In the heady early ’70s, many of us sensed that tax reform was finally on its way. The sleepy public had awakened to its true interests. One of the few solid results of that climacteric was victory over the depletion allowance. For years this had been the quintessential loophole, the symbol and a citadel of special privilege: it was preferential; the benefitting industry contains the largest industrial corporations;the industry is our major polluter, directly and indirectly; oil income includes a high share of unearned rents; and the use of industry wealth in politics was feared as a corrupting force. Accordingly, the repeal of depletion in 1975 was hailed with relief and satisfaction at a job well done, a triumph for equity, efficiency, and righteousness.
Paper delivered at 20th Annual Conference of TRED, The Committee on Taxation, Resources and Economic Development, Cambridge, 1982. Pp. 1-54.
