The Menendez Gas Tax Amendment: Bad Idea

The DSCC is idiotically pushing the Menendez gas tax amendment to suspend the federal gas tax for 60 days at a cost of $6 billion, which I believe outstrips our entire alternative energy and climate change research budget by billions of dollars. (On the plus side, it would be paid for by eliminating $6 billion in tax breaks for oil companies).

Considering that supplies of gasoline are limited by supply, not demand, basic economics tells us that any cut in prices due to a gas tax reduction will be balanced by an increase in the base price, thus saving consumers considerably less, and offering oil companies even more ungodly massive profits. Also, since the tax cut would be paid for by taxes on oil companies, they would raise gas prices to preserve profit margins (shareholders first!).

The DSCC is selling this as "tax relief". Where have we heard that before? That's right: George W. Bush.

As George Lakoff said:

The phrase "Tax relief" began coming out of the White House starting on the very day of Bush's inauguration. It got picked up by the newspapers as if it were a neutral term, which it is not. First, you have the frame for "relief." For there to be relief, there has to be an affliction, an afflicted party, somebody who administers the relief, and an act in which you are relieved of the affliction. The reliever is the hero, and anybody who tries to stop them is the bad guy intent on keeping the affliction going. So, add "tax" to "relief" and you get a metaphor that taxation is an affliction, and anybody against relieving this affliction is a villain.

"Tax relief" has even been picked up by the Democrats. I was asked by the Democratic Caucus in their tax meetings to talk to them, and I told them about the problems of using tax relief. The candidates were on the road. Soon after, Joe Lieberman still used the phrase tax relief in a press conference. You see the Democrats shooting themselves in the foot.

What could that $6 billion be spent on instead?

The Weatherization Assistance Program, which enables low and limited income residents to weatherize their homes, pays for itself by reducing winter heating bills by an average of 31 percent, or $274 per year. Its present funding is $322 million -- Bush's 2007 budget slashes it to $235 million, which would push 28,650 families out of the program.

Less than $250 million is now being spent on solar power, wind and biomass research combined.

The Federal Energy Management Program is funded at about $17 million a year and saves about a $1 billion a year! The 2007 Bush budget cuts the FEMP by $2 million.

The Climate Change Science Program gets about $1.9 billion in funding; the Bush budget for 2007 cuts $200 million.

(Care of the Union of Concerned Scientists.)

If you want to see what a serious, responsible, and helpful energy policy would look like -- check out Energize America or go to Yearly Kos's energy panel.