Slog News & Arts

Line Out

Music & Nightlife

« School Outing | What the? »

Tuesday, April 29, 2008

Gas Tax Relief—It’s the New Green Collar Jobs!

posted by on April 29 at 13:16 PM

By popular request:

Hillary Clinton wants a gas tax holiday, Erica! What do you have to say about that?

OK, I’ll just say it for you:

Here’s some “maverick” thinking for you: GOP Democratic presidential candidate John McCain Hillary Clinton wants to “spread [tax] relief across the American economy”focus every day on ensuring that [American families] can make ends meet.” So will she be cutting the income tax? Providing a rebate on the sales tax, one of the most regressive taxes in existence?

Nope. According to the AP:

Hillary Rodham Clinton criticized Barack Obama on Monday for opposing proposals to suspend federal gas taxes this summer, a plan she and Republican John McCain have endorsed. Obama didn’t take the bait. He ignored Clinton and focused on McCain.

Clinton would pay for her summer cheap gas scheme by taxing windfall profits from oil companies. Obama would also institute a windfall profits tax, but he would use the money to help low-income families pay their energy bills.

According to CNN,

Analysts and Obama said the proposal to suspend the tax temporarily would do little to stimulate the economy or lower gas prices and could leave roads in disrepair.

“It’s a quick fix for people who believe cheap gas is their birthright,” said Tom Kloza, chief oil analyst at the research firm Oil Price Information Service. “It’s not a prudent thing to do.”

Kloza said the amount of money motorists would save would do little to stimulate economic growth. The revenue from the gas tax is much needed for road repairs, he added.

“Look, somewhere down the road you have to use less,” Kloza said. “As painful as it might be, higher prices do sway behavior toward a more energy disciplined America.”

RSS icon Comments


the difference between mccain and clinton is getting smaller and smaller.

Posted by Bellevue Ave | April 29, 2008 1:20 PM

I love you Annie!

Posted by <3 | April 29, 2008 1:20 PM

To be fair, Annie, Erica did criticize Hillary's position (albeit EXTREMELY briefly) on her blog.

Posted by Hernandez | April 29, 2008 1:21 PM

Hillary will say what it takes to win/get the nomination including play-acting at being a Republican. If this were 2004 she'd be vocally opposing gay marriage left and right and probably not be pimping out Chelsea to gay bars like she is this year.

Posted by Jason | April 29, 2008 1:23 PM

The problem is you can't beat a republican by being so similar to them that no one sees the difference between the two.

Posted by Bellevue Ave | April 29, 2008 1:26 PM

Erica's head must be exploding. Ann Coulter and her are both supporting the same candidate.

Posted by Jeff | April 29, 2008 1:29 PM

I just don't know how I can hold my nose enough to vote for her if she gets the nomination. So troubling.

Posted by ahava | April 29, 2008 1:30 PM

Seriously, Clinton is running as a Democrat? Really? Nader is really starting to look like an option if she steals the nomination from Obama!

Posted by Andrew | April 29, 2008 1:31 PM

Hey, I read your link and I think that "Erica C. Barnett" person wrote a really incisive analysis of the gas tax holiday. She seems to have a grasp of transportation and environmental issues, doesn't she? Why, if The Stranger had someone like that on staff, she could make a positive contribution to counteract the fiscally and environmentally damaging pandering that politicians do to get elected. I would inquire as to who this Barnett works for.

Posted by elenchos | April 29, 2008 1:32 PM

So much for Clinton's protecting the environment Erica! HA HA HA HA !!!!!!

Posted by Erica is a Clintonian Tool | April 29, 2008 1:40 PM

Tom Kloza: Gas tax money would do little to help the people paying the tax, but would financially destroy the people collecting the tax.

How does that work?

Posted by six shooter | April 29, 2008 1:47 PM

well since i'm poor i'll speak up. sorry but id rather have affordable-ish gas right now than energy assistance. and i get energy assistance. but without gas i can't get to work. and really even worse than all of that is the insane price of food right now. they ought to tax the shit out of oil companies and give it to local organic farmers. i'm already on food stamps, but i think soon i'll have to go get the nasty shit at the food bank.

Posted by well | April 29, 2008 1:53 PM

well, during the period of the gas suspension you could possibly buy 1 more tank of gas with teh amount the gas tax costs you. if you bought 500 gallons of gas you'd save 90 bucks.


six shooter, the individuals cost of the gas tax as a % of their expenditure on gas is small. The % of revenue generate to fund road maintenance by the gas tax is huge.

Posted by Bellevue Ave | April 29, 2008 2:08 PM

@12: It works like this. Gas tax relief would save the average consumer just $25 over a summer. (That is, if increased demand didn't push prices higher than they would otherwise be.) Which may be significant to you, @13, but the vast majority of gas buyers could save that amount by driving less, carpooling more, and taking advantage of transit—or cutting down on other voluntary expenditures.

But ~25 bucks from the entire driving population of the United States contributes an enormous amount of money--about $10 billion over a single summer--to infrastructure projects that keep highways in shape. You want your roads to fall apart? Vote Hillary or McCain.

Posted by annie | April 29, 2008 2:11 PM

How much does the average long-haul trucker pay in gas tax a year? How much of that expense factors into the costs of goods?

Clinton says she'll replace the cut in gas-tax revenue to infrastructure projects with tax revenue on oil profits.

Posted by six shooter | April 29, 2008 2:20 PM

I'm still waiting for a politician to get up and have the guts to say "We need a national rail system that works and is high speed" and "we need to build out rapid mass transit in this country on the scale of the interstate highway system.". All towns over X amount of population will be connected by this new system,etc,etc.

If someone actually says that and means it, than I will vote for them instead of this pandering crap about waiving gas taxes for 3 months. But I guess its too much to ask for someone in office to actually have a long term vision of how to cut down on per capita gas consumption without wacking people over the head with a huge stick, i,e. tolls and higher taxes on every little thing.

Posted by Brian in Seattle | April 29, 2008 2:25 PM

#17: This country's fucked. It's still too stuck on generational issues from the 1960s to think about substantive change on that level. And even if someone did run on an ambitious platform like that, they'd be tarred socialists ("he/she wants to make us like Europe!"), radical environmentalists ("they wanna take away our cars!), or pie in the sky liberals.

Posted by Jay | April 29, 2008 2:35 PM

six shooter, the diesel tax is also at or around 6% per gallon. the discount on all goods carried by at current demand levels for diesel long haul trucks doesnt counteract the effect that there needs to be a revenue source to pay for roads.

and putting taxes on the profits of oil companies simply reintroduces the taxes into the price of gas. to compensate for higher tax costs they will simply raise the price of gas to maintain a % profit margin. there is no free lunch for a public good such as open access roads.

Posted by Bellevue Ave | April 29, 2008 2:36 PM


Obama's transportation plan includes the following:

Support Development of High-Speed Freight and Passenger Rail:
Barack Obama supports development of high-speed rail networks across the country. Providing passengers with safe high-speed rail will have significant environmental and metropolitan planning advantages and help diversify our nation’s transportation infrastructure. Our domestic rail freight capacity must also be strengthened because our demand for rail transportation has never been greater, leaving many key transportation hubs stretched to capacity. Obama is committed to renewing the federal government’s commitment to high speed rail so that our nation’s transportation infrastructure continues to support, and not hinder, our nation’s long-term economic growth.

@16: Much more than $25, obviously. But I'm not interested in structuring our tax policy to benefit a single occupation. There should be a better way to provide assistance to truckers than to waive taxes for the entire country. Yes, Hillary wants to get the windfall tax profit passed. But even if it can pass Congress, it would only pay for part of the gas tax holiday, so some would probably come out of the infrastructure budget despite her best intentions.

Posted by annie | April 29, 2008 2:38 PM

Thanks Annie & Bellevue.

Posted by six shooter | April 29, 2008 2:46 PM

people should boycott the gas companies until they are willing to limit their profits by charging a reasonable amount at the pump.


Posted by infrequent | April 29, 2008 3:06 PM

infrequent, stop trolling and providing "will in seattle" ideas to people.

six shooter. another thing to consider is the distributed cost to goods carried by long haul trucks. if eliminating the gas tax shaved off 1000 dollars from a haul, and the haul consisted of 300 hd lcd telivsions, the cost saved per television would be $3. if the haul savings was $500 and the quantity was 4000 tomatoes, it would $.125 off the cost of the tomato.

as you can see the savings are minuscule to the total cost of a good because long haul transportation costs are so variable and dispersed onto every good in the haul.

Posted by Bellevue Ave | April 29, 2008 3:16 PM

i don't troll; that was clearly a joke. but hey, you're the expert!

Posted by infrequent | April 29, 2008 3:39 PM

@15 gee, thanks for your condescending solutions, but a lot of us have already done all of that stuff. that's like telling someone whose house is already in foreclosure that they should refinance.

Posted by well | April 29, 2008 3:41 PM

it is pretty annoying that BP and cohorts are posting huge profits, while at the same time the price of gas is prompting goofy legislation. the gas-tax break, if i understand it correctly, will be giving money from the gov to people, and to companies (in shipping expenses), and, in a round-about way, to the oil companies themselves.

aside from that, i think it's strange that as fuel prices increase, that price "can't" be passed on to the cost of the good. the npr story from a couple weeks back on the trucker "slow down" tried to explain this, but it left me with even more questions.

Posted by infrequent | April 29, 2008 3:50 PM

@1 wins.

But I loved the info in @20, annie. Very good to know.

Posted by Will in Seattle | April 29, 2008 3:50 PM

And I don't support the position @22.

Boycotts only work in limited circumstances.

Now, grudge matches, those work.

Posted by Will in Seattle | April 29, 2008 3:54 PM

@25 its hard to offer solutions to someone that is so hopelessly bent on others solving their problems for them.

as i said above: taxing the profits of oil companies is just going to raise the price of gasoline because there is

a. limited refining capacity in the United States
b. limited amount of refiners
c. since every company bears the brunt of this tax they will all raise their prices accordingly

profits from oil companies are used to

A. explore for new oil fields (increase supply)
B. make capital improvements to existing oil fields and refining facilities (increase and maintain current supply)
C. pay share holder dividends in some cases

So until the government opens up the ability to build new refiners and it is actually economically beneficial for old companies to build them, taxing the same 4-5 big players isnt going to do squat.

Posted by Bellevue Ave | April 29, 2008 3:55 PM

@25: I am not trying to be condescending, and there certainly exists a minority that will be adversely affected by $25 over the course of three months. Feel free to vote your own economic interest. I am, after all: I bike, walk, and bus almost exclusively, so I have the luxury (albeit earned through my own time, sweat, and choices) of not paying for gas directly.

But of course, this is all entirely hypothetical. Neither Clinton nor McCain will be president this summer, and even if Congress were able to pass Clinton or Obama's windfall tax, it would take quite a while for revenues to make it to federal coffers.

You will be paying that $25 in tax this summer. The question is, do you want a president who institutes economically and environmentally deleterious tax cuts in order to provide a tiny amount of cash to almost everyone, including millionaires who easily afford to pay the tax, or do you want a president who tries to target tax relief to the most cash-strapped citizens?

Posted by annie | April 29, 2008 4:21 PM

@29 - they're building refineries in India, FWIW. It's a red herring.

(caveat - I own and have owned oil companies and made a mint from your gullible consumption of this product).

Posted by Will in Seattle | April 29, 2008 5:49 PM

will, you know that refineries in india have nothing to do with gas refining capabilities in the united states.

Posted by Bellevue Ave | April 29, 2008 5:57 PM


But if oil companies increase the price to offset their increased taxes, they'll just pay more in taxes. Oil companies are making such obscene prices right now that opposing a windfall tax, because OMG they might raise prices a little, is nonsensical. Besides, those companies have been getting tax breaks for ages, with the absurd justification that they'll use the money to search for more oil sources and open new refineries. That hasn't been happening. Tax the shit out of the bastards.

Posted by keshmeshi | April 29, 2008 6:04 PM

I'm not completely opposed to a windfall tax, but I'm not sure most people understand how, or why, gas fluctuates at the pump.

Here's a really good read:

Posted by Dougsf | April 29, 2008 7:29 PM

dougsf - thanks for the link. i've read similar articles before, but i'm still left wondering.... the oil companies are selling at a higher price making huge profits. it's one thing to suggest they sell below market value. it's another thing to wonder how the market value got inflated. was it artificial? it doesn't matter where the gouging it taking place, we are told prices are getting higher because the cost of oil is going up. yet the paycheck for the oil companies is going up even higher still (reflecting more than just the increase in the cost of oil).

Posted by infrequent | April 29, 2008 9:49 PM

@32 - you really need to keep up. The refineries in India are actually intended to provide product (refined) to the USA, Japan, and a few other nations.

Try doing a Yahoo or Google news search for Refinery India Oil or something like that - it was in a number of stories - at least two in the print edition of the Wall Street Journal - so it must be somewhere else.

Posted by Will in Seattle | April 30, 2008 1:29 AM
Posted by elenchos | April 30, 2008 9:01 AM

40% of 1.2m barrels a day out of total consumption of 388 million gallons per day = not making a difference.

thats 1/10th of 1% in supply increase.

Posted by Bellevue Ave | April 30, 2008 11:19 AM

keshmeshi, you're ignoring that the objective isn't to punitively tax oil companies for making profits, it is to reduce gas prices at the pump. considering that objective, taxing profits only encourages the producers to seek higher total revenue, either through more units sold at a lower cost, or less units sold a higher cost. since gas is pretty inelastic it makes more sense to raise prices rather than sell more units.

and I already explained why they cant open more refineries or won't; there is no incentive to do so because of the environmental regulations and because it doesnt make sense economically to do so.

Posted by Bellevue Ave | April 30, 2008 11:29 AM

How much exactly will gas be then?

Posted by Katie | May 1, 2008 9:36 AM

Comments Closed

In order to combat spam, we are no longer accepting comments on this post (or any post more than 14 days old).