Gas Price Fixes that Won't
McCain, Clinton call for gas tax relief that really isn't, while Bush dredges up old ideas with a variety of problems.
Summary
Hillary Clinton and John McCain are offering overburdened motorists a federal "gasoline tax holiday." But economists say that the proposal is unlikely to actually lower the price of gasoline. McCain's plan would essentially give federal funds to oil refineries, while the net effect of Clinton's plan probably wouldn't be much at all, although it would create a lot of new administrative work.
President Bush took another tack, dusting off a couple of golden oldies that he said would help halt the escalation in motorists' costs: allowing companies to drill for oil in Alaska's Arctic National Wildlife Refuge and encouraging construction of more refineries.
But opening up ANWR would lead to a negligible bump in world oil supply, and would provide barely five percent of what the U.S. consumes today. The spigot wouldn't even be fully opened until the mid 2020's -- if Congress acts now, which isn't at all likely. And Bush fails to acknowledge that investors aren't interested in building refineries for strong business reasons that go beyond the tangled permitting process.
Analysis
In a week that saw furious truckers steer their rigs to the nation's capital for a horn-blaring war dance over escalating fuel prices, President Bush and two candidates who want his job were offering proposals that are unlikely to provide any real comfort to motorists.
Happy Holidays?
Senators John McCain, the presumptive Republican presidential nominee, and Hillary Clinton, who hopes to win the Democratic nomination, have both called for suspending the 18.4 cents per gallon federal tax on gas as well as the 24.4 cents per gallon tax on diesel. McCain proposed the idea on April 15, while Clinton introduced her twist on it on April 25. Both candidates claim that the "tax holiday," which would extend from Memorial Day through Labor Day, would save Americans money by mitigating the rising price of fuel.
McCain (April 15): I propose that the federal government suspend all taxes on gasoline now paid by the American people -- from Memorial Day to Labor Day of this year. The effect will be an immediate economic stimulus -- taking a few dollars off the price of a tank of gas every time a family, a farmer, or trucker stops to fill up.
Clinton (from campaign Web site): Suspending the gas tax will provide real, immediate assistance to American families and for our economy. Recent testimony before the House of Representatives by the American Trucking Association indicates that even small changes in price can have big impacts. Just a one-penny decrease in the price of diesel annualized over an entire year would save the trucking industry $391 million a year.
Clinton campaign spokesperson Geoff Garin said in a conference call this week that the proposal would save each driver $70. The Clinton campaign did not respond to our request to clarify how it arrived at that figure. But the non-partisan American Association of State Highway and Transportation Officialsestimates that the total savings for the average American motorist works out to about $28; for a two-car household, that would be $54.
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Member Comments
Posted By: weraloc @ 05/12/2008 9:49:23 AM
Comment: Do you know the difference between a moral and an economic argument? For Clinton and McClain it is a moral issue not an economic one. Economists do not recognize morality, so leave their arguments out of it.
Posted By: $2Gas @ 05/08/2008 10:05:54 AM
Comment: Demand $2 a Gallon Gas
Oil hit a new high of $120 a barrel on May 5, 2008.
The cost of making a barrel of synthetic fuel from coal is estimated to be around $55, including the sizeable infrastructure investments and the labor force necessary to operate the plant.
Petroleum poor Germany fueled WWII with synfuel from coal. It is proven technology.
America is the Saudi Arabia of coal with 1/3rd of the deposits on planet. We can eliminate dependence on foreign oil.
Reducing America???s trade imbalance, keeps money, technology and jobs here in America.
It is estimated that every billion in trade deficit equals 13,000 American jobs lost. $400 billion for oil last year: do the math.
And we can quit sending those billions to countrys that sponsor terrorism.
Synfuels are cleaner burning than gasoline and carbon sequestration can remove the CO2 hot house gases.
Visit http://governor.mt.gov/hottopics/faqsynthetic.asp
Ethanol from corn is a windfall for farmers but is it good for motorists.
After 4 months Congress is already rethinking. Unintended consequences include higher food costs for wheat, chicken, beef, pork, less grain for export, reduced gas mileage and incompatibility with older cars.
Harness your anger at the pump. Call or write your US Senators and demand a Manhattan Project to create an American synfuel industry within the decade.
If you don???t raise your voice the international companies, lobbyist and politicians will assume you are fat dumb and happy and ready to pay even more.
In Kentucky call
Senator Jim Bunning @
202-224-4343
and
Senator Mitch McConnnell @
202-224-2541
Posted By: Driver of wagons @ 05/07/2008 1:51:05 PM
Comment:
It was only a matter of time!
In this one move, the White House ended McCain's accountability for his use or abuse of the primary public financing system while putting him in position to take money for the general.
For this maneuver to have been arranged for the benefit of Senator McCain, of all people--the John McCain who has regularly, severely criticized the FEC as a "corrupt" agency--is a remarkable turn in his career as a reformer. A Commissioner who acted to enforce the law, to just raise an important question of enforcement, has been stripped of his post. This was clearly in Senator McCain's interest, this raw power play. It is also in his interest to have the FEC, back in business minus Mason, arrange for his money for the fall campaign.
He goes on to make a case that's going to be central to Obama's logic for forgoing public financing, despite his pledge to join the system: That McCain is a hypocrite on this reform issue.
For all the time that McCain has savaged the performance of the FEC, he has LED the sizeable crowd of critics who believed that the agency is too beholden, on the whole, to the narrow interests of parties and their candidates. Yesterday, Republicans could not have acted more narrowly in just this vein: effectively firing a Commissioner to immunize their Presidential nominee from enforcement action in a pending case but making sure that there is enough of an agency left to get him the money needed to finance his campaign.