How DUMB can US voters be?

Again, just Billy acting like this is a big deal.

It's not.

They are in fact reasonable, because oil and natural gas are assets which get depleted and so they only apply to reducing taxable income associated with production of oil or gas, but not for the transportation, refining or retailing of the refined products (which is where a great deal of those profits that Billy mentioned actually come from).

To put the magnitude of these depletion allowances in perspective, they apply to oil and gas, but if we just applied it to OIL alone, it wouln't raise the price of a gallon of oil by but 1.4 cents. If applied to both oil and gas use however, the impact wouldn't change the price we pay for gasoline by even 1 cent a gallon.

When these subsidies are removed then we will then pay for them at the pump, instead of through our taxes. Since almost all tax payers also drive or buy things which are shipped via truck or use NG to cook and heat water with, the actual impact (which is tiny anyway) will be pretty much a wash for most people, though by not providing this incentive to drill via our PROGRESSIVE tax system, it will end up being paid, just more regressively.

adoucette said:

... They are in fact reasonable, because oil and natural gas are assets which get depleted ...

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I asked why a special "depletion allowance" break only for big oil and mines, when others, much more in need, get none. For example the older manual laborer loses much of his muscular strength. - What is the logical justification for treating this depletion differently? You ignored that question. Or if only very high income (and thus larger taxes paid) is why a tax break exists, then why not for top NFL quater backs - Their skill are rapidly depleted in part by injury and in part by growing older. Again what is the logical basis for government treating real people more badly than rich corporations?

adoucette said:

... Billy acting like this is a big deal. It's not. {depletion allowances} only apply to reducing taxable income associated with production of oil or gas, but not for the transportation, refining or retailing of the refined products (which is where a great deal of those profits that Billy mentioned actually come from)...

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True, but article of my post said there were seven other special tax breaks big oil gets.

Also your arguement (which I don´t buy) that it is a wash as if Big oil had to pay more in taxes, then gasoline would have higher costs neglects the fact that higher gas costs would be a desirable signal in the market place as it would encouraging other choices. Making it mandatory that we pay taxes to give big oil this break kills that market place signal. I.e. is just one more example of "big brother knows best." - will tell you what to buy. Much like giving $7,500 to buyers of EVs or hundreds of other ways the government tilts the economic playing field to favor what it knows is best for us. Let the invisible hand of Adam Smith determine what is offfered for sale, not some USSR style central planning government deciding what you should buy.

Most serious of this hidden central planning (and main cause of current economic crsis) is big brother´s idea that all should be home owners, not renters. (The mortgage interest deduction in you itemized 1040 is well disguised "central planning.")

The US would be much better off now if the cost of gas had been higher decades ago. The depletion allowance and the seven other tax breaks for big oil have really hurt the US. - Hooked it on big oil tit, just as big oil wanted. So yes, it is a "big deal." And it is your argument that it is not, is what is false.

GET THE GOVERNMENT OUT OF THE BUSINESS OF DETERMING OR BIASING WHAT IS IN THE MARKET PLACE.

Billy T said:

I asked why a special "depletion allowance" break only for big oil and mines, when others, much more in need, get none. For example the older manual laborer loses much of muscular strength - What is the logical justification for treating this depletion differently? You ignored that question. Or if only very high income (and thus larger taxes paid) is why big NFL quater back - His skill are rapidly depleted in part by injury and in part by growing older. Again what is the logical basis for government treating real people more badly than rich corporations?

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Nothing really, except that depreciation has normally only been used against business assets. Unlike businesses, we get to retire. Oil is not unlike other businesses that get to depreciate assets that get used up.

True, but article of my post said there were seven other special tax breaks big oil get.

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Yes, and so I used the SUM of them, at $4.4 billion per year.

eight different tax break programs that the Office of Management and Budget estimates will cost U.S. taxpayers $44 billion over the next decade

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Billy T said:

Also your arguement (which I don´t buy) that it is a wash as if Big oil had to pay more in taxes gasoline would be higher neglects the fact that higher gas cost would be asignal in the market place, encouraging other choice. Making it mandatory that we pay taxes to give big oil this break kills that signal.

Click to expand...

Except when the signal is LESS THAN 1 CENT per gallon it is not really a signal at all, it's just a bit of spurious noise.

I.e. is just one more example of "big brother knows best." - will tell you what to buy. Much like giving $7,500 to buyers of EVs or hundreds of other ways the government tilts the economic playing field to favor what it knows is best for us. Let the invisible hand of Adam Smith determine what is offfered for sale, not some USSR style central planning government deciding what you should buy.

Click to expand...

Yes Billy, but comparing the impact on consumers to a $7,500 govt subsidy to buy an EV to a less than 1c impact on a gallon of gas (less than $5 year to someone driving a car that gets 30 mpg and 16,000 miles per year) is just SILLY.

The US would be much better off now if the cost of gas had been higher decades ago. The depletion allowanc and the seven other tax breaks for big oil have really hurt the US.

Click to expand...

No they haven't Billy, their total cost is way too small to have any significant negative impact and on the plus side they have theoretically at least, encouraged drilling and thus helped to reduce imports.

To adoucette

You seems to be arguing that the small increase in gasoline costs that no special tax break for big oil would have made would have had NO effect on car designs or buyer´s choices, even if steadily acting for decades. - There is no reason to believe that. In fact evolution proves that idea wrong with much smaller differences action for much longer times.

Small percentage difference can have large and immediate effects upon buyer´s choices. For example if there are two 10 pound bags of sugar in the grocery store and one is a penny cheaper, it will out sell the other.

In real terms, compared to annual salaries, the increases in gasoline prices have been very samll and yet are transforming the cars being offered for sale.

Again there is no reason to believe your false argument that a relatively small increase in the cost of gasloine make no difference in buyer choices or what car makers offer for sale.

Why is it that your posts are never critical of large financial interests, even when they pay bribes to Congressment via their lobbists? Are you employeed by the American Association of Manufactures or of Commerce?


BTW, your just now deleted Post correctly noted that the US exports consideral corn based alcohol to Brazil. I will tell you why:

Brazil does not drive up the cost of its food supply by diverting more than 1/3 of the corn crop to alcohol production. We keep the cost of food low and take advantage of dumb American voters selling us subsidized (by their tax dollars) lower cost alcohol.

Billy T said:

To adoucette

You seems to be arguing that the small increase in gasoline costs that no special tax break for big oil would have made would have had NO effect on car designs or buyer´s choices, even if steadily acting for decades. - There is no reason to believe that. In fact evolution proves that idea wrong with much smaller differences action for much longer times.

Click to expand...

Evolution doesn't prove that wrong at all.

Indeed the incredibly slow pace of evolution shows HOW FRIGGING LONG it takes for such a TEENY TINY push to have any impact.

No one is making a $25,000+ car buying decision based on the difference of a fraction of a cent per gallon Billy, an amount which adds up to less than $5 per year.

Try to be realistic Billy.

Billy T said:

Again there is no reason to believe your false argument that a relatively small increase in the cost of gasloine make no difference in buyer choices or what car makers offer for sale.

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No Billy, not a "relatively small increase", we are talking about an increase that is LESS THEN 1 CENT per gallon.

That isn't even in the realm of being relatively small.

A 3% increase might be considered "relatively small", and that would be over a dime a gallon.

Which is why the best selling vehicle last month, even with gas near $4/gallon was a large truck, and the other top sellers were good size sedans followed by GM's large truck.

Vehicle February 2012 Sales

1. Ford F-Series 47,273
2. Toyota Camry 34,542
3. Nissan Altima 32,953
4. Chevrolet Silverado 32,297

In contrast, Leaf sales in Feb were just a piddly 468 and that's with a $7,500 govt subsidy.

Billy T said:

To adoucette

Why is it that your posts are never critical of large financial interests, even when they pay bribes to Congressment via their lobbists? Are you employeed by the American Association of Manufactures or of Commerce?

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Well you've never posted any info about actual bribes, but regardless, I'm against them.

But I'm in favor of allowing businesses to depreciate assets they spend capital on, as it encourages investment.

I'm in the Software business, and without our ability to depreciate the huge upfront costs that we have to sink to develop new systems, a lot fewer systems would ever get built.

adoucette said:

...
No one is making a $25,000+ car buying decision based on the difference of a fraction of a cent per gallon Billy, an amount which adds up to less than $5 per year. ...

Click to expand...

adoucette said:

.... When these subsidies are removed then we will then pay for them at the pump, instead of through our taxes. ...

Click to expand...

In top quote you argue the cost increase is insignificant. In bottom post you argue that killing these special tax breaks big oil gets would drive up the price we pay for gas at the pump.

Which way is it?

But again even small cost differences do influence the buyer´s decisions. I will not search to find how the ratio of the cost in gasoline to dive 10,000 miles has changed compared to the average salary during the last decades but doubt there has been any significate increase in that ratio yet cars have drastically changed to become more efficient.

Your argument that small increments of driving cost as percent of your income, if any, would have no effect on car designs offered or buyer´s choice, leads to the false conclusion that the gas hog boats that once were large part of the US fleet should NOT have become extinct.

You can offer no proof, or even a plausible reason why a higher cost of gasoline decades ago, would not have given the US a more fuel efficient fleet. Smaller cars more like it did for the Europeans and many others. I am not saying that the increase in cost of gasoline due to big oil not getting its tax breaks would increase the cost of gasoline to European levels, but it would have been a step in that direction.

It is interesting to see / hear all the Republican candidates promissing to do exactly the wrong thing about the price of gasoline. A demonstration of their great leadership abilities. Little wonder they also want big oil to keep its tax breaks - perhaps giving big oil even greater tax breaks is how they plan to lower the cost at the pump of gasoline.

Billy T said:

In top quote you argue the cost increase is insignificant. In bottom post you argue that killing these special tax breaks big oil gets would drive up the price we pay for gas at the pump.

Which way is it?

Click to expand...

It's both Billy.
If you cut the tax break we will see the cost increase in the price we pay at the pump.
The price increase will however be less than 1c per gallon.

But again even small cost differences do influence the buyer´s decisions. I will not search to find how the ratio of the cost in gasoline to dive 10,000 miles has changed compared to the average salary during the last decades but doubt there has been any significate increase in that ratio yet cars have drastically changed to become more efficient.

Click to expand...

Well there were a lot of factors Billy, but adjusted for inflation, gas was about $2 a gallon in 1970, so yes it has increased quite a bit.
But also people are driving many more miles per year now, so you have to multiply the increased price by the increased daily mileage, and then the number of cars per person went up, so many more households were operating two or more cars, which was also a big factor in the demand for higher milage vehicles, but even that wasn't enough, people still picked bigger cars, so the Govt FORCED people to higher mileage cars with "guzzler taxes" and with ever increasing CAFE standards.

Your argument that small increments of driving cost as percent of your income, if any, would have no effect on car designs offered or buyer´s choice,

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And that's NOT my argument.
I said an increment of LESS THAN 1 Cent/Gallon would have no impact.

Sure, if we were talking the several dollars or more per gallon that is nominally paid in the EU, then of course it will have an impact over time, but that increase is several HUNDRED times as large as what we are discussing, and still, even with the much higher prices paid in the EU, the cars we drive are really not all that different from the ones they drive, indeed it has more to do with the distances and commutes over there being smaller, narrower streets and parking spots being harder to find etc.

adoucette said:

... The price increase will however be less than 1c per gallon. ...

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how is that possible since the price of gas is always XXX.99 dollars per gallon? I.e. the fraction of a cent is always 0.99

You're kidding, right?

http://email.angelnexus.com/hostedemail/email.htm?CID=14610964031&ch=6B06D0B4DF5A3D532F27238F88541448&h=8358472236475456e22a38ec667ae209&ei=WHO1-_kNj said:

Five years ago, the U.S. commanded 60% of the global corn market. Today the U.S. market share has fallen to less than 30%. And as a reminder, gas prices are at $4.00/gallon.

The high price of food has led to serious shortages in emerging markets. Egypt is on the verge of a counterrevolution. Millions will starve to death around the world because of senators in Iowa and 27 other states who want ethanol boondoggles.

At the same time, the U.S. will have less leverage to influence the ongoing political transformation because the global corn market is being over taken by Brazil, Argentina, and the Ukraine — countries that don't stick their food in their cars, and thus have it available for export.

Furthermore, the U.S. will be blamed for high food prices and staving children. The United Nations has warned, “World grain reserves are so dangerously low that severe weather in the United States or other food-exporting countries could trigger a major hunger crisis next year.”

Emerging market food shortages will increase Al-Qaeda membership, which in turn will lead to more attacks on Americans.

Back at home, the middle class is paying more for food and gas. This has a direct impact on disposable income and will delay the economic recovery.

Click to expand...

As pointed out earlier (in quotes from Nobel Price winning soil bio-chemist) in this thread, making alcohol from Iowa corn makes more pollution than cars running on natural gas, which now would be cheaper with no government subsidy required. The stupid corn to alcohol program started this thread and as they years have passed it has become and ever dumber idea, but not killed as Senator Glasser, of Iowa, is head of the Senate´s "ways and means" committee.

Iowa´s short growing season requires a lot of nitrogen fertilizer to speed corn´s growth. Micro-organism in the soil convert much of it into NOx, which is not only a powerful GHG but aslo a serious health hazard in many cities - a key part of "photo-chemical smog." When tropical sugar cane is used to make alcohol, little or no Nitrogen fertilizer is needed, but some is typically used to increase the sugar yield per acre, not to speed growth in the tropics where it can grow all year long, but does have most harvested in the fall.

Less dumb than they were, now

Republics/Democracies have inherent flaws.

If a Candidate told voters truthfully that he would need to increase fuel prices by 25% but that they would never rise again for 100 years would lose over a Candidate that truthfully says I will keep fuel costs the same but in 10 years they will double.

No long term philosophies can occur in governments with such short terms.

I'd start by making a Presidential term at least 6 years, with 4 terms maximum. We could've stood a few more terms of Reagan.

kwhilborn said:

... No long term philosophies can occur in governments with such short terms.
I'd start by making a Presidential term at least 6 years, with 4 terms maximum. ...

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I don't think that would make much difference for two reason:
(1) Most of US problem come from Congress, not the sector that administrates the laws they pass (or copes with their failure to pass).
(2) More fundamentally most of US problems stem from local funding of pre-college schools. - Poor neighborhoods produce mainly poorly educated graduates, who understand little of economics or history, and little of math and sciences, so are:
(a) Not employable in modern world that must compete with nations that do educate all their students much better in math and sciences (and give them ALL essentially free health care, so they stay healthy, productive, self-supporting longer).
(b) Are easily lead by those who can pay the most for TV sound bites and vote for candidates who promises the most "goodies" now with bills sent to generations not yet born, who cannot vote to protect themselves from the growing “unpayable” debts.

SUMMARY: "Poor education" is the main reason why US has several times higher percent of its population either in prisons and on food stamps, both of which strain the budgets - block more productive government investments.

Virginia On Deck

Billy T said:

Less dumb than they were, now

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Well, we'll see. There's a big election in Virginia this year, which will have some predictive suggestion toward 2014.

If the Republican ticket wins, that's bad news in terms of voter intelligence. No, really, that's how insanely extreme it is up there, between Attorney General Ultrasound, who is investigating Governor Ultrasound while also finding himself exposed in the alleged corruption. He's running for governor. To replace him as AG, the Republicans picked a state representative who wants to force women, under law, to report miscarriages and potential miscarriages to police. They selected for Lieutenant Governor a preacher who is beyond merely insane, and can't even spell the word "commandment" properly on his own damn book cover. And if that wasn't enough, they figured it was a good idea to hire as their point man for engaging African American voters a black reverend who agrees with Pat Robertson that the black people in Haiti got nothing more than they deserved in the 2010 earthquake.

It's incredible. In a year when the great threat to the Republican Party is the growing distance between its right wing and the average voter, the Virginia GOP called off its primaries, invoked a convention, and hand-picked a slate so far to the right that not only could it not survive outside the South, there is serious question in the broader political punditry and commentariat whether the Old Dominion Republicans can actually win.

To the other, it's Virginia. It's one of those places where this sort of ticket might actually win. It seems a tremendous risk, but the point is apparently to prove that the GOP is still a national party. Because, you know, what plays in Pittsylvania is so clearly indicative of how things will go in the Seattle. Or something like that.

A victory in Virginia will see the hardline right harden even more in the run up to November, 2014.

That is to say, there are some excellent tests coming up by which we might gauge just how stupid American voters can get.

As to the congressional approval numbers, one wonders at what point people will actually start voting for a different breed of politician.

kwhilborn said:

Republics/Democracies have inherent flaws.

If a Candidate told voters truthfully that he would need to increase fuel prices by 25% but that they would never rise again for 100 years would lose over a Candidate that truthfully says I will keep fuel costs the same but in 10 years they will double.

No long term philosophies can occur in governments with such short terms.

I'd start by making a Presidential term at least 6 years, with 4 terms maximum. We could've stood a few more terms of Reagan.

Click to expand...

no we couldn't have

@ Billy T,

America will not stand for a Government that would support Global warming initiatives like Kyoto.

That is an example.

They would rather have lower taxes for a few years even if it means they will all die off in 50 years.

This is of course, an exaggeration, but the point is made.

In a Republic people will go for the short term good. They will vote for whoever gives them the lowest taxes even if they cannot breathe the air in their cities.

Also...

You make the point of spending a lot of education equally among students to ensure they are all intelligent. Would it not be cheaper and smarter to look for achievers early on and separate them from the future garbage men. The world needs garbage men as well and they should not all require advanced educations.

I am all for educating those willing to learn, but this is not always the case.

@ pjdude1219,
Spoken like an Air Traffic Controller.

kwhilborn said:

@ Billy T, ...(1) You make the point of spending a lot of education equally among students to ensure they are all intelligent. (2) Would it not be cheaper and smarter to look for achievers early on and separate them from the future garbage men. (3)The world needs garbage men as well and they should not all require advanced educations. (4) I am all for educating those willing to learn, but this is not always the case...

Click to expand...

On (1) spending more can only offer more people a better education, not make a "dumb bunny" intelligent. I think less than half the population needs or should go to college IF pre-college schools were much better.
On (3) Yes, and not only garbage men, but all sorts of repairmen, like plumbers, and artists etc. too. The social pressure for all to go to college is a big mistake - most should go to trade schools* and learn how to fill the many jobs we need that don't need a college deducation or if so inclided, start their own businesses immediately after graduation from a good highschool. US society rams too many square pegs into round college holes to the deteriment of all, especially those socially forced to go to college when they would rather not.

On (2) There are too many "late bloomers" like Einstein, for early elimination. Let the people chose /decide if they like learning things taught in college or not. Likewise quite a few of the "early bloomers" don't do well in college.
On (4) I agree, strongly. One of most unhappy students I knew when at college was their only because his MD dad demanded it. After a couple of suicide attemps, he just disappeared.

* For a few, college can be a "trade school." The dad of one of my good friends in high school sent him to the state college with the instructions: Party all you can, make lots of friends, but don't bust out. (His dad owned a small life insurance company.) My dad's instructions to me were: Sit in hard chair in back of the room. Keep your mouth shut and ears open. Don't lose your full scholarship. (We were poor and I keep it. In fact I never paid a dime for education thru the Ph. D. I worked for my meals cleaning dishes mainly as an undergrad and as assistent teacher as Grad student.)

@ Billy T,
It sounds like we were in complete agreement here, although your expanded version provided more detail. I am of course supportive of those wishing to retrain or educate later in life.

You suggest flaws in our system of Government, but you have not suggested solutions. I have suggested that longer terms be allowable for Presidents, and you point out it is also Congress. What should we do?

Obviously we must alter democracy as I doubt Marxist philosophies are on the table.

Criticism should come with (at least) suggestions or hints of solutions even if totally wrong.

Maybe an organization can get 20% of our taxes and use it to target unpopular public issues without danger of being shut down. Have it so they do not answer to our government but the world stage, so things like Global Warming can be addressed. This is not a great idea, but it is at last an idea.

We could have votes based on IQ or knowledge, but that could open a lot of ugly doors and is not feasible.