The Haphazard Blog

A Real Way to Start Energy Independence

by on June 18, 2010 8:43 PM, under Politics

When I was a candidate for this office, I laid out a set of principles that would move our country towards energy independence.  Last year, the House of Representatives acted on these principles by passing a strong and comprehensive energy and climate bill –- a bill that finally makes clean energy the profitable kind of energy for America’s businesses.

Now, there are costs associated with this transition.  And there are some who believe that we can’t afford those costs right now.  I say we can’t afford not to change how we produce and use energy -– because the long-term costs to our economy, our national security, and our environment are far greater.

So I’m happy to look at other ideas and approaches from either party -– as long they seriously tackle our addiction to fossil fuels.  Some have suggested raising efficiency standards in our buildings like we did in our cars and trucks.  Some believe we should set standards to ensure that more of our electricity comes from wind and solar power.  Others wonder why the energy industry only spends a fraction of what the high-tech industry does on research and development -– and want to rapidly boost our investments in such research and development.

This is some of what President Obama had to say on Tuesday. It’s basically a rehash of what he (and many others) have been saying since they began to run for President. (On a side note, Jon Stewart has a great segment on how long we’ve been talking about energy independence and doing nothing.)

Here is my simple solution to get the ball rolling. I’m sure it has been suggested many times. Remove every subsidy that is given to the oil industry (and really any energy that relies on imports). This includes tax breaks, favorable loans for capital costs and removing legal protections that limit liability (for most of us, if something is too risky, we don’t do it, but if we could take those risks and have someone else shoulder the burden of the liability, who would pass on that?).

Take all that money (tens of billions) and start investing in alternative energy companies and technologies. People go where the money is. Start-ups will be chasing it. Companies who are established will be chasing it. All the companies who were getting all these subsidies will suddenly be very interested in alternative energy. Is there really any justifiable reason to prop up an industry that is more than capable of turning profits without this help? What is the argument against this? When these global oil companies complain about taxes, they aren’t complaining about the U.S. taxes, but their total taxes. What they want from the U.S. is for taxpayers to subsidize them to offset all the taxes they pay everywhere else. Just like prescription drugs, we get to provide the subsidies while other countries get paid the taxes.

I’m not saying we need to increase taxes, but this argument that taxes here are too high and if we increase taxes (many consider taking away subsidies the same thing) all these companies will just leave the U.S. If oil companies are paying almost 50% in taxes, and the maximum U.S. corporate tax rate is 35%, I’d think they’d prefer to pay those taxes here. It’s time to stop rewarding  oil companies and reward companies that are investing in the future of energy, whether it’s nuclear, wind, solar or something we haven’t thought of yet.


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