Category Archives: Government Revenues

Can Tesla Survive The Loss Of Subsidies?


Three years ago, The Los Angeles Times posted “Elon Musk’s growing empire is fueled by $4.9 billion in government subsidies”. I have not seen a summary of the current total of Musk’s subsidies but it is certainly more than $4.9 billion now. When The LA Times speaks about an “empire” it included Tesla, Space X and Solar City—all Musk controlled businesses.

This discussion will focus on the Tesla electric vehicle (EV) business.

Subsidies start with the Federal Tax Credit of $7,500 given to each buyer of a Tesla EV.  (Every EV maker gets the same treatment.).  California also provides a $2500 subsidy per car.

The following is from the LA Times posting:

“Tesla has also collected more than $517 million from competing automakers by selling environmental credits.  The regulation was developed in California and has been adopted by nine other states.”

These regulations require that companies selling automobiles must also sell a certain percentage of EVs.  Sales of an EV gives the seller environmental credits.   Manufacturers are penalized for not selling enough EVs and must buy credits to offset their failure. Because Tesla sells only EVs it gets a lot of credits which they sell to the other car makers.

The following 2016 video discusses what the Wall Street Journal thinks subsidies mean to the Tesla’s bottom line: (Please excuse the 15 second commercial.  When video ends click back to this page.)

https://video-api.wsj.com/api-video/player/v3/iframe.html?guid=00E58A9F-9315-47FE-BFED-7C79B2C3A98B&shareDomain=null

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Congress Needs To Take Ownership Of Regulations


The preceding posting “Federal Regulations And Intervention Cost America Consumers And Businesses $1.9 Trillion In 2016, discussed the scope and effect regulations have on the economy.  This posting will look at some solutions.

From the CEI posting titled “Ten Thousand Commandments 2017comes the following excerpts:

A regulatory liberalization agenda would provide genuine economic stimulus and offer some confidence and certainty for businesses and entrepreneurs.

Steps to Improve Regulatory Disclosure

Certainly, some regulations’ benefits exceed costs, but net benefits or even actual costs are known for very few. Without more complete regulatory accounting, it is difficult to know whether society wins or loses as a result of rules.

An incremental but important step toward greater openness would be for Congress to require— or for the Office of Management and Budget to initiate—publication of a summary of available but scattered data.

Regulations fall into two broad classes: (a) those that are economically significant (costing more than $100 million annually) and (b) those that are not. Agencies typically emphasize reporting of economically significant or major rules, which OMB also tends to emphasize in its annual assessments of the regulatory state. A problem with this approach is that many rules that technically come in below that threshold can still be very significant in the real-world sense of the term.

Ending Regulation without Representation: The Unconstitutionality Index—27 Rules for Every Law

Agencies do not answer to voters. Yet in a sense, regulators and the administration, rather than Congress, do the bulk of U.S. lawmaking. But agencies are not the only culprits. For too long, Congress has shirked its constitutional duty to make the tough calls. Instead, it delegates substantial lawmaking power to agencies and then fails to ensure that they deliver benefits that exceed costs.

Agencies face significant incentives to expand their turf by regulating even without demonstrated need. The primary measure of an agency’s productivity—other than growth in its budget and number of employees—is the body of regulation it produces. One need not deplete too much time and energy blaming agencies for carrying out the very regulating they were set up to do in the first place.

For perspective, consider that in calendar year 2016 regulatory agencies issued 3,853 final rules, whereas the 114th Congress passed and President Obama signed into law a comparatively few 214 bills. Thus, there were 18 rules for every law in 2016 (see Figure 24). The ratio can vary widely, but the average over the decade has been 27 rules for every law. Rules issued by agencies are not usually substantively related to the current year’s laws; typically, agencies administer earlier legislation. Still, this perspective is a useful way of depicting flows and relative workloads.

Regulatory reforms that rely on agencies policing themselves will not rein in the regulatory state or fully address regulation without representation. Rather, making Congress directly answerable to voters for the costs that agencies impose on the public would best promote accountable regulation. Congress should vote on agencies’ final rules before such rules become binding on the public.

Well, why don’t they vote on agency final rules?

Concern about mounting national debt incentivizes Congress to regulate rather than to increase government spending to accomplish policy ends.

By regulating instead of spending, government can expand almost indefinitely without explicitly taxing anybody one extra penny.

This creates unfunded liabilities. Leaving the people regulated to fund the regulation. Congress could pass a law intending to reduce homicides in the US by requiring an increase of police officers per square mile of city area to match New York’s successful program of 119 officers per square mile.. This would require, for example, a doubling of Chicago’s police force according to a posting by Politics & City Life titled “City Size and Police Presence.” This might be a great idea, but either fund it or let the people in Chicago decide if they want to double the police force.

Affirmation of new major regulations would ensure that Congress bears direct responsibility for every dollar of new regulatory costs. The Regulations from the Executive in Need of Scrutiny Act (REINS) Act (H.R. 26, S. 21), sponsored by Rep. Doug Collins (R-Ga.) and Sen. Rand Paul (R-Ky.), offers one such approach. It would require Congress to vote on all economically significant agency regulations—those with estimated annual costs of $100 million or more. It has passed the House in the current and three previous congressional sessions but has not moved forward in the Senate.

Congressional rather than agency approval of regulations and regulatory costs should be the goal of reform. When Congress ensures transparency and disclosure and finally assumes responsibility for the growth of the regulatory state, the resulting system will be one that is fairer and more accountable to voters.

Please read the entire CEI report by clicking here.

cbdakota

Federal Regulations And Intervention Cost American Consumers And Businesses $1.9 trillion In 2016.”


President Trump says he wants to drain the SWAMP.  When I think of draining the swamp, I think of shrinking the government.  Specifically aimed at getting rid of the many bureaucrats that are virtually a law unto themselves.  They are not working to carry out the Executive and Legislative wishes, but rather to impose their agendas. They do this by co-opting legislative authority though regulations and rulemaking and by employing “red tape” to detour the executive intentions.   (This is often known as the Deep State.)

The Competitive Enterprise Institute(CEI)’s Vice President for Policy and the US economy, Clyde Wayne Crews, Jr. produces an annual survey of the size and scope and cost of federal regulations. Then that is translated into how those regulations affect the American consumers, business and the US economy. Crews reports that “Federal regulations and intervention cost American consumers and businesses $1.9 trillion in 2016.”

 

Crews’ effort is captured in the following posting “Ten Thousand Commandments 201: A Fact Sheet”:

Federal government spending, deficits, and the national debt are staggering, but so is the impact of federal regulations. Unfortunately, regulations get little attention in policy debates because, unlike taxes, they are unbudgeted, difficult to quantify, and their effects are often indirect. By making Washington’s rules and mandates more comprehensible, Crews underscores the need for more review, transparency, and accountability for new and existing federal regulations.

The 2017 report is unique and will serve as a benchmark to measure President Trump’s efforts to cut red tape against those of his predecessors. President Obama’s final year in office showed a regulatory surge. Will Trump keep his promise and slam the breaks on overregulation?

 

Highlights from the 2017 edition include:

 Federal regulations and intervention cost American consumers and businesses $1.9 trillion in 2016. When you add the taxpayer dollars government agencies spent administering these regulations, the total cost of the regulatory state reached $1.963 trillion last year.

 Federal regulation is a hidden tax that amounts to nearly $15,000 per U.S. household each year.

 In 2016, 214 laws were enacted by Congress during the calendar year, while 3,853 rules were issued by agencies. Thus, 18 rules were issued for every law enacted last year.

If it were a country, U.S. federal regulation would be the world’s seventh-largest economy, ranking behind India and ahead of Italy. 

    Many Americans are concerned about their annual tax burden, but total regulatory costs exceeded the $1.92 trillion the IRS collected in both individual and corporate income taxes in 2016.

 Some 60 federal departments, agencies, and commissions have 3,318 regulations in development at various stages in the pipeline.

The five most active rulemaking entities–the Departments of the Treasury, Interior, Transportation, Commerce and the Environmental Protection Agency–account for 1,428 rules, or 43 percent of all federal regulations, under consideration.

 The 2016 Federal Register contains 95,894 pages, the highest level in its history and 19 percent higher than the previous year’s 80,260 pages.

 Last year, the Obama administration averaged 86 “major” rules, a 36 percent higher average annual output than that of George W. Bush. Obama issued 685 major rules during his term, compared with Bush’s 505.

 

That is quick look at the Federal regulations and intervention that cost American consumers and businesses $1.9 trillion in 2016.

Deplorable!

Crews has some ideas, worthy of consideration, on how to fix this major, and growing problem.  That’s next.

cbdakota

Correcting Harmful Wind Energy-Related Policies


The following are 5  Master Resource postings examining opportunities of the Trump Administration to correct harmful wind energy-related policies,

 

U.S. Wind Energy Policy: Correcting the Abuse in 100 Days (Part I)      2/2/17

https://www.masterresource.org/wind-power-federal-laws/us-wind-policy-reform-100-days-i/

 

Federal Energy Efficiency Mandates: DOE’s End Run vs. the Public Interest (Part II)

By Mark Krebs and Tom Tanton — January 31, 2017

https://www.masterresource.org/department-of-energymoniz/eere-end-run-ii/

 

Big Wind: Threat to Air Navigation, Military Assets (Part III)

By Lisa Linowes — February 16, 2017

https://www.masterresource.org/windpower-vs-radar/wind-versus-radar-iii/

 

DOE: Breaking the Federal Arm of the Wind Industry (Part IV)

By Lisa Linowes — February 23, 2017

https://www.masterresource.org/department-of-energymoniz/doe-breaking-federal-wind-iv/

 

Wind Energy and Aviation Safety (Part V)                        3/02/17

https://www.masterresource.org/windpower-safety-issues/wind-aviation-safety-v/

 

cbdakota

Is The Paris Agreement Realistic? Part 1 Background


Time for some background on the Paris Agreement (PA) that was adopted by consensus in December of 2015 at the 21st Conference of Parties (21COP), a UN organization.  These COP meetings are gatherings of warmers, NGOs, and politicians (seeking to tax and regulate their citizens) usually at some exotic place. The attendance is in the 20,000 range, most of them traveling to Bali or the like in fossil fuel powered jet airplanes in order to attend several weeks of meetings in large air conditioned rooms. A little bit of hypocrisy on display, perhaps.

The objective for the PA in general is described by Wiki as follows:

“(a) Holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 °C above pre-industrial levels, recognizing that this would significantly reduce the risks and impacts of climate change;

(b) Increasing the ability to adapt to the adverse impacts of climate change and foster climate resilience and low greenhouse gas emissions development, in a manner that does not threaten food production;

(c) Making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development.”

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What Do Scientist Say About Man-Made Global Warming?


 

Richard Lindzen, (Alfred P. Sloan Professor of Meteorology, Department of Earth, Atmospheric and Planetary Sciences, MIT) discusses the beliefs of three groups.  Group 1 are the IPCC scientist that believe that CO2 emissions are causing global warming.  Group 2 are scientist that are typical called skeptic and Group 3 are the politicians, media and environment groups plus some hangers-on’s.

Lindzen asks “where do we really stand on the issue of Global Warming”, and discusses this in the following video:

 

 

 cbdakota

For The Left, The NGOs and The Technical Societies, The Battle Over EPA Regulations Is All About Money


The EPA has been overstepping its authority. This has led to regulations that are unnecessary, burdensome and often not in concert with bills passed by Congress and signed into law by the President. At times, the EPA has been acting as a law making body, which is beyond their authority.  The current Administration intends to correct this situation.

gore-making-money

As the Administration undertakes this task, the Left will mount a campaign intended to defeat the Administrations objestives.  The Left will tell you that the Administration is going to poison your children, make all rivers a sewer, make the air you breathe toxic and Earth will be destroyed by catastrophic climate change. None of which is true.  The media of course will join in and support anything the Left says.  They will report about someone who is supposed to be suffering because of the actions of the Administration. They will ignore the many who are able now make a success of their business as the useless regulations are canceled. The left knows they will miss their opportunity to tax and regulate if the Administration is successful.

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