by Mark Silva
For all the debate over a summer "gas-tax holiday'' on the presidential campaign trail, don't count on any gas-pump tax-break from Capitol Hill any time soon.
The Senate's Democrats will be rolling out a package of energy and gasoline proposals on Friday, but knowledgeable sources say it won't contain any gas-tax respite. Suspension of the 18.4-cent per-gallon federal gas tax from Memorial Day through Labor Day isn't going over well among many members of either party - who view it as offering little assistance for consumers and creating an $11-billion deficit for the government.
But the package is likely to include some of the "windfall profits taxes'' on oil companies that many Democrats have been advocating - regardless of the fact that the White House signaled pretty clearly this week that a windfall-tax on the oil companies, racking up record profits with the spiraling price of oil and gas, is a non-starter.
"We're just going to tie them as closely as we can to big oil,'' Jim Manley, spokesman for Senate Majority Leader Harry Reid (D-Nev.) says of the White House, "and let the fight begin.''
The fight over a gas-tax break has provided fuel for Sen. Hillary Clinton's contest with Sen. Barack Obama. She supports the tax holiday. He opposes it.
"We're trying to draw a lot of attention to how much more costly it is to do anything in life anymore,'' Clinton said this week campaigning in Indiana.
Obama has replied with a TV ad arguing: "We could suspend the gas tax for six months, but that's not going to bring down gas prices long-term. You're gonna save about 25, 30 dollars, or half a tank of gas... That's typical of how Washington works. There's a problem, everybody's upset about gas prices - let's find some short-term, quick fix that we can say did something, even though we're not really doing anything.''
Republican Sen. John McCain also supports the tax holiday: "It's really just a little thing to give some people'' a boost, he suggested in an interview on MSNBC today. "You know, right now we want to pump up American confidence, hope, optimism, and, you know, they say they got a little bit of a break, particularly in rural America...''
"The problem with the gas tax holiday is that it could provide no relief for families while enriching oil companies,'' says Daniel J. Weiss, senior fellow and director of climate strategy at the Washington-based Center for American Progress. "There is no guarantee that the service station actually lowers the price of gasoline by the full 18.4 cents. They could lower it by 9 cents. They could leave the price the same...
And the summer cutoff of tax revenue could put a serious dent in the Highway Trust Fund, which counts on about $41 billion in excise taxes to support the nation's roadways.
"The gas tax holiday would add another $11 billion to the deficit, without any guarantee that there would be any savings to the families,'' Weiss said today.
Weiss has presented a paper at his center arguing for a fuel price "reliefbate,' a check for as much as $450 for families, depending on their income, to offset the prices they are paying for gasoline.
This plan would offer the least assistance for families earning as much as $75,000 a year - a "reliefbate'' of $200 - who face an average fuel expenditure of $2,857 this year. It would offer the most aid, $453, to households that are earning less than $10,000 a year but are still pacing an annual fuel bill of $1,292.
The advantage of this plan, he suggests, is providing relief to people who need it while a general break in the gas tax could benefit everyone, regardless of need, and only worsen a national budget deficit already at near-record levels.
The underlying problem is that it is difficult for anyone -- from the campaign trail to Capitol Hill --to offer any true, immediate relief in the price of gasoline. The president this week said that if he had "a magic wand,'' he would wave it. But he has no magic wand.
"It's very difficult to affect gasoline prices in the short-term,'' Weiss acknowledges. "Possibly the only way to do it would be in cities that have good transit systems, like Chicago and New York, to subsidize people who are now driving to get out of their cars and get on to trains.... The problem is there are all kinds of equity issues.''
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Comments
We could pay for the tax break if we stop the war for ten minutes.
Posted by: bill r. | May 1, 2008 4:07 PM
Obama 08. Yet another sound decision. What did Liary and McSame do??? Try and con you.
Posted by: Keith Lifetime Chicagoan and Southsider | May 1, 2008 4:11 PM
The liberal Democrat socialists like Harry Reid, Dickie Durbin, Chuckie Schemer and Nancy Pelosi and Ram Rod Emmanuel have no intention of giving us a break at the pump.
The idea of a windfall profits tax is rife with stench--the oil companies would pass it to the drivers at the gas stations.
The federal government is a parasitical conniver who doesn't discover the oil, drill for it, reifine it, distribute it or pump it into gas tanks. They swoop down like bald eagles and steal the tax of 18.5 cents off the top, the state and the cities take more without contributing.
The old line is this is how we pave your highways. Thou shalt not steal applies to governments every much as it does to individuals.
The governent run by these socialists Democrats would like to nationalize the oil companies that is sort of Hillary's plan. When she talks about squeezing oil companies and reining in OPEC she is going to sue them in effect. The Clintons run government by lawyers for lawyers. In all of this our life, liberty and pursuit of happiness is curtailed.Jerry White, Springfield, IL
Posted by: Jerry White | May 1, 2008 4:21 PM
Please excuse the rant above. It would be funny if the guy wasn't serious.
Sus[pending the gas tax would be foolish and counterproductive - thats the money that is used for the highway fund, and it hasn't been raised in nearly 2 decades. In the meantime, briddges are falling into the Mississippi river as our infrastructure isn't being updated, and no one wants to pay for it.
Posted by: Joey B | May 1, 2008 4:45 PM
So Hillbillary and McSame want to reduce the amount of money available to pay for our highway infrastructure.
If they really believe that's a good idea, I've got a bridge in Minneapolis to sell them.
Posted by: Doug "Hussein" Zook | May 1, 2008 5:03 PM
Finally someone who is correct in his comments about oil and our government. Everyone wants to go after "easy money" by dipping into the oil companies profits. Are these same parasites ready to give the money back when oil prices come down? Not a chance. Nationalization of the oil companies would be a disaster. Name one government agency that is run efficiently.
Posted by: Jim | May 1, 2008 5:07 PM
Nancy and Harry control the house. John and Hillary tried.
Posted by: Jeff | May 1, 2008 5:24 PM
Good. The silly idea should never have been "alive" in the first place. Joey B's got it exactly right.
Posted by: DCL | May 1, 2008 5:25 PM
I drive about 400 miles a week, so that's one tank of gas, say, $35 at current pump prices. So we're talking a savings of slightly more than $6 per week, or $72 between Memorial Day and Labor Day. Big deal.
This plan is like using a bandaid when what you really need is a tourniquet.
Posted by: jlp | May 1, 2008 5:36 PM
Whenever I have tax questions I search out a climate strategist at a socialist think tank. They know everything!
Posted by: whatnow | May 1, 2008 5:46 PM
On April 30, 2008, Hillary Clinton gave an interview to Bill O'Reilly in which she stated:
"You know what. Rich people, God Bless Us. We deserve all the opportunities"
watch and spread it : http://www.youtube.com/watch?v=pypZVJQt1Tg
Posted by: Jimmy | May 1, 2008 5:48 PM
Once again thanks to BIG Goverment for helping screw the little guy. Hope you all enjoy you great vacations. Those of us that you so easily screwed will be thinking of you while we sit at home.
Posted by: A Look Into The Future | May 1, 2008 5:55 PM
I'm so tired of the oik (intentional) companies and their lame excuses for the price that they charge at the pumps, and then they post their big profits. Hit them with their winfall profit taxes and let that money pay for the infrastructure issues.
Posted by: A Look Into The Future | May 1, 2008 6:01 PM
Do you REALLY think the millions they're making from the gas gouging are going to our highways? Get real. They're pocketing it.
Posted by: nick | May 1, 2008 6:05 PM
This was always just another scam from Billary who is always pandering to the voters.
Billary must be setting some sort of record for telling outright lies during a Presidential campaign and that's pretty impressive when you consider all of the lies Bush Jr told in 2000 and 2004.
Posted by: John E | May 1, 2008 6:08 PM
Why should the Liberals give you a break at the pump when your own President will not do it for you!! Get real, drop the gimmicks and get behind an Oil Corporations' give-back!! They could give us back some of that 123 BILLION DOLLARS IN PROFITS, they took from us, last year!! It can be handled by the Oil Corporations, the same way President Bush's stimulus package is supposed to work!! We may even get more money from the Oil Cartel, I mean, Corporations!!
SUPPORT OUR TROOPS, BRING THEM HOME, ALIVE. NOW.
Posted by: Don Fitzgerald, Chicago | May 1, 2008 6:10 PM
We should be driving less...not more! Why on Earth would we need an incentive which pushes us in the wrong way? Hang on, it's an idea from DC. My mistake.
Posted by: JBH | May 1, 2008 6:19 PM
18 cents, big deal. How about state and local taxes too, then we'll talk. How about this solution, somebody go tell the Fed to shove it and stop debasing our currency. The price of gas (oil) is a result of a falling dollar. That's how much they've devalued it. Look at oil priced in gold ( a real currency) and tell me I'm wrong. But you won't, you'll blame oil companies, democrats, and republicans. It's all you know.
Posted by: alan | May 1, 2008 6:41 PM
The best solution for the long term would be to address supply. How about we drill for our own oil in Alaska and the Gulf? Sure, you can trot out the old "it won't help us now because it will take years to bring that oil to market," but if we stopped arguing years ago and took action we wouldn't be so unhappy now.
Posted by: no name | May 1, 2008 7:48 PM
Jimmy: I also heard her say that. I just hope a lot of other people did, too!!! Then she has THE NERVE to try to say she's not "ELITE"!!!!! Also, you Hillary backers, remember what she said about obliterating Iran!!! Doesn't she think she should get the NOMINATION first??? And if she does...LOOK OUT ... THAT mouth of hers JUST MIGHT GET US INTO ww3.!!!
Posted by: MLD | May 1, 2008 8:08 PM
Even if the tax holiday wouldn't fly (and it's not like ANY of our money we give to the gas companies does ANYTHING to help any of US) at least it was a shot over the bow.
Nothing to attack Hillary over.
Posted by: retrieve those knickers | May 1, 2008 8:25 PM
I think these democrats are crazy, their plan is to tax more on gas companies instead of giving citizens a break at the pumps. Taxing more on gas companies will only increase price at the pumps, which actually hurting more on working class citizens.
Posted by: James | May 1, 2008 9:43 PM
Good decision re. the gas tax. Shoving the country into even more debt is not the answer. Plus, our roads are already in shreds.
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Then Mr. Straight Talk says this;
"It's really just a little thing to give some people'' a boost, he suggested in an interview on MSNBC today. "You know, right now we want to pump up American confidence, hope, optimism, and, you know, they say they got a little bit of a break, particularly in rural America...''
What clarity! What mental acuity! That's telling it like it is, Johnny!
Posted by: C.Morris | May 2, 2008 9:21 AM