Dicky's Doodles &Scribbles

Cartoons,editorials and comment about current events and more.

Thursday, May 01, 2008

Gas Tax Holiday Debate

Last January, as predictions of impending recession were much in the news, I suggested that a good form of economic stimulus might be a gas tax holiday.
My idea would have been for the federal government and the state governments combine to drop the gasoline tax for a certain period of time.
I sent my idea everywhere I could find an email address for and it was published in We The People, a local monthly and on We!, an online site. Other than that I had no response or replies to my emails.
I was surprised to hear Presidential candidate John McCain recently endorse such an idea, pertaining to the federal tax only. Hillary Clinton did as well.
Barack Obama, who I support for President, panned the idea as have many others, including New York Times foreign affairs columnist Tom Friedman. They have ridiculed the idea as a “political gimmick.”
Some have said this idea would just increase oil company profits. It’s not clear just how. Some have said lowering the tax would encourage people to drive more. Very doubtful, a small savings such as proposed probably would not encourage gasoline customers decide to suddenly go on extended drives! Maybe a two dollar drop would do that.
Perhaps the strangest statement has been that this plan was “No substitute for a new energy policy.” Well, I agree with that but this was not intended as an energy policy, just as a way to keep some money in people’s pockets longer.
It has been noted that the federal gasoline excise tax is dedicated towards the maintenance, repair and construction of roadways and bridges. Certainly this proposal would cost money, estimated at about $11.9 billion in uncollected taxes.
How much of a budget shortfall will be caused by the millions of rebate checks being mailed out, at great expense of man hours and printing costs? Some estimates say a cost of $40 million just to mail the checks. It is also estimated it will cost the U.S, treasury over $100 billion to make good on those checks. (figures are from Mark Silva’s blog on the Baltimore Sun website. Who knows what they might be?)
Are we entering into la la land yet?
Barack Obama said the idea would save the average American “About thirty dollars” a month. I guess he doesn’t know many folks that drive to work each day on long commutes, or families with several members, including teenagers, who drive. Also farmers, ranchers, truckers, cabbies, pizza delivery and other small businesses could see a substantial savings.
I also wonder what would have been the discussion had it been someone other than John McCain or Hillary Clinton had come up with the suggestion. It seems that once again we are seeing politics trump any serious discussion.
Texas residents are aware that from time to time the state declares a sales tax holiday, often just before school starts, on certain retail items. Shoppers save a little and the state loses a bit of revenue flow. No lasting harm seems to result. But I would say there is even less chance the State of Texas would ever entertain such an idea.
Probably the gas tax debate is moot. The chances of it ever being put into place are probably slim to none. Something to muse while you spend a large part of your rebate check filling your gas tank.


At 7:42 PM , Blogger Twitchard said...

I find myself agreeing with you about the disappointment on this turning into a petty political squabble instead of an actual debate over the merits of the plan.
Also I'm disappointed in McCain in failing to carry on the debate. He should stand up more to Obama's claims that the plan won't have a big effect. Like you mention, what about the pizza delivery men? Additionally, doesn't the price of gas affect the price of everything else too?

Do you think one of the candidates will be serious enough to properly continue the debate or is this a finished issue already?


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