Politicking Over High Gas Prices
High gas prices are causing a ruckus in Washington D.C. as politicians scramble to please constituents disgruntled about having to pay more at the pump. The Republicans have cobbled together an eight-point plan which includes a $100 rebate to to approximately 100 million Americans, opening up the Arctic National Wildlife Refuge to drilling by oil companies, investing more resources in renwable energies, increased tax breaks from hybrid car owners and increased taxes on oil company profits when prices are over $55 a barrel. (Bush has said he will veto any bill that includes this last provision.) The price tag of this bill has been approximated by aides at $20 billion.
What's unfortunate is that I do support the Republicans on many of the proposals, but the bad still seems to far outweight the good. Go ahead and increase tax breaks for hybrid car owners--I've heard rumors that these cars don't pay for themselves in cash saved on gas anyway, so let's at least reward people for being good to Mother Earth. And investing heavily in renewable energies is something the federal government should have done long ago. However, I have serious issues with the other points outlined above. Taxing oil companies sounds great initially, but there seems to be some scholarship indicating that BigOil benefits the economy because for the past several years, they have been investing a greater sum of money than their reported profits. (I'll try and locate the article where I read this and post it here.) So I vote for a little bit more digging to be done before we do more harm by funneling dollars from the private sector to the notoriously-inefficient public sector. As for opening the Arctic to drilling--all I have to say is, hands off! We don't need oil badly enough to damage one of the last pristine areas left in this country. As for the price tag, is it really wise to be adding another $20 billion to the monstrous federal deficit? Finally, what is with the $100 hand-out? Is that supposed to make a material difference to people who drive to work every day? And for the rest of us, is that $100 supposed to provide some consolation? If it weren't such a pathetic gesture, it might actually be insulting.
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There are some great articles about how a higher gas price may actually benefit American strategic interests, if we would only look further than the immediate short term consequences for our wallets. After all, if what we want is to reduce our dependance on foreign crude, the best first step might be to jack up prices and force ourselves to pursue alternatives. Thomas Friedman has a great piece in the Times discussing such a strategy, as does Virginia Postrel on the Dynamist blog. Friedman warns:
What's unfortunate is that I do support the Republicans on many of the proposals, but the bad still seems to far outweight the good. Go ahead and increase tax breaks for hybrid car owners--I've heard rumors that these cars don't pay for themselves in cash saved on gas anyway, so let's at least reward people for being good to Mother Earth. And investing heavily in renewable energies is something the federal government should have done long ago. However, I have serious issues with the other points outlined above. Taxing oil companies sounds great initially, but there seems to be some scholarship indicating that BigOil benefits the economy because for the past several years, they have been investing a greater sum of money than their reported profits. (I'll try and locate the article where I read this and post it here.) So I vote for a little bit more digging to be done before we do more harm by funneling dollars from the private sector to the notoriously-inefficient public sector. As for opening the Arctic to drilling--all I have to say is, hands off! We don't need oil badly enough to damage one of the last pristine areas left in this country. As for the price tag, is it really wise to be adding another $20 billion to the monstrous federal deficit? Finally, what is with the $100 hand-out? Is that supposed to make a material difference to people who drive to work every day? And for the rest of us, is that $100 supposed to provide some consolation? If it weren't such a pathetic gesture, it might actually be insulting.
...
There are some great articles about how a higher gas price may actually benefit American strategic interests, if we would only look further than the immediate short term consequences for our wallets. After all, if what we want is to reduce our dependance on foreign crude, the best first step might be to jack up prices and force ourselves to pursue alternatives. Thomas Friedman has a great piece in the Times discussing such a strategy, as does Virginia Postrel on the Dynamist blog. Friedman warns:
This is not your parents' energy crisis. The price of oil is not soaring just because of greedy oil companies. It is soaring because of structural changes in the global energy market that could have vast consequences for America and the world if we do not respond in a comprehensive manner.
posted by the Assistant at 12:53 AM
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