PavCo Multimedia Synergistics Weblog

May 4, 2008

Gas Tax Pandering

Filed under: Politics — CPav @ 5:50 pm
Tags: , , , ,

A few follow-up comments to my ice cream gas tax story a few days back:

  • The Huffington Post has a rundown of support/opposition for the proposal by both McCain and Clinton. Interesting that the only person they could find who supported the idea was a politician, who frames it as a “why shouldn’t Big Oil pony up?” issue.
  • John McCain says he’ll pay for the lost revenue from not collecting the gas tax for the summer by cutting pork barrel spending projects. But these cuts, if he were successful in making them part of a budget, wouldn’t be in effect until the next budget round, so that’s a number of months of shortfall that isn’t made up for in the McCain proposal. And he also doesn’t say how he’s going to replace the jobs that will be lost in Congressional districts that don’t get to build their projects due to the slashed spending.
  • Hillary Clinton will pay for the lost revenue brought on by the tax holiday by taxing the windfall profits of the oil companies. Civics lesson, people: One junior senator from New York State cannot pass a tax all by herself, even with the help of the senior senator from Arizona, especially when there is no evidence that a majority of Congress supports the plan.
  • Even making the enormous leap of faith that the lost tax revenue will somehow be made up in such a way as to not jeopardize bridge and highway repairs, there’s another problem with the whole plan: There’s nothing to force the oil companies to pass the savings on to the consumer. Nothing. Nada. Just because they’re not paying the government that 18 cents per gallon, doesn’t mean they’ll drop prices by a corresponding amount. And when the tax goes back into effect, does anyone really think the companies will be good corporate citizens and not raise their prices a corresponding amount? (“Oh, trust us. The price would have been this high all summer except for that tax rebate.”)
  • And, if the cosmic forces align just right and the tax holiday passes through Congress and the lost revenue is recouped somehow and the oil companies do pass on the savings to the consumer and don’t pass the subsequent increase back, some of the experts say that the lower prices will cause consumers to buy more gas instead of less, which will make the prices go up more.
  • North Carolina Governor Mike Easley, a Clinton supporter who’s been stumping for her in his state, spoke out against the idea when McCain proposed it, but supports it now that Clinton has endorsed it. In other words, he was against it before he was for it. (Audio of his statements is linked from this blog, and the third commenter makes many of the points I’ve made here, with some more detail.

So, basically, anyone who’s telling you that a gas tax rebate will save you money this summer is counting on the fact that you don’t know anything about basic budgets, the way laws are passed, and the way business accounting and supply and demand work.

In other words, they not only think they’re smarter than you, but they think you’re dumb as a gas pump.

Maybe later we’ll talk about which candidates are truly elitist.

The 300 Project: 6/81


1 Comment »

  1. […] CPav @ 7:48 am Tags: barack obama, elitist, gas tax holiday, hillary clinton, Politics In my Gas Tax post last night, I noted that there was a lack of support from economists — and, really, anyone […]

    Pingback by We Don’ Need No Stinkin’…Economists? « PavCo Multimedia Synergistics Weblog — May 5, 2008 @ 7:48 am | Reply

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