Well, there he goes again. Yesterday Biden went on a tirade about oil and gas company record profits – that’s what happens when you restrict supply – and so now he wants to impose a tax on their “windfall profits.”
Um, Joe, hello. You’re the one who created these high profits by restricting the supply of oil and gas companies.
This tax scheme was tried, of course, disastrously by Jimmy Carter back in 1980 during America’s previous energy crisis.
The tax raised 20% of its projected revenue, and less than half of *that* was net revenue. Worse, it caused:
- an eight percent reduction in domestic oil production until the tax was repealed by Reagan
- a spike in the price of oil and gas at the pump
- a major increase in imported oil from OPEC nations
Other than that the policy was a complete success.
Here’s the definitive report on it from the Congressional Research Service:
Fortunately, there are only 18 US Senators on board with this terrible idea, which would require legislation. Three of them are presently running for re-election: Michael Bennet, Richard Blumenthal, and Raphael Warnock.