Spelunking the Bailout Bill — Carbon Tax Audit Anyone?

Ronald Bailey | October 3, 2008

As many have noted, the bailout legislation passed by the Senate and up before the House today contains a lot of early Christmas presents for various favored industries. One favorite is a provision repealing a 39-cent excise tax on wooden arrows for kids. (I'd have thought for-the-kids nannystaters would have argued for banning such dangerous toys which encourage violence rather than hand arrow corporations a tax break, but these are strange times.)

Another provision that has alarmed the good folks over at the Capital Reseach Center is a clause authorizing a "carbon audit of the tax code." CRC's Green Alert warns:

This appears to be an attempt by global warming fanatics to lay the foundation for an economy-killing carbon tax just like the "cap-and-tax" system that is now destroying European industry.  

The actual provision reads: 

             SEC. 117. CARBON AUDIT OF THE TAX CODE.

(a) Study- The Secretary of the Treasury shall enter into an agreement with the National Academy of Sciences to undertake a comprehensive review of the Internal Revenue Code of 1986 to identify the types of and specific tax provisions that have the largest effects on carbon and other greenhouse gas emissions and to estimate the magnitude of those effects.

(b) Report- Not later than 2 years after the date of enactment of this Act, the National Academy of Sciences shall submit to Congress a report containing the results of study authorized under this section.

(c) Authorization of Appropriations- There is authorized to be appropriated to carry out this section $1,500,000 for the period of fiscal years 2009 and 2010.

I am not deeply schooled in the arcana of legislative construal, but on its face, the provision appears to authorize a look at the tax code to see how it affects the emissions of carbon dioxide and other greenhouse gases. Such an audit could uncover tax subsidies of carbon-based fuels that one would surely want eliminated. On the other hand, it might reveal taxes that are hampering the use of carbon-based fuels.

Finally, it could also find tax subsidies of alternative fuels that one would also want eliminated, but it's unlikely to find taxes that suppress the adoption of alternative fuels. Of course, I understand that those who put in this audit provision will most likely use the findings to argue against carbon fuel subsidies, and skip over the subsidies to the alternative fuels they favor. But isn't eliminating some subsidies better than eliminating no subsidies?

Comments

Guy Montag|10.3.08 @ 12:30PM|#

Ron,

Finally, it could also find tax subsidies of alternative fuels that one would also want eliminated, but it's unlikely to find taxes that suppress the adoption of alternative fuels.

You mean, like, unleaded gasoline, right?

|10.3.08 @ 12:33PM|#

As always, the actual global warming fanatics are the people opposed to research and knowledge.

Oh my goodness, we can't find out how the tax code effects carbon emissions!

|10.3.08 @ 12:35PM|#

But isn't eliminating some subsidies better than eliminating no subsidies?

HAHAHAHA

You really think any subsidies will be eliminated, Ron?

|10.3.08 @ 12:37PM|#

Episiarch: One lives in hope.

|10.3.08 @ 12:39PM|#

Contrary to joe's assumption that anyone concerned about this provision must be some kind of fundie luddite hayseed, I can think of two very good reasons to give it a thumbs-down:

(1) It will either be a complete waste of time and money, generating a report that sits, ignored on the shelf or

(2) It will be used for green social engineering via the tax code.

Now, you may think (2) is a feature, not a bug, but (contra joe, who apparently thinks this is a purely academic exercise) lets not pretend that laying the groundwork for green social engineering is not precisely what this is all about.

Guy Montag|10.3.08 @ 12:41PM|#

RCD,

Two baseball teams from Chicago could really use your batting average as of late.

|10.3.08 @ 12:41PM|#

Episiarch: One lives in hope.

Not me, Ron. Not me. I opened Pandora's box and failed to close it fast enough to retain the hope.

|10.3.08 @ 12:42PM|#

"Episiarch: One lives in hope."

No Ron! Bad Ron! We speak in the First Person here!


Oh wait...nm

Guy Montag|10.3.08 @ 12:44PM|#

Ron and Epi,

Pleas, fellows, let's leave that distasteful town in Arkansas, from whence many a bad Presidential candidate has escaped to the wild, out of this serious matter?

|10.3.08 @ 12:45PM|#

RC doesn't want to answer the question, because of what might be the political implications.

It's like the Bush Doctrine, except instead of attcking countries, you attack research, and instead of worrying about terrorists attacking us, you're worried about Congress changing the tax code.

|10.3.08 @ 12:45PM|#

Ignorance is bliss.

|10.3.08 @ 12:47PM|#

A: Let's commission a study of the minimum wage, to determine its effect on employment..

B: Nooooooooo!!!!!!!! a) it will either be a complete waste of money, or b) it will be used to argue for the elimination of the minimum wage.

I'd be ashamed to make that argument.

|10.3.08 @ 12:51PM|#

Good, effective, analyses of the distortionary effects of the tax code are everywhere. Save your my money, and buy one off the shelf, you retards! And read it.

Go flat, baby!

Guy Montag|10.3.08 @ 12:54PM|#

They already tax everything carbon, to include life.

That effect would be: A drag on the economy.

There, all it needs is a cover page, header, footer and a few annexes.

Is the NAS still located in Rosslyn near the METRO? I will be happy to pick up my check there.

|10.3.08 @ 12:55PM|#

I think the one lesson that we should learn--but won't--about the current financial services meltdown is that social engineering has far too many unintended consequences and should be generally eschewed by government. I might recognize an exception or two to that statement, depending on what one wants to throw in the category of "social engineering", but I think we'd do a lot better not trying to manipulate people so much.

|10.3.08 @ 1:15PM|#

RC doesn't want to answer the question, because of what might be the political implications.

No, RC realizes that the "question" is a Trojan Horse for political goals that RC abhors. RC sees no reason to do anything to advance those goals, no matter how well disguised.

A: Let's commission a study of the minimum wage, to determine its effect on employment..

B: Nooooooooo!!!!!!!! a) it will either be a complete waste of money, or b) it will be used to argue for the elimination of the minimum wage.

Bad example, joe. That study could conceivably be used to argue either side of the minimum wage question, depending on how it comes out. There is no conceivable use of the carbon audit other than to push green social engineering.

Kyle|10.3.08 @ 1:18PM|#

Wouldn't simply printing the tax code have the largest effect on carbon emissions?

|10.3.08 @ 1:19PM|#

We speak in the First Person here!

Speaking of, one of the most enjoyable parts of the debate last night was counting how many times the Bidenator referred to himself in the third person.

"Disco Stu doesn't advertise."

|10.3.08 @ 1:19PM|#

Joseph, in your case IGNORING is bliss. TTFN

Guy Montag|10.3.08 @ 1:25PM|#

Kyle,

The printed tax code in the trunk of my Charger may aid in traction and prevent rubber burning. However, I estimate that it would reduce available space for dead hookers.

|10.3.08 @ 1:25PM|#

No, RC realizes that the "question" is a Trojan Horse for political goals that RC abhors. RC sees no reason to do anything to advance those goals, no matter how well disguised.

Ah, that must why you are so hell-bent to denounce any research into correlations between race and crime, or race and IQ. Oh, wait...

There is no conceivable use of the carbon audit other than to push green social engineering. Really? So there are no elements of the tax code - no, wait, scratch that, there could not possibly be any elements of the tax code - that promote fossil fuel use. For example, there could not possibly be any write-offs for vehicles that advantage SUVs over smaller cars.

And if there are, you don't want to know about them.

|10.3.08 @ 1:29PM|#

Speaking of, one of the most enjoyable parts of the debate last night was counting how many times the Bidenator referred to himself in the third person.

So how many was it?

|10.3.08 @ 1:32PM|#

So how many was it?

Twice, by my count, so not enough to warrant a satisfying drinking game. But I got a late start.

Guy Montag|10.3.08 @ 1:34PM|#

Didn't Sen. Biden use his big, fake 'I am smiling because I freaking hate you' smile a lot? Seemed to, but I was watching in a bar and the TV was on closed captioning.

|10.3.08 @ 1:37PM|#

Twice, by my count, so not enough to warrant a satisfying drinking game.

"George likes spicy chicken!"

Chuck|10.3.08 @ 1:37PM|#

My own predictions:

1) This will take way longer than 2 years

2) It will cost way more than $1.5 million

3) The results will be obsolete by the time they are published.

Guy Montag|10.3.08 @ 1:41PM|#

Chuck,

I am only charging $1.3 million for the report above and I did it in like 45 seconds, but the rest of what you say sounds right :)

|10.3.08 @ 1:43PM|#

I looked at the debate transcript and employed my advanced in-page searching powers (which I only use for good). Looks like he went Dole on us four times. Twice in one sentence, which may be a record.

|10.3.08 @ 1:45PM|#

I looked at the debate transcript and employed my advanced in-page searching powers (which I only use for good). Looks like he went Dole on us four times. Twice in one sentence, which may be a record.

This is why they pay you the big bucks, ProL. Nice work. :-)

|10.3.08 @ 1:49PM|#

Thank you, but I cannot take sole credit. It's this kind of in-depth research that makes the Hit & Run commenters the best journalists in America. And it's why Urkobold knew that Palin would be the VP candidate back in May.

|10.3.08 @ 1:51PM|#

Ah, that must why you are so hell-bent to denounce any research into correlations between race and crime, or race and IQ.

Again, joe, you miss the point. This isn't research being conducted by some academic out in the Real World. This is an audit done by the federal government of the tax code. If you can't see the difference . . .

Really? So there are no elements of the tax code - no, wait, scratch that, there could not possibly be any elements of the tax code - that promote fossil fuel use. For example, there could not possibly be any write-offs for vehicles that advantage SUVs over smaller cars.

C'mon, joe. For somebody with your predilection for state micromanagement to suddenly realise that the tax code introduces multitudinous distortions into economic decision-making is a little disingenuous.

Sure. The audit might reveal that. It would be mildly interesting to know. But as I have been very clear all along, the audit will have no conceivable use except for green social engineering. Its a Trojan Horse. Pretending its not doesn't change the fact that it is.

Guy Montag|10.3.08 @ 1:55PM|#

RCD,

How many more charges are you going to make at that windmill? Just deciding when I should take the evening meal break ;)

|10.3.08 @ 1:57PM|#

It's this kind of in-depth research that makes the Hit & Run commenters the best journalists in America

I thought pulling shit out of our asses and quoting Always Sunny was why.

Gilbert Martin|10.3.08 @ 1:57PM|#

"But isn't eliminating some subsidies better than eliminating no subsidies?"

No.

It still has government in the business of trying to pick the winners.

|10.3.08 @ 1:57PM|#

RC Dean wrote,:
"There is no conceivable use of the carbon audit other than to push green social engineering."

My usual thing is for government to buy Certified CO2 Offsets for it's own emissions. This is one of the most libertarian things the government can do wrt reducing greenhouse gas (and equivalent) emissions. I have no real idea how much that would cost, but my uneducated guess is that if all energy of all types were eliminated, there would be some money around for Offsets. Examining the greenhouse gas effects of the law would be a natural extension of that policy, the exact greenhouse gas equivalent effect can be found, and offsets purchased. Many cumbersome government policies can then be abandoned for being redundant or inefficient.

In short I am advocating that the greenhouse gas reduction effort (and with that Alternative Energy Policy) be outsourced to the free market, rather than be a government project. This does require measuring the emissions effects of (subsidies) policies of the government. Among a few other things like regulating and auditing CO2Offset markets.

Getting the government to do measure its effects is likely easier than getting them to end subsidies and bad policies. Getting those measurements makes it easier to end those bad policies.

And thus Sam-Hec has spoken! ...or written or commented or somesuch.

piperTom|10.3.08 @ 2:01PM|#

Read carefully. The legislation clearly requires carbon to be a gas.

You only thought it was warm before.

Guy Montag|10.3.08 @ 2:01PM|#

Oh, carbon emmission haters, why do you want to kill all of the plants? Huh? Huh? Huh?

|10.3.08 @ 2:07PM|#

I thought pulling shit out of our asses and quoting Always Sunny was why.

To clarify, I was talking about our fact-finding genius and nearly fanatical devotion to objectivity. . .and to the Pope. However, you're correct to note that our style and clever cultural references do make us popular with our readers as well.

|10.3.08 @ 2:07PM|#

This,
"I have no real idea how much that would cost, but my uneducated guess is that if all energy of all types were eliminated, there would be some money around for Offsets."

Should have read,
"I have no real idea how much that would cost, but my uneducated guess is that if all energy Subsidies and other Market Protections of all types were eliminated, there would be some money around for Offsets."

My Bad.

Guy Montag|10.3.08 @ 2:16PM|#

Reason,

PS, I love the "Smoke out big government" ad in the right margin!

|10.3.08 @ 2:50PM|#

How many more charges are you going to make at that windmill?

I'm done, thanks.

a knight|10.3.08 @ 3:30PM|#

In Re: Wooden Arrows

So now Reason considers the rescinding of a ridiculous tax (weapon tax on arrows made for children's archery that more than doubled their retail price) pork?

Go figure...

DannyK|10.3.08 @ 6:33PM|#

How can you quote in all seriousness a blog which throws out hysterical phrases like "global warming fanatics" and "economy-killing carbon tax"? That's the rhetoric of a writer deep in the pocket of Big Oil.

|10.3.08 @ 8:56PM|#

I was more disturbed by what I read ... let's see, I think it began on page 325 ... mandating that insurers cover mental health and substance use care the same as their 'regular' medical coverage.

I didn't have time at work today to read the whole thing carefully, but that certainly caught my attention.

Gotta download it here at home and read the whole thing this weekend, I guess.