More than 200 economists, including four Nobel prize winners, signed a petition rejecting proposals by presidential candidates Hillary Clinton and John McCain to offer a gas-tax holiday.
Columbia University economist Joseph Stiglitz, former Congressional Budget Office Director Alice Rivlin and 2007 Nobel winner Roger Myerson are among those who signed the letter calling proposals to temporarily lift the tax a bad idea. Another is Richard Schmalensee of the Massachusetts Institute of Technology, who was member of President George H.W. Bush’s Council of Economic Advisers.
The moratorium would mostly benefit oil companies while increasing the federal budget deficit and reducing funding for the government highway maintenance trust fund, the economists said.
"Suspending the federal tax on gasoline this summer is a bad idea, and we oppose it,” the petition says. Economist Henry Aaron of the Brookings Institution is among those circulating the letter and said most signers are economists. Aaron said that while he supports Obama, the list includes Republicans and Clinton supporters.
Sad but true.
Ben Sargent via Yahoo!
Source:
More Than 200 Economists Denounce Clinton, McCain Gas-Tax Plans
Brian Faler
Bloomberg, May 5 2008
http://www.bloomberg.com/apps/news?pid=20601087&sid=aTzCmqCNyLho&r
Is that the Hummer tax break you are talking about? and a great deal for those people too stupid to live within 5 miles of work.
Vote for the smartest person running – nothing else (race, gender, or age) counts. Notice who is not on-board with this latest mendacious fiscal fuckery.
Raise taxes on the oil companies.
Lower taxes on gasoline.
Brilliant.
I suggest they offset the reduction in gas tax with a new tax on birth control pills. We’re gonna make the kids pay anyway, so the least we can do is make more of them ;-)
June gasoline had a thirteen cent range today. Anyone who thinks an 18 cent change in gasoline taxes will have an impact on demand needs to get their head out of their…textbook.
Clinton has the brains to take away Sen. McCain’s one popular proposal so far. An 18 cent/gallon tax is not an energy policy that will wean America off its dependence on gasoline as a transportation fuel, so let’s not pretend that Sen. Obama has transcended the energy issue.
Just to throw it into the ring:
Would it make sense to lower the per gal tax on small (lets say 3 trucks or less) trucking companies? A smaller group who is being hurt whoose use of fuel contributes to real work/transactions. (Sorry you soccer moms and dad’s, but it just ain’t the same!
This is a question not a challenge.
alexd
PS Another acceptable ,at least to me, alternative would be to pay me and only me, to use gasoline and throw in one of those nice audi 8s to waste it in!
Reduce Consumption – Why doesn’t the President just ask companies to let their employees work from home 1 day a week over the summer if possible?
It could be optional. They could make it a patriotic cause if they like.
Are these the same economists that told us the world was wonderful a year or two ago? Should I be dubious of their intentions? Could there be political underpinnings for any of their positions since some have already publicly endorsed an unnamed candidate who has not supported the gas tax relief scheme?
I agree with their position but I also believe there is some politics here. Stiglitz is an avowed Bush hater and by inference prolly a McCain hater. That’s fine but should we call a spade a spade? Is this a really a political effort to discredit certain candidates?
Unfortunately, I feel about talking mouth pieces as you feel about government statistics.
How about a real long term fix?
The French produce over 95% of their electricity from nuclear.
There’s no reason we can’t do the same thing; oh, except maybe all the anti-nuclear enviro-whackos who would rather see us pollute the planet with fossil fuels than convert to clean nuclear…
Maybe this is just a way to fatten oil company margins in time for the Windfall Profits Tax…
On the other side, didn’t the Temporary Gas Tax Holiday in Georgia after Katrina work to lower prices?
http://www.econbrowser.com/archives/2005/09/gasoline_taxes.html
I’m not sure if that would scale to a national tax holiday.
Either way it’s a bad idea. We already are facing funding issues for highways with improving fleet fuel economy reducing tax proceeds and cost inflation for road construction reducing how far each tax dollar goes.
The gas tax is chickenshit. Let’s see these profiles in courage come out against something seriously wrong with the tax code, like say the home mortgage interest deduction.
Today, on CNBC’s ‘Power Lunch’ Dennis Kneale mentioned that rising oil prices are deflationary (something about when people drive less it means they can’t ‘go out and buy’ iPods.)
If that’s true, then inflation in food prices must be deflationary too. If you can’t afford food, you can’t eat, if you can’t eat, you don’t have enough energy to carry home a Vizio flat panel TV from Costco.
This also means:
1) The core rate excludes food and energy because when they’re inflationary, they’re really deflationary.
2) You’re witnessing a new economic orthodoxy. John McCain, Hillary Clinton and now Dennis Kneale prove that the economic elite are all just plain wrong.
(posted earlier in an unreadable format)
“clean nuclear”
I’m pretty sure you don’t know what at least one of those words means…
When I first saw the headline about the gas tax “holiday” I thought they wanted to remove the tax for the Memorial Day Weekend and then the July 4th weekend just to leave a few bucks in people’s pockets for those long weekends (literally seven days total) and I kind of liked the idea.
Then I read the story. Oops.
…GOLD, CRUDE and DOW…bla bla
Barry, this will happen more and more with the popularity of your site trending higher. So:
a) be careful what you wish for in terms of reach/popularity
b) be sure to address these issues in your new site.
The federal motor fuels tax is the main source of revenue for the Highway Trust Fund and even a temporary repeal of the tax would significantly reduce available funds for surface transportation projects. The trust fund already faces a likely shortfall of about $4 billion in 2009, and a suspension of the gas tax would further threaten its precarious health.
Whether Obama lucked into this policy issue or not, he has found himself on the intelligent, logical side of the debate. I don’t think McCain or Clinton considered how many DOT, construction, consultant and transportation jobs would be lost due to this “popular” gas tax holiday…unless they are betting on the ignorance of the American Public. When you consider the backlog of highway projects awaiting funding, inflationary costs for steel, oil and concrete and the fact that the purchasing power of the federal gas tax has been diminishing over the past 20 years, you can see that this is one of the worst campaign ideas ever. It’s never easy or popular to raise taxes, or even index the gas tax to inflation, but our highway system (and rails/waterways) is arguably one of the main reasons we have such a strong economy. If we don’t maintain this infrastructure, we will begin to experience the cumulative impacts that will bring us further to recession and disaster.
The Highway Trust Fund Fix is one of the action steps on the Infrastructure Action Plan for the 110th Congress http://www.asce.org/reportcard/2005/actionplan07.cfm
It just doesn’t get the votes like a gas tax holiday. If you’ve made bearish bets on the economy and have prepared for a recession, just wait and watch what happens if government puts the breaks on our transportation system!
“Elite opinion is always on the side of doing things that really disadvantages the vast majority of Americans.”
–HR Clinton
It’s good that someone spoke up for the proletariat.
Howbout a summer “foreclosure holiday” where the banks can’t auction off your house until it’s fall and the temperature makes “tent-living” a tad brisk.
Mich, did you read that closely?
“You can lose all or more of your money if you listen to me [My Disclosure].”
or… is that the new Federally approved financial services firm fine print? Darn good one, if so. I hope it applies to mortgage brokers too.
So let me get this straight.
The slimy pols are FOR raising the price of gasoline via Iowa Caucus-pandering ethanol subsidies (50 cents per gallon), but THEN they advocate a (18 cents) temporary tax relief?????
I say we line up and shoot the lot of them.
Combined IQ of Hillary and McCain is 12
>>Elite opinion is always on the side of doing things that really disadvantages the vast majority of Americans.”
–HR Clinton
It’s good that someone spoke up for the proletariat.<< Spoken like a true elitist. The voice for the proletariat is Obama/Edwards.
I guess elitist is anyone who passed economics 101?