After all, he called his a PERMANENT relief to middle class families. And permanent is hardly ever IMMEDIATE; (so it most likely wouldn't do anything about this summer). It could go for gas, groceries, healthcare, or whatever the family chooses. None of them 9including McCain) has found anything IMMEDIATE THAT WORKS that will lower fuel prices at the pump. Even Bush (scary) recently said one of the "smartest" things that I've ever heard come out of his mouth, regarding this very thing. The also scary thing is that both HRC and McCain suported a gas tax holiday (Democrat and Republican, rather than Democart VS. Republican), while the other Democrat opposed it (not along party lines). HRC should more resemble the other Democrat Obama (as she does in the rest of her general policy platform) than McCain. It is no surprise that their policies are very similar across the board; it's as it should be: both are Democrats. Their policies SHOULD contrast more sharply with the Republican's than with each other's. Yet, HRC also sounds like McCain on "nuke Iran" comments.
Running on Fumes
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In the Clinton ad "Gas Tax," two hard-pressed motorists bemoan the high cost of gasoline. Enter Clinton the fighter: She wants to use the "windfall profits of big oil" to give families a break from the gas tax, saving them $8 billion over the summer, the narrator says. He tells us Obama calls that "just pennies" and would "make you" keep paying the tax. Then we hear a bit of the long-term: Clinton would "make" the oil companies invest in clean energy, which will bring oil prices down for good.
It's true that the federal gas tax brings in as much as $8.5 billion in revenue over three months. If prices really went down by 18.4 cents per gallon (24.4 cents for diesel), the average driver could save $28--or $56 for families with two vehicles (Clinton's team says it would be $70 per motorist, but we've been unable to find any support for that). Families that do a lot of driving could save more, of course, and reduced fuel costs might translate into slightly lower prices for food and other goods that have to be trucked or flown to their destination markets. Meanwhile Clinton would make up the funds that went missing in the federal treasury by, she says, taxing the oil companies' windfall profits.
But as we pointed out last week, economists say that Clinton's plan isn't likely to save any money at all. Lower gasoline prices would simply trigger demand, but since refineries are already working at full capacity in the summer months, the supply of gasoline (at least in the short term) is pretty much already fixed. Any price reductions that might appear initially would quickly be wiped out by the increased demand that would lead consumers to bid up the price of gas until prices returned to their pre-tax holiday levels. That means that the 18.4 cents per gallon that drivers currently pay in federal taxes would instead be transferred to the pockets of oil companies. Clinton then proposes to tax that profit to pay for the gas tax holiday.
We and other journalists have tried, unsuccessfully, to find any economists who think Clinton's holiday will actually give drivers relief. The Clinton campaign itself hasn't produced one, either. When pressed to name a single economist who supported her plan during her May 4 appearance on This Week, Clinton responded:
Clinton (May 4): Well, I'll tell you what, I'm not going to put my lot in with economists, because I know if we get it right, if we actually did it right, if we had a president who used all the tools of the presidency, we would design it in such a way that it would be implemented effectively.
The president's toolkit is admittedly impressive, but we're skeptical that it includes a gizmo for suspending the laws of supply and demand.
As for making the oil companies invest in clean energy, we'd note that the companies are already doing just that. They may not be doing enough of it to satisfy Clinton, and some have seen the handwriting on the wall more clearly than others, but at a hearing last month on Capitol Hill the Big Five oil companies -- ConocoPhillips, Exxon, BP, Chevron and Shell -- all described their efforts on alternative energy, some of which are significant.
Haven't We Seen That Somewhere Before?
Barack Obama 2008 Ad: "Pennies"
Narrator: Another negative ad from Hillary Clinton. But here's what she's not saying.
Narrator: USA Today calls her three-month gas tax holiday "political pandering."
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