This is an archived article that was published on sltrib.com in 2008, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
Why would a politician promulgate policy that would boost gasoline consumption, enrich Big Oil, increase dependence on foreign crude, hasten global warming, rob the federal highway trust fund and threaten thousands of jobs?
Actually, there are two short and simple answers to that long-winded question: 1) It's an election year. 2) John McCain and Hillary Clinton are trying to buy your vote.
The proposal for a federal gas tax holiday this summer, contrary to the candidates' claims, is not an honest, earnest attempt to alleviate the plight of the poor.
It's pure political pandering, as Barack Obama points out. At best, it would put a few pennies in your pocket if Congress approves this foolish proposal.
Economists say the idea flies in the face of the law of supply and demand. In times of constricted supply, like now, the price rises to a level necessary to reduce the demand to meet the available supply. If you lower the price by suspending the tax, the demand increases, a shortage is created, and the price goes back up. Only the oil industry gains.
And, even if it did work - the extra supply appeared from thin air, or the oil companies declined to charge what the market will bear - the costs would outweigh the benefits.
McCain said the tax holiday would allow the poorest Americans to "maybe travel a little bit." If that's true, the policy would be encouraging the consumption of gasoline, contradicting the candidate's commitment to reduce our dependence on foreign oil and combat climate change.
Clinton estimates the average consumer would save $70 over the summer if the 18.4 cent federal tax on a gallon of gas and the 24.4 cent tax on a gallon of diesel fuel were removed. But it would cost the federal highway trust fund an estimated $9 billion, a reduction that, according to the American Road and Transportation Builders Association, would jeopardize 300,000 highway-related jobs.
A windfall tax on oil company profits, Clinton said, would be used to restore the fund. That's assuming Congress would approve the tax. McCain said he would replenish the fund with other tax revenue. But that would require cuts to other programs.
If you scrape the veneer from this proposal, its rotten to the core. It's not sound public policy; it's political pandering at its worst, and Congress should reject the idea.
If McCain and Clinton really want to solve our nation's energy problems, they'll pump more money into renewable energy resources, not more gas into American cars.