President Obama has been arguing for the repeal of certain oil company tax breaks for years, and it looks like the current hike in gas prices may provide the White House with a convenient opening:
After coordinating with the White House, Senate Democrats expect to consider, likely before the end of the month, legislation that would repeal tax breaks for oil and gas companies, a senior Senate Democratic aide said.
Details of the bill are still being decided, but the revenues could be used for consumer relief or to fund alternative energy initiatives, the aide said.
The aide said there are no easy energy solutions and that Democrats will continue to pursue the “all-of-the-above” strategy advocated by the White House.
Republicans argue that increasing the tax burden on oil companies is the last thing we should be doing during a time of high gas prices. “If someone in the administration can show me that raising taxes on American energy production will lower gas prices and create jobs, then I will gladly discuss it,” Senate Minority Leader Mitch McConnell said in a statement to Roll Call. “But since nobody can, and the president doesn’t, this is merely an attempt to deflect from his failed policies.”
While some Republicans maintain that repealing tax breaks for oil and gas companies will lead directly to higher gas at the pump, that claim is debatable. That said, higher taxes on oil and gas companies certainly don’t lead to lower gas prices or energy-sector job creation.
Which makes you wonder why the administration and Senate Democrats are touting this as a way of dealing with rising gas prices. According to Roll Call, Democrats are still considering whether the tax breaks would be used to pay for “consumer energy relief” or “alternative energy initiatives.” In other words, either flat-out election-year bribery with consumer energy rebates, or the subsidization of various Obama-approved “green energy” initiatives. None of which will address the underlying economic reasons behind the rising gas prices.
Republicans have had political success with the gas price debate so far, particularly by emphasizing the importance of pursuing domestic energy sources like the Keystone XL pipeline. But it sounds like Senate Democrats are preparing for another class warfare-tinged fight with the GOP, this time about tax breaks for mammoth oil companies. That could help Obama pivot back to the populist, tax-the-rich strategy that he was pursuing last fall.
This is weird, Alana – the price of a barrel has never been higher, and the gasoline tax has never been higher, a tax hike won't lower the price of gasoline, it HAS to be passed on to the consumer. Democrats never never never understand that – it's only simple basic math. n nA CONVENIENT TIME to HIKE the cost of Gasoline? n Sure it is in OBAMA BIZARRO WORLD. n nThere is an old Russian fable, with different versions in other countries, about two poor peasants, OBAMA and Boris. The only difference between them was that Boris had a goat and OBAMA didn’t. One day, OBAMA came upon a strange-looking lamp and, when he rubbed it, a genie appeared. She told him that she could grant him just one wish, but it could be anything in the world. nOBAMA said, “I want Boris’s goat to die.” n nSo with skyrocketting gas prices causing skyrocketting monthly and unavoidable bills, the Obama camp wants to send them exponentially exploding even higher – of course he does – since his ultimate goal is to DESTROY the USA, totally – he is thinking this is his last chance to inflict enough damage to do HIS GOALS some good before the GOP takes over in 2013 and starts trying to undo some of his damage. IF the NEW batch of GOP have learned anything.
So the story goes… Every day ten men go out for lunch. They each have the exact same meal and the tab for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this… n The first four men (the poorest) would pay nothing. n The fifth would pay $1. n The sixth would pay $3. n The seventh would pay $7. n The eighth would pay $12. n The ninth would pay $18. n The tenth man (the richest) would pay $59. nSo, that’s what they decided to do. The ten men ate lunch every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. nHe said, “Since you are all such good customers, I’m going to reduce the cost of your daily lunches by $20. Food for the ten will now cost just $80.” nThe group still wanted to pay their bill the same way we pay our taxes, so the first four men were unaffected. They would still eat for free. But what about the other six men — the actual ‘paying’ customers? How could they divide the $20 windfall so that everyone would get his “fair share”? n nThey realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being “paid” to eat his lunch. So the restaurant owner suggested that it would be fair to reduce each man’s bill by roughly the same formula based on what was paid, and he proceeded to work out the amounts each should pay. nAnd so… n The first four continued to eat lunch for free (no change) n The fifth man, like the first four, now paid nothing (100% savings). n The sixth now paid $2 instead of $3 (33%savings). n The seventh now pay $5 instead of $7 (28%savings). n The eighth now paid $9 instead of $12 (25% savings). n The ninth now paid $14 instead of $18 (22% savings). n The tenth now paid $50 instead of $59 (15% savings). n nEach of the six who had been paying was now better off than before, and they all still ate the same meal. But once outside the restaurant, the men began to compare their savings. “I only got a dollar back out of the $20 savings,” declared the sixth man. He pointed to the tenth man, “but he got $9″! n n“Yeah, that’s right,’ exclaimed the fifth man. “I only saved a dollar, too. It’s unfair that he got back nine times more than I!” n“That’s true!” shouted the seventh man. “Why should he get $9 back when I got only $2? The wealthy get all the breaks!” n“Wait a minute,” yelled the first four men in unison. “We didn’t get anything at all. This payment system exploits the poor!” n nSo the nine men surrounded the tenth guy and beat him up. n nThe next day the tenth man didn’t show up for lunch, but the other men sat down and ate without him, anyway. When it came time to pay the bill, they discovered something interesting. Between them all they didn’t even have enough money to pay half the bill. n nAnalysis comes free with this entire story, but I left that part out, tonight. Some folks need to practice THINKING. Seems to be a bit of a Lost Art in too many political circles.