Termination Fees, Windfall Profits and a Federal Wilderness Land-Grab
The Federal Communications Commission holds a hearing to investigate “termination fees” for customers who cancel their cell phone, cable or Internet contracts early.
Senate Republicans block efforts by Democrats to impose a windfall profits tax on the nation’s largest oil companies.
The House of Representatives passes bills that will lock up hundreds of thousands of additional acres of federal lands from productive uses.
1. CONSUMER
The Federal Communications Commission holds a hearing to investigate “termination fees” for customers who cancel their cell phone, cable or Internet contracts early.
CEI Expert Available to Comment: Research Associate Ryan Radia on why termination fees in telecom contracts are no different from those for any other product:
“Despite intensifying opposition to early termination fees, these fees are really nothing new. Aside from telecom services, consumers have long had the choice of signing long-term contracts that involve early cancellation charges. Renters typically sign 12-month apartment leases, and are usually required to pay a breakage fee if they back out of their lease early. Similar contract clauses are often found in fitness center memberships and automobile leases. Are all these incarnations of early termination fees fair game for government regulation, too?”
2. TAXES
Senate Republicans block efforts by Democrats to impose a windfall profits tax on the nation’s largest oil companies.
CEI Expert Available to Comment: Senior Fellow Marlo Lewis on the economic track record of the windfall profits tax:
“According to the Congressional Research Service, the ‘windfall profits’ tax Congress enacted in 1980 diverted $79 billion from potential investment in energy infrastructure, reduced domestic oil production by as much as 6 percent, and increased petroleum imports by as much as 16 percent. When oil prices fell in the mid-1980s, the tax cost more to administer than it generated in revenues. History suggests that a new ‘windfall profits’ tax would similarly discourage investment in energy production, increase oil imports as a share of total consumption, and produce less revenue than anticipated. Those who decry America’s growing ‘dependence’ on foreign oil have no business touting “windfall profits” taxes, which are a proven means to increase oil imports at the expense of domestic production.”
3. CONGRESS
The House of Representatives passes bills that will lock up hundreds of thousands of additional acres of federal lands from productive uses.
CEI Expert Available to Comment: Adjunct Analyst R.J. Smith on the problems with ever-expanding wilderness designations:
“The National Wilderness System already includes over 104,000,000 acres of land—that is an area larger than the entire state of California—most of which has never been inventoried for vital minerals or energy reserves, and is now locked up forever. It can only be used by a tiny percentage of the population as all mechanized equipment is forbidden—including for rescue operations. The unmanaged forests are the source for insect infestations and disease and uncontrollable forest fires. And we keep creating more and more.”
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FOR MORE INFORMATION
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