchases of foreign oil while curtailing U.S. production. Guess what? The promised revenue boom never happened on our shores.
In lieu of a windfall policy, as a taxpayer, I would prefer to ask lawmakers to explain a few things first.
For starters, exactly what the federal and state governments did with the roughly $397 billion they received by taxing the profits of the largest oil companies between 1977 and 2004, and the additional $1.1 trillion they received in taxes at the pump during that same period.
On a somewhat smaller scale, I’d like to know the whereabouts of the $30 billion that Exxon/Mobil has paid annually in taxes over the past several years courtesy of a 41 percent rate on its taxable income. According to the most recent statistics available from the Internal Revenue Service, the total income tax paid by the bottom half of individual taxpayers was $27.4 billion. In effect, the Treasury garners more money from one Big Oil company than from 50 percent of filers.
I don’t believe that shaking the cobwebs off a 28-year-old failure from the Carter administration will result in any significant miracle at the pump. I, like many of you, lived through the Carter quadrennial. And though I get nostalgic every so often, I really don’t want to go back to the future.
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