As I informed you 3 weeks ago the gasoline prices are on their way to $2.00 a gallon national average before Obama takes office in January. November 4 will put us at $3.00/gallon or a little better as a national average. Multinational oil companies have a target of $2.00/ gallon by Jan 2009 inauguration day. As I mentioned earlier they have made trillions and their cash coffers are full. The only way to keep us hooked is to make gas “cheap” again (in relative terms) which they hope will make us forget about Wind, Solar. and alternative fuels. It worked in the mid 80’s, when government abandoned research in wind, solar, and alternative fuels after asserting the US was going for independence from foreign oil, because gas was below $.89 a gallon. At that time oil companies took their profits and invested in large land holdings, because home and land prices had plummeted . . . . ..sound familiar. Between 1997 and 2006 they sold most of their land holdings for substantial profits . .and the cycle starts again.
My former colleagues in the oil industry assure me the plan is still in tact. There will be ups and downs on the way, but that’s the only way to not be so obvious in price control through the futures market.
Since a lot of money is made on heating oil in the winter, they plan on making up any “loss” by charging more for heating oil. Listen to the news. They are already setting the northern states up by “leaking” news that home heating prices may be up 15-20% this winter, even though crude oil prices will be substantially lower than last winter.
Big oil got scared when the Democrats in Congress stopped purchasing oil for the Strategic Reserve and that is when the speculators made their last hurrah seeing oil spike one last time before starting the recent decline. The halting of purchases has had the accumulative affect of adding 2 days of inventory to the United States gasoline reserves. By January 1, it will add 4 days of inventory to the national gasoline reserves. At that time we will start to purchase for our national oil reserves again.
The public outcry for alternative sources of energy must be stopped to preserve the U.S. dependency on oil, which is the plan of Big oil. Gasoline could be manipulated to $1.49 to force out independents and keep us dependent by making alternative sources “too expensive”.
Posted in 2008, Alternative fuels, democrat, economic recovery, ECONOMICS, foreign oil, Gas Prices Going to go Down, gasoline prices, income tax, investment, national debt, OBAMA, oil, savings, TAX REFORM, Uncategorized
Tagged 2009, alternative energy, Alternative fuels, congress, gasoline prices, heating oil, oil, oil futures, oil industry, Oil Prices, Solar, Wind energy
Here is the proposed Democrat plan for economic recovery in this election cycle. this was initially intiated by my recommendations starting back in April 2008.
- The American Manufacturing Credit – 5% non refundable tax credit on all capital equipment purchases for new manufacturing, refining, and mining facilities built in the US or its possessions. An additional 5% Credit for all purchases of “American made” products for building or refurbishing closed facilities. ( sunset clause 2015) (this will benefit companies producing vehicles in US and provide jobs in auto industry, so they can convert to new fuels and more fuel efficient vehicles) A 50% write off the first year of “placed in service” equipment. Balance written off over next 2 years. A tax exemption for US based companies that repatriate their profits to the US to benefit from this provision. This will also help stop the purchase of US companies by foreign interests.
Global Warming Reduction Act. A 50% write off the first year of “placed in service” pollution control equipment to support clean coal energy. Balance written off over next 2 years. Upper limit subject to $50 million of pollution equipment per facility. Make interest tax exempt for bonds floated by states,municipalities, or the federal governament for funding private companies for pollution control improvements within their jurisdiction with federal guarantee to state and municipalities. (This is in addition to the AMC above, sunset clause 2014.)
Home Purchase Credit – The up to $5000 Home Buyer Tax Credit is provided as a federal income tax credit to first-time buyers who meet the maximum income limits. (This was made available to Washington DC Home Buyers through the Federal Tax Relief Act of 1997 and should be implemented throughout the nation.) This should have a sunset of December 2011. ( this is same type credit I created in 1974 (Principal Home Tax Credit) to get credit worthy citizens to buy homes.) The one passed recently is simply wrong, it is not a tax credit, its a loan. The housing industry will fall deeper into depression unless the D.C. Type credit is implemented.
Iraq War Debt Reduction Act – 10% surtax on personal and corporate net taxable income over $250,000 and an additional 5% surtax on salary and exercised stock option income and non deferred compensation over 2 million per year. Sunset expiration 10 years after implementation. ( this has to be same for individuals Schedule C and Corporate to be fair to unincorporated business.) (those who benefit the most from a capitalistic system that fights for freedom with soldiers lifes and public funds should pay the most since they benefit the most)
Savings and Investment Provision – The first $2000 of dividends and $2000 of interest annually will be exempt from federal income tax. For those over 65 it will increase to $4000. (Obviously to increase and sustain the savings rate in America)
Capital Gains and Losses Equity Provision – 1) Capital gains tax would stay the same with a 19% tax on gains exceeding $250,000 annually. 2) Annual capital losses against other income would not be limited to the current $3000, but would be one million dollars. Capital losses on the sale of a principal residence would be allowed, but subject to a $10000 annual write off with carryover provisions. ( to assist those losing money when foreclosed on homes.
Alternative Energy Development Provision – A) 3 year Phase out of the current provisions subsidizing ethanol. Allow purchase of “loss” from alternative Fuel companies, when profitable companies buy them out and continue alternative fuel research for at least 10 years. ( Solar, Fuel Cell, Electric,Wind, Geothermal). Elimination of all Tax credits/subsidies to Oil and Gas Exploration and Production companies but allow Oil companies to buy up these companies with losses. Expires 2025. (B) Foreign Oil Import Tax of $2.00bbl. The oil from North, Central and South America NAFTA partners and Iraq would be exempt. This provides protection for the small oil operators “wildcatters” that find most of the new domestic oil and natural gas fields.
Alternative vehicle fuels provision – Government will convert all vehicles weighing over 8000 pounds to propane. Business and individuals will get a 100% write off of conversion costs, State and municipalities will receive federal grants for 80% of the cost to convert or 10% of cost of new propane driven buses, garbage trucks, and like vehicles.Restore the expired tax credits relative to alternative fuel driven vehicles, ie hybrids, expires 2020.
Oil and Gas Exploration provision – Allow the drilling on currently restricted offshore federal leases based on the usage of the existing federal leases currently idle. Allow 10 exploratory wells to be drilled on offshore restricted land for each successful completion of a new well (after 1/1/2008) on existing federal leases onshore. All new offshore oil produced must go to US refineries. Expires 2025.
The windfall profits tax should be avoided. It is too complicated, requires too big of an addition to federal government to oversee, and does not provide the tool to keep foreign oil more expensive than oil from the Americas and Iraq. A tariff on foreign oil is the right thing to do at this time with no sunset clause. We import 3 times the oil as we did when I recommended it(windfall profits tax) in the 1980’s. It was made so complicated by the Washington insiders it was only particially effective.
Sunset clauses are important to get capital to move to the targeted markets in a timely fashion, while other provisions provide tax revenue. With an expiration date that requires prompt planning and adequate time to implement moves capital where it is needed.
Posted in 2008, democrat, economic recovery, ECONOMICS, foreign oil, income tax, investment, OBAMA, savings, TAX REFORM
Tagged 1974, alternative energy, barack obama, capital gains, CLINTON, DEMOCRATS, ECONOMICS, FEDERAL TAX CODE, Federal Tax Relief Act of 1997, Fuel Cell, global warming, iraq, Iraq war, MCCAIN, NAFTA, national debt, natural gas, OBAMA, offshore drilling, oil exploration, oil refineries, politics, pollution control, Principal Home Tax Credit, public funds, refineries, republican, solar power, TAX, TAX INCREASE, TAX REFORM, wind, Wind energy