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Paper Companies' Windfall of Unintended Consequences
Jamie found a post on ScienceBlogs that serves as a stark example of the law of unintended consequences, as well as the ability of private industry to game a system of laws to their advantage. It seems that large paper companies stand to reap as much as $8 billion this year by doing the opposite of what an alternative-fuel bill intended. Here is the article from The Nation with more details and a mild reaction from a Congressional staffer. "[T]he United States government stands to pay out as much as $8 billion this year to the ten largest paper companies.... 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.'"
It wasn't mentioned in the summary, but the tax credit was passed in 2005. So no one thinks the $8 billion is related to stimulus packages passed more recently.
No, those will cost us a lot more when companies figure out how to fraud them.
Doesn't matter. Precedent from the Supreme Court states that the IRS has sovereign immunity and cannot be sued on any issue within it's own domain.