The Accidental Tax That Changed Our Nation’s Energy Fate

Andy Snyder|November 10, 2022

Shares of Tesla are plunging. Gasoline prices are soaring. And diesel is in short supply.

Things shouldn’t be this way. The market’s natural forces should be able to shake us through all of this.

But they can’t. And we know why.

We’ve been working on a very special project lately. It involves a well-known celebrity and a slew of research on the nation’s energy sector. It’s been incredibly interesting… and more than a touch depressing. (You can see it all here.)

But it’s given us a great vision of what might have been and what could be – where the money will flow… who will get rich… and who will go broke.

Fueling the Nation

We’ve spent a good amount of time recently studying how we got here… and learning why the folks in charge are so desperate to push the nation to a single source of fuel.

Why has California banned natural gas in homes? Why is electricity – perhaps the most centralized form of energy – the government’s fuel of choice?

We’ll run our cars on the stuff… heat our homes with it… and wonder what to do when a wayward squirrel shorts out the grid.

The folks in charge may be turning into alarmists on the subject of energy, but none of this is new.

Absolutely not.

Washington has been working with the nation’s elite for centuries to determine who collects the spoils as they fuel the nation. We’ll take an in-depth look at the topic in the next issue of Manward Letter… but there’s a bit of the story that needs to be shared with everybody – even the folks who have yet to get out their wallets and subscribe to the world’s best off-center newsletter.

What’s going on these days is nearly a mirror image of what was happening during the late 19th century.

Prior to the Civil War, the government didn’t need a whole lot from its citizens. Taxes were simple and slim. But the war was costly. Both sides spent far more than they had… ushering in a slew of new taxes.

Never one to miss a chance to tax a vice, Washington implemented a $2.08 per gallon tax on alcohol.

It was meant to reach into the pockets of the folks trying to drink away their worries. But it accidentally changed the fate of the nation.

Drunk on Profits

At the time, you see, alcohol was a major source of fuel. It was cheap to make, could be created from the abundance on our farms and – the kicker – just about anybody with a still could make the stuff.

Its chief competitor – kerosene – didn’t get such high marks. Most of it came from coal… something the average fella didn’t have ready access to. It also required a centralized source to refine it and bring it to market.

And with a centralized source… comes a very concentrated profit stream.

Alcohol was the market’s clear choice. But with the high tax, it couldn’t compete with kerosene.

An astute reader may ask why the IRS didn’t just clear up the language on this accidental tax.

We’ve long found it in our best financial interest not to question the IRS, but in this case, the answer is as simple as it is obvious. The folks in charge didn’t clean up their mess because it benefited the folks in the kerosene game.

Remember, a deep-pocketed, centralized industry has a lot more sway with lawmakers than a bunch of hillbillies out in the sticks.

The destruction was clear and obvious.

Before this tax was passed, alcohol was quickly becoming the nation’s fuel of choice. In the years prior to the tax’s ratification, dozens of patents were filed related to alcohol’s use. Technology was advancing quickly.

But after the accidental sanction… no additional patents were filed. Advancement stopped.

The tax didn’t last forever. But it lasted long enough. In 1906, a firm enemy of the oil industry was in the White House. Under Theodore Roosevelt, the tax went away.

The Rockefellers, of course, were none too happy to have a cheaper alternative to gasoline on the market once again.

But their quest to keep the nation addicted to oil wasn’t over yet. Fortunately for them, the damage done by the 40-year-old tax gave them quite an advantage.

Today, we wonder what could have been.

Where would our nation (and the world) be if this accidental tax had never been imposed… if the free markets had been allowed to stay free?

It’s a keen idea to remember as the lobbying dollars flow and Washington continues to pick the winners.

History shows the most centralized source of energy will win the fight. It’s great news for the few folks who own it all… but bad news for the rest of us.

Check out our latest research and you’ll see what we mean.

Editor’s Note: Washington’s energy blunders are just the tip of the iceberg. Andy’s uncovered what he’s certain is the biggest political and economic scam in U.S. history. He calls it The Great American Deconstruction… and it’s going to decimate the wealth and freedoms of countless Americans. Get the devastating details here.