The House Appropriations Committee’s newest member, Rep. Jo Bonner (R-AL), visited The Heritage Foundation’s weekly blogger lunch today to pitch his new “Commitment to Reforming a Broken Process.” Bonner faced a hostile crowd of conservative bloggers who did not see why Bonner was willing to support a one-year moratorium on earmarks but refused to back an all out ban. Bonner responded with a number of points, including: 1) there is no good definition of what an earmark is; 2) the system can be fixed with transparency; 3) a one-year moratorium is enough time to fix the system. When pressed on the politics of the issue, Bonner explained he did not believe it was necessary for GOPers to adopt an all out ban in order to differentiate themselves from Democrats this fall.
Bonner found a much warmer response from conservatives when he said he was no fan of Hillary Clinton’s gas tax holiday plan and was even more strongly against the windfall oil profit taxes that both Clinton and Barack Obama are trying to sell the American people on the campaign trail. Bonner voiced many of the same points the Wall Street Journal identified in their editorial on the subject yesterday:
You may also be wondering how a higher tax on energy will lower gas prices. Normally, when you tax something, you get less of it, but Mr. Obama seems to think he can repeal the laws of economics. We tried this windfall profits scheme in 1980. It backfired. The Congressional Research Service found in a 1990 analysis that the tax reduced domestic oil production by 3% to 6% and increased oil imports from OPEC by 8% to 16%. Mr. Obama nonetheless pledges to lessen our dependence on foreign oil, which he says “costs America $800 million a day.” Someone should tell him that oil imports would soar if his tax plan becomes law. The biggest beneficiaries would be OPEC oil ministers.
There’s another policy contradiction here. Exxon is now under attack for buying back $2 billion of its own stock rather than adding to the more than $21 billion it is likely to invest in energy research and exploration this year. But hold on. If oil companies believe their earnings from exploring for new oil will be expropriated by government – and an excise tax on profits is pure expropriation – they will surely invest less, not more. A profits tax is a sure formula to keep the future price of gas higher.