NYT: I Spit on Your Federal Gas Tax Holiday!
Pity The New York Times. When presidential candidate John McCain suggested suspending the federal gas tax– a republican-anti-tax-compatible theoretical quick fix for pain at the pump– no problem. Off with his head! But when Democratic presidential hopeful Hillary Clinton threw her support behind the plan, well, that's heresy! Needless to say, the tax-loving liberal paper give both John and Hillary a proper bitch slapping. "Nixing the gas tax would increase demand for gasoline — exactly the wrong response to global warming and rising energy prices. So wrong, in fact, that both Mrs. Clinton and Mr. McCain support policies that would cut carbon emissions and increase the price of energy. (Talk about voting for something before they voted against it.)." Bad consumer! Bad consumer! "Americans — like the rest of the world — must find ways to curb their use of fossil fuels. Higher, not lower, prices are an important way to spur the needed technological innovation and curb demand." While they're at it, how about a good old-fashioned Bush bash? (Only 194 days 'til the next election!) "There is not enough oil in Alaska to provide a lasting solution. And Mr. Bush’s prescription would do nothing to address climate change or quench the thirst for oil." Barak wins! "Fortunately, Mr. Obama has not caved to the rising calls for cheap energy and has refused to follow his rivals down this misguided path." The editorial ends with just the right touch of sanctimonious self-congratulation. "We know pandering when we see it."
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This is a dumb dumb idea, put out there simply to attract "dumb" voters. I don't intend to insult, but we all know it is. Hillary takes it a step further (she really will say ANYTHING to get a vote) by proposing a gas tax stoppage. This will get a good number of dumb voters to venture this way. Nevermind every other cost in their lives, saving $30 in gas taxes is a GREAT idea! But to take it a step further and propose windfall taxes against the oil companies makes it even worse. They're a business. We don't HAVE to use their stuff. If I were them, I'd charge 50% profit margin. 10% is more than acceptable. You don't think they'll pass that along too? But beyond that, this allows Hillary to get voters who say "yeah! stick it to those evil oil companies!" without ever stopping to think for even a second how the whole fiasco would play out. How would they feel when that bridge that needs rebuilding collapses and kills a few dozen people? Or even that rebar that sticks up destroys your car's rims. Are you still gonna be happy for this $30 you saved in gas taxes??
Hmmm...so many posts and yet not one "Boo-Yeah it's the Ron Paul Revolution!" Come on fellas, I've got like hundreds of these crusty old signs for this crusty old fella spread across my city. Surely his isolationist approach would reduce both consumption and emmisions...as we'd eventually run out of oil and start using ox-carts and such again. Oh wait, maybe that's why there are no Ron Paul fans here. What is the 0-60 time for an ox-cart? Hmmm, maybe I'll have to Tivo "Little House" today and crunch the numbers. Where's my TI-83?....
With all this back and forth about how a gas tax repeal would help or hinder whatever the cause of the moment is, I'm surprised nobody has mentioned the obvious: every penny of the gas tax goes into the "General Fund" to be disbursed at the whim of the a**hole politicians in DC. Not one nickel of it is dedicated to infrastructure maintenance or improvement in any kind of permanent "superfund". I tend to believe that less tax is good, now if only the voters would learn to elect politicians who could actually learn how to spend less.
I personally think that the tax cut proposal is dumb pandering, but it should result in somewhat lower fuel prices. Demand will not necessarily spike in response to a temporarily reduction in the price. Short-term demand is fairly inelastic, which means that price increases and decreases over short periods of time don't do much to influence demand, either way. A permanent tax cut would be a different matter entirely, because the market would adapt to that with different vehicle purchases and behavior. But a brief holiday should put some cash back into the pockets of drivers, with minimal effect on consumption. That being said, Obama is showing some intestinal fortitude, and he deserves some respect for it. Instead of focusing on his former clergyman, he should be pointing at pictures of the bridge in Minneapolis, and reminding us of what happens when infrastructure is neglected.