T. Boone Pickens is trying to convince Congress to grant a $1 billion per year tax subsidy to a special-interest group involving natural gas for automotive use (C&E News, 7/2/2011, page 20). Congress seems to be listening. The House has submitted H.R. 1380, and the Senate said to be drafting a similar bill.
In the last election, we thought we had sent a strong message to Congress that government spending should be reduced. Presuming that Republicans would be more conservative on spending, we changed the composition of the House. However, we seem to have misjudged the situation. Is there some sort of "spending disease" that has now infected the new House members?
T. Boone Pickens' selling point is that this is a method by which we can reduce our dependence on OPEC oil. However the fact is that we do not need to be dependent on OPEC anymore. Substantial oil reserves have been discovered in the United States, including West Texas. Our only problem is government intervention in not allowing drilling permits for production. For example, the Department of Interior is now considering declaring the Desert Lizard an endangered species, which will eliminate the newly discovered West Texas oil reserves from being developed.
Large quantities of natural gas have also been discovered in the Marcellus Shale of the Northeast and in the Bakken Shale of North Dakota/Montana. With this probability of significantly larger production, the price of natural gas will naturally fall. This will make it automatically attractive for extended use in automobiles. That being the case, why do we need a $1 billion per year tax subsidy?
Both the House and the Senate need to reconsider what they doing from both Requirement and Government Expense Reduction points of view.
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