Various Dems and observers have been getting nervous of late that Obama hasn't been fighting back hard enough against the various attacks from the McCain campaign. Presumably, this straightforwardly negative ad, coming as part of Obama's energy policy roll-out, will be greeted with a sigh of relief:

The McCain campaign already has Mitt Romney out protesting that oil companies give to Obama as well, but a quick look at the FEC data shows, unsurprisingly, that McCain gets oodles more. It's also a little shady for the ad to suggest that McCain's tax breaks for the oil sector are targeted; they are, of course, part of his plan to give huge tax breaks to all corporations. On the whole, like most attack ads, there is some exaggeration here, but not much.

As for the contrast proposal in the ad, I'm skeptical of windfall profit taxes in general because they seem arbitrary -- it's one thing to have a progressive income tax that goes across the board, it's another to target particularly successful industries, especially when increasing demand and limited supply suggests that they should be making a larger profit.

Luckily for my free market conscience, it turns out that at some of these increases are due to tax loopholes -- the Republican-run Senate Finance Committee voted to impose a one-year windfall tax on oil in 2005. (They defeated a similar tax this spring). While the industry will claim that this tax will threaten their ability to increase oil exploration and investment in renewable energy, that doesn't make much sense if most of this money is being returned, in record-breaking numbers, to stockholders.

Look for more on Obama's energy plan later today.

--Tim Fernholz

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