Communism has been proposed

Sigh... alright, I gave a teaser this morning about a potential rant, and I don't want to disappoint. I won't go on for too long about this, in part because I really hope some of my rant is self-explanatory (and redundant with previous rants on other topics), and also because the bill in question doesn't have a prayer of actually passing. But here goes:

Six House Democrats, led by Rep. Dennis Kucinich (D-Ohio), want to set up a “Reasonable Profits Board” to control gas profits. 

The Democrats, worried about higher gas prices, want to set up a board that would apply a “windfall profit tax” as high as 100 percent on the sale of oil and gas, according to their legislation. 

…The Gas Price Spike Act, H.R. 3784, would apply a windfall tax on the sale of oil and gas that ranges from 50 percent to 100 percent on all surplus earnings exceeding “a reasonable profit.” It would set up a Reasonable Profits Board made up of three presidential nominees that will serve three-year terms.

Reasonable profits? Excessive compensation? Mandatory free bag checking? What the hell is going on? When did our federal government, the most fiscally irresponsible group of politicians ever to have graced this fine nation, suddenly become the arbiters of all that is right and proper in the world of business?

There is nothing more ridiculous or counter-productive than these pseudo-communist government policies whose sole purpose seems to be to mitigate the negative impact of other government policies (believe me, oil and gas companies wouldn't have these kinds of profits--nor would banks and health care companies, for that matter--if it wasn't for persistently inflationary Fed policy that drives up the prices of the things we use the most).

But what bothers me the most is that these policies wouldn't even be effective in the first place. American companies and their executives are incredibly creative and resourceful (normally, this is considered to be a good thing), and it's not exactly difficult for them to show a nominal profit of zero in order to avoid paying a usurious tax. As a matter of fact, they're already doing it in large numbers, and it's costing our government a boatload of money.

Pretending that our gas companies couldn't find a way to avoid paying this tax (say, by paying their top executives ridiculously high salaries) is just indicative of how little our politicians actually understand about business and incentives. Sigh. Whatever. Good work, Rep. Kucinich. You're a true American hero.

[Marginal Revolution]