Editorial: Windfall folly costs

12/05/2005
With the Windfall Profit Tax Act of 1980, the US Congress accomplished only one of its goals. The misnamed tax was supposed to capture for public use $280 billion from the difference between a statutory base price of crude oil and a market price thought sure to rise forever. But the market price fell. By the time of its repeal, the tax had raised less than $40 billion. Meanwhile, US exploration and production declined, and oil imports rose.The excise did, however, fulfill its political motivation: It punished oil and gas companies for profiting while oil prices rose to levels consumers found uncomfortable. Many of the targeted companies spent the rest of the 1980s and much of the 1990s mo...
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