Pulped Intentions

The Nation’s Chris Hayes has written a great story illustrating how Washington and environmental policy work together to create wasteful stupidity. 

Thanks to an obscure tax provision, the United States government stands to pay out as much as $8 billion this year to the ten largest paper companies. And get this: even though the money comes from a transportation bill whose manifest intent was to reduce dependence on fossil fuel, paper mills are adding diesel fuel to a process that requires none in order to qualify for the tax credit. In other words, we are paying the industry–handsomely–to use more fossil fuel. “Which is,” as a Goldman Sachs report archly noted, the “opposite of what lawmakers likely had in mind when the tax credit was established.”

What happened?! Read the whole thing. It’s a terrific example of unintended consequences. Chris says, “I’ve come to expect that even nobly conceived laws will be manipulated and distorted for private ends. But once in a while I hear a story that gives me the queasy feeling that I’m nowhere near cynical enough.”

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13 thoughts on “Pulped Intentions

  1. Perhaps if our very well-paid (salary and benefits) representatives thought out the bills that they “craft” for our benefit(?) the original intention of the bills would be realized. But, what with election campaigns always coming up and junkets all over the country and the world for still more research that results in clusterfucks like this, who has the time to research how the money will be spent, let alone read the damn bills?Gosh, term limits would be great. Think it'll ever happen? Nah.

  2. The “Gee Whiz” naivete in “I’ve come to expect that even nobly conceived laws will be manipulated and distorted for private ends. But once in a while I hear a story that gives me the queasy feeling that I’m nowhere near cynical enough.” leaves me at a loss. I suppose it is simply a biological impossibility for folks at The Nation to concede, even after such an epiphany, that such private manipulations of nobly conceived public policies are categorical to the nature of politics. A subsequent epiphany that such private manipulations would be rendered obsolete if there were a significantly less powerful political mechanism to be captured would require a level of deference to reality that the Nation, and certainly its readers have never entertained.

  3. Actually, I fall a little more in love with the MARKET when I hear these idiot tales of woe. For every barrier the government errects in marketplace (even the ones I semi-approve of) the crafty private sector will alway find a way to leap over, around or through it. Just ask my accountant during tax time.

  4. It's not just the paper industry. All industries that generate stuff that can burn (think used french-fry grease) are on the bandwagon. It's what happens when the government thinks it's smarter than the market.

  5. “Most industry leaders would like to keep a low profile on this issue. Unfortunately, we think it is a material enough issue that it will draw attention.” One can only hope. It has, at least, been submitted to Digg.

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  7. As the article says: To take advantage of the situation, the paper companies are runing at full capacity. Something that will drive the price of paper down. Now, since the process requires freshly cut pulp timber that means more tree farms are being harvested to feed the process. And, since the process requires wood and can not be carried out using recycled paper, the price of recycling just comparitively more expensive. No wonder recyling is a losing proposition.

  8. My husband works for a paper mill takng advantage of this credit. They are NOT running at full capacity. Note the numbers in the article. The amount of the subsidy does not make up for the business losses. No one is building right now, and as silly (and likely temporary) as this subsidy is, rest assured that they are not cranking out lumber/paper products that no one is buying in order to take advantage of a tax credit that won't make up for their losses.

  9. Actually, I fall a little more in love with the MARKET when I hear these idiot tales of woe. For every barrier the government errects in marketplace (even the ones I semi-approve of) the crafty private sector will alway find a way to leap over, around or through it. Just ask my accountant during tax time.

  10. Actually, I fall a little more in love with the MARKET when I hear these idiot tales of woe. For every barrier the government errects in marketplace (even the ones I semi-approve of) the crafty private sector will alway find a way to leap over, around or through it. Just ask my accountant during tax time.

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