Distributive Policy and Energy Subsidies

The Obama administration would like to end tax breaks for oil companies including, “deductions for certain drilling costs, tax credits for low-volume oil and gas wells and a manufacturing tax deduction for oil and gas companies.”  Oil companies argue that ending tax breaks would reduce domestic oil drilling which would in turn cost jobs and decrease oil independence. Opponents of oil subsidies cite the desirability of increasing renewable energy sources, decreasing greenhouse gasses, and increasing tax revenues from oil concerns.  While pushing for increased taxes on the oil industry under the guise of fiscal and environmental responsibility, the Obama administration increased renewable energy funding by $460 million.

Under Lowi’s description of distributive policy, the corporation is clearly evident as the primary political unit in energy subsidies.  These policies are decided in Congressional committees. The Department of Energy is heavily involved in the push for renewable energy.  For the most part, the power structure is a stable relationship between the elite and support groups for both the oil industry and renewable energy interests.

http://www.reuters.com/article/idUSTRE6103RM20100201

The Corporate Average Fuel Economy (CAFE) Program

Congress enacted the Corporate Average Fuel Economy (CAFE) program in 1974 to reduce reliance on foreign oil imports and conserve existing oil reserves for the future in response to the 1973-1974 oil embargo and the ensuing "energy crisis". The program also aimed to protect air quality through reduced emissions and reduce expenditures for fuel. In 1978, the standard for passenger cars was 18.0 mpg. By 1990, passenger cars were required to average 27.5 mpg, a standard still in effect in 2003.

Much debate has surrounded this program. Overall fuel consumption has risen since its enactment and we are still dependent on foreign oil. Fuel efficiency standards have risen and fallen. Automobile safety has been debated as the average size of cars has decreased in efforts to increase fuel efficiency. Other pieces of legislation such as the Clean Air Act have had more impact on pollution reduction than has increased fuel efficiency standards. Congress has adjusted the CAFE program numerous times in attempting to meet the goals of lessening dependence on foreign oil and improving air quality; however, neither goal has been fully realized through its policies. Various interests agree upon the policy, but for different reasons.

 

http://www.davidbarber.org/research/cafe.html

 

Hird on Policy Analysis in Decision Making

Hird found that non-partisan research organizations (NPROs) have substantial influence on legislatures due to their physical institutional proximity. However, most of this influence tends to be in providing information in the form of summaries and fiscal analysis of policy. Compared to other constituencies, NPROs have little real influence on policymaking. Legislators tend to favor larger NPROs and believe they have more influence on policymaking than do smaller NPROs. When legislators view NPROs as primarily information gathering and synthesizing organizations, rather than as information analyzers, they rate the strength of the NPRO less favorably. In addition, legislators view their constituents as the most important source of information for understanding and formulating policy decisions.

I agree with Hird in his assessment of how data from NPROs is used in policymaking. In my opinion, NPROs could serve a much more useful function if legislators incorporated their findings in to policy decisions. When the views of constituents, who by their nature have self-serving interests, trump careful analysis of programs and policies, the true effectiveness of these programs and policies is not examined. Legislators must keep constituents happy to preserve their own well-being and longevity in office. Unfortunately, this may lead to the creation or perpetuation of pet programs that are popular, but not necessarily able to stand up to the unblinking scrutiny of well-designed, unbiased policy analysis. If tax dollars are dedicated to maintaining NPROs, the policy analyses they generate should play a significant role in determining which policies have the best cost-benefit ratios and highest levels of effectiveness. They should not simply be used to summarize information for legislators who are too busy to read entire program reports.

Traditional vs Interpretive View of Policy Analysis

Shulock describes the traditional and interpretive views of policy analysis. The traditional view is client oriented with the clients being decision makers. It assumes that policy analysts can influence the decisions of clients through their analysis. She terms this as an “optimistic view that reflects the positivism of the social sciences.”


In Shulock’s interpretive view of policy analysis, she redefines “use”. She proposes three ways that policy analysis is used outside of the traditional view of analysis as a product or recommendation to be delivered to a client. These uses are “(a) as language for framing political discourse, (b) as legitimate rationalization for legislative action where prospective rationality is inhibited by “garbage can” decision environments, and (c) as a symbol of legitimate decision processes that can increase support for governance processes in a society that values rationality.”

While the traditional view of policy analysis relies on rational choice and objectivity, the interpretive view tends to be ambiguous and used to justify actions as a symbol of rationality. In my opinion, the interpretive view sacrifices objectivity and thus the validity of analysis to allow policy makers to hand pick analyses that support policy decisions rather than using rigorous analytical results to improve policies and programs.

The article I selected, “With elections looming, U.S. poverty hitting record levels” reports that,

"In 2008, the poverty level stood at $22,025 for a family of four, based on an official government calculation that includes only cash income before tax deductions. It excludes capital gains or accumulated wealth. It does not factor in noncash government aid such as tax credits or food stamps, which have surged to record levels in recent years under the federal stimulus program.

Beginning next year, the government plans to publish new, supplemental poverty figures that are expected to show even higher numbers of people in poverty than previously known. The figures will take into account rising costs of medical care, transportation and child care, a change analysts believe will add to the ranks of both seniors and working-age people in poverty."

This is an example of the interpretive view of policy analysis. Clearly, data is being manipulated to show that poverty is greater than previously. When tax credits and food stamps have “have surged to record levels in recent years under the federal stimulus program”, but are not counted as income, it paints a deceptive picture of the resources people have at their disposal. The “new, supplemental poverty figures” that will take into account “rising costs of medical care, transportation and child care” once again change the parameters for defining poverty, not the actual number of people living under such circumstances. What was defined as lower middle class thirty years ago could easily be defined as living in poverty today. Policy analysis has, in this case, been carefully tailored to support expansion of existing programs and implementation of new ones to address a problem that has been inflated by changing the definition of poverty.


Link to article:
http://www.msnbc.msn.com/id/39123485/ns/us_news/