As we noted earlier this week, there's been quite the feud on the presidential campaign trail and airwaves lately, with Hillary Clinton and John McCain advocating in favor of a gas tax holiday this summer and Barack Obama rejecting such proposals as "political stunts" that fail to offer Americans any real relief. Clinton hasn't let up, releasing ad after ad this week hitting him hard for his position on the issue. In her most recent spot, the narrator tells viewers that Obama will "make you keep paying that tax, instead of big oil."
Well, today saw the release of a letter (PDF) from 150 economists backing up Obama's position. The authors identify themselves as "Democrats, Republicans, and Independents," adding that their opposition to the concept of the gas tax holiday is simply "a matter of good public policy":
In recent weeks, there have been proposals in Congress and by some presidential candidates to suspend the gas tax for the summer. As economists who study issues of energy policy, taxation, public finance, and budgeting, we write to indicate our opposition to this policy. Put simply, suspending the federal tax on gasoline this summer is a bad idea and we oppose it.
There are several reasons for this opposition. First, research shows that waiving the gas tax would generate major profits for oil companies rather than significantly lowering prices for consumers. Second, it would encourage people to keep buying costly imported oil and do nothing to encourage conservation. Third, a tax holiday would provide very little relief to families feeling squeezed. Fourth, the gas tax suspension would threaten to increase the already record deficit in the coming year and reduce the amount of money going into the highway trust fund that maintains our infrastructure.
Signers of this letter are Democrats, Republicans and Independents. This is not a partisan issue. It is a matter of good public policy.
As we pointed out in our previous post, Illinois' own experience with a gas tax moratorium in 2000 supports the letter's assertion that such "holidays" offer "very little relief to families feeling squeezed."
Post new comment