Posted by Tine
Two news items today converge in my mind that scream the green lobby has the Presidents ear…BIG TIME!
“Budget plan seeks nearly $50 million boost for offshore wind development,” by Ben Geman – The Hill
The White House fiscal year 2011 budget plan seeks a 53 percent boost in Energy Department wind power R&D to support new efforts to tap massive offshore wind resources. ** The White House is requesting $123 million for DoE’s wind program, a $43 million increase over current spending. The funding includes $49 million for several activities to support coastal wind power, which is in its infancy in the U.S. ** “Investments will address common barriers and risks to offshore projects – financial, regulatory, technical, environmental, and social. Specific activities include: assessment of offshore wind resources and environmental impacts; R&D related to cost-effective offshore foundations, enhanced turbine reliability, domestically manufactured components and specialized installation vessels; and design and planning of electrical cabling and utility interconnection,” DoE’s budget plan states.
“The President’s Tax Hike on Drilling,” by Roy Cordato – corner, National Review
One well-publicized element of President Obama’s proposed budget is the elimination of “subsidies” for fossil fuels. But, in large part, these are not subsidies at all. One proposal relates to the tax treatment of oil-company incomes. According to the New York Times, Obama proposes to eliminate the expensing of what are called intangible drilling costs. These represent about 70 percent of all drilling costs and are made up of labor, supplies, contractors, and fuel. Under current law, oil companies can write off the expenses against other income in the year that those expenses are incurred, rather than depreciating them over time. In reality, to allow expensing of these payments is not a subsidy. It avoids the imposition of a tax penalty on oil drilling and is an example of how all production costs should be treated by the tax code. ** Expensing guarantees that companies can reclaim the full cost of their Investments against taxes and that they are not penalized for investing in what are called “long lived” investments projects. These are investments, like drilling for oil, that will yield income over an extended period of time. Investment costs to a company five, ten, or twenty years into the future are worth less than they are today. If a company is not allowed to write off an investment in the year that it is incurred, it is being denied the right to write off the full cost of that investment.
Government should be neutral regarding business. This is rediculous!