In a recent letter, Mr. Solorzano blamed just about everything wrong in the country on tactics of the tea party. He says that in their canon, a few expenditures (defense, prisons, border fences, oil depletion allowances etc.) are “good.”
Defense expenditures are one of the primary obligations of the federal government; prisons are the responsibility of both the federal, state and local governments; border fences protect the integrity of our sovereignty. As to oil depletion allowances, they are essential to the business of exploring and producing oil and natural gas.
As a construction manager, Mr. Solorzano understands the value of depreciation allowances. In the oil industry, depletion allowances are the equivalent of depreciation. Without that, in the construction business much less capital would be available for other commercial projects. The same is true in the oil industry. The value of a particular project is decreased with the production of each barrel of oil and each MCF of gas. The recovery of the depletion allowance makes capital for other drilling opportunities.
In addition, Mr. Solorzano says the national debt and the monetization by the Fed (printing money) are not the main causes of the precarious economic condition of our country, as averred by tea partyers.
Dr. Elmendorf, director of the nonpartisan Congressional Budget Office, stated in a recent Congressional hearing that the large and growing debt can produce a fiscal crisis. The federal government cannot keep on spending and borrowing money any more than any of us can. This is not rocket science propounded by any small government group; it is just common sense. Both political parties have indulged in the spending problem.
Wayne Blankenship Jr.
oil and gas independent