Guest essay by Eric Worrall
President Obama has proposed a $10 per barrel carbon tax to fund renewable energy, and to “encourage” people to stop using oil.
From the Whitehouse Statement;
For too long, bipartisan support for innovative and expansive transportation investment has not been accompanied by a long-term plan for paying for it. We need a sustainable funding solution that takes into account the integrated, interdependent nature of our transportation system. Travelers choose between walking, biking, driving, flying, and taking the train; and companies choose between trucks, barges, airplanes and rail lines. So to meet our needs in the future, we have to make significant investments across all modes of transportation. And our transportation system is heavily dependent on oil. That is why we are proposing to fund these investments through a new $10 per barrel fee on oil paid by oil companies, which would be gradually phased in over five years. The fee raises the funding necessary to make these new investments, while also providing for the long-term solvency of the Highway Trust Fund to ensure we maintain the infrastructure we have. By placing a fee on oil, the President’s plan creates a clear incentive for private sector innovation to reduce our reliance on oil and at the same time invests in clean energy technologies that will power our future.
Why does the green version of “encouragement” always seem to involve beating ordinary people with price hikes until they comply?
If the President really wants to encourage green energy, why doesn’t he announce a tax holiday for profits made from green innovations? I doubt there would be any worthwhile innovations; making renewables affordable is an intractable problem. But at least a tax holiday wouldn’t hurt anyone. A tax holiday would stimulate interest and investment, while allowing ordinary people to continue to enjoy low oil prices.
why doesn’t he announce a tax holiday for profits made from green innovations?
Maybe because it’s all about punishing the big bad oil companies.
But it is not the oil companies who will be punished. It is the end consumer who will be so punished. That is always the case.
We know that but they continue to blame oil companies and try to pretend that it will hurt them and the sad fact is a lot of brain dead people will buy into it.
Obama’s lies come through loud and clear again. You know what’s true when he complains about something. Whatever he asserts as true, especially when he uses the term “let me be clear”, is an absolute falsehood.
But it is not the oil companies who will be punished. It is the end consumer who will be so punished. That is always the case.
That is never the case. Both the producer and the consumer will be punished. Margin of profit on oil is less than 10%. It takes 14 years from startup before you even break even. What do you think a massive percentage increase in price does for demand?
If a 10$/barrel increase on a barrel of oil didn’t adversely affect the oil companies — and badly–why don’t you think they charge that much more and rake in the profits? Because they’d lose profits, that’s why. They already charge as much as the market can bear for maximum profit.
This skit is highly applicable:
H/T Peter S. on Judith Curry’s blog
@Evan Jones
You make a good point, but in the end I believe the larger cost is to the consumer. Oil demand is somewhat fungible; we can decide this summer not to visit the in-laws in Montana, or fly there and the kids can Skype with grandma and grandpa. On the other hand, I have to get to work and it’s 30 miles one way. That is non-fungible. Whether I take the train or a car, oil will be consumed, so either my ticket price or gas receipt is going to reflect that additional tax.
It’s a tax on oil at the well head of domestic production, which will squeeze domestic production out of the marketplace, and cost hundreds of thousands jobs in the US.
“let me be clear”, is an absolute falsehood.
=====================
I want to make one thing perfectly clear … I am not a crook (3:42)
http://www.wepsite.de/Big%20Game,Rich%20Little.mp3
evanjones, what you are forgetting is that competition keeps prices down. However a tax on all producers doesn’t affect competition. Since everyone’s costs go up by the same amount, everyone’s prices will go up by the same amount.
Companies don’t pay taxes — they collect them. It’s the end consumer that pays all the taxes.
Joking aside, this is a MUCH bigger issue than people are making it out to be.
Half of the world has already been working at taking the standard trade of oil off of the U.S.D. This would give them every reason and the ability to do just that with China more than willing to build the refineries to import all the oil they can buy (a lot).
Take oil trade off of the U.S.D. and our economic advantage in buying oil disappears over night. This would essentially destroy the U.S. economy and the world’s right along with it. Presto, the green agenda gets a big win.
A $10 per barrel tax on a $30 per barrel price is a 33% increase in price at the pumps
Bryan A,
Look on the bright side. Next time oil prices go to $100/bbl, Obama would only be responsible for 10% of the pump price increase, while the free market will own 233% of it.
The don’t report any profits because they are all losers w/o a government subsidy and they thy go bankrupt after burning through subsidies and “loans”.
So I have to ask do you charge all production around the world that you import from???? 😒
Venezuela and Arab nations will be exempt from paying this tax, so only those nasty ultra rich US citizens would be affected by it. This is also the only group that Pres. B.O. can have a direct effect on
Or punishing Pennsylvanian Coal Miners
Don’t you have to actually have profits, before a tax holiday would do any good?
It is about giving money to green companies who will then ‘donate’ it back to the Democrat party, cf. Solyndra. Obama couldn’t care less about global warming, CO2, big oil, reducing consumption, etc. It is all about money and power.
You’ve pinned the tail on the DONKEY OR IS IT THE JACKASS???
All green incentives involve pain. Seems that way to me anyway.
This should be question #1 at upcoming campaign debates. I’m getting the corn popper ready,.
That’s what I thought. Way to hand some ammunition to the GOP …
Oh the GOP will roll over and give this to that creature on a gold platter!
It is not about discouraging the use of oil. It is simply a tax to garner revenue for a bankrupt country. More on the way.
It is also a regressive tax, but I doubt Dem. voters could comprehend that.
RIGHT ON POINT ! CAN’T BEAT THAT COMMENT.THANKS
Kokda & Derek – <b a new $10 per barrel fee on oil paid by oil companies
Even worse is his pushing the increase to their hated ‘Big Oil’. Oil companies are not payers, just collectors.
Is he really just angry that the one promise of “rates skyrocketing” that was coming true is now not because his masters in Saudi are flooding the market?
…that’s true. To them, everything has to be “progressive”!
Heck, I am a progressive. I like actual progress. But to these chuckleheaded chickenheads, it isn’t progressive unless it’s regressive.
How about abolishing all “extra” tax on oil? Now, that would be progressive. Something real progressives like JFK and LBJ would have understood. But not these neo-phoney-balognas.
Obama doesn’t care about garnering revenue for a bankrupt country. He plans to spend every bit of it and then some to help Democrat cronies and unions get rich off of green subsidies and government handouts. He did the same thing with the stimulus. He claimed he was going to spend the money to rebuild roads and bridges. Then, when running for re-election, he took credit for having done a wonderful job of rebuilding the nation’s infrastructure. But right after his re-election he asked Congress to give him another stimulus so he could spend it on rebuilding our aging and failing infrastructure. Union built roads and bridges sure don’t last as long as they used to. Nobody in the media seemed to notice the contradiction.
First they actually have to build them. You can go up to Harlem and look at entire square miles of effective progressive accomplishment. That which benefited everyone and converted massive, horrible slums to decent housing and dragged entire neighborhoods out of crime and poverty, benefiting rich, poor, and in between.
But what did we get out of the “stimulus”? A whole bunch of nothing and the upward of a trillion beans added to the national debt — which costs everyone. Well they did produce a a bunch of signage “brought to you by the stimulus”, at around 10 Gs a pop. (Not counting the cost to cost to remove it.)
These self-righteous knucleheads aren’t about shovel-ready. They are about increasing the tax on shovels.
Those so-called liberals wouldn’t know actual liberalism if it bit them in the ass — which it has.
What unions? In manufacturing, nearly all unions are dead as we shipped our jobs to China. And both GOP and DNC people did this to us with ‘free trade’.
No, it was the greedy unions who destroyed the companies who employed them.
Free trade brings better products at lower prices. However those who believe that are entitled to life time sinecure’s at the wage of their choosing, would prefer that consumers not have a choice.
Lithium supply is one of the issues involved in moving the U.S. auto manufacturing to other countries.
Wrong. Sure, it’s a revenue-raiser, but it is on the back of oil. It punishes oil, in favor of Big Green. And it will hurt our economy.
Perhaps somebody should point out that this tax will damage the economy and lead to reduced tax income elsewhere but then that might be something too complex for him to understand. I am always amazed by all the UK politicians who did PPE (Politics-Philosophy-Economics) at university and then totally fail to understand economics such as how taxation distorts the market – as does reverse taxation ie subsidies – and the ‘unexpected’ effects it can have. The Blue Labour chancellor hit properties over £1.5m with a hike in sales tax because they must obviously be rich people (note- in many areas of London and SE that is not an uncommon value) and then, surprise, sales dropped off. So tax receipts dropped as people withdrew from selling and now there is a growth in such properties being rented out.
One of the left wing mantras is that people don’t change their behavior because of taxes. That’s why we can raise taxes as high as we want and it won’t affect the economy.
Then in their next breath they tell us they have to raise taxes on cigarettes and oil so that people will use less of those products.
Gerry, MarkW
Thanks.
Agree.
Totally.
I looked in one of London’s free papers this morning – and one bedroom flats, out in the suburbs – say 40-65 minutes in on the Tube – are stating from £360K – some start from £475K.
And, if you want a bed-sit – “Studio Flat” in, admittedly a nice development @ #1 Blackfriars – stats at over a million.
Are London property prices utterly stupid?
Too carping right. Squared.
Auto – within the M25 – and unable to afford my own house . . . . .
Mods – shows the value [?!?!?] of twenty years in one house. I think.
For awhile this old UK citizen looked to the ‘New World’ to ensure homo sapiens would contrive to improve the well being of the whole.
I now find the ‘New World’ is controlled by a homo superbus, so backward we will all go. Once it is accepted somebody knows it all there can be no development.
How much chance does this have getting past a GOP Congress? Why $10/barrel? What’s the significance? Why not 30% or does that have too much of a “tax” connotation? Phased in over 5 years. I guess the Dems are looking at a long term commitment, but I more fancy the idea that there is a significant source of funding coming back to the Dems from this “fee”.
Maybe if he calls it a “royalty” it might pass.
Only if it was not used to build more windmills or solar farms.
Yes regressive tax, like poll tax proposed by Margaret Thacher way back.
“For too long, bipartisan cooperation in Congress has been nonexistent. I am therefore issuing an Executive Order…”
/sarc
It has every chance. People have already fully accepted that theft is the government’s legitimate tool for modifying your behaviour. You are not objecting to it. That means you will submit to it. Your behaviour needs to be modified and your government says so and you haggle a bit over it and then submit.
Why 10$? It’s just to cater to your feelings- you will feel so powerful when you cheerfully settle for only 5 inches – and you will have negotiated it- so it’s not an imposition – you will be fully engaged in the dickering.
The ‘phasing in’ bit is also for your feelings – they’re saying they will be gentle and put it in slowly.
People won’t struggle so much when it’s gentle cuz then it looks like luv and caring. You want to believe.
Bottom line – government is not your biatch. That’s got the roles swapped.
It has no chance whatsoever of passing through a Congress the Republicans control. As a tax bill, it has no chance of being passed even if the Republicans control the House only.
That’s the point. Obama doesn’t expect this to pass. It’s merely a game to blame the Republicans and Congress as to why the US can’t do anything about global warming.
Obama expects to make this an executive order. No, No No.
Wrong. Executive orders cannot create taxes. This has to appear in Congress first.
He’ll call it a fine and have the EPA implement it.
It doesn’t have to pass Congress. Executive orders are his specialty.
“All executive orders issued by Obama are hereby withdrawn.”
Signed President D.T.
P.S. Go get real jobs you bums.
Obama does not understand that because after all he is having the oil companies pay for it and not the consumers. Isn’t that better? Sarc
Unfortunately for him that is the operative reality. He would not recognize the sarcasm in your statement. Obviously when you tax business only the business is hurt (in the left’s worldview people don’t pay for it when they buy the product or when they can no longer find a product because the evil people who provided it are no longer in business!)
No one is taxing anything. The chance of this becoming legislation is zero. This is about partisan politics and blaming Congress for lack of action on global warming.
CORRECT 1 1 🙂
Except for the fact that there is already a 48.68 cent/gallon tax on gasoline and a 54.40 cent/gallon tax on diesel…..
I haven’t grown tomatoes in my area for three years because the weather hasn’t been warm enough recently to produce a decent crop, and I blame “global warming”. That should give this clueless administration something to think about.
Obama does not understand that because after all he is having the oil companies pay for it and not the consumers. Isn’t that better? Sarc
You said it, brother. I have never seen a president this invested in not understanding, well, much of anything. Or this sanctimonious. And I am including Carter.
Tax holiday? I don’t think any of the green renewable types pay any taxes now. Even mighty GE, which made $7 billion profit in the U.S. a year or two back, didn’t have to pay any U.S. federal tax. Supposedly, they filed a 50,000 page tax return.
This is just another money grab. $10/bbl comes close to 45 cents/gal of gasoline, or more than double the current tax. Which is supposed to be spent on roads and bridges. And usually isn’t.
Does anyone really think the oil companies won’t just pass this tax on to the consumer in the form of higher prices? Still, the timing is good. With oil prices down, easier to get support for a scheme to pour more $$$ into the Federal maw.
Check your arithmetic Engineer. There’s 42 gallons/bbl + a little for the gains from hydrogen injection. Works out to about 23 cents/gallon
42 gallons of oil in a barrel. That will produce around 30 gallons of gas and diesel.
The devil is in the details but this looks like a 33 cent/gallon tax to me.
No the 23 cents is correct there is little loss and the other outputs will also have the tax as they should.
The issue for me is the lack of tax on coal and even more interestingly imported solar cells from China are very heavy in coal energy input during manufacture no tax there also.
So a tax on a so called CO2 problem in reality is a witch hunt against a perceived lobby.
If you believe the the CO2 hypothesis then act consistently and with integrity.
3.7 litre s us gal 4.3 can gal stupid pres and small gal and we have a bigger dumbass but so is our gal 😉
I don’t like GE, but I’m tired of the GE myth. GE lost billions during the recession. You are allowed to roll forward losses. People do it all the time with capital gains losses. What did GE pay last year?
We British pay a substantial road tax every year, & for tonks the people believed, & some probably still do, that it was to go into the road infrastructure system. It was nothing of the kind & simply a means of raising taxes!
Tonks?
I figured from the context that this is the British word for “years”, but all Google could come up with was Nymphadora.
Chris
Yeah – for tonks and tonks, tonks meant – by context – years, or twonkers [Not Nice Intellectually] or shed-loads.
Or, probably, elsewhere – at least twenty-two other things.
Sorry – English is a living language, and bits of it live: – some fly – webinar – and some die – hand phone.
Auto
Obama voters are ignorant enough to think the tax is being paid by the evil oil companies. Greens really believe that the only thing standing between themselves and nirvana is an evil conspiracy of companies involved in thoughtcrime.
It took a whole lot of time, trouble, and treasure to mal-educate them in that direction.
I’m having trouble pinning down exactly how many barrels of oil are used per day in the U.S., but I’m seeing somewhere around 18-20 million barrels per day. So a $10 per barrel ‘cahbon’ tax works out to $180-$200 million smackeroos of revenue per day.
Wow! That’s enough to fund U.S. government spending for… about 30 minutes.
Or if 100% of it is applied to retiring our $19 trillion national debt, it would only take 95,000 days (260 years) to pay it off. Of course, some are saying the debt will continue to climb until it hits $30 trillion, at which point it would take 150,000 days (411 years) to pay it off.
Some how I see this administration coming up with “better” things to do with that money, like buying more votes.
Santa Claus is 100% envious.
Smackeroos from suckeroos who wouldn’t know a supply-demand curve if it hit them in the cup.
ev
Ahhh . . . . . . . .
The universal franchise.
Auto. Mods – not a thought that this should even hat/tip to Sarc. ‘Snot.
It is Straight Up.
Maybe impossible to get a national cap-and-trade but a national carbon tax is doable. The individual states can do the cap-and-trades. So people will end up with both taxes imposed on them.
The carbon tax should be voluntary, If you want it, pay up.
Climatenexus, Sept.25, 2015
Emissions trading explained in this article.
http://www.climatenexus.org/learn/solutions-policy/emissions-trading
Fossil fuel distributors can be included in cap-and-trade. So you can end up with double taxation which is very regressive on the poor and an inflationary factor in the economy as these taxes will be passed through to customers.
Also known as demand side management. Demand side management has been used for centuries by dictators to control people.
Cap-and-trade will be brought into the states and provinces at the sub-national level. Carbon tax at the national level.
So far this is not widespread so most people don’t know anything about the cap-and-trade and direct carbon tax issues.
When you can no longer afford something you just have to do without it. Won’t have much effect on the affluent because they have plenty of disposable income.
It’s all about getting the “money” into the hands of those that know how it should be proportioned.
Even if they don’t realize it.
It’s all about getting the “money” into the hands of those that know how it should be proportioned. Even if they don’t realize it.
They’d get more gold out of the goose if they weren’t hell-bent on slaughtering it.
How about decreasing the tax on oils and jumping back right-quick before they get drowned in the extra revenue? These ninnies appear to be under the risible impression that if you raise taxes by 10% you get 10% more revenues.
Don’t believe I’ve ever seen the word “ninnies” used on internet, it brings back memories 🙂
ninnies
The nattering nabobs of negativism have gone down a notch.
“For too long, your money has not been under my control. In addition, you have been doing things I don’t want you to do. To address these two critical issues, I will now use the power of the state to take away your money and do what I want with it, and punish you for doing what I don’t want you to do.”
A little honesty in piracy is all I ask for. Sorry, I meant politics.
Foreign policy, race relations, now economics.
WHAT A STAR.
Falling star, I trust.
Not even. At least a falling star shines brightly for a short bit.
“The problem with socialism is that it eventually runs out of other people’s money.” – Margaret Thatcher
Broke means having no money. The US needs $19 trillion to get BACK to broke.
Which means we would need 19 years of $1 trillion budget surpluses not counting interest. I don’t even want to know how many more years the interest would add on to that scenario because I will be dead long before that. Thank god Apophis will kill us all in 2036 and end the misery.
One HUGH detail has been left out of the President’s proposal – that is the negative economic effect. long term, of such a tax. Right now, oil is the energy source of choice that enables the economy to be what it is. It is far and away the most efficient way to move product and people to market. The Law of Supply and Demand will exact a serious price for such an action. I have heard of NO discussion about how much this would hurt or depress the economy and therefore the low income populace (any color). Inhibiting the creation of wealth by any means is NEVER a desirable thing to do.
NW sage….maybe you missed all the ‘Trade Deals’ that weren’t about trade, but about social justice from the UN to purposely de-industrialize the U.S. Remember what C. Figures said about 1 year ago.
It is sad how people refuse to understand how Reagan broke the unions by encouraging ‘free trade’ and how both Bushes did this in spades along with Clinton number one. They ALL did this which is why China is the world’s biggest industrial power today and the US has killed its own goose.
I heard estimates made about a year ago, that claimed each 80 cent reduction in the price of a gallon of gasoline, would add one percent to the U.S. GDP
And any savings on gasoline prices go directly into the pockets of the most needy among us. A double benefit of low gasonline prices: stimulates the economy, and helps the poor (and all the other gasoline users, too).
Therefore, rasing gasoline prices, as President Obama proposes to do, harms the U.S. economy, and harms the poor.
Obama believes in fair redistribution of the misery, especially when HE causes it.
And he can’t even pull that one off.
It’s worse than a crime. It’s a blunder. — Louis Antoine, Duke of Enghien
“[i]…a new $10 per barrel fee on oil [b]paid by oil companies[/b],…[/i]”
You stupid stupid stupid stupid stupid americans who don’t think oil companies will pass on the cost to us consumers, I’ve got two words for you:
Jonathan Gruber.
That’s right, the architect of obamacare can be found in a number of videos saying the American people were stupid not to realize insurance companies would pass on their higher costs to us.
In shore, the DNC elite leveraged the collective stupidity of the American left-wing voter on obamacare.
“A tax holiday would stimulate interest and investment, ” Ummmmmm…..if the investments ( factorys,more workers,etc) goes up, the Dems would just up the taxes on them. You CANNOT win against cooked politicos,which every psychopathic one of them is, regardless of so called political stripe.
So with this ‘punishment tax’ in place, it would generate around $70 billion a year in revenue?
What makes these idiots think that the punishment won’t be carried over to the consumer?
“But it’s for green technologies!”
Oh so then I also get to look forward to a price hike in my energy bills as well as the potential for an energy crisis when this all goes south….
Bravo!
That’s “brava” — you sexist pigdog.
Perhaps what they ought to do is lower the barriers to entry in the oil industry to allow for more competition and to encourage smaller players, while at the same enforcing/holding high environmental standards around oil spills.
No, that might actually produce more wealth. Which is an exclusionary factor.
The only thing that will stop these guys’ schemes dead in their tracks is the vague possibility that they might actually work. Can’t have that, can we? Anything but that.
Are you a scientist or engineer, evan? What do you know about feasibility studies, or cost/benefit ratios when it comes to determining project merit?
I’m betting you hear something, it sounds good, and you jump on the bandwagon even though there’s no wheels and nothing to pull it. At least the noise of the band makes for a good time, right?
Wonder who did the cost-benefit analysis for Solyndra.
I am a game designer/developer and simulation modeler. But what do I know?
If you took a close look, you might be surprised at how many regional players there are in the oil industry, not including the mom&pop wildcatters. Compared to, say, the 3 or 4 companies that bake nearly all the bread you eat.
Don’t think for a second this money will be used for “clean transportation”. He’s going to get his climate reparation money to the UN one way or another. At $10 per barrel that’s over a 30% tax rate!!! So far the oil companies have been staying out of the AGW fray but stuff like this will energize them to flex their muscles….. or go out of business……and I doubt they will allow that to happen.
Don’t think for a second this money will be used for “clean transportation”. He’s going to get his climate reparation money to the UN one way or another.
In solar-powered planes, I’m sure.
Nothing Obama says bears any resemblance to reality.
He won’t get the tax just as certainly as climate models will be inaccurate. Doctors do not avoid treating diabetes appropriately so that they can amputate limbs to make more money, The police did not behave stupidly, Nobody got all we-weed up and Global Warming/ Thermogeddon/ Climate Change is not the worst problem facing humanity today.
OTOH, Obama does need to raise more money because he and his wife will undoubtedly want to take multi-million dollar vacations and stick the taxpayers with political fund raising that will costs. He will also likely cause billions to be spent to pay for his pen and his phone.
His last vacation to Hawaii cost tax payers $70 million. That’s as disgusting as it is expensive.
Bill and Hillary would have to give about 100 speeches to rake in that much money.
I’m confused … the Federal Government doesn’t spent a dime on solar panels or windmills … so what is Obama going to spend this money on ? hmmmm … at least when the Mafia shakes you down they at least give you something in return (protection, etc.) this guy just wants to take your money … maybe we could offer him a penny per barrel paid directly to him for as long as he lives to just shut up and go away …
They spend it on themselves.
Maybe this new tax is to pay for Obama’s $12 billion green federal loan guarantee programme.
http://wattsupwiththat.com/2015/08/26/obama-12-billion-new-federal-loan-guarantees-for-renewables/
The real crime is that the Administration can spend (waste) all the financial resources you want on Commercialization of alternative liquid fuels and the results will be minuscule because there is currently no viable option even after spending billions. Maybe some day down the road ( decades) someone will develop a battery that makes sense, but where is all the increased electricity supply coming from?. Numerous cellulosic green liquid fuel programs have been a bust, the list is long and private investors seem to have gotten the message that escapes the Administration. Even the current government funding for cellulosic fuels needs to be curtailed based on performance.
Does anyone think the government spending will produce any results (what has the DOE produced after 30 years?), while sucking $$ out of the economy will likely have disastrous results on the economy.
…..Well there’s……. nope….. how about……. nahhhh…. didn’t they….. no, that was Benny Hill… I give up. What have/i> they produced after 30 years?
What is weird is that the world economy is supposedly tanking but lower than ever energy prices don’t seem to be helping.
lower gas prices are helping in the usa. it is probably the main reason that the us economy is improving.
Lower gas prices ? That just means lower tax revenues for any government . Therefore this tax is to keep the money rolling in. Weren’t taxes supposed to be ” just a stop gap measure” 100 years ago to fund WWI and were supposed to be gone after we “Won” ? yeah right.
If the gas stations sell more gallons, the government will get more revenues since the “40” cent tax per gallon is for gallons sold. If it was 40 cents per gallon the government would still get “40” cents per gallon.
If it is $4.00 per gallon the gov. still gets “40” cents per gallon. So if there is more gas being sold the Gov gets more.
If the gas stations sell more gallons, the government will get more revenues since the “40” cent tax per gallon is for gallons sold. If it was 40 cents per gallon the government would still get “40” cents per gallon. If it is $4.00 per gallon the gov. still gets “40” cents per gallon. So if there is more gas being sold the Gov gets more.
Who taught you remedial economics .001? We’ve spent tens (hundreds, thousands?) of billions to prevent that. Such thinking is a direct failure of modern education.
@tobias
No, it doesn’t. Only if demand is reduced. The state and federal taxes are a fixed amount, not a percentage of the sell price. The current low price for oil is a result of overproduction, not a drop in demand so in the US at least gasoline tax revenues for governments remains the same.
@Evan Jones – I’m just using some common sense. I never had a class in remedial economics .001.
Federal and state taxes are 47.99 cents per gallon. If you sell more gallons because of very low prices, the government (State and Federal) gets more revenue.
http://www.api.org/oil-and-natural-gas-overview/industry-economics/fuel-taxes/gasoline-tax
I’m just assuming that more gallons are being sold at $2/gal than when it was close to $4/gal.
More about who earns more from selling gasoline at the pump Hint (the government):
“At the gas tank integrated oil companies make about 7 cents per gallon. Meanwhile, the government extracts more than 48 cents, on average, per gallon. That’s right: Uncle Sam takes nearly seven times more out of drivers’ wallets via taxation than “Big Oil.”
Ref: http://www.forbes.com/2011/05/10/oil-company-earnings.html
I’m just using some common sense.
It’s not so common, these days, I think. The only classes I ever had were dedicated to its suppression.
I never had a class in remedial economics .001.
Neither did a whole lot of these so-called economists. (Neither did I, for that matter. I was trained in demographics and futurology by Herman Kahn,)
I’m just saying that the more gallons sold will give the fed and state government more revenue. I’m just thinking (I don’t have the statistics) that $2 a gallon gas compared to $4 a gallon gas will result in more gallons sold. People will drive more and not be scared to make just one trip to the store, but maybe 2 or three. (because of low gas prices). Do you dispute that logic – evanmjones?
All of my formal academic training not only disputes it, but excoriates it.
(I don’t, of course.)
Exactly, it is a huge bonus. Low fuel costs are quite a freebie, that can vanish in a very short time. Then we will see how really weak the global economy is.
Nonsense. Everyone knows that if the corner drugstore (if any still exist) charges ten bucks for a candy bar, profits will just soar.
Lower gas prices are probably helping a bit in the short term – unfortunately, there is a ‘fire-sale’ quality to it as the industry itself is going bankrupt. There is also the fact of excessive micro-managing and regulation that is running up over-all business costs and creating stagnation. This environment kills off small business and only allows the short term survival of large corporations who have deep enough pockets to absorb additional costs – so instead of a healthy, diverse, flexible system, you have a rigid system, dominated by a few giants. And gigantism is the last step before extinction. Asteroids and ‘climate change’ aside, THAT’s what happened to the dinosaurs.
Given the apparent largess the Green Blob suggest that the oil industry is in receipt of, you know, those ongoing and huge subsidies, it’s a simple matter of reducing these by $10 a barrel. No problem. Certainly no need for a tax. Why hasn’t anyone suggested this to El Presidente?
It is a myth that the oil and gas get huge subsidies in the US. The left distort the facts by reporting the consumer subsidies given by other Countries like Venezuela providing cheap gas for votes. The left quote items as subsidies which are legal IRS tax deductions that are available to every other business that operates in the US and overseas
Besides the cost of the Lease the Federal government already collect 12.5% royalties on production on production from Federal land.
Also every gallon of gasoline is taxed 18 cents and diesel 24 centsin the US. Don’t tell me that all that goes toward roads because it is not!
Finally the oil and gas companies are the largest contributor to the US treasurry after income tax.
Where will that revenue come from after they are put out of business or mor HQ overseas as many other industries have already done.
Motor fuel is already the most taxed necessity in the US.
Catcracking, true. I think Manfred was using sarc…
It is a myth that the oil and gas get huge subsidies in the US.
The idea being to charge 20$ in stupid fees and give back 2$ and call it a “subsidy”. Sound democrat economics. Get with the program. Or else.
Or relocate overseas to a low tax environment since 50% of their profits come from overseas anyway.
US already has one of the highest corporate tax rates. .
The thought has occurred to me. But I am working class.
The rich can and do vote with their feet. Remember when they bumped up the UK marginal rate from 40% to 50%? Half of the millionaires took a bunk and the UK lost a barrelful of revenue. When they relented and took it back to 45%, some of them came back. (Not enough to break even, of course.)
The CBO is forced to calculate in such a way that a tax cut always results in reduced revenue. In their fantasy world, a 20%-off sale results in a loss of 20% in profits. It does not appear to occur to these flatheads that — just maybe — the extra sales will result in (gasp) net profit. Even the supply-siders have to kow-tow and make like they will “make up” for the “loss” by “closing loopholes”.
If I was offered a job there, I wouldn’t take it, as I prefer to remain marginally sane.
Democrats and Obama showing us how they intend on taxing the poor to death (literally) while hiding it within the cloak of saving the planet.. Drive the cost of living so high that the elderly and poor are denied basic life necessities like food, heat and medicines…
You cant fix STUPID! Tax and spend democrats…
You cant fix STUPID! Tax and spend democrats…
Sure you can. Stupid was on the ropes for a while, there. But they fixed stupid. Now stupid is bigger and better than ever.
No F’n Way. Vote Cruz!
Obama is totally controlled by the real rulers of the planet. This legacy seeking idiot does what he is told. His best friend is not Moochelle, it’s his Teleprompters. Without them, he sounds like a blithering idiot. Which he is.
If you voted for this a++clown, give yourself a big kick in the a++.
How many extra people will die in cold states because of additional fuel poverty?
Part of President Obama’s announcement is cash to help people in the North East install solar cells and wind turbines, to replace heating oil with renewables…
https://www.whitehouse.gov/the-press-office/2016/02/04/fact-sheet-president-obamas-21st-century-clean-transportation-system
(last paragraph)
Solar will really work great in the North East with it’s abundant sun in the winter and lack of snow cover and of course will not provide any liquid fuel for auto’s
The challenge to provide electricity and transportation fuels is currently two different forms of energy and should probably not be mixed as to the solution, unless one believes that a magic viable battery will suddenly appear out of nowhere and we can afford to spend billions and billions of tax dollars on a electrical charging system on thousands of miles of highways especially in rural areas. It will not be cheap or readily accomplished without lots of pain.
North East install solar cells and wind turbines, to replace heating oil with renewables
Just the thought of that makes me shudder. Despite wonderfully warm winter this year, I still remember the winter before that, and I can’t help thinking of what would have happened if we were using solar panels to heat our house during all those snowstorms…
The new cheap electricity in the North Eastern states will come from Canada which Canadians will gladly pay for.
ELECTRICITY WILL NECESSARILY GO THROUGH THE ROOF! THE KING HIMSELF SAID!
Obama can’t get out of office fast enough. I wish there were grounds to impeach him.
There are probably plenty of grounds for that. Unfortunately republican majority is sufficiently gutless to actually do it.
+1 Udar you are exactly right.
There are plenty of grounds, but (a) the Senate would need a two-thirds majority to convict and remove from office; (b) he has less than a year left; (c) the Republicans would not dare impeach “The First ‘Black’ President” (never mind that he is half Kenyan, half Euro-American). So it won’t happen. /Mr Lynn
What a clown.
“If the President really wants to encourage green energy, why doesn’t he announce a tax holiday for profits made from green innovations? ”
As Professor Glenn Harlan Reynolds would say, “Insufficient opportunity for graft”.
UNCLE!
THRUSH
If this is correct, the guy is more clueless than I suspected. This is just not going to happen.
A tax on oil/gasoline to fund roads? Seems like a good idea to me. Sort of a logical/non-GOPer idea.
In California the law is clear: annual car registration fees are to be used for road infrastructure.
So what happened? The Legislature ‘borrows’ the money, never repays it, and the roads are full of potholes, bridges are crumbling, etc.
What makes you think the same thing wouldn’t happen at the federal level?
isn’t there already tax for that? Federal tax of 0.18/gal plus whatever state tax on top of that? Directly paid by users of the said roads?
Tax on crude means my heating my house in the winter so my family doesn’t freeze to death is going to be used to fund road repairs. How logical is that?
right. and look at the roads.
and db, you are right, politicians are politicians….but it is _so_ logical to use a fuel taxes to pay for road repair and infrastructure, even you must see that. And, for the most part, the more gas you use (think SUVs and trucks), the more damage you do to the roads. And the interstates are mainly destroyed by 18 wheelers, not cars or even big SUVs.
@trafamadore
Were you born thick or did someone hit you in the head with a brick today? db et al pointed out that these taxes are already supposed to be used for road infrastructure repair/improvement but the funds are currently diverted to other purposes. Increasing taxes of this sort will not miraculously wind up with their being used for their supposed purpose.
DJ,
My point went right over his head: no matter what they say, the gov’t just wants the loot. It will go for its intended purpose, until the public looks away. Then it will be diverted.
When the income tax was first proposed, the government promised that only the top 3% of wage earners would have to pay it, and the tax rate would never exceed 1% of income. How’d that work out?
California is not the only state where this is taking place.
Don’t need road signs to let you know you are in Michigan because all of the sudden the roads are bad.
The crooks that want to tax you know they can use that money on all sorts of things, traf…EXCEPT what they told you they’d spend it on.
Don’t tell me you’re so brainwashed by the mainstream media you haven’t figured that out yet.
Vote Cruz and get the government straightened out for a change. Or have you wondered why all the Establishment/Santa Claus groups hate and fear him?
Such a clueless troll you are, traffy. That is what the gas tax is for. Oh, but wait, the electric and hybrid cars get a free ride on that one, don’t they? High time they paid their fair share.
So do the bicyclists.
Obama Slogan: “Vote for Change” Guess you get what you vote for. The only question is: “What side is he on?”
When did investment equal another tax?
Of course it’s a tax. The government has no way to raise money except by taxes or fees (or conceivably by selling abandoned assets). How those tax monies are used is another matter. You can call it ‘investment’ if you want; road repairs are generally the prerogative of the States.
/Mr Lynn
…and those “abandoned assets” were once paid for by…. yes, you guess it, TAXES.
Investment is progressive speak for tax and graft.
Anybody good with math? How many barrels of oil does it take to fly this man to his golf games? How about a $1,000,000,000 tax per lie for office holders and office seekers? Poof! National debt vanishes.
$100 per lie should do it.
One flogging in a public square .
20 lashes for a first offence.
After that, 100 lashes.
Lies should leave visible scars on the office holders that tell them.
JustAnOldGuy
He is a democrat politician. One of two things would happen, assuming you could even count all of his lies.
1. You could not find enough money in the budget to pay for all of his lies.
2. He is a democrat politician, he’d pay it by government credit card.
Governments already get massive tax revenue from fuel levies on gasoline.
Nobody has thought about how to replace this government revenue when we all change to electric cars. Currently this tax is about 40% of gasoline cost in Australia.
Wait for the protests when electric cars have to pay for road costs!!
They’re already talking about that in Washington State. The move is to require a transponder in every vehicle, and you pay per mile. So it won’t matter what sort of fuel you use. State Gov’t is already worried about the loss in revenue due to better gas mileage, or no gas mileage.
Better get ear plugs. The wailing, gnashing of teeth, and screams from Big Green will be epic.
In New Zealand the tax on fuel is call road user charges (RUC) in the 60’s or 70’s, I don’t recall anymore. Was implemented to improve road infrastructure and safety. What happened in reality is that almost every year RUC’s went up and most of the revenue raised went into a consolidated fund. When more fuel efficient cars came about, RUC’s went up. And so on…
One wonders how much more damage Obama’s rule by decree regime can inflict on the US economy and the people before he gets his well deserved big “A”?
When you going to start exporting 4X to the U.S. again?
Been outa here for quite a while Tom. It did start here back in the 1850s, but the Queenslanders are now the custodians of XXXX (like most Castlemainians they can’t write either hence XXXX).
There are better brews from Aus that are better than XXXX IMO. James Boag and Coopers for instance.
But XXXX had the best commercials.
Is it possible that the glut in oil was deliberately created not only to punish Russia for grabbing the Crimean peninsula but to drive the price of oil to the point where a $10 tax seemed like a good deal? When it rises later, the tax will be built in and hard to see. People will be used to it.
What is interesting of course is to follow the money. Who will get this manna from oil? The very people who plan to run the oil companies out of business, right? Why not rather tax the oil and give it to people who are poor in the form of income tax breaks, removal of state and local taxes, education chits and other things that list up the bottom – float all ships?
The amount involved isn’t that much I guess. Hardly worth collecting. Can be the international oil companies be made tax collectors on behalf of the federal government?
Crispin: See British Columbia Carbon Tax. A broke government implemented a Carbon Tax to pay for their social programs – a politically expedient left coast approach.
“investment has not been accompanied by a long-term plan for paying for it.”
Funny how he never thinks this way when he is discussing the federal government spending.Course only to a parasite is “investment” forcibly taking other peoples money and throwing it to corrupt cronies.
The responsibility of paying your bill is only important when saving the planet?
The only legacy Obama will leave is the legacy of lies and destruction.
Tax and spend, spend and tax. It never changes. Methinks the shooting is going to start sooner than later.
This $10 USD per barrel ain’t going to fly – no way – don’t you USA people worry…
I hope the GOP republicans highlight this crazy idea soon…
Hillary would want it to be $15/barrel and Bernie would want it to be $20 or more per barrel…
And when oil prices go over $100 USD per barrel, do you think they will reduce it or eliminate it – Hell No…
Anyway, oil companies aren’t stoopid. They’ll just stop using barrels to avoid the tax!
Actually Bernie would have the government nationalize all the U.S. oil companies.
Back of envelope, this adds $0.32 per gallon of gas/diesel, that’s a +150% increase in the Fed Excise tax.
It also adds to the cost of all those good things made from oil like plastics thereby ensuring that our industries cannot compete with the rest of the world. Since the feed stocks from crude-oil are used to make the massive amount of plastic in our cars will also increase in cost only if manufactured in the US. Foreign cars will be cheaper and US auto manufacturers out of business.
President’s overall goal accomplished.
The logic is all wrong. When funding is needed for a new bridge or highway, it is often raised by placing a toll on the use of that bridge or highway. It is not raised by placing a toll on existing infrastructure. The funders are confident the expenditure can be recouped because the new bridge or highway will be an attractive alternative that people will be happy to pay for.
Obama and other climate alarmists keep telling us renewable energy will not only be green, it will be a financially attractive source of power. Particularly as it is ‘free’ and infinite, whereas fossil fuels will become more expensive as we reach peak oil, coal, gas etc.
So to fund renewable energy he should apply a toll to the users of renewable energy because surely, like the new bridge, they will find it a lot more attractive in the long run?
Since when have they ever used logic?
Except tolls can have an unexpected consequence. Tolls in the Lower Mainland of BC have gotten to a point where businesses and people are relocating away from areas with tolls as the cost is significant, especially if you have to cross a toll structure several times a day. But perhaps that is good. The toll causes people and business to relocate to less dense areas, more telecommuting and working from home saving wear and tear on the infrastructure (although increasing the pay back period on the structures due to lower use.) The law of unintended consequences.
Well. That’s going to help the oil industry then isn’t it?
It’s very clever actually. It will send billions to the unions to go lean on their shovels on the highways and bridges, and line the pockets of his green friends.
What’s not to like?
w.
The foreman phoned the engineer “We are out on the job but someone forgot the shovels. What should we do?”
The engineer replied “I guess you will just have to lean on each other.”
The billions will be for high speed rail boondoggles, not working roads.
Willis. I don’t even see people with shovels just orange cones. The cone business must be great.
Why don’t all of the greens/global warmongers just stop using oil and anything and everything derived from oil right now? Because they are fricking hypocrites. Every last one of them.
@Jimmy Haigh, 8:09 pm,( + many btw and as all of us realize) Even if they would only try it for a week they might (big might) at least wake up for a few minutes.
But then they would all fall asleep “at the wheel” all over again while they would be waiting for the government to “rescue” them!.
Little do they realize that in case of emergencies ( Hurricanes, tornadoes, floods and so on) it is not the “government” that “saves” them. FEMA tends to be the last to show up. Every time it is a large group of volunteers, neighbors and many other people that show up without being asked and that just do the right thing! And most of those never ever get on the front page of the news!
Try evacuating from a hurricane threat in an electric vehicle!
Jimmy,
You are right, the president must have the biggest carbon footprint in the US and maybe the world as he flies in Airforce 1 on a whim all over the country including a separate flight for his dog or his wife when they decide not to fly to the same place together.
I’m surprised someone has not published his huge, unnecessary carbon footprint.
Add to his trips several C-17’s carrying his official helicopters (includes decoys).
Kubler: And all those bullet resistant black SUV’s.
A federal spending plan and the word ‘sustainable’ don’t belong in the same universe.
Tax and spend and spend and spend and…
You know I’m just wondering if President Obama is deliberately trying to hang an albatross around the neck of who ever winds up being the democratic candidate for president.
They are going to have to defend this, Gee I’m running for president and I support YOU paying more for tank of gas.
Yup that will be a sure vote getter. Think of Bernie, with his I’m going to tax the top 1%. Both Bernie & Hillary where up there tonight carrying on on how they’ll help the mid-class, and take on Wall-street etc. And Bozo just stabbed them in the back, not with a simple knife mind you, but with a Macedonian sarissa
This is going to be more fun for Bernie and Hillary then the immigration raids have been.
This is going to be entertaining
michael
Does he even consider how regressive this tax is? At $30/barrel, this is a 33% surcharge across the board, rich and poor alike. Interesting that most of the time it’s “tax the rich” while this is “screw the poor”. Make up your mind, Obama.
Will love to hear Hillary defend this as anything other than an example of crony capitalism, with a bone thrown to the unions via the highway fund.
The $10 per barrel Oil (Oh! West Texas …. or or North Sea Brent! … Ha ha USA is NOW an oil EXPORTER … So is the $10 on oil IMPORTS or on ALL OIL EXPORTS! …. bummer that as Abudabi will run to North Sea Brent quick!).
Well ! Lets say this is a “E! Musk” cash back for that 2-hr ‘night’ in Paris” I.e. Obama is repaying his gay lover Elon Musk for a few minutes in Paris in December 2015.
Sad sad sad.
Barack really does not know how to repay his gay lovers with Federal monies from the IRS! Ha haa
So
Barak du!
Well. The Senate and House will … Ignore such a bald face crime.
Even a petty Felony crime against the peoples of the USA and a Crime Against Humanity against the peoples of World … who Obama hates with …. Gay sucking.
Ha ha
Of course the $10 a barrel tax is in addition to the 48.69 cent fuel tax on each gallon of gasoline.
OMG…now the big bad oil companies won’t be able to afford paying all of us “DENIERS” !!
Fortunately this is one thing he can’t do through executive action.
The Republican Congress response was “Go pound sand.”
When Obama starts to say “let me be clear”, you know for sure that he is setting the ground for another lie.
The story’s leading picture of Obama forced me to scroll down rapidly to avoid nausea. This Obama idea is just yet again tax grab by Socialists who find that they are yet again running out of other people’s money.
agree 100%. Obama makes me nauseous at what he is doing to destroy this country and the constitution h swore to uphold.
Obama?
“LEGOLAAAS!! BRING HIM DOWN!!!”
The difference between the Demolicans and the Republicrats is that one side says, ” step 1 tax the rich”, “step 2 bribe the middle class”, “step 3 screw the poor”, “step 4 enrich my buddies”, while the other side skips steps one and two.
Under Obama’s steady hand, the Democrats have lost majorities in both the Senate and the House of Representatives. My guess is that Democrat politicians will be glad to see the back of him.
Although if Sanders gains the presidency, their problems have just begun.
So Obama wants to tax oil by about one third at today’s price. Then he will continue to tax the gasoline made from that oil. It will be a tax on a tax designed to make the price of fuel skyrocket. It also seems to be designed to prepare the way for a value-added tax where taxes are added to products at each stage of its production. Do these “progressives” ever think of anything other that how to get more money out of taxpayer pockets? I’d rather give my money to big oil than big government. At least big oil provides a useful product that they don’t force me to buy.
Louis. Good point about the tax on tax. When I sold gasoline in Indiana in the late sixties a sales tax of 2% was levied on nearly everything except necessities. There was already a 4 cent federal and 8 cent per gal state tax on gas so the sales tax had to be calculated on only the part that wasn’t tax. It was a pain in the rear to add the sales tax to the dollar figure displayed on the pump. The price of the gas was 32 cent for regular and 34 for eythel. I made 1.60 dollars per hour or in other words 1.6/0.32 = 5 gallons per hour.
601nan needs to seriously calm down.
Nah he is just jealous.
seconded
Okay Now that I live in sunny AZ I don’t that often of home heating oil.
After a quick check HHO prices in New England range from a low of $1.375 in Maine to over $2.00 a Gal. in most of the states. Heating bills in winter can be $400. to $800 per month. and President Obama wants to increase this cost.
Oh and all those obscene profits the oil companies are making?
This is BP.
http://www.theguardian.com/business/2016/feb/02/bp-annual-loss-biggest-for-20-years-axes-thousands-of-jobs-deepwater
And now Shell
http://www.bbc.com/news/business-35490364
michael
Obama’s response will be — Road trip! Like the boys in Animal House.
Let’s see $10/bbl oil tax x 20 million bbl/day x 365 days/yr= an oil tax of around $73 BILLION/year.
This insane tax will increase the cost of EVERYTHING from increased transportation costs, lower living standards, cost millions of jobs from decreased competitiveness, decrease corporate profits, increase debt, decrease wages, limit capital investments, etc.
All these detrimental consequences will occur for absolutely NO good reason whatsoever. It’s just the government stealing more money and increasing control over our daily lives…
Let’s say we elect a new president that wants to: decreased government spending, lower taxes, balance the Federal budget, decrease the size of government, decrease government rules and regulations and wants to eliminate the IRS with a flat tax…
I’m sick of this Leftist insanity.
This is the coveted Energy Tax every administration in every nation has wished for as there is nothing produced in any country that does not use energy. That is a universal tax everyone within a nation everyone contributes to. Rich or poor – no matter, Obama will be in your pocket. And he will be long gone by the time those who are bad at math figure it out. The energy companies won’t notice it – why should they? It is just one more operating expense they pass on to the sheeple that suck this stuff up. They would be the sheeple who rejoice because they think he’s sticking it to big oil. That ain’t watts happening by a long shot. But it may help fund his unconditional opening up of the borders. Oh wait – there’s all that new deficit spending that my great-great grandchildren get to pay for. Sorry, no upside to this new rogue activity.
When the carbon tax that Gillard here in Australia said she would not implement got implemented (On electricity only) the price of electricity to industry and domestic consumers, strangely enough, went up in my case about 7%. We were told that the carbon tax on power would not be passed on to consumers only the big polluters would pay. And, not so strange, is profits went UP for power generators. When the carbon tax was abolished by Abbott, my power bill went down by about 7%. Hummmm…funny that!
The lack of cheep reliable energy, including oil, will be the downfall of your USA.
I think that’s Obama’s end game.
I think the bloke is a bloody idiot.
That, plus he really, really just hates America.
Tax the corp and unless there is a corresponding import duty on gasoline, there is no change in consumption, just an incentive and enrichment to import. Transfers of wealth are the progressive way.
If you tax the corp, unless there is a corresponding tariff on the import of crude products there will be no change in consumption, just a transfer of wealth to other producing jurisdictions. The classic progressive wealth transfer.
Dear Mr Worell,
I am an assiduis reader of all your excellent articles on this wonderful website.
One think really sticks in my craw though.
Why oh why does your good self fall into the greenies trap of referring to the trace gas of creation as “carbon”
I realise that I am a carbon unit, and all living objects are likewise, but the plant food I exhale is called carbon dioxide, and when barmy O’Barma, and Mizz Gillard refer to Co2 as carbon, it is a deliberate propaganda ploy to deamonise it.
Sorry about the rant, but age and grumpiness are correleated, unlike Co2 and ambient temperature(s).
Kind regards from the Scottish Gulag.
Its a kind of literary shorthand. If I write “carbon tax”, everyone immediately knows exactly what I mean, even though the literal meaning of “carbon tax” is not a concise representation of what I am describing. Don’t worry, my grandpa and I used to debate the correct use of language – fond memories :-).
Do we tax the Carbon in biofuels and ethanol?
“waterside4
February 5, 2016 at 12:26 am
…and Mizz Gillard refer to Co2 as carbon, it is a deliberate propaganda ploy to deamonise it.”
She is “married” so the Mizz label is, well garbage. Bit like Helen Clark in New Zealand. She never said carbon. She said cahbohn because she was “tutored” in her speeches and those speech writers were clueless idiots! Mind you, she is from Barry in Wales, UK. That’s where old steamers go to get junked! I wish she’d go there!
Similafly spelling Mr Worrall and thing not think…….back to “skool” for me!
tax enough already
It probably is an honorable goal – to get all those gas guzzlers off of the road.
Maybe also – to get the cash guzzlers out of politics.
His big idea – to steal money from productive industry and hand it to hypothetical ones that only ever looked good in the promotional literature.
So Exxon pays for Solyndra.
Brilliant thinking, because who needs real practical energy delivered at the point of use, when we can enjoy the fruits of dumb and unworkable pipe-dreams funded using other people’s money by scientifically illiterate politicians? (sarc)
I forgot to mention Solyndra version II. a.k.a. Abengoa.
Currently in progress. This from 17hours ago. (link below).
It’s actually surprising that these players can not survive, considering that the market has been rigged heavily in their favor with extraordinarily generous subsidies that represent multiples of the real market value of the thing that they trade. Supposedly electricity, but actually they trade in self-promotion and promises.
http://www.reuters.com/article/abengoa-restructuring-idUSL8N15J4SM
in other words: hidden taxes? we don’t need no sinken hidden taxes.
so if you tax domestic oil companies this only helps the likes of Saudi Arabia, Iran, etc.
As well as increasing the cost of manufacturing causing even more mfg. to move to places like China.
What a fabulous foreign policy idea.
Yeah, you can bet that this suggestion will be popular on Al Jazeera and Russia Today.
Environmental alarmism and crushing western oil and gas independence are their favorite topics.
Presented in various no so subtle guises.
Well now that is NOT what is being proposed. The basic idea is to subsidize electric cars and public transportation using a $10 per barrel tax on ALL oil used. The detailed implementation is likely to be extraordinarily complex and require a whole heap of bureaucrats to administer. One issue is that a LOT of gasoline is imported while there are considerable exports of diesel fuel.
Another is does the $10 per barrel rule apply to all oil usage , that would be a burden on those dependent on oil for heating for example. The tax is clever in only one regard. The big losers will be poor people who live n rural areas who will see their bills rise and get no benefit. These people however tend to vote Republican so Obama s=doesn’t care. The big winners will be those who live in cities and will get new federally subsidized jobs AND cheaper pubic transit. They of course happen to be Democrat’s by and large.
In short this is a naked attempt to bribe potential democratic voters, the fact that on a global scale it will penalize US industry and agriculture by imposing costs on them that competitors do not have to bear is irrelevant. Tammany Hall rules apply in the Whitehouse today.
State cap-and-trades could also include natural gas which will impact urban dwellers with increased taxes for household uses.
What do you expect? He has proven favors Iran over the US Citizen anyway.
Is this few to be levied on imported oil, or only on oil produced in the USA?
I meant fee
Another Bright idea from a socialist, don’t ya just love how they spend your money’s
These people never stop: Thursday, February 4, 2016, 2:56 PM – Ice coverage on the Great Lakes is near record-low levels for this time of year, and scientists are concerned about the effect this will have on wildlife species in the months to come. But not one word about this: http://savetheeaglesinternational.org/new/us-windfarms-kill-10-20-times-more-than-previously-thought.html
DEFINITION of ‘Free Enterprise’ An economic system where few restrictions are placed on business activities and ownership. In this system, governments generally have minimal ownership of enterprises in the market place. This system aims for limited restrictions on trade and minimal government intervention.If this Green Movement is so great why doesn’t free markets jump all over this concept and raise the money.
http://time.com/9480/great-lakes-frozen-time-lapse-video/ How come when the Great Lakes were frozen over in 2013 and 14 not a word .
Great Lakes levels depend on which way the wind is blowing. When frozen over the water doesn’t move around or more stable?
Urban people will benefit from public transportation. Middle and upper classes won’t change much because of this tax, so who’s hurt? Oh yeah, it’s the poor who cling to their bibles and guns who will suffer most.
Regardless of the merits of energy taxes, if your going to do it, then the tax should be at the pump, not on crude oil. First, the bureaucracy to collect the tax is already in place; just raise the existing federal excise tax on gasoline. Ten dollars per barrel on crude is about 30 cents per gallon at the pump. Not such a big deal with gas prices where they currently sit. Taxing crude oil is much more complicated and requires new bureaucracy (ugh!). Second, the tax is placed directly on consumers, who must ultimately pay any taxes. Third, the tax on oil producers will hurt the marginal producers, since they do not set the price of oil It will force some of them out of business. This is especially the case with the low prices for crude we now have. That said, none of this is going anywhere. It’s just politically convenient to be seen as beating up on oil companies.
The key is to tax all crudes. This includes imported oils. In such a case the internal market price will be uniformly higher. Imported refined fuels will have to be taxed at $25 per barrel.
Fernando,
I heard this proposal reported on the news last night as a tax on imported oil. So it might be presented as a protective tariff. Don’t see how that would make it palatable to the large international oil producers, but domestic companies might like it. Like most protective tariffs, it implies higher domestic prices.
The tax could be used to set up a fund to pay for nuclear plants, these can be used to supply baseload capacity.
Don’t forget to tax electric and hybrid cars, who are getting away scot-free currently.
Request Eric Worrall next time please place a photo of President Obama in your articles not smiling at me. He reminds me of a kid getting away with something.
No not a kid. But a man who is taking liberties. His eyes in his video speech about “energy price rises” spook me!
This will go down well with the thousands of oil employees across the nation who fear losing their jobs through the crashing oil price. The comments above support my long held view that people, in any profession, go into local authority employment because they do not have the intelligence, work ethic or ability to hold a job down in private industry or commerce where their skills or otherwise are judged by bottom line profit.
How about before we add another new tax we insist that the states and the Federal government use the existing gasoline taxes only for their original intended purpose?
Perhaps the oil companies should deliver the actual product instead of the $$ to the Whitehouse.
I am sure a few hundred thousand barrels of crude oil wouldn’t pose any sort of storage hazard, it isn’t like the stuff is flammable or toxic or anything.
And Obama can trumpet how he is saving the world by not letting that oil be burned.
Transportation is not just transportation. It is a base cost for every product or service we use, including food. Oil by-products are part of just about every product we use from pens to autos. And let’s not forget heating.
In effect, the chief is recommending increasing the overall cost of living for every man, woman, and child in America. Like the middle class has not been being hammered enough, let’s increase their cost of living and really throw sand in their gears.
Cannot describe how maliciousness this proposal is.
What bipartisan support? Read yesterday where even Paul Boehner Jr has stated that any such tax will be DOA in the House! That is IF he will actually do that, which I’ll believe when I see it!
Tax Hollywood – they are the biggest backers of this crap. Tax $10 on every movie ticket and see how quickly that gets changed.
Not a bad idea, Djozar.
…Everything that Obama touches turns to Shiite’ !
This of course is DOA. Can’t do a “Presidential Mandade” to get it around the Senate.
Unless it is the payoff for looking the other way while government officials got insider info to short oil futures.
“If the President really wants to encourage green energy, why doesn’t he announce a tax holiday for profits made from green innovations?”
Because the idea isn’t about Climate Change or legitimate plans to mitigate AGW. I’m afraid its much more sinister than that. Obama knows everything you know about CO2, he just chooses to support the Agenda 21 misdirection of humanity, away from the impending consequences of the quiet sun.
However.. If the tax model was changed 1:1 from that based on profit over to one based on consumption, (so abolish corporate taxes on oil company profits and dividends etc. for an initially zero net revenue change over to tax per volume sold) – the government would then have an incentive to INCREASE oil consumption!
Hey kids! .. you should be driving a heavier SUV with a V8! Miles per gallon? .. why bother, look how cheap gasoline is! And we will starting drilling offshore both coasts to make it even cheaper!
Note his method of skirting the end user tax on gasoline. This is a replay of Waxman Markey indirect tax strategies thinly veiled. A $10 tax per month on electric cars would be better.
How is it that most every trophy on this president’s mantle is also a nail in this country’s coffin?
Fire up the legal armada to ram it through as another executive order.
It is mind boggling how stupid some people are who gain high office. As others have noted, the claim that this tax would be levied on Oil Companies is nonsense. In all cases it is the consumer who pays, and they will always pay no matter what is claimed. All the tax would do is increase the rate of decline of the US economy. Having achieved that how much revenue can government hope to glean to fund its growing aspirations as the nation grows poorer, and everyone will become poorer, and that includes the rich who largely fund all this idiotic thinking.
What a great legacy Mr Obama is going to leave, 8 wasted years never learning how work with Congress, or the free world. I would hope Americans would be able to find a better prospect to take over as President, but those making the headlines do not offer much hope.
So government insiders started shorting oil futures well in advance of the decline in price in cahoots with the Feds who were thinking if we force the price low enough no one will mind a new tax. If it gets passed the insiders will start going long on oil futures and in the end when oil goes back up we are still stuck with the tax. Insiders get rich both ways, government gets it’s new tax. They all win.
exactly….also higher gas prices will raise the price of everything else…which will also raise the amount of taxes taken in
Speaking of taxes, think how much more in SS taxes the government will collect when they raise the minimum wage to $12/hr. And they never had to pass a tax increase!
Nothing wrong with a user tax to adeuately fund highway and bridge repair.
Everything wrong with a tax to perpetrate the funding of crony capitalism (can we all say ‘Elon Musk’ together?).
On the Good Morning America show this morning (02/05/16) they said President Obama was proposing a $10 per barrel tax on oil to be used for rail and transportation purposes. No mention was made of clean energy or reducing our reliance on oil. Sometimes I think the media intentionally tries to mislead the public.
The only thing that’s missing is a glistening white star sparkle on one of his teeth assaulting us through that sucker punch smile.
I’ve got a slightly different take on all this.
The US government has been overtly and passively following a policy of increasing the global natural gas and oil supplies. The purpose is to reduce the soft power of Russia and to a lesser extent certain Middle East countries.
The grand plan is to have the US be a reliable exporter and minimal consumer.
Chess moves.
Dwight D. Eisenhower and Khalid of Saudi Arabia in the early 50’s made an agreement to keep the oil price very very low. This to stop the USSR from obtaining any wealth from their vast amounts of OIL which would have financed their system. This is what lead to the collapse of communism. In return the US agreed to and will protect Saudi at all cost regardless of how non democratic they are. This policy remains today. It’s the Saudi’s who are presently over supplying the world. Yes James you are smack on.
Here’s a good analysis of just how President Obama’s proposed $10 per barrel oil tax would seriously hurt the poor:
Indeed. Energy tax is the most regressive tax imaginable, for the reason the author points out. The poorer you are, the more of your money that goes to energy. It is a horrible tax.
And the author of the above analysis?
Barack Obama, March 30, 2011
Go figure …
w.
The only reason they are floating the idea is because prices are low, which is a reflection of the weak economy.
Anyone who has been paying attention for the last 40 or so years realises that the western economies have thrived when energy is cheap and faltered when cost soared. I see this tax as a seizure of opportunity on the part of the big players in power to keep a chokehold on the masses and drive commerce down so that real estate can be gobbled up by the elite.
I’m probably mistaken, but I see it oppositely, low prices indicate nobody is lining up to transport the oil gushing out of the spigots, until the world economy returns to growth there will be an oil glut.
God help the oil companies.
But, despite record low oil, gas, coal transport, consumer prices are sky high and rising. What gives
What is missing here are the budget cuts that are suppose to go along with any new taxes as part of the President’s balanced approach to deficit reduction. The President is already years late with the budget cuts that are suppose to have gone along with the tax hike on the rich and the ACA taxes. According to the President’s economic “plan” The savings from the troops coming home in FY 2014 are suppose to enough to fund infrastructure improvements and to insure that the federal government will start posting annual debt lowering surpluses starting in FY 2015. No additional taxes should be required. The President needs to follow his own economic “plan”. Congress should not be a problem because the President said that he would bring the nation together and that he would solve problems between the parties by reaching across the isle. Apparently reaching across the isle with middle finger extended has not worked very well.
It’s great politics. First you raise taxes on a barrel of oil then you blame big oil for a rise is gas prices. You get the money, they get the anger directed at them.
Make sure you remember the difference between deficit reduction and debt reduction. Deficits are the annual difference between revenue and expenditures. So when you have a $500 billion deficit and it gets reduced to $400 billion, that qualifies as deficit reduction. But it still increases the debt.
Excellent point. The President routinely takes advantage of the difference between the two words to deceive everyone. He even used that tactic in the State of the Union speech and a bunch of Dumbocrats cheered. First he ran up a huge deficit then claimed he was reducing it every year.
Sad
What happened to “evanmjones” ??
He was on quite the roll there for awhile.
Recharging the batteries 🙂
Off to work. It requires a bit of fossil fuel to recharge those batteries. Then I go home and do peer-review level science until I conk out. Having the time of my life.
I am currently deconstructing Hubbard & Lin (2006) to support our paper on siting. At this point it’s about five-papers-in-one. It’s surprising how little goes into a lot of these scientific papers. And how little verification of results actually occurs.
After 8 year of no economic growth and a major recession on the way, teamstupid wants the USA to go full Obama… You should never go full Obama.
Not even a smidgen!
This proposal would trickle down and be a $10 per barrel tax on motorists—or 20 to 25 cents per gallon on refined fuels,” said Patrick DeHaan, senior petroleum analyst at GasBuddy.com. “To me it’s clear: this is not something oil companies are going to absorb.”
If the tax is on a barrel of crude, it is not only on auto fuel, but also on heating oil, all plastic and other products that are made from oil, including propane, butane, etc. Interesting since ethanol uses a lot of fossil fuel in manufacture and shipping, the cost increase will extend into numerous biofuels also.
I doubt the Administration can grasp the consequences in including a likely deep recession since it will also put US industry at a competitive disadvantage..
$10.00 tax on per barrel of oil is a stupid idea first. 2nd it will hurt the poor most. 3rd it will not pass the house and senate. If it did pass, it will only increase as time goes by $11-$12-$13-$14-$15 and on and on…
To show just how serious he is about this, President Barack Obama has decided to ground Air Force One
.. fat chance