McCain Wants To Suspend Gas Tax
Inflation is up due to a 17 percent increase in energy costs -- but that doesn't mean McCain's proposal is a good idea. That's because the government is already in deep the throes of deficit spending, and we're wallowing in debt.
Some of that debt load is responsible for the drop in the dollar and resultant increase in the cost of all things imported. (Note that Europeans, whose Euro is currently trouncing the dollar, are paying more than twice what Americans pay at the pump. But they have, in the main, extensive mass transit alternatives which we do not unless we live in NYC.)
Keynesian economics suggests government should spend when the economy slows -- to help stimulate it. But it also suggests government should retreat when the economy grows -- which, of course, we haven't done nearly so well. Especially with this President.
But there's another reason we shouldn't do this: rising prices lead to decreased demand. (And gasoline demand is starting to respond to the increased price at the pump.) In turn, this means less environmental pressure (climate change and air pollution) and, perhaps, increased demand for mass transit services. It also means, potentially, less reliance on Middle Eastern and South American oil.
And it's pretty inconsequential -- a reduction of only about 5-6 percent.
A better argument might be made for reducing the diesel tax because so much of the nation's commerce depends on trucking. Maybe. (Will someone please explain to me why the least refined fuel -- diesel -- currently costs as much as 60 cents more per gallon than regular?)
Americans (except for those who have lost loved ones) haven't been asked to "sacrifice" while we engage in a discretionary war in Iraq and a half-hearted one in Afghanistan. Now we're once again being coddled and pandered to for the most crass of reasons: a possible vote in November.
From the web: Reason - McCain's Gas Tax Pander--Who Loses?; CommnWeal - McCain Gas Tax Madness; Kicking Tires - McCain Gas Tax Reprieve No Real Break
Comments
Dementia exhibits itself in cruelly creative ways, nutty tax-cutting among them. Did you happen to see the mid-year report from the Treasury about the deficit? It’s up to $310 billion so far this year. We’re heading for a record, folks (previous record was $412 billion in 2004). And John McBush wants more tax cuts. (See the report here: http://www.cbo.gov/ftpdocs/90xx/doc9075/04-2008-MBR.htm)
It’s not just the gas tax he wants axed, but the AMT, too, and the corporate tax, down to 25% from 35%, and make the Bush tax cuts of 2001 and 2003 permanent. This is beyond dementia. It’s reckless endangerment of self and surroundings.
Thanks, Pierre — I think you are being too kind, as dementia would recuse McCain of responsibility. I think it’s a more active pandering, a “vote for me” move. The other tax cuts are for the buds. :-/
We leave our grandchildren endebted for life. :-/
Looks like the “new” Republican equation is (Increased Spendings – Reduced Taxes = Huge Debt). Not that they are alone to do this. Many countries in Europe have long been known for their poor budgetary discipline.
I don’t think deisel is “least refined” any more since EPA rules now require sulpher to be almost completely removed. Least refined would likely be “residual fuel oil” for industrial boilers/power plants and chemical industy feedstock.