Wind Tax Credit Labeled 'Welfare' by Koch-Funded Groups
By Jeff Spross
The Institute for Energy Research (IER) has a new study out arguing against tax credits for wind energy on very odd grounds.
Specifically, the study looks into the production tax credit (PTC) for wind energy, which was first passed in 1992, updated by the 2009 stimulus bill, and will probably expire at the end of this year thanks to congressional gridlock.
The study figured out the share of total federal tax revenue paid by the population of each state, and divided the amount of revenue that goes into paying out the PTC amongst the states accordingly. It then compared the amount each state pays to support the PTC with how much benefit from the PTC each state sees. Since wind power is concentrated in a few specific states, some wound up getting significantly more benefit than they paid, and some states got much less. California, for instance, lost almost $196 million more in taxes than it received in tax credits, while Texas got over $394 million more than it paid out.
Now, IER is a conservative group, it receives some of its funding from the Koch brothers, and has a long history of pushing fossil fuel interests. At the end of the paper, IER declares that federal wind subsidies “create an unfair redistribution of wealth across state lines that enriches wind companies in select “net taker” states at the expense of taxpayers in other states,” and that “even in states that seem to accrue net ‘beneﬁts’ from federal wind subsidies, these subsidies merely redistribute wealth from taxpayers to wind energy companies.” The American Energy Alliance—IER’s sister organization—took up the cry, promoting the study under the headline “End the Wind Welfare!” And the conservative Washington Examiner ran an ad along the same lines Monday morning.
But one funny consequence of its analysis IER doesn’t mention is that—with the exception of the southeastern states—the “net payers” on its map roughly line up with the blue states in the 2012 election. The top four net payers —California, New York, Florida, and New Jersey—all went blue, suggesting their constituencies are more inclined to support efforts like the PTC to combat global warming and to support renewable energy. Meanwhile, three of the top four net takers—Texas, Oklahoma, and North Dakota—went red, implying they oppose precisely the kind of government intervention they benefit from.
More fundamentally, however, IER’s case proves too much. Most industries are distributed in “clumps” across the country, meaning any effort to aid or support them through tax subsidies will have a similar distributional result as the PTC. The oil and gas industries, for instance, benefit from a wealth of federal tax carve-outs, but the economic activity they generate is concentrated in just a few key states.
In fact, the point is so broad it applies to any tax subsidy for any activity whatsoever. Under this logic, the home mortgage interest deduction is an unfair redistribution from people who don’t own homes to people who do; the tax exclusion for employee health benefits is an unfair redistribution from people who don’t get their insurance through their job to people who do; Sen. Mike Lee’s (R-UT) proposed tax credit for families would be an unfair redistribution from Americans who choose not to have children to Americans who do.
In other words, the study’s point is far too broad to work as an argument against the PTC specifically. It can only work as an argument against aiding any kind of choice by any business or individual through the tax code at all.
Short of that totalistic position, which virtually no one actually supports, we have to debate each tax subsidy on its individual merits. And the only way to argue against the PTC on that score is to claim burning fossil fuels doesn’t create market externalities, and/or that climate change isn’t a serious problem.
That claim becomes harder and harder to make with each passing year.
Visit EcoWatch’s RENEWABLES page for more related news on this topic.
At first glance, you wouldn't think avocados and almonds could harm bees; but a closer look at how these popular crops are produced reveals their potentially detrimental effect on pollinators.
Migratory beekeeping involves trucking millions of bees across the U.S. to pollinate different crops, including avocados and almonds. Timothy Paule II / Pexels / CC0<p>According to <a href="https://www.fromthegrapevine.com/israeli-kitchen/beekeeping-how-to-keep-bees" target="_blank">From the Grapevine</a>, American avocados also fully depend on bees' pollination to produce fruit, so farmers have turned to migratory beekeeping as well to fill the void left by wild populations.</p><p>U.S. farmers have become reliant upon the practice, but migratory beekeeping has been called exploitative and harmful to bees. <a href="https://www.cnn.com/2019/05/10/health/avocado-almond-vegan-partner/index.html" target="_blank">CNN</a> reported that commercial beekeeping may injure or kill bees and that transporting them to pollinate crops appears to negatively affect their health and lifespan. Because the honeybees are forced to gather pollen and nectar from a single, monoculture crop — the one they've been brought in to pollinate — they are deprived of their normal diet, which is more diverse and nourishing as it's comprised of a variety of pollens and nectars, Scientific American reported.</p><p>Scientific American added how getting shuttled from crop to crop and field to field across the country boomerangs the bees between feast and famine, especially once the blooms they were brought in to fertilize end.</p><p>Plus, the artificial mass influx of bees guarantees spreading viruses, mites and fungi between the insects as they collide in midair and crawl over each other in their hives, Scientific American reported. According to CNN, some researchers argue that this explains why so many bees die each winter, and even why entire hives suddenly die off in a phenomenon called colony collapse disorder.</p>
Avocado and almond crops depend on bees for proper pollination. FRANK MERIÑO / Pexels / CC0<p>Salazar and other Columbian beekeepers described "scooping up piles of dead bees" year after year since the avocado and citrus booms began, according to Phys.org. Many have opted to salvage what partial colonies survive and move away from agricultural areas.</p><p>The future of pollinators and the crops they help create is uncertain. According to the United Nations, nearly half of insect pollinators, particularly bees and butterflies, risk global extinction, Phys.org reported. Their decline already has cascading consequences for the economy and beyond. Roughly 1.4 billion jobs and three-quarters of all crops around the world depend on bees and other pollinators for free fertilization services worth billions of dollars, Phys.org noted. Losing wild and native bees could <a href="https://www.ecowatch.com/wild-bees-crop-shortage-2646849232.html" target="_self">trigger food security issues</a>.</p><p>Salazar, the beekeeper, warned Phys.org, "The bee is a bioindicator. If bees are dying, what other insects beneficial to the environment... are dying?"</p>
EcoWatch Daily Newsletter
Australia is one of the most biodiverse countries in the world. It is home to more than 7% of all the world's plant and animal species, many of which are endemic. One such species, the Pharohylaeus lactiferus bee, was recently rediscovered after spending nearly 100 years out of sight from humans.
Scientists have newly photographed three species of shark that can glow in the dark, according to a study published in Frontiers in Marine Science last month.
- 10 Little-Known Shark Facts - EcoWatch ›
- 4 New Walking Shark Species Discovered - EcoWatch ›
- 5 Incredible Species That Glow in the Dark - EcoWatch ›
FedEx's entire parcel pickup and delivery fleet will become 100 percent electric by 2040, according to a statement released Wednesday. The ambitious plan includes checkpoints, such as aiming for 50 percent electric vehicles by 2025.
- Which Is Worse for the Planet: Beef or Cars? - EcoWatch ›
- Greenhouse Gas Levels Hit Record High Despite Lockdowns, UN ... ›
- 1.8 Billion Tons More Greenhouse Gases Will Be Released, Thanks ... ›