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Gas tax summer break runs on empty

Friday's lead editorial.

What happens if Hillary Clinton hitches a ride on John McCain’s campaign bus?
You can’t call it “Straight Talk Express” anymore.

Clinton and McCain are barreling down a dead-end road together with their proposal to get rid of the federal gas tax for the summer. Sure, it’s full speed ahead for a while. But they can’t get anywhere in the long run.

McCain came up with the idea first, calling on Congress “to suspend the 18.4-cent federal gas tax and 24.4-cent diesel tax from Memorial Day to Labor Day.”

He didn’t propose any way to make up the lost revenue, which supports transportation programs like highway construction and, incidentally, keeps a lot of people working. But at least he acknowledged a role for Congress.

Clinton didn’t when she mimicked McCain’s proposal and added a dubious funding mechanism.
“Hillary will impose a windfall profits tax on oil companies and use the money to temporarily suspend the 18.4-cent per gallon federal gas tax and the 24.4-cent per gallon diesel tax during the upcoming peak summer driving months,” her campaign proclaimed.

Hillary will impose? She’s not president yet. And this “windfall profits tax on oil companies” raises such a complex issue it would take Congress months to enact the necessary legislation — if it ever could agree on what amount of profit is considered a “windfall” and how much money oil companies, or any companies, ought to be allowed to make. What she proposes, then, is an immediate tax break paid for by a very speculative revenue source sometime later.

But this is about political mileage, not policy sustainability. Maybe it’s a smart bid for votes. Motorists would welcome any break at the pumps and might resent Barack Obama’s dismissal that they’d only save an average of $30 over the entire summer.

In the long haul, however, the country needs to develop more energy resources and break its addiction to foreign oil. Obama has put forward some suggestions, and Clinton and McCain have as well. They all know that encouraging Americans to drive more — many of them in gas-guzzlers, still — isn’t going to pay off down the road. And depleting revenues for transportation projects isn’t going to keep the country moving.

Americans don’t need to pay higher gas taxes. North Carolina legislators wisely capped the state’s gas tax last year, or else motorists here would be paying even more at the pump now.
Yet, it simply isn’t responsible to pretend that a gas tax summer holiday is going to pay any real dividends. McCain and Clinton ought to get off that bus. It’s running on empty.

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Comments (9)

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Tony Moschetti said:

Even when you're right about an issue you can't help showing your true colors. "Hillary will impose a windfall profits tax....." "This tax raise such.......that it would be hard to agree on how much profit companies should be ALLOWED to make.

That is an unbelievable statement in a supposedly free Capitalist country. The oil companies make approximately 9.5 percent net profit. Microsoft makes approximately 27 percent, and McDonalds more than 11 percent. It seems that Mrs. Marx wants to tax someone's "excess" profits, it would be Microsoft!

Why doesn't Mrs. Marx go on the campaign trail and shout, "the oil companies are making a 9.5 percent profit?" Because that won't stir up the ignorant fools who have no clue, and don't know that her husband vetoed legislation in 1994 or 95 that would have permitted, Oh my God, drilling for oil in ANWAR, that by now would likely have reduced our dependence on Middle east oil. Supposedly we would have been getting about a million barrels a day, which is what we buy from Saudi Arabis, at neary 50 times what it cost them to get the oil.

I guess Mrs. Marx is unaware of all of the above!

laura James said:

Is Mr. Corporatist such an 'ignorant fool' that he seriously thinks this is a free market? Working Americans are almost as unfree under predatory Capitalism as citizens in Soviet Russia. And it's getting worse every day.

Sure, our government allows us to mouth off in our "free speech zones." Big deal. It's very convenient for the predators in this society to allow us to blow off steam -- it prevents us from doing what citizens in real democracies do: national strikes and walkouts and non-violent civil disobedience.

The deck is completely stacked against working Americans, in favor of banks and corporations that write our laws and buy off our Congress and install our presidents. When is the last time you saw a mom and pop hardware store or other independent retailer? When is the last time you felt free to quit your job and start a business -- but couldn't because you are tied to your employer's meager health care plan, because you have a pre-existing condition?

When conservatives in America say "Freedom" what they really mean is freedom for corporations to pollute, peddle unsafe products, exploit workers, and dictate how our tax dollars get spent.

Bigsky007 said:

Instead of running for the presidency, Senators Clinton and McCain should resign from the Senate. Their votes to invade Iraq based upon sloppy and faulty intelligence was the epitome poor decision-making. With zero concern for our troops they couldn’t bother to read the Intelligence Estimates. How could McCain, detesting war, as he claims, not ask very critical questions about the validity of the intelligence? Iraq was a sovereign country. With over 4000 young Americans and millions of Iraqis lives at stake, it was incumbent upon both Clinton and McCain, to make sure that the intelligence was correct or not vote in the affirmative. Isn’t this a case of acute betrayal of our young men and women in uniform?

Clinton and McCain have not even acknowledged their mistakes and they have not given any assurances that they wouldn’t repeat them. Besides millions of casualties, and a country destroyed, they made, in effect, a trillion dollar mistake. Now, they are asking for a promotion and a pay raise, whereas most American workers would be fired. Maybe, I don’t understand elitism. However, this both looks and smells like it to me. Where are the apologies, remorse and sense of responsibility here? It seems that responsibility stops at the Abu Ghraib level. We neither help nor support our troops, when we reward poor judgment and saddle them with sub par leaders. They, our troops, deserve better decision making, even by the voters. This country should have and could have done much better than giving them a double dose of Bush.

Bigsky007 said:

Instead of running for the presidency, Senators Clinton and McCain should resign from the Senate. Their votes to invade Iraq based upon sloppy and faulty intelligence was the epitome poor decision-making. With zero concern for our troops they couldn’t bother to read the Intelligence Estimates. How could McCain, detesting war, as he claims, not ask very critical questions about the validity of the intelligence? Iraq was a sovereign country. With over 4000 young Americans and millions of Iraqis lives at stake, it was incumbent upon both Clinton and McCain, to make sure that the intelligence was correct or not vote in the affirmative. Isn’t this a case of acute betrayal of our young men and women in uniform?

Clinton and McCain have not even acknowledged their mistakes and they have not given any assurances that they wouldn’t repeat them. Besides millions of casualties, and a country destroyed, they made, in effect, a trillion dollar mistake. Now, they are asking for a promotion and a pay raise, whereas most American workers would be fired. Maybe, I don’t understand elitism. However, this both looks and smells like it to me. Where are the apologies, remorse and sense of responsibility here? It seems that responsibility stops at the Abu Ghraib level. We neither help nor support our troops, when we reward poor judgment and saddle them with sub par leaders. They, our troops, deserve better decision making, even by the voters. This country should have and could have done much better than giving them a double dose of Bush.

Gail Dunham said:

Double the Cost of Gas = Double the Taxes Paid!

Every time the cost for gas increases, the TAXES paid increase! The PEOPLE have already paid far more in gas taxes. A Gas Tax Holiday for the summer is a great short term solution.

Hillary has always promoted long term solutions too -- but in the meantime the people need the gas tax relief now.

Gail Dunham
Summerfield

brian444 said:

God forbid Obama should do the math and point out the paltry savings. Good for him to avoid the demagoguery on this issue. As much as my heart is wrenched by the forlorn cries of those who will have to pay the extra $30 in taxes, I can't really see that more deficit financing--folks, they're going to spend the money anyway--is a good idea.

Now if somebody wants to propose that the tax be cut in tandem with highway spending, then I'm listening.

Andrew Brod said:

The more I look at the Clinton-McCain pander on the gasoline tax, the more I think that we're all entirely missing the point. The issue isn't whether a $30 saving is significant or not, because those savings won't materialize for consumers.

For a number of reasons, the supply of oil appears to be highly unresponsive to prices (supplies have not been increasing as they normally do when prices rise). The implication of this is that cutting the gasoline tax will have LITTLE OR NO effect on the price of gasoline! Maybe it'll drop it by a penny or two, but certainly not by the amount of the tax, which is 18.4 cents per gallon.

I realize that this might be tough for some to understand, but look at this this way: if oil companies are already pumping as much oil as they can, then cutting the tax isn't going to lead to more production. It'll cause price to drop temporarily, but consumers will just bid it back up close to the starting point.

The upshot is that while the gas tax is repealed, consumers will still be paying those 18.4 cents per gallon, or at least 16 or 17 cents of it. But instead of the government collecting that money to pay for roads, the oil companies will get it. I wonder if Clinton and McCain really want to run on a platform of helping oil companies earn higher profits?

IllinoisVote said:

THE SPIN: Obama argues that Democratic Sen. Hillary Rodham Clinton and Republican Sen. John McCain ” he calls them "the two Washington candidates" are pandering to voters by proposing to suspend the federal gas tax of 18.4 cents a gallon for three months. He says a tax holiday would provide consumers little real relief, ignore the country's energy problems and take money from road and bridge repairs. "This is the problem with Washington. We are facing a situation where oil prices could hit $200 a barrel. Oil companies like Shell and BP just reported record profits for the quarter. And we're arguing over a gimmick that would save you half a tank of gas over the course of the entire summer so that everyone in Washington can pat themselves on the back and say that they did something," Obama says. Clinton says Obama is turning his back on people who need relief from rising gas prices. Republicans, including the campaign of rival John McCain, question his switch. THE FACTS: In 2000, gasoline prices were climbing quickly, reaching $2 a gallon in the Chicago area ” a remarkable price back then. Illinois legislators scrambled to offer some election-year relief to angry motorists. Obama voted three times for a tax holiday. The version that ended up becoming law required a six-month suspension of the state's share of the sales tax on gasoline, a 5 percent tax paid directly by consumers rather than gas stations. It also required gas stations to post signs on their pumps saying that the Illinois General Assembly had lowered taxes and the price should reflect that cut.

Again, Obama is lying to voters in North Carolina and Indiana. Here in Illinois, we know the truth. Do not let Obama fool you too.

Dan the Man said:

Something doesn't add up. Obama says the tax holiday is too small to give any real relief for the tax payer. But yet its sooooooo big it's going to make our highways turn into gravel roads and put 10s of 1000s of people out of work. Sounds like more double speak. This is what is wrong with Washington now. They keep raising our taxes a penny here, a nickel there and they say it is not enough to hurt the tax payers, because it is so small. But yet the accumulative effect results in HIGH TAXES. So why not start by lowering the taxes the same way they raise them, a little at a time. I'll gladly take a gas tax holiday and be thankful for it. It will probably be the only tax relief I'll get if a democrat wins the White House. They are already promising more than they can pay for.

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