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West Virginia editorial roundup

November 19, 2013
Associated Press

Recent editorials from West Virginia newspapers:

Nov. 18

News and Sentinel, Parkersburg, W.Va., on wasting billions on farm subsidies:

Though getting government spending under control often is seen as a Democrats vs. Republicans battle, some of the most egregious waste gets bipartisan support.

"Farm support" spending is exhibit No. 1. Taxpayers fork over about $30 billion a year in various agriculture subsidy programs. Originally created to help small family farms and otherwise ensure this country produces enough food, the spending too often benefits big agri-corporations and rich investors, not farmers.

About $5 billion a year is sent out in direct payments to alleged farmers. But the Government Accountability Office has revealed that during the past five years, such payments went to about 2,300 farms that have grown nothing except their bank accounts.

Another report was that 18,000 recipients of such payments live in cities, not on farms.

But both Republican and Democrat lawmakers vote to continue the handouts, year after year.

It is long past time they were plowed under.



Nov. 19

The Herald-Dispatch, Huntington, W.Va., on an announcement gives glimmer of hope for 'cracker' plant in state:

West Virginia lost out last year in its quest to have energy company Shell build a natural-gas "cracker" plant in the Mountain State. The scrambling by Gov. Earl Ray Tomblin and the legislature to persuade the company to build ended in disappointment, but perhaps one official was correct when he described that pursuit as a "warm-up" for efforts to come.

The state now has a petrochemical company acknowledging publicly that it is exploring building a cracker plant in the state and has even purchased an option to buy land where it could be located. That's further along the road to landing a plant than last time, when Pennsylvania eventually was chosen for the Shell plant.

Tomblin and officials with the Brazilian company Odebrecht announced together on Thursday in Parkersburg that the company was pursuing the possibility of building a cracker plant in Wood County. Such a plant takes natural gas and breaks it into smaller molecules to create ethylene, which is used in making plastics. The project envisioned by Odebrecht officials would not only include a cracker plant but also three polyethylene plants for the manufacture of plastic products.

Although details were scant as far as a timetable and the level of employment, such a complex no doubt would represent thousands of jobs. Tomblin described the announcement as a "defining moment in the economic development of our state." Let's hope he's correct.

Ever since the advent of horizontal drilling, or fracking, in the past several years, interest and activity in extracting natural gas from the Marcellus Shale formation has grown. The state has tried to take advantage of its location in the Marcellus region to benefit economically with more investment and jobs. The Odebrecht project — to be known as Appalachian Shale Cracker Enterprise, or Ascent — could indeed be the first major prize from that industry for West Virginia.

West Virginia Department of Commerce Secretary Keith Burdette said he is optimistic Ascent will become reality, and the payoffs for the state would be tremendous. One huge benefit, he said, would be to create the beginning of a network to take advantage of regional natural gas developments. "The more that we create, we create an energy, a cluster that makes building the network of support around it so much easier and so much more justifiable," he said.

That's a lofty hope, but the groundwork laid between the state and Odebrecht officials could be the first step in getting there.



Nov. 15

Charleston (W.Va.) Gazette on U.S. budget:

If Congress does not pass a proper budget in coming months, the next round of sequestration cuts takes effect in January. The second phase -- $110 billion worth that could cost the nation 800,000 jobs -- would be even more damaging than the first round. Here is a better idea: Everyone pays a fair share toward the nation's shared expenses.

In West Virginia, for example, between 1990 and 2011, personal income taxes increased by 227 percent, and consumer sales taxes went up by 161 percent. At the same time, taxes paid by corporations dropped.

Even the often-cited U.S. corporate tax rate of 35 percent is misleading, because many of the most profitable corporations don't pay their share -- legally or not.

Instead of cutting important government functions that actually nurture future prosperity; the country should tackle its deficit with new revenue. And some of that revenue could come from closing tax law loopholes that are now used and abused. For example:

— Change the law that encourages companies to shift jobs to other shores, said Steve Wamhoff, legislative director of Citizens for Tax Justice. American companies are allowed a foreign tax credit -- a credit for taxes they must pay in other countries. More problematic is allowing companies to defer paying taxes on offshore profits for years.

— End accounting tricks that make it appear profits are earned by subsidiaries in other countries, so they are not taxable in America. The IRS knows this is happening a couple ways, Wamhoff said in a recent conversation with the Gazette. One is that the profits American firms report to the IRS earned in Bermuda, for example, amount to 1,000 percent of Bermuda's GDP.

— Tax excess profits from intangible property. A firm may send a patent to Bermuda and then tell the IRS the company has to pay a huge royalty to a Bermuda subsidiary for the patented idea. That fake cost of doing business lowers the company's U.S. tax bill. The nation could collect another $23 billion by ending that practice.

No one wants taxes to rise, but the tax burden has been shifted to those who can least afford it for decades. It is time for a course correction.

Why should households and small businesses in West Virginia, or any state, get fleeced by these policies and then be harangued day and night to cut needed government functions to pay for it?




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