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Another Wacky Progressive Idea

Thanks to the Council for Citizens Against Government Waste (CCAGW) for condemning the wacky idea proposed by Rep. Dennis Kucinich (D-Ohio). He was joined by several other far left members of the House of Representatives -- Reps. John Conyers Jr. (D-Mich.), Bob Filner (D-Calif.), Marcia Fudge (D-Ohio), Jim Langevin (D-R.I.), and Lynn Woolsey (D-Calif.).

H.R. 3784, the Gas Price Spike Act of 2012, would “amend the Internal Revenue Code of 1986 to impose a windfall profit tax on oil and natural gas,” which is the profit on sales that “exceeds a reasonable profit” as determined by a three-member independent Reasonable Profits Board. Here’s how CCAGW justified their decision:

“If passed, the bill would create taxes of 50 percent on profits 100 to 102 percent above a “reasonable” amount, taxes of 75 percent for profits between 102 and 105 percent of a reasonable profit, and a 100 percent tax on anything above 105 percent.  According to Kucinich, the new revenue would be used on “forward-thinking transportation alternatives.”

“This bill represents populist demagoguery in its lowest form,” said CCAGW President Tom Schatz.  “Gas prices, like all others, are determined by supply and demand.  The idea that they can be lowered by imposing exorbitant, arbitrary taxes on the companies that provide consumers with gasoline and natural gas reveals an unflattering degree of economic ignorance among these members.  The predictable result, which has already been observed in states that have experimented with price ceilings on gasoline, will be shortages and a dramatically more inconvenient gas-buying experience.

“It is not the business of government to determine which industries may or may not benefit from increased demand for their products,” added Schatz.  “Nor is it possible to define ‘reasonable’ profits in any objective manner.  The notion that such a threshold should be decided by the political class is frightening, to say the least, and a plan to lower the price of valuable products by reducing firms’ incentives to produce those products is about as likely to be effective as pixie dust or séances.  Consumers decide which firms to patronize, and consumers determine businesses’ fates.  Political meddling with that system leads to disasters like Solyndra.”

Kudos to the Council for Citizens Against Government Waste (CCAGW). By the way, CCAGW is the lobbying arm of Citizens Against Government Waste.

Express your outrage. Call Rep. Kucinich’s office on Capitol Hill at (202) 225-5871. Other contact information for Rep. Kucinich is available at his website here.

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