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Rep. Tim Huelskamp: Wind subsidy is corporate welfare, distorts market

  • Published Friday, Nov. 30, 2012, at 4:10 p.m.
  • Updated Friday, Nov. 30, 2012, at 4:10 p.m.

Democrats (sometimes accurately) accuse Republican leadership of prioritizing the interests of corporate America ahead of the average person. Republicans (often rightfully) criticize the Obama administration for expensive “investments” in the private sector that yield negative returns for taxpayers.

But when it comes to energy subsidies, politicians on each side of the aisle embrace their characterization of the other: Republicans are willing to distort free markets, and Democrats are willing to defend corporations.

This is reflected in the bipartisan supporters of extending – once again – the massive taxpayer subsidy for the wind-energy industry.

A one-year extension of this 20-year-old “tax credit” carries a total price tag of $12 billion. According to the industry’s own estimates, not extending it for one year will result in 37,000 jobs lost. That amounts to roughly $324,000 in taxpayer subsidy per job. And this wind subsidy is 86 times greater per unit than subsidies for oil, gas and coal. (I’d like to see those gone, too, by the way.)

Budgeting is always about priorities, particularly so when America is already $16 trillion in debt. Are we going to hand out $12 billion propping up a private industry that should stand on its own after 20 years of massive taxpayer support? Or should we instead use that $12 billion for another year of the school-lunch program?

Contrary to the claims made by well-paid lobbyists, this is no infant industry still in incubation. While the subsidy goes to the wind farms that produce the energy, the loudest supporters are the large manufacturers who produce turbines and other related equipment.

Siemens, which has threatened to lay off workers in Kansas if the tax subsidy is not extended, is a $100 billion global corporation. General Electric, another big player in the wind-product business, is even larger. These companies have enormous legal and accounting departments that should be smart enough to know that Washington cannot keep spending and borrowing forever.

Businesses such as Siemens and GE get to reap the rewards of success when they make smart decisions. But they should also suffer the consequences of bad decisions. If this is a profitable industry, then they will find a way to survive without massive taxpayer subsidies. If they cannot, then they and taxpayers should not be in the business.

Republicans and Democrats alike should not be tricked into ignoring the principles for which they typically stand just so big businesses do not have to evaluate and improve their own practices. We need more of all types of market-competitive energy, and we cannot afford a massive, market-distorting $12 billion subsidy for an industry that should be profitable by now.

Tim Huelskamp is a Republican member of Congress from Fowler.

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