Obama, Clinton disagree on “gas tax holiday”

Obama and Clinton have been sparring all week over the idea of a “gas tax holiday” during the summertime. Since McCain announced that he’d support the idea, Clinton also signed on while Obama disagrees.

A report on Obama’s latest criticisms of Clinton’s plan from Yahoo News:

INDIANAPOLIS – Broadening his attack, Barack Obama said Saturday that Hillary Rodham Clinton’s support for a summertime break from the federal gasoline tax symbolizes a candidacy consisting of “phony ideas, calculated to win elections instead of actually solving problems.”

Not so, the former first lady told a campaign audience as the next round of primaries approached. Obama is “attacking my plan to try to get you some kind of break this summer,” she said.

Here’s a video report on it from Reuters:

I actually give Obama a little credit for not jumping on the bandwagon. Not that suspending federal gasoline taxes is a bad idea, I’m usually in favor of reducing pretty much every tax, but promises like this during a heated election year seem like political opportunism. As in, it’s the “feel good” thing to do in the short term, not a long term solution. Apparently President Bush has also signed onto the idea seeing the political opportunism train rolling on by.

  • Josh

    All the lowering of the gas tax would do is increase demand for gasoline. The increase in demand would push the already far-too-high price even higher, far more than would be offset by the decrease in the tax. It is predicted that the “holiday” would save less than 30 dollars for the average motorist, and almost guarantee that gas prices would be far higher moving into the 2008 holiday season, which would be terrible. This is one of the most economically “stupid” plans I have ever heard of.

    I have to say that I am almost insulted that Clinton would have such a low view of the intelligence of Americans. She obviously knows that this plan will hurt our economy, not help it, she just thinks that Americans are stupid enough to fall for what amounts to little more than a pointless gimmick. Her campaign has been based around her assumption that most Americans are either stupid, or too complacent to realize they’re being dicked around by her marketing gimmicks, and she’s largely been right. Still, however, I’d rather not have a president that assumes that I am a retard.

  • bennett

    This gas tax holiday is not at all what we need. Josh your right that the economics of this really don’t make sense, but that really does not matter to McCain (who does not really seem to worried about economics) or Hillary (who I firmly believe does not support free-market solutions to many of these kinds of vexing economic problems). This is an extremely short term solution aimed at generating support for each of their campaigns. I would rather see longterm energy diversification policies developed so that in 2, 5 or 10 years from now my heating bill does not go up 30% from the previous year, and gas does not increase in price by 2-3% every other month.
    One thing that I would like to see happen is to give these huge energy companies who quarter after quarter are reeling in record multi-billion dollar profits major tax incentives to invest in deploying renewable energy technologies and infastructure to facilitate that technology throughout our country. Viable and amazing renewable energy technology exists and is ready to be deployed today but the two major factors preventing that are mass production of these technologies and tied directly to that factor is a lack of market deployment.

  • Josh

    I think that an establishment of new-generation nuclear plants would be our most efficient option. Modern nuclear plants are also among the safest method of power production.

  • Josh, I agree on the nuclear, it should be considered a viable option.

  • Michael

    Who Killed the Electric Car?

    Sorry, I don’t buy this “scare” tactic people throw out about taxing “success” when it comes to the oil companies. There are a few corporations (not all, but a select amount) that have really manipulated politics, policies, and profits in this country for quite some time. And they have done it at the clear expense of the U.S consumers, the environment, and the development of our country’s economy.

  • Well the problem with indiscriminately taxing an industry that congress thinks they can score political points with is that the tax gets passed on to consumers in several ways. The most obvious being an increase in the price for the goods to cover the taxes. The other, perhaps less obvious, way in which consumers pay for the taxes is the loss of expansion and development by the companies being overly taxed.

    If politicians want to create jobs, which they all claim to want, then they should drop taxes on corporations to be more competitive with the rest of the industrialized world.

    The fact that the United States has the second highest is a big issue:

    Country

    Corporate Tax Rate in 2006

    Japan

    39.5

    United States

    39.3

    Germany

    38.9

    Canada

    36.1

    France

    35.0

    Spain

    35.0

    Belgium

    34.0

    Italy

    33.0

    New Zealand

    33.0

    Greece

    32.0

    Netherlands

    31.5

    Luxembourg

    30.4

    Mexico

    30.0

    Australia

    30.0

    Turkey

    30.0

    United Kingdom

    30.0

    Source: http://www.taxfoundation.org/news/show/1466.html

    Most economists I’ve heard agree that it should immediately be dropped to 35% with the goal being down to 30% eventually. I say go to 25% right now and get it done with so our major companies can continue expanding and pass those tax savings on to their customers, the American people.

    To continue spurring economic growth, we don’t need more profit taxes, we need fewer. Then you will see true job growth which helps everyone.

    Increasing taxes simply gives congress more money to immorally waste, which they do plenty of already. It’s like giving a drunk another drink, and the keys to the liquor cabinet.

  • Robert

    This proposed tax would lower prices by $0.18. I’m not impressed.

    Ya know, as much as obsessively loath high gas prices, I recognize that in terms of global warming, they’re probably for the best in long run. I agree with Obama that we need to lower our demand for gasoline rather than lowering the price.

  • Dreadsen

    I don’t know if any of you watched “Face the Nation” and “Meet the Press” this morning.

    Senator Bayh from Indiana said in rebuttal to Obama voting against the Gas tax that Obama voted for it 3 times in Illinois.

    But on Meet the Press Tim Russert had Obama on and asked him about it. Obama said they thought it was a good idea and tried pushing it in Illinois but all that happened was the Gas Prices went up, no one saved money and the Gas Companies made a bigger profit. He learned from the mistake in Illinois.

  • Josh

    Wait, what, learning from a mistake? We can’t have a guy like that in office!

  • Frank

    Nate,

    The government doesn’t have the money to cut corporate taxes.

    The discussion should be about raising receipts and cutting spending.

  • Michael

    Nate, look at the very countries you listed. Would you say that those top countries have weak economies (Japan, Germany, U.S, France, Canada)? I do not see the correlation between high rates and soft economies.

    My concern is that I think we, as consumers, are being presented with a myth about taxation. We’re told that to tax big corporations, especially oil companies, would disrupt capitalism and go against the very nature of our country’s economic interests.

    We don’t have a capitalistic society here, the government is knee-deep in most of our economic policies. Now, we certainly have a capitalistic leaning, but this mixture of government and capitalism has led to some unfortunate results– among them, certain corporations manipulating governmental policies (FDA, FCC, etc).

    I do not think ‘taxing’ oil companies are the ticket to go– since like Nate said, this would simply be passed down to the consumers. I do think that if we are against “monopolies” in this country, we need to bust up this certain oil monopoly on energy sources. Electric, nuclear, even the problematic hydrogen, is already controlled or owned by oil companies. This is probably the direction Edwards was going with his pull to bust some of the lobbying and monopolies.

  • Christopher Schwinger

    It’s not too off the subject to post this: http://www.freedomswatch.org/MediaCenter/VideoAds/tabid/73/Default.aspx

    Watch the top ad (Congressional Leadership – Out of Touch on Gas Prices) – it’s almost unbelievable! :O