Republicans in Congress seem to be having an identity crisis. More than 80 of them have signed on to a bill that has the blessing of President Obama, Senate Majority Leader Harry Reid, House Minority LeaderNancy Pelosi and even that pillar of liberalism, Al Gore. Unfortunately for the co-sponsors of H.R. 1380, known as the T. Boone Pickens natural gas bill, the conservative grass roots elements that swept them into office last year are beginning to notice.
Fiscal conservatives helped make the Pelosi Congress a bad memory but Republican support for the Pickens bill is shaking the confidence of many grass-roots leaders. The bill, which purports to help reduce our dependence on foreign sources of oil, is not good conservative fiscal policy, is not good energy policy and it’s certainly not a bill Republicans should be trumpeting.
The Pickens plan is no longer just about windmills. It aims to create an artificial market for natural gas through billions of dollars worth of subsidies and tax credits for the conversion of an as-yet unknown number of vehicles and filling stations to natural gas. The plan will provide a $100,000 tax credit for every filling station that converts to natural gas, $64,000 in subsidies for trucks and up to an $11,500 subsidy for every natural gas car.
Natural gas exploration and increased use isn’t a bad thing for America. We should be expanding domestic energy exploration. However, at a time when the GOP should be looking to reduce taxes, spending and regulations to help create a more affordable energy future, this proposal potentially could cost hundreds of billions of taxpayer dollars while having a negligible impact on gas prices. Its impact on our demand for foreign oil, even after a decade, is also projected to be minor compared to the costs.
Further, the bill is a perfect example of crony capitalism, and the GOPtakes a great risk with tea party members if they go through with it. T. Boone Pickens has spent millions courting lawmakers for this legislation. He also just happens to be the largest shareholder in Clean Energy Fuels, which owns 200 natural gas stations across the country. Clean Energy Fuels owns BAF Technologies, which is one of the largest companies that converts vehicles to run on natural gas, and Mr. Pickensalso owns the mineral rights to almost 200,000 acres believed to have significant natural gas reserves. He’s lined it all up for personal profit, and now just needs the bill to pass and be signed into law.
In supporting the Pickens bill, Republicans are playing the same Washington game they ran against in 2010. This bill, if enacted, would make Mr. Pickens a fortune, give the president a victory, insert government further into the marketplace and hand the taxpayers a huge bill.
Playing favorites with one energy source over another is not what this nation needs. Republicans should be looking to level the playing field and encourage innovation. Members of Congress should well consider that by helping create an artificial market, this bill could very well do to home energy costs what ethanol did to the family grocery bill – increase prices dramatically. On a fundamental level, the Pickens bill does something anti-Republican: It encourages greater dependence on government and favors intervention over innovation.
Republican lawmakers shouldn’t be helping Mr. Pickens take a shortcut to massive profits on the backs of the American taxpayer. Reducing regulations and helping entrepreneurs like Mr. Pickens should be encouraged but if they truly believe that natural gas is the future, they should commit their own capital, not the American taxpayers’, to assume the risk. They should be able to create products that drive consumer demand and compete in the free market.
Conservative co-sponsors should abandon this bill and instead focus on real solutions to increase energy choice, reduce costs through broad-based expansion of domestic sources of energy, lower taxes on energy producers regardless of source, and eliminate taxpayer subsidies to level the playing field among energy producers. Tea party members who were the driving force for change in 2010 are watching how the GOP solves its very own energy crisis.