With winter coming on, Marylanders, along with most folks in the Northeast, can expect to pay a good deal more to keep their houses warm. But while temperatures outside are dropping, the political temperature in Congress and state legislatures is rising from Bangor to Brownsville.
The immediate reason is the Persian Gulf crisis. In the wake of soaring oil prices, lawmakers from the oil-producing states like Texas are demanding tax incentives to stimulate drilling and seeking fees on imported oil. Such measures would be a big bonus for oil-producing states. By contrast, the Northeast and Midwest, which rely heavily on imported petroleum, would take it on the chin.
On top of that, the debate over energy policy is being waged in the context of a bitter regional battle over the S&L; bailout. The 18 states of the Northeast-Midwest region, for example, are responsible for only $1.3 billion of the $29 billion loss that resulted when state-chartered thrifts went under. But taxpayers in those states must pay the same amount as those in Texas, where insolvent thrifts accounted for $21 billion of the $29 billion -- largely because Texas simply dropped the regulatory reins.
It's unfair that states like Maryland, which cleaned up its own S&L; mess, or Vermont, which hasn't had a bank failure since the Depression, should be burdened with subsidizing Texas' orgy of greed and fraud. The proposed fee on imported oil, which would hit these states hard, only exacerbates regional inequities. No wonder lawmakers on Capitol Hill are beginning to align themselves along regional lines on this and other issues.
Congress may not be able to reverse totally this growing continental divide. But it can ensure a measure of equity by adopting a broader energy policy and, on the banking front, by beefing up regulatory oversight, limiting federal deposit insurance liability and making sure the scoundrels who have been getting a free ride pay back what they owe through new taxes.
The great divide