Some GOP House Members may see no problem in pushing H.R. 1380, the Boonedoggle, Pickens-Your-Pocket Bill, which would hand out tax credits up to $64,000 apiece for the purchase of natural gas vehicles, because, after all, chief beneficiary T. Boone Pickens is a major donor to Republican candidates.

According to Investor’s Business Daily, however, H.R. 1380 would also confer windfall profits on the Left’s patron-in-chief, billionaire George Soros. IBD explains:

It so happens that a company called Westport Innovations is a leading provider of technology that allows engines to operate on clean-burning fuels such as compressed natural gas and would be expected to benefit from HR 1380′s huge allocation of taxpayer dollars.

According to the folks at gurufocus.com, which monitors the wheeling and dealing of major investors, George Soros, the Hungarian billionaire who has made a fortune manipulating currencies among other financial shenanigans, owned 5,547,604 shares of WPRT, valued at $122 million as of March 31. That represented 1.45% of his equity portfolio and his third-largest holding.

So Soros could once again profit handsomely from U.S. energy policy determined largely by a Democratic party whose causes he has supported over the years, just as he profited from his investment in Petrobras, the state-run Brazilian oil giant.

On the company’s Web site, Westport Innovations describes itself as “The global leader in natural gas engines.” It says: “The Westport group of companies has sold over 32,000 natural gas and propane engines to customers in over 20 countries.” So yeah, H.R. 1830 would enrich Westport and the Left’s Daddy Warbucks.

GOP House Members who are unwilling to oppose H.R. 1380 out of free market principle should consider doing so out of a sense of political survival.

Update on the Boondoggle Bandwagon

The controversy over the T. Boone Pickens Earmark Bill, H. R. 1380, continued to grow this week. Three more Republicans joined Rep. Steve Pearce (R-NM) in getting off the Boonedoggle Bandwagon and withdrew as co-sponsors.  They are Rep. Todd Akin (R-Mo.), Glenn Thompson (R-Pa.), and Tim Griffin (R-Ark.).  The complete list of 187 co-sponsors can be found here.

A joint letter organized by Heritage Action for America and signed by seventeen conservative organizations opposing the bill was sent to the Hill. Pickens himself published an op-ed co-authored by flack-for-hire Denise Bode in Politico that was full of his usual blend of self regard, bluster, and misinformation.  Pickens and Bode claimed in the op-ed that the House Republican Study Committee has endorsed his bill.  It has not, and Politico quickly corrected Pickens.  They also claimed that wind power is now cheaper than new coal-fired power.

Pickens continues to claim that he is not in this for the money, but only to reduce America’s reliance on foreign oil.  See my CEI colleague Marlo Lewis’s blog on GlobalWarming.org detailing Pickens’s BP Capital Management’s investments in a wide range of companies that would benefit by enactment of the Pickens-Your-Pocket Plan.

As readers of this blog are no doubt aware, I’m a big fan of ‘fracking,’ a.k.a. hydraulic fracturing, the American-made technological miracle in natural gas production that has roughly doubled known North American gas reserves in only the last five years. In previous posts, I’ve defended fracking from nonsensical attacks launched by ill-informed environmentalists. Quite contrary to what the alarmists would have you believe, we’re lucky for the fracking revolution. Not only has it dramatically increased our domestic supply of natural gas, but now it’s being used to extract oil, too, and it could prove just as revolutionary for that industry.

Fracking does, however, have one major drawback: it has caused rampant rent-seeking. While gas supply has exploded, American consumption increased only 9 percent from 2005 to 2010. The sagging economy has further increased this disparity between gas supply and demand. For consumers, this is great, as it should usher in a period of relatively stable, low prices in the historically volatile gas market. For gas producers, it could be great. The low prices should make their product more attractive relative to other forms of energy. In turn, this could lead to whole new sectors of demand.The problem is that a couple major players in the gas industry refuse to wait for market forces to work their magic.  Instead, these impatient industry titans are trying to convince politicians to enact policies that force Americans to use natural gas.

Consider, for example, Chesapeake Energy CEO Aubrey McClendon, who is leading a nationwide charge to force Americans to use more gas for electricity. As I’ve explained, McClendon has been traveling around the country trying to convince eco-friendly governors to switch from “dirty” coal to “clean” gas. So far, he’s scored one major success. In Colorado, Governor Bill Ritter pushed through a law requiring fuel switching from coal to gas for almost 1,000 megawatts of electricity. If McClendon gets his druthers, other states will follow suit. As I understand it, McClendon’s next targets are Texas and Arkansas.

Then there’s natural gas mogul T. Boone Pickens. He’s trying to get the Congress to enact H.R. 1380, a.k.a. the “Pickens Your Pocket Boondoggle Bill” or the “T. Boone Pickens Earmark Plan,” which would have taxpayers finance the use of natural gas as a transportation fuel, in particular for the trucking industry.

At the very least, these policies are special interest rip-offs. But they could be much, much worse, due to unintended consequences typically wrought by such massive market manipulations.

It’s a welcome development that fracking has increased gas supply; it’s an equally unwelcome development that it has also increased rent-seeking.

I just finished watching the Sunday morning political talkies, and the second biggest ad buy of the day was in support of H.R. 1380, the NAT GAS Act, legislation that was produced by billionaire T. Boone Pickens to benefit the natural gas industry. T. Boone Pickens is a major player in the natural gas industry, so he basically made H.R. 1380 to make himself richer. That’s why this blog has referred to H.R. 1380 variously as the “Pickens Your Pocket Boondoggle Bill,” and the “T. Boone Pickens Earmark Plan.”

The advertisements I saw left me troubled. They indicated that T. Boone Pickens is less tone deaf, and therefore potentially more successful, than the last time he tried to get the Congress to enact legislation that he wrote to further enrich himself.

That was the 2008 “Pickens Plan,” and it was even bigger rip-off than H.R. 1380. The “Pickens Plan” was a simple four-step strategy: (1) subsidize wind produced by T. Boone; (2) subsidize transmission towers to deliver T. Boone’s wind power to cities; (3) force Americans to buy wind power produced by T. Boone; (4) force American motorists to fill their cars with T. Boone’s “leftover” natural gas, the stuff that was displaced by T. Boone’s wind power.

The first time around, T. Boone Pickens thought he had all his bases covered. He’d long been a big GOP donor, so he had that going for him. He relied on Democrats’ reflexive support for unreliable, expensive “green” energy like wind. Just to be sure, he supported their campaign coffers, too. Finally, he had a great public relations hook: “energy independence.” He could show videos of American flag burning in the Middle East and promise to wean the U.S. off Saudi crude with T. Boone’s wind and gas.

It was a great plan…with one fatal flaw. T. Boone Pickens branded his Plan with his face! He actually labeled his self-enrichment scheme the “Pickens Plan.” A lot gets past the American electorate, but they are intrinsically suspicious of legislation written by billionaires. It was too obvious a huge special interest payoff. And so it failed.

The ads I saw this morning were ALL burning flags, and ZERO T. Boone Pickens. This worries me, because it’s a much more effective pitch than, “billionaire T. Boone Pickens deserves even more money.”

Representative Steve Pearce (R-New Mexico) yesterday removed his name as a co-sponsor of H. R. 1380, which I have dubbed the T. Boone Pickens Earmark Bill.  Rep. Pearce is an outstanding conservative Member of Congress, who is policy oriented and held in high regard by his colleagues, so his defection from the Boonedoggle Bandwagon is an important sign that House conservatives may be starting to rethink their support.  Pearce deserves special credit because the oil and gas industry, which would benefit from the Pickens-Your-Pocket Plan, is the largest industry in his southern New Mexico district.

There is a highly controversial natural gas bill floating around the House of Representatives, with over 180 cosponsors, written about here (also here and here).

The Daily Caller’s Chris Moody summarizes the debate:

The measure has 180 bipartisan co-sponsors, including many of the chamber’s most conservative Republican members. But some are crying foul over the special treatment that the government would be providing to the natural gas industry, arguing that it is not Washington’s role to “choose winners and losers” by offering tax credits to promote one energy industry over another. The bill’s proponents, however, say promoting natural gas — a plentiful resource in the United States — will help wean the country off foreign oil, provide resources to alternative energy sources and increase the nation’s energy security.

A coalition of nearly two dozen free-market and conservative groups sent a letter to members of Congress in March urging them to avoid new subsidies and tax credits, and they plan to blast anyone — especially Republicans — who do.

The divide is so deep in fact, that it has even split the libertarian advocacy group Campaign For Liberty, a co-signer of the March letter, with its founder, Texas Republican Rep. Ron Paul, who is co-sponsoring the tax credit bill. Paul discussed his support for tax credits during a recent interview with MSNBC, arguing that they are not subsidies, as his critics would call them, but rather another form of tax reductions.

Republicans in the House of Representatives are flocking to support a bill to extend and create a number of taxpayer-funded subsidies for manufacturers and buyers of vehicles powered by natural gas.   Nearly eighty House Republicans (and a hundred Democrats) have signed up as sponsors of H. R. 1380, the New Alternative Transportation to Give Americans Solutions Act (or NAT GAS Act).  Just call it the T. Boone Pickens Earmark Bill.

Many conservative Republicans in the House, particularly a number of new Members with Tea Party connections, have sworn that the fiscal and economic crisis confronting America requires a radical change in federal policies.  Out-of-control spending must be stopped; spending earmarks must be abolished; crony capitalists on the prowl for corporate welfare must be sent packing; subsidies for special interests must be abolished; government must stop interfering in the economy and let free markets work.

That big talk doesn’t seem to apply when the spending is being earmarked for a crony capitalist who is one of the biggest contributors to Republican candidates in history–billionaire T. Boone Pickens.  Apparently, some subsidies are good if they benefit the right special interests.  And government interference in the economy is wonderful if it is done in the name of reducing oil imports.

H. R. 1380 would extend the tax credit of 50 cents per gallon of liquid natural gas (or its equivalent of compressed natural gas) when used for fueling vehicles and provide purchasers of natural gas vehicles with credits ranging from $7,500 to $64,000.  The lower end is for passenger cars and the upper end for big trucks.  There are also credits for natural gas vehicle manufacturers and for installing natural gas fueling stations.

Why are billions of dollars of taxpayer-funded subsidies needed?  According to T. Boone Pickens’s web site, it’s because natural gas vehicles are cheaper to operate than gasoline or diesel vehicles:  “Even with higher initial costs (which will disappear as manufacturing ramps up) the life-cycle costs of NGVs [natural gas vehicles] are significantly lower.  Fuel costs are at least 15 percent less using natural gas rather than gasoline or diesel.”

So people need to be paid in order to make them want to buy vehicles that will save them money.  Yes, that makes sense: I always prefer the more expensive product unless there is a government rebate for the cheaper one.  Call it the Boonedoggle bill.

As for getting us off foreign oil, this claim is trotted out to support every payoff to special interests in the energy sector.  It’s a claim for which little evidence is ever produced.  What will reduce our dependence on foreign oil is producing more of it in this country.  What the bill will do is increase demand for natural gas, which will tend to increase prices for natural gas, which means a big payoff for T. Boone Pickens, who has invested heavily in–you’ll never guess–natural gas.

It’s sad to look at the list of conservatives who claim to be principled who have signed up to support the Boonedoggle.  Here’s the complete list of Republican sponsors as of today.  The chief sponsor is Rep. John Sullivan of Oklahoma.  Most surprising and perhaps most disappointing is Rep. Ron Paul of Texas, who claims that he votes against everything that isn’t in the Constitution.  I seemed to have missed the section of the Constitution that allows taking billions of dollars from taxpayers to give to fatcat billionaires and corporate welfare queens.  Call it the Pickens-Your-Pocket bill.

This stampede by conservatives, including several freshmen who identify with the Tea Party, to support the T. Boone Pickens Earmark Bill makes a mockery of their claims to want to cut federal spending, eliminate subsidies to special interests, and get government out of people’s lives.  We’re very close to returning to business as usual in Washington.