Stimulus, Tax Reform, and Incandescent Light Bulbs

Stimulus & Deficits

In the Richmond-Times Dispatch editorial, “The Recovery Act Worked,” Michael Cassidy wrongly denies that the $800 billion stimulus package “will make the federal deficit worse.” 

CEI’s Counsel for Special Projects Hans Bader points out that, according to the CBO, the stimulus will shrink the economy “in the long run.”

“In the short run, the CBO claimed the impact of the stimulus was positive. But that conclusion was based on economic theory, not real-world data. The CBO did not take into account how regulations in the stimulus package destroyed jobs in America’s export sector. Nor did it take into account how 79 percent of the stimulus package’s green jobs funding went to foreign firms.“

Tax Reform

Barack Obama has recently proposed a tax write-off for businesses.

CEI’s Senior Fellow Chris Horner explains why this new tax policy may actually reduce carbon emissions.

“President Obama’s imminent proposal to allow businesses to expense capital equipment through the end of next year is something my colleagues at CEI — particularly Marlo Lewis — have been advocating for some time. Not as “stimulus” (though it should have some stimulative effect — if not enough of one to overcome the negative effect of Obama’s refusal to maintain current income-tax rates in 2011). But as an emissions-reduction scheme.“

Incandescent Light Bulbs

The last major US factory making incandescent light bulbs is closing this month.

CEI’s General Counsel Sam Kazman argued last year against the government’s decision to ban incandescent bulbs.  He referenced a 1980s town in Iowa that gave out 18,000 free fluorescents in an effort to conserve electricity.  The plan to save energy did not work.

“Despite the fact that over half of the town’s households participated, electricity use actually rose by 8 percent. Once people realized they could keep their lights on at lower cost, they kept them on longer.”