Energy Independence: Government Should Neither Inhibit Nor Subsidize Any Type of Energy

by Ron Paul

As the economy continues in its downward spiral and talks in Congress about reducing spending have only amounted to political theater, the subject of how the tax code treats energy has become a topic of controversy. Specifically, should we subsidize, enforce mandates, or give tax credits and deductions to industries like ethanol and natural gas? Having a thriving energy market domestically is a good thing and something the government should not hinder. Not only would decreasing our dependence on foreign oil simplify our foreign policy, but it would greatly enhance our anemic economy at home.

Of course, the government should neither inhibit nor subsidize any particular type of energy. While many people agree with that statement, there is much confusion over the difference between government subsidies and tax credits or deductions. The difference is night and day, yet so many times they are all lumped together as evil government handouts. A subsidy IS a government handout. It amounts to the government taking money from the people and giving it to a favored interest. It is the worst sort of market manipulation and it is something I can never support. This kind of government mischief is anathema to the Constitution and the principles of freedom and the free market.

By contrast, with tax credits and deductions, industries, business, and individuals simply get to keep more of the money they have earned. Ideally, the tax code should not be used for social engineering, but, until we have true tax reform, I will always support tax credits and deductions that keep more dollars in the private sector where they are spent, saved, or invested. This means I will support tax credits and deductions for energy producers, farmers, homeschoolers, family child care expenditures, expenses of evacuees from disaster areas, and even adoption expenses. I’ve almost never met a tax cut, deduction, or credit I didn’t like. Any measure that keeps money in the private sector to spend, save or invest, rather than allowing the government to waste or misallocate is a win for the economy.

Inequities in the tax code dealing with tax credits should be solved by giving all participants equal treatment. Removing

I oppose ethanol mandates because I do not think anyone should be forced to use or buy ethanol. Ethanol mandates often serve as corporate welfare for big agriculture ethanol producers. The marketplace should decide whether or not to use ethanol, and producers of ethanol have to discover if they can produce it at a price that makes good business sense. No industry should be allowed to use legislation to create a “market” for its products. The real reason ethanol mandates continue to surface in federal legislation is that agribusiness continues to have one of the most powerful lobbies in Washington.

Furthermore, while I do not support providing federal grants to any industry, I do support the tax credits contained in the NAT Gas Act, HR 1380. These credits reduce taxes for the production or purchase of vehicles that run on American-made natural gas. These credits are not subsidies. Of course, we should repeal federal barriers to energy production and reduce taxes on all forms of energy. Therefore, I have also introduced the Affordable Gas Price Act HR 1102 which would remove governmental barriers to offshore drilling, encourage private investment in new refineries and suspend taxes on gasoline when the price at the pump reaches a certain threshold. Lowering taxes to encourage the domestic production of energy and getting government out of the way of the American energy market is not a government giveaway; it is the way it should be in a free country.


  • ncwdane

    when we do print Money, print it Direct from the press at the mints, Bypass the fed,
    that way we dont borrow it or have to pay it back,
    Kennedy signed exec. order 11110 just before he got assassinated & it was to bypass the fed & have the treasury print our money,
    If we do it that way, get rid of Geithner because he is an employee from the federal reserve & conflict of interest.
    so what if we print mone to pay for elect, cars charged by home solar, so we can travel for free, it saves Army

    • Libertarian777

      Having the fed print money won’t change anything. The fed enables the deficit through purchasing treasuries. You are proposing that we give the treasury unbridled range to print and inflate the money supply even faster? Remember the treasury already debased the dollar even before the fed came along. In fact that was the excuse used to found the fed.

      The treasury’s only role (via congressional approval) as far as money goes in the constitution is to regulate the value of money by regulating the fineness and weight of gold or silver coin. That is to say the faith of the government is that we trust they have attested to the fineness of the gold/ silver coin by weight. This is not to say they should have the power to regulate ‘value’ through legal tender laws.

  • ncwdane

    I Like Ron paul & he is my fav so far by far
    especially cause he wants to Rid the fed,
    we had govt funding for Dams & that has helped America
    if we’re gonna fund education, then we need to fund entrepanurs
    so there is Jobs for those graduates
    our problem isnt stacks of money in peoples living rooms creating inflation like happened in Germany that they had to have a wheelbarrel full of money to buy bread
    crysler got a bail out but the public made profit off there profit

  • midtra52

    Ron is right, it’s just that coal gets sooo many tax credits and deductions that alternative energy cannot compete. They get 0% interest loans from the government which is another form of subsidy. Wind energy doesn’t get the deductions that coal does, they do not get 0% interest loans. Until they do coal will continue to be heavily subsidized. You can’t give one company tax credits and deductions while not doing so for their competitors, this is still a subsidy and Ron need to realize that.

  • thefakeyeti

    This is where I and many others really start to part ways with folks like ron paul..

    If a resident builds a dam on a river, and the river inhibits fish from migrating, ie effects MY part of the river, and puts wild life in danger. The government has every moral right and ground to step in..

    HOWEVER, I think a president would have a better shot at drastically cutting down the military complex, thanthey would of ending the EPA, which I think most americans support…

  • Steve Markinson

    turn of your television america dont be sucked into the propaganda and get the show on the road spread the word about ron paul the time has arrived get the groundswell out there it starts with you as the individual.

    Be the change you want to see in the world vote ron paul

  • Cinemaguy2007

    come on American! let’s bring back the republic! Ron Paul 2012

  • ninjashade411

    If I ever grow up to be a father, I want to be like this man.

    • Michael

      If you follow this man you will never grow up ninja. You’ll always be a silly ninja.

  • PeoplePower

    Independent energy is great idea do it yourself folks & it’s in your total control …

    Ron Paul is revolution make your choice.
    (1) do it yourself & you can do whatever you want total control in your hands.
    (2) Allow someone else to tell you what you can do with your own stuff.

    Go Ron Paul ­čÖé

  • bart666a

    Jesus: this boy is our last hope…

    God: no. there is another..

  • EndTheFedRes

    Every time I watch his vids I learn something.

    Subsidies= Free handouts at the taxpayers expense.
    Tax Credits/Deductions=Keeping more of what you earn.

  • jhunted7667

    the ECONOMY is our Valley Forge and Ron Paul is our General Washington Agree with me then give me a thumbs up

  • jhunted7667

    the ECONOMY is our Valley Forge and Ron Paul is our General Washington

  • jhunted7667

    the ECONOMY is our Vally Forge and Ron Paul is our General Washington

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  • thetimman00

    Individuals freedom first. All else will fall in its place naturally.

  • TheMass33

    I wonder if Ron is a Youtube Partner? LOl.

  • BassGoesBoom1

    Not just government subsidizing or inhibiting energy supplies but also big corporations especially big oil

  • goldeneggify

    Liberate our intelligence and ingenuity… first, do no harm. No long faces. Register Republican and Vote Ron Paul.