House Votes Preemptively Against Carbon, Crude Oil Taxes

June 15, 2016

The U.S. House of Representatives took two non-binding votes last week rejecting future energy taxes, and the discussion of whether or not energy taxes are different from the “user fees” that fund federal transportation programs came up repeatedly.

The House considered two non-binding concurrent resolutions on June 10 expressing the “sense of the Congress” offered by oil and gas state legislators. The first (H. Con. Res. 89) expressed the sense of Congress that a carbon tax “would be detrimental to American families and businesses and is not in the best interest of the United States” and passed by a vote of 237 to 163. The second (H. Con. Res. 112) expressed the sense of Congress that “a new tax should not be placed on oil” and referenced President Obama’s proposed $10.25 per barrel crude oil tax in the preamble. It passed by a vote of 253 to 144 (with two voting “present”). In both cases, Republicans almost unanimously supported the resolutions while over 85 percent of Democrats voted “no.”

While the debate on the carbon tax resolution focused on climate change, debate on the crude oil proposal often mentioned the fact that the President’s proposed oil tax was the “pay-for” for his plan to spend $413 billion over the next ten years on surface transportation infrastructure and Highway Trust Fund solvency.

Rep. Earl Blumenauer (D-OR) certainly remembered, noting that Congress (including his own Ways and Means Committee) did not hold any hearings on the President’s proposals. He remarked that “If we would be honest, have independent experts, if the committee would do its job, we wouldn’t be having bizarre debates like this that suggest that the President’s proposal would hurt the economy or would be costly. To the contrary, it would strengthen the economy, put millions of people to work at family-wage jobs, and improve the conditions of families from coast to coast.”

The ranking minority member on the House Transportation and Infrastructure Committee, Peter DeFazio (also D-OR), also criticized the Republican majority for the failure to properly provide adequate levels of infrastructure funding, in typical DeFazio style:

   Mr. DeFAZIO. I would be kind of embarrassed if I was in the majority and that is what I was wasting time on while people are trapped in traffic, while people are dying, because we can’t maintain our transit systems. People are blowing out tires because we can’t repair the roads.

And, oh, we are all for infrastructure until it comes to paying for it. We passed a 5-year bill. We paid for it with phony money. We pretended that when we have private tax collection, that it will make money–private tax collection. Republicans have passed that twice before. It kind of pissed off the American people. And guess what, it lost money each time, and then we put it back in the IRS.

But, no, this time it is going to make money and we are going to use it and pay for infrastructure. Give me a break. And the Federal Reserve makes that money and puts it in a reserve account with a computer. Let’s take that money and spend it.

Basically, you are just averting the real problem here, which is we need to have a serious discussion about how we are going to pay to build America’s infrastructure and become a world leader again and be the envy of the world again.

The SPEAKER pro tempore. The Chair will remind Members of the House to refrain from vulgarity in debate.

(DeFazio ended up being one of the two Democrats voting “present” on the resolution.)

Some of the resolution’s supporters got a bit defensive on the topic of transportation “user fees” (i.e. the existing excise taxes on the highway usage of gasoline and diesel fuel that go to the Highway Trust Fund) and why a tax on crude oil (which goes to plastics, home heating oil, and many other non-highway uses) is not a user fee. The resolution’s sponsor, Dr. Charles Boustany (R-LA) said that “Ronald Reagan believed that a user fee was important, a specific user fee. I think he and I would both agree that a specific user fee is important for infrastructure. This is not a user fee. This is a detrimental tax on American competitiveness, on American jobs, on American wages, on American energy security, and it hits at the very foundation of our national security. It is the wrong way to go.”

Rep. Garrett Graves (R-LA) said that “We need to work together in a bipartisan manner to come up with a new user fee concept to get us additional dollars for infrastructure.  This was a unilateral proposal. This was not subject to hearings, and it is not appropriate. It is contrary to our economy; it is contrary to American interests; and it is going to increase our trade deficit.  Mr. Speaker, I strongly urge that we support this legislation and that we move forward in a bipartisan manner to fix the user fee concept to increase the investment in infrastructure to where we can improve our roadways.”

Blumenauer also quoted from a letter from the Transportation Construction Coalition that said, in part:

While the sincerity of the Obama Administration’s proposal for a Highway Trust Fund solution is dubious given its release three months after the President signed the FAST Act into law, a per barrel oil tax of that magnitude would be a real and permanent solution. And its nexus to highway users as a revenue mechanism is far more honest than the budget gimmicks, deficit spending and burdens placed on non-transportation sectors of the economy that the Congress has deployed since 2008 to keep investment in the surface transportation programs essentially static.

We certainly respect the right of members of Congress to disagree with the President’s proposal, but it is incumbent upon anyone who does so to bring forward an alternative way to achieve the same objective. We strongly believe all potential revenue options should be on the table. Preliminarily disparaging one significant solution just makes it more difficult to resolve a problem that has plagued Congress for nearly a decade.


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