MISSOULA, Mont. - Sen. Max Baucus is being asked to sharpen the subsidy scissors.
Taxpayers for Common Sense, along with local groups and experts, are calling for the Montana Democrat and other "super committee" members to look hard at how much the nation spends on oil and gas tax breaks and subsidies as it looks to cut the federal deficit.
State Rep. Betsy Hands, D-Missoula, who carried a bill to end the state's oil and gas tax holiday, says the same scrutiny would be timely at the federal level.
"There are no facts that back up the need for a reduced tax rate for the oil and gas industry when you look at the market prices, technology advances, access to markets."
Hands says environmental angles also should be considered when it comes to oil and gas industry subsidies - since development of those resources come at a cost to landscapes.
Thomas Power, a University of Montana economist professor, says tax incentives and subsidies only are appropriate for industries facing a disadvantage in the free market - not for companies already highly profitable.
"As an economist, it always startles me when representatives of the business community ignore basic economic relationships, such as supply and demand. Yet, oil and gas interests have been doing exactly that."
Oil and gas subsidies usually are promoted as a way to encourage local development and job creation. Taxpayers for Common Sense has issued a "Green Scissors" report which highlights federal spending that also hurts the environment.
The "super commitee" has until Nov. 23 to submit recommendations to Congress.
The "Green Scissors 2011" report is online at greenscissors.com.
Groups to Sen. Baucus: Use Subsidy Scissors (Public News Service)
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