The United States can't afford giveaways for mining and
oil companies anymore.
When you're in a
hole, you stop digging. And when you've got a $1.3-trillion deficit and $15.7
trillion in debt, you've got to start cutting.
That's why we joined the
environmental group Friends of the Earth and the free-market R Street Institute
to forge "Green Scissors" that Congress could potentially use to snip
nearly $700 billion from the nation's bloated budget.
Our Green
Scissors 2012 report proposes more than 100 cuts to five sectors, including
energy, agriculture, transportation, insurance, and public lands and water. We
focus on cutting subsidies, eliminating unnecessary liabilities, and ensuring
that the federal government receives its fair share for private use of public
resources.
These handouts not only cost taxpayers billions and increase federal deficits, but they distort markets and often harm the environment. So whatever your rationale — waste, markets, or the environment — we've got you covered.
One of the most
egregious examples of these kinds of handouts is the 1872 mining law. It's
remained virtually unchanged since, well, 1872. This dusty statute allows
private industry to mine valuable resources such as gold, on public lands, for
free.
And speaking of
old-fashioned giveaways, taxpayers have subsidized the fossil fuel industry
since the early 20th century — today to the tune of $110 billion per year. This
industry is one of the most profitable worldwide. Oil, gas, and coal companies
must bear their own costs of doing business.
But the
outrageous subsidies don't end there. Created in the aftermath of airline
deregulation in the 1970s, the Essential Air Service program is a policy relic
that epitomizes wasteful and environmentally harmful spending. Subsidizing
expensive regional flights that serve only a handful of passengers makes no
sense for taxpayers.
Taxpayer-subsidized insurance programs have in some sectors
become the largest form of federal support. In 2011 alone, federal crop
insurance cost taxpayers more than $11 billion. It doesn't work like any
insurance you're familiar with — 62 cents out of every premium dollar comes out
of Uncle Sam's pocket.
The insurance companies' costs for administering the
policies are paid by the taxpayer, and so are most of the losses. Elsewhere,
taxpayers are on the hook for oil spills if clean-up costs exceed $75 million,
and for nuclear accidents running more than $2 billion. That means taxpayers
essentially take on all the risk for both of these profitable industries.
Speaking of
unnecessary liabilities, the Department of Energy's Title XVII Loan Guarantee
Program is a perennial Green Scissors target. Created in the Energy Policy Act
of 2005, the Title XVII program has continuously proven itself a serious
failure. Publicly scrutinized for its default of a $535-million loan guarantee
to the solar start-up Solyndra, the Title XVII program is now pushing to
finalize an $8.3-billion loan guarantee for a pair of nuclear reactors in
Georgia and a $2-billion loan guarantee for a financially troubled uranium
enrichment facility.
Over the past
year, Congress has managed to score a handful of victories on Green Scissors
targets, most notably allowing the $6-billion-a-year ethanol tax credit to
expire and die the ignoble death it deserved. This victory will earn taxpayers
a savings of $30 billion over the next five years. Another recent success was
the defeat of efforts to increase subsidies for oil shale. Taxpayers have been
down that road before, losing billions.
In these tight
budget times, we cannot afford to continue throwing good money after bad. As
lawmakers argue over what to do about the enormous deficit and looming
automatic budget cuts, they need to pick up the Green Scissors and start
cutting.
Read the full Green Scissors 2012 report at www.GreenScissors.com
Read the full Green Scissors 2012 report at www.GreenScissors.com
Ryan
Alexander is president of Taxpayers for Common Sense, a nonpartisan federal
budget watchdog. www.taxpayer.net
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