At a time when the price of a gallon of gas seems to go up every day and Americans have been paying more at the pump than ever for what seems to be a long, long time, it was inevitable that someone like National Journal's Amy Walter would describe the two major party presumptive presidential nominees' disagreement on energy policy as a "gasoline fight" -- evoking images of a raging fire that engulfs both men.And that's what the gas crisis threatens to do to whoever wins in November.
The American public wants easy answers, like the ones they used to get from politicians. But the same old song and dance doesn't work anymore.
The tough choices didn't go away -- they just got tougher.
Today, President George W. Bush said he wants America to expand domestic oil production.
Bush correctly pointed out that high oil prices lead to high gasoline prices.
And prices have risen, in part, because demand has risen in India and China.
Well, we've outsourced a lot of jobs to those countries, and those incomes are pumping money into the Indian and Chinese economies now, not the U.S. economy. All those workers in India and China need transportation to work. And they want to enjoy some of the other benefits of more prosperity.
Which is why demand has increased.
And some people over here want to blame Indian and Chinese workers for needing more gas to do precisely what American workers have done for decades -- commute to work.
But the U.S. is still the leading gasoline consumer in the world.
Even though the American population is (seemingly) dwarfed by India and China.
The population in the U.S. is a little over 300 million. India has nearly four times as many people (1.1 billion), and China has a little more than four times as many (1.3 billion).
Just based on population figures, India and China each should be consuming four times as much oil as the U.S. Right? Well, the cultures are different, there are different levels of personal freedom in each country, but the fact is that India and China have done more to promote the idea of mass transit.
Bush wants to open part of the Arctic National Wildlife Refuge (ANWR) for oil exploration. And he wants Congress to halt a ban on offshore drilling.
Presumptive Republican nominee John McCain -- to re-phrase a famous John Kerry quote -- was against offshore drilling before he was for it -- as he appears to be now.
Senate Majority Leader Harry Reid of Nevada called it "a cynical campaign ploy that will do nothing to lower energy prices, and represents another big giveaway to oil companies."
Sounds like coded words of support for the other really bad idea on energy in this campaign, Barack Obama's recent call for a windfall profits tax on oil companies with the proceeds being used to help the poor pay high energy bills.
But, as I said a few days ago, drilling in ANWR or offshore is a short-term solution at best. And a windfall profits tax may make people feel better, but it won't improve supply and, ultimately, it won't raise the kind of money some people say it will.
What we need is a long-term solution. We have to stop pretending that there is a way to return to the way things used to be.
When McCain and Obama have finished preaching to their respective choirs and decide that they're ready to reach beyond their bases, maybe we can have a realistic discussion about energy policy.
So who's got an answer?
4 comments:
The gas tax holiday and the increased drilling will do nothing but make the current problem worse.
Cutting taxes on gas is a double hit: it removes desperately needed money from our coffers (we already are in incredible debt to China and running obscene deficits that we will force our grandchildren to pay), and the very little lowering of prices we'd realize at the pump would only stimulate more usage, which is not good for the environment AND would lead to greater gas prices as demand would even further outstrip supply.
The oil that we have in ANWR and offshore would barely dent the need for consumption, and would run out rather quickly. Besides, it would be 5-10 years before that oil is even available as gasoline at the pumps. So there is no relief at the pump there, and a huge gamble on the environment -- from both the drilling and the continued pollution from automobiles.
You are correct that Obama's plan will not do anything to the price of a gallon of gasoline. But you are missing the point of the increased taxes on the obscene profits Big Oil is enjoying on all of our backs. I'm sure you've noticed that the oil giants are making HUGE profits as the prices skyrocket. An additional tax on that could go to fund lots of things, and would be a fiscally responsible action that our government short on cash could do. We can't go on milking the middle class and the poor for the benefit of the super wealthy, which is what is happening.
So while Obama's plan won't decrease gas prices, it will help our budget mess. The real question is what is too much of a tax and what is fair? That has to be resolved.
What we need are real alternatives to driving our personal vehicles. Right now, most of us don't have a choice. The old argument was that if gas got high enough, people would stop driving. We've seen that isn't the case. Why? Because a century of government subsidies to the auto and oil industries has created our dependence on personal transportation for most of our needs. Don't think so? Drive out to Frisco at 6 a.m. in the middle of the week and try to use public transportation to get to downtown Dallas. Let me know how it goes for you.
Maybe windfall taxes on the obscene profits of Big Oil could be used to help fund alternative transportation systems (like rail) and search for a more sustainable way of living and using energy. Something has to be done. While Obama is obviously trying to use this tax idea to stimulate voters who believe it might lead to lower prices, which it won't, at least he is on the right track toward fiscal responsibility.
My position on the windfall profits tax is based on historical facts. When we tried that in 1980, big oil companies reduced production and tax revenues were about one-fifth what was projected.
I've seen no evidence to indicate it would be different now.
I don't question the motive behind the windfall profits tax, only the logic.
we have to start somewhere. Again, the wealth gap in this country is the greatest single issue we face; our politics, policies, tax laws, livelihoods and future are all influenced by it.
Some call it "soaking the wealthy" but we have to change what we've been doing -- soaking the poor and middle class for the benefit of the wealthy.
Take the war in Iraq: Who benefits and how do they benefit? Answer: weapons manufacturers, big oil (has benefitted by higher prices and now sweetheart deals as we heard yesterday), contractors, etc. How do they benefit: Taxpayers (now and in the future as we pay off this debt). We take tax money disproportionately from the middle class and poor and pour it into the pockets of these folks.
While a fair tax on big oil isn't the only solution, it is a step in that direction. What also has to be done is close all the loopholes allowing big corporations to end up paying very little in what we are led to believe they pay.
Well, that's the real trick, isn't it?
I mean, if there really is such a thing as "Big Oil," do you think the people who run "Big Oil" will pay these profits taxes?
I think it's more likely that the cost will be passed along to millions of stockholders, possibly eating away at their dividends.
My 78-year-old father, for example, depends in part on his dividends from Exxon stock he inherited from my grandfather. If his income from that stock goes down, it literally takes food off his table -- food that costs more than it should, anyway.
I think the profits you talk about are being realized by OPEC's oil producers. Our domestic oil producers only satisfy a fraction of our consumption.
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