TAX WHAT YOU DON'T WANT:

[O]ne of the hardest hit sectors in the U.S. is the energy sector as it experiences the double blows of the Chinese coronavirus and the flooding of the oil market by Russia and Saudi Arabia, a move that has driven oil prices down while those nations fight for market share with the United States. So while demand is down, prices are also down.

To add to this problematic situation, small and large U.S. refineries are getting punished under an unrealistic Renewable Fuel Standard mandate. So in the middle of an economic downturn, as our energy sector is under tremendous stress, we are continuing the madness of unnecessary regulations on a key aspect of our economy (one that should also be considered a national security issue). These RFS mandates imposed on this core industry in America impose a heavy cost of RFS compliance credits (RINs) that is then draining cash from American-owned businesses at a time when draining cash can, and actually may, lead to bankruptcy.

How did we even get to this point? The RFS goes back to the 1970s when Americans were worried about running out of gasoline. Mario Loyola wrote in The Atlantic on Nov. 23, 2019, "With experts warning that the world was quickly running out of oil, the shocks of '73 and '79 led President Jimmy Carter to call for wartime-style rationing of fuel and other draconian measures to avoid a 'national catastrophe.'" This fear resulted in a corn subsidy and not much more. Then in 2005, the Energy Policy Act mandated renewable fuels be blended with gasoline.  According to a 2019 report from The Heritage Foundation, "to wean America off of its alleged dependence on foreign oil, President George W. Bush signed" legislation which "mandated that fuel suppliers blend renewable fuels into America's gasoline supply." The law didn't really do that but instead increased the blend of renewable fuels each year and set ridiculous targets.

Tweet   @brothersjudd