Why the Gas Tax Holiday is a Bad Idea

Now I realize that the facts may be irrelevant in this case, and that McCain and Clinton are just pandering for votes. It IS that time of year, after all. But I thought I would lay out a few reasons why the tax holiday is a bad idea.

First, consider the individual impact of lowering gas prices (assuming you realize a full $.18 drop, which is in a subsequent arguement by 18 cents. You are likely one of two type of gas buyers. The Honda Accord variety, that perhaps fills up once a week for an estimated 8-10 gallons. Taking the high number, you're saving $1.80 per week with this gracious tax holiday. That adds up to a whopping $7.20 a month or $36 over a 5 month period. Thirty six bucks. Now, don't get me wrong, that's a movie date with the wife, but I think I'd rather the money stay with Uncle Sam and our roads continue to get worked on. Even assuming you're like me, and has to fill up his Tundra at 20 gallons a week, the savings doubles to $3.60, $14.40, and $72 respectively. That certainly helps a bit but in the grand scheme of things, $3.60 a week just doesn't help me out substantially for anything.

Second, realizing an $.18 savings is likely not going to happen, for two reasons. First, oil companies may seize an opportunity and raise prices a little more to realize a better margin. Second, even assuming BP and Texaco don't act like little devils, we have this little thing called supply and demand to deal with. If you do waive the tax for 5 months, people by perception will continue to buy gas as they would or worse, buy more gas by taking more trips. As demand goes up...you get the idea. Suddenly that $.18 savings disappears. Oh, and when the tax is restored, your price jumps magically. Guess what doesn't happen? Prices go up easily, but are "sticky going down". So don't expect to see the reverse happen so quickly.

Finally, let's please realize this for what it is, pandering for votes in election season. There is only one candidate smart enough to see this and call it out, Barack Obama. Short term fixes aren't going to correct a problem that requires a long term solution. There is only two ways to lower the price of gas in any significant fashion. Either dramatically increase the supply/refining capacity or reduce the demand. The latter can be accomplished in a variety of methods: alternative fuel sources, higher fuel economy standards, getting us off foreign oil altogether, and many more. I look forward to the day when I'm plugging my car in at the end of the day and letting my solar panels charge the car while I sleep.

If I were Obama, in my first State of the Union, I would issue a challenge similar to Kennedy's "man on the moon" mission, and challenge this country to get off of Oil as an energy source, period. We have the technology world-wide, what we lack is the political will. The next POTUS can provide that catalyst. In 10 years we can be off of foreign oil completely. Imagine how much easier our foreign policy will be then.

Let Hillary & John ride this wave and pander til the cows come home. People will hopefully see this for what it is, and Obama will shine the truth on it, and he'll win in Indiana and North Carolina because of it.


Revenue Drop

It is a dumb idea at the federal or state levels because all of the sudden revenue goes down and you end up having even more budget problems.

From my understanding....

she also mentioned introducing a bill for a "Windfall tax" to be levied on the oil industry. This will replace the lost revenue. Since I'm not pandering for votes, and have been waiting for some 'substance' from either candidate, I sort of like the idea. At least try to do something! I know this site heavily favors Obama now that Edwards has withdrawn, but we can try to be open minded. Just because some candidate is saying he or she is about change, show me! I say you have been in a legislative body and should have been trying to introduce 'change' all along. If Hillary introduces this bill before May 6, I will see her as the real change candidiate.

Windfall tax?

Ummmm, so where has she been on this "windfall" issue for the past two years. This is Hillary pandering ... pure and simple. And on top of that, it's a stupid stunt that simply promotes America's excessive consumption without doing anything to alter the fundamental disaster that is our energy policy.

Exactly my point, James...

Where has either candidate been on these issues? Just the fact that one of them is committing to doing something to take on these huge corporations would be something new. I know the bill would be voted down, mainly by McSame and a bunch of Democratic senators, too. But at least it shows me they are willing to go on record and challenge the corporate powers in this country.

Load of Bull

It is easy enough to go online and look at financial statements of oil companies and other large corporations. When politicians talk about "windfalls" they always talk about gross profit and never get at profit margin. If one looks at profit margins, evil companies like Bank of America are much more profitable than the oil companies.

How does Bank of America make so much money? Billions of dollars in fees and penalties make up half their profits every year. Who pays most of those fees, especially ones like overdraft, over limit, and late fees? You guessed it- the people with the least money.

Real change?

There's real change, and then there's the sake of change to seem like you're doing something. That's what this tax holiday represents. Its pandering, plain and simple, and its the worst kind. Because not only will the tax breaks be mitigated by increased demand and price changes, but we'll be worse off in the process.

I don't have an issue with the windfall profit tax idea conceptually, but lets use that money for something useful, like getting us off of oil to begin with. Not surprisingly, Obama talked about funding an "Apollo Project" concept for energy in Winston-Salem today. I swear I didn't have an advance copy of his speech before I wrote the post. But that is exactly what we need to get off of foreign oil. And we can do it. I hate to sound cliche, but "if we can put a man on the moon..."

There's no shortage of 'evil' companies....

so I won't disagree with your premise, but the subject of this topic has to do with the petroleum industry. My focus is limited, so....

Listened to the Hagan interview on

TSOT today. Did you know that Hagan use to work for BOA? How do you post the audio thingy here? Here's the link to the website with the interview.

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

Bank of America, the evil

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions


I didn't know that, and couldn't figure out what BOA you were talking about! All I could think of was that kid's song "I'm being swallowed by a boa constrictor..."

Be the change you wish to see in the world. --Gandhi
Pointing at Naked Emperors

Don't know that kid's song

Have you ever heard Mr. Moon?

"Mr. Moon, Moon, bright and shiny moon won't you please shine down on me,
Oh Mr. Moon, Moon, bright and shiny moon, shining behind that tree,
I'm gonna shoot that possum with my big shot gun, shoot that possum 'for he starts to run,
Oh Mr. Moon, Moon, bright and shiny moon, won't you please shine down on, please shine down on, please shine down on me....shine down on meeeeee!"

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

I knew different words to it

but I can't remember them now!

I'll have to call my mom and get them.

We used to sing that one, and lots of others on car trips when I was a kid.

Be the change you wish to see in the world. --Gandhi
Pointing at Naked Emperors

REALLY? You're the first person I've met

that has even heard of it. Different words, I'm interested to know them. Maybe they are another verse cause that's the only one we know. (Hubs, the kids and I always sang on long car trips too.)

No matter that patriotism is too often the refuge of scoundrels. Dissent, rebellion, and all-around hell-raising remain the true duty of patriots.

Progressive Discussions

i wonder if anyone has thought of a program like

food stamps, but GAS stamps. They would be issued at reduced cost to low income persons based on need. It would be funded with a windfall tax on oil companies' profits, which they would pay until they are not making tens of billions in profits per year.

Person County Democrats

I actively oppose gerrymandering. Do you?

I forgot you were in Brad's district! Sorry Brad!

I think that it's so wonderful that you're running for county commissioner. Local politics matter the most - it's where we can really make a difference. While the Obama/Clinton stuff is exciting, and the Perdue/Moore stuff is..well, frustrating - what you're doing is really democracy in action.

I hope all of us who are in a position to run for office do it. There should never be an unopposed seat if there is an able Democrat, and honestly, I think every Democrat should have a primary. (And every election should be short and publicly financed!)

You are standing for education in your county - and there is nothing more important. People talk about the economy being the most important thing. It is important, but without education, we wouldn't be able to build our economy. You will be a wonderful County Commissioner in Person County.

Please let me know if there is something I can do to help.

I wish we had had more of a chance to talk on Sunday, too.

Be the change you wish to see in the world. --Gandhi
Pointing at Naked Emperors