calls for a break in the federal gas tax, he is skeptical that the measure would bring substantial improvement to people at the pumps.
At 18.4 cents a gallon, stopping the feds
would take a small bite of
, which have hit $5 a gallon in recent weeks. The White House had considered a tax holiday in February as gasoline prices soared to nearly $3.50 a gallon before shelving the idea.
BIDEN BUCKS FEAR OF RECESSION
But with prices soaring, Biden is now considering a temporary three-month tax break, calling on Congress and
suspend their withdrawals. Senior administration officials anticipated Wednesday’s decision as the latest effort to “soften the impact of Putin’s price hike” ahead of the summer driving season.
The official said that the combined actions of the federal government, the states, the
industry and retailers “could lower prices at the pump to as much as $1 a gallon or more.”
Asked to report on the $1 deduction, the official said it “wasn’t meant to be too specific,” adding that Biden “wouldn’t talk about it as a specific number.”
“The idea is to give an idea of the magnitude of the relief that could be provided if people heeded all of the president’s calls for action,” she said.
Biden’s press secretary dismissed tax-exempt skepticism as a “trick,” as Barack Obama called it during his 2008 presidential bid. Karine Jean-Pierre said Biden was simply responding to reporters when he said over the weekend that the tax holiday was back on the table.
“He was asked a question yesterday, and he answered it,” Jean-Pierre said of Biden.
“He’s going to do whatever he can to make sure he eases the pain and the pressure that Americans are feeling at the pumps,” she added.
Still, the results for frustrated consumers are likely to prove insignificant, said Michael McKenna, a Republican energy lobbyist.
“The substantive results of a federal gas tax suspension are pretty clear – wholesalers, retailers and consumers are going to share in the benefits one way or another. So consumers could see up to a reduction in nickel per gallon,” said McKenna, a White House official in the Trump administration. Washington Examiner. “Not nothing but not much either.”
Worse, the slight reprieve would push demand while doing little to increase supply.
“Consumers will hardly notice,” said Bob McNally, a former Bush administration energy official. “To the extent that the consumer benefits, it would only support demand, which keeps prices high.”
Gas tax revenues help fund the Highway Trust Fund, which pays for road and bridge improvements and is already underfunded. Suspending the tax would undermine the fund.
Xan Fishman, director of energy policy at the Bipartisan Policy Center, said eliminating the gas tax would do more harm than good.
“It’s better to have your infrastructure in good shape and pay a small gas tax than to lose that gas tax and have bad roads messing up your car,” Fishman said.
Speaking to reporters, the White House said on Tuesday it would seek alternative funding to replace lost revenue.
Fishman argued that the administration should look to long-term sustainable policies to support its energy transition goals.
“We need to think about our energy policy in a way that we can drive decarbonization while making sure we have energy security and energy accessibility,” Fishman said. “Any policy that does any of these things but not all of these things is going to lead to a bad place.”
A senior administration official insisted on Tuesday that the decision was “not a step back” from Biden’s climate or
“We walk and chew gum exactly as I think the American people would expect an administration to do,” a second official said.
But it’s not just gas that weighs on household budgets. Inflation is at its highest level in four decades and prices for consumer goods and services in May rose 8.6% from a year earlier, according to the latest government price data. And a stock market sell-off scares people’s worry about the direction of the economy.
Overlooking this is the
with Democrats poised to lose seats in both houses of Congress.
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McKenna said Biden’s push would do little to solve the supply shortage and suggests a president more interested in spurring a green energy transition through high fossil fuel prices. “Equally insignificant” are the political results for Biden, he said.
“The president has no intention of doing what needs to be done here — rejecting notions of net zero, gas-powered car bans, and the jihad against oil and gas being waged by his own financial regulators,” McKenna said. . “The only conclusion that remains is that the Biden team wants high gas prices. These prices serve their political purposes. Everything else is a charade.