Clinton, on the attack, takes to the airwaves on ‘gas-tax holiday’
It’s one thing for a good presidential candidate to embrace a bad idea. It’s worse when the candidate knows it’s a bad idea. It’s worse still when the candidate attacks her rival for failing to embrace a bad idea. And it’s the worst when the candidate feels so strongly about the bad idea that she starts running television commercials about it.
And that, unfortunately, is exactly what we have in the case of Hillary Clinton and the “gas-tax holiday.” Her campaign unveiled a new TV ad yesterday in North Carolina and Indiana attacking Obama for not supporting a temporary suspension of the 18.4-cent federal gas tax.
After mentioning Clinton’s plan to temporarily freeze foreclosures, the announcer in the ad tells viewers, “Now gas prices are sky rocketing and she’s ready to act again. Hillary’s plan: use the windfall profits of the oil companies to pay to suspend the gas tax this summer. Barack Obama says no again. People are hurting. It’s time for a president who’s ready to take action now.”
I don’t doubt that Clinton’s focus groups found all of this quite compelling. People are livid over gas prices, and if Clinton tells them she’s going to cut the price by lowering a tax when families are most likely to be driving more, they’re very likely to respond well.
But Clinton’s proposal has no merit, and would probably do nothing but boost the profits of oil companies. Clinton, an incredibly smart, detail-oriented policy wonk, no doubt knows this, but cynically hopes to score a few points with an awful.
It’s rather transparent demagoguery. Worse, it’s crude and cheap demagoguery.
Harvard economist Greg Mankiw noted yesterday, “I don’t know any prominent economist who favors this McCain-Clinton proposal. More common is the reaction of a friend of mine (a veteran of the Clinton administration) who calls the idea ‘ludicrous.'”
Paul Krugman, usually a rather enthusiastic Clinton supporter, explains:
Why doesn’t cutting the gas tax this summer make sense? It’s Econ 101 tax incidence theory: if the supply of a good is more or less unresponsive to the price, the price to consumers will always rise until the quantity demanded falls to match the quantity supplied. Cut taxes, and all that happens is that the pretax price rises by the same amount. The McCain gas tax plan is a giveaway to oil companies, disguised as a gift to consumers.
Is the supply of gasoline really fixed? For this coming summer, it is. Refineries normally run flat out in the summer, the season of peak driving. Any elasticity in the supply comes earlier in the year, when refiners decide how much to put in inventories. The McCain/Clinton gas tax proposal comes too late for that. So it’s Econ 101: the tax cut really goes to the oil companies.
The Clinton twist is that she proposes paying for the revenue loss with an excess profits tax on oil companies. In one pocket, out the other. So it’s pointless, not evil. But it is pointless, and disappointing.
Thomas Friedman added that the McCain-Clinton proposal is “a reminder to me that the biggest energy crisis we have in our country today is the energy to be serious.”
It is great to see that we finally have some national unity on energy policy. Unfortunately, the unifying idea is so ridiculous, so unworthy of the people aspiring to lead our nation, it takes your breath away. Hillary Clinton has decided to line up with John McCain in pushing to suspend the federal excise tax on gasoline, 18.4 cents a gallon, for this summer’s travel season. This is not an energy policy. This is money laundering: we borrow money from China and ship it to Saudi Arabia and take a little cut for ourselves as it goes through our gas tanks. What a way to build our country.
When the summer is over, we will have increased our debt to China, increased our transfer of wealth to Saudi Arabia and increased our contribution to global warming for our kids to inherit.
No, no, no, we’ll just get the money by taxing Big Oil, says Mrs. Clinton. Even if you could do that, what a terrible way to spend precious tax dollars — burning it up on the way to the beach rather than on innovation?
The McCain-Clinton gas holiday proposal is a perfect example of what energy expert Peter Schwartz of Global Business Network describes as the true American energy policy today: “Maximize demand, minimize supply and buy the rest from the people who hate us the most.” Good for Barack Obama for resisting this shameful pandering.
Alex Koppelman reminds me that “political campaigns are rarely about the actual merits of policy proposals.” That’s painfully true. Demagoguery works. Playing on voters’ fears and ignorance works. Confusing the public with bad ideas that sound good works.
But I really don’t think Clinton wants to win this way. She’s smarter and better than cheap pandering.
Worse, all of this reinforces Obama’s argument that he’s more honest, principled, and willing to tell people the truth, even when they don’t want to hear it. Obama wants to present himself as a “different kind of politician,” and Clinton’s gas-tax attacks are making it easier for him to do so.
I’m absolutely certain that McCain and Clinton know full well this gimmick wouldn’t do anything to help consumers, and may actually make matters worse by encouraging consumption, pushing prices higher.
They know this, but are pushing the idea anyway, hoping, cynically, that it will pay political dividends anyway. What a shame.
when most economists say its a bad idea, even the ones who support you you know its a bad idea.
Still it shows we need president Obama instead of the other two jokers
But I really don’t think Clinton wants to win this way.
Why?
(Same Q goes for McCain).
I smell Mark Penn. (Ew!)
I’d rather have one of the candidates ask Bernanke not to lower interest rates again today. This leads to a weaker dollar and higher gas prices. It seems to me that it affects a whole lot of people a lot faster than a miniscule easing of credit. Or am I missing something here?
This issue is a GIFT to Obama– it’s a two-fer. It makes Hillary look like a republican and helps him define himself as someone who isn’t just trying to say pretty-sounding words.
Obama needs a quick counter ad to explain that if your 12-gallon tank costs $45 to fill up then this “tax holiday” could save you, at most, $2.25. If you fill up your tank once a week we’re talking about a savings of, approximately, $30 for the whole length of the “holiday.” Then show clips of McCain saying “this will help famlies take vacations” and Hillary boasting how critical this tax holiday will be to help struggling American families. End it with a statement about how this shows both Hillary and McCain are OUT OF TOUCH with the problems of struggling Americans.
It is nothing but a nice sounding GIMMICK and an insult to Americans who they assume don’t think and can’t do any basic math.
Thanks Hillary– this could be the very issue that helps define what kind of president you’d be and what kind of president Obama would be.
zoe (5) Actually Obama did say yesterday it would only help 25 to 28 dollars, while costing 300,000 construction jobs. It would make a good ad, though.
I didn’t catch the 300,000 job loss part– that makes it worse than a gimmick, it’s BAD PUBLIC POLICY.
Obama better jump on this, it could be a great defining moment for him. Everyone cares about gas prices right now, so it’s the kind of policy issue that could really get the public’s attention.
If it works, next Wednesday people will be like “Rev. Wright who?”
Cheap pandering is the Clinton way in or out of the white house. The Clinton’s will sell Americans out just to win for greed,avarice and power.
“It’s time for a president who’s ready to take action now.”
That just makes no sense. None of these candidates will be president now.
Obama needs to play up his experience with this in Illinois. “We tried this before in Illinois, and it didn’t work. My experience shows me that this is nothing more than a gimmick which won’t help drivers the slightest bit.”
That argument would play well in Indiana, where he could remind them that the state tried this to no avail in 1999.
I’m so glad that Hillary is pushing this in Indiana and NC– once again I don’t understand why she’s running this campaign the way she is. She’s a smart woman with a lot of political experience, but she’s about to set a trap for herself (that she thinks she’s setting for Obama) and then fall directly into it.
If she’s running ads on this then his campaign will have no choice but to counter them– all they need to do is put together clips of her and McCain boasting about how much this would help everyone. Then provide the math and job losses that would result.
Thanks, Hillary. The timing couldn’t be better.
The gas prices are finally sending a clear signal to consumers that their best individual and collective strategy is to conserve by driving less and purchasing much more efficient vehicles. Rather than pander by dropping the federal gas taxes the candidates would achieve much greater credibility by driving home the conservation message and proposing to accelerate even further the schedule for implementing the new CAFE standards.
Is Hillary or Obama or McCain going to come out with proposals to scale back the mandates on making ethanol from corn or dropping the federal subsidies for ethanol? This would potentially have much greater impacts on cost of living that screwing around with the federal gas tax.
You don’t need to run a poll to know that the average Indiana voter doesn’t read Tommy Friedman and has no clue of wtf elasticity of supply means. Hilary will win Indiana and the democrats will get a fair chance in November.
I’m stunned — CNN is running a piece which calls the idea a bunch of BS and makes Obama look like the right one.
It’s been reported the “holiday” would cost $8 billion in taxes that would otherwise be used to repair and maintain the nation’s infrastructure.
But I really don’t think Clinton wants to win this way. She’s smarter and better than cheap pandering.
If I had a lot of time, I could go back through here and find all the times you’ve had to say something basically like this. I think it’s sweet (and reflects nicely on you as a person) that you continue to do so, but at a certain point you may have to realize that yes, she does want to win this way, ANY way. She will in fact do and say anything, even if she’s “smarter than that.”
Same old same old. In a lot of ways this highlights why Clinton will be Bush with breasts. Her view is that doing almost nothing in the name of progressives as long as it doesn’t hurt the status quo that got folks into that mess is better than actually changing the status quo for the better. The rhetoric will sound better, but the end result will be the same, nothing gets done. Pointless and insulting to progressives aka LIBERALs.
Lewis Black once said (paraphrased because I don’t have the exact quote), “Repubs say I have a really shitty idea! Democrats say I can make it worse!”
But I really don’t think Clinton wants to win this way. She’s smarter and better than cheap pandering. I think not! I think Clinton wants to win any way she can, and if she can’t she wants to bring Obama down so she can try again in 2012.
He needs to run an ad that basically says the $25-30 bucks you *might* (depend on how fast they hike the price back up) save this summer will then come right back out of your pocket in the next three months, and then the next three months, and then the next three months.
There’s no way in hell that the oil companies don’t raise the price an extra little bit each time this summer to gain this 18 cents for themselves and then tack the 18 cents back on top come September.
I knew it was only a matter of time before some sex-obsessed troglodytic guy mentioned breasts and Hillary in the same sentence.
Good catch on the math, zoe. And it’s good to see Obama picked it up too, Danp.
Another thing — if gasoline prices went down 18 cents, we’d be back to where we were, like, two months ago. When gas prices were already too high.
The gas tax reduction won’t cost 300,000 jobs. It will barely cost any jobs at all.
Clinton and McCain are hypocrites.
How can you be for reducing green house gases AND be for an incentive to create more green house gases.
McCain might not know any better. But Clinton is smart enough to know she is wrong.
Gas prices will fall late summer/fall as we get closer to the election and Hillary/McLame will then be able to claim that “their” idea helped to make this happen so they can take credit. You know these people don’t do anything for nothing: Hillary creates a wedge against Obama now which might help her in Indiana and neutralizes McLame in the fall after she has stolen the nomination.
I agree with Jen @ 15. Your avowed neutrality is putting a strain on intellectual honesty, CB– it’s abundantly clear at this point in the race that Clinton would be happy to win no matter what it takes. It was easy to take the position that they’re all respectable candidates back in January; it’s much harder to make that argument now.
Worse, all of this reinforces Obama’s argument that he’s more honest, principled, and willing to tell people the truth, even when they don’t want to hear it. Obama wants to present himself as a “different kind of politician,” and Clinton’s gas-tax attacks are making it easier for him to do so.
Why’s that “Worse”?
Steve, what’s worse is that Clinton is dividing the Democratic Party on the issue when it should be speaking with one voice against McCain’s pandering proposal.
Lets take a look at how this ‘tax cut’ will really effect the average American.
Assumptions: 1500miles driven monthly, average 15mpg
1500/15 = 100 gallons of gas used monthly
18.4 cents MAXIMUM savings per gal x 100 gal = $18.40
$18.40 x 3 months summer drive season = :$55.20 average maximum savings net to driver
Why are we making a campaign issue out of saving Americans LESS than 75.00 over a three month period?
This is being communicated in a way that the average unthinking American sees some great benefit to them.
Yes … going from $4 a gallon to $3.80 is going to make such a huge difference in our lives, isn’t it, McClinton?
I’ll repeat what I posted yesterday: How’s about we keep the tax, raise the taxes on oil companies, and use that revenue for research into other ways to power our cars … such as batteries that last longer and charge faster, along with more efficient solar power stations which we could have on the side of our houses or apartments to charge our cars.
It’s not like we’re creating flying cars — just ones that don’t run on gas. They’re already out there and can be improved and mass produced.
So what the holy hell are we waiting for?! Seriously … WTF?
Gas prices will fall late summer/fall as we get closer to the election and Hillary/McLame will then be able to claim that “their” idea helped to make this happen so they can take credit.
In this case, I think they may think they’re being smart, but I’m betting on the oil companies wanting more money to outsmart them. Come Labor Day and the return of the tax, when the price bumps back UP 18 cents? Then they’re going to be stuck, because no one’s going to be happy with them then. Then they are rather forced into the corner of having already raised the price by their pandering and having to do it again, for some made up reason, when the price goes back up.
McCain will call for it to continue, being a tax-cutter, while Clinton will call for more taxes on the oil companies, which they’ll promptly pay for by raising prices (again). And I don’t think that’s a win or a loss for them. The money people “saved” will be used toward the new and higher prices. They’ll have to come up with some other pander to help themselves out.
I’ve heard Obama speak twice (in person) and each time when he’s mentioned the need to improve our infrastructure (which also means jobs, here) the audience has gone wild. It’s not like people are dumb, we know what needs to be done. It’s just hard to do the right thing when the wrong thing seems so attractive and so easy. Ooooh, shiny! Especially hard when the other two people in the race are very attracted to showing us shiny things.
neil wilson (21):
Here’s my source. http://www.nytimes.com/2008/04/29/us/politics/29campaign.html?_r=1&bl&ex=1209614400&en=336577f1089edce7&ei=5087&oref=slogin
What’s yours? Or are you merely suggesting that McCain will simply let the deficit rise to counter the lack of revenue. I’ll concede that if Hillary’s plan were carried out, these jobs would continue. But I would also ask, is anyone in Washington even talking about either McCain’s or Clinton’s proposals?
TR, I was amazed that MSNBC was calling McCain’s policies vapid and really railing on him last night. I thought there might be a breakthrough but then Tweety (who was the guy in the box on this particular show) went into typical Matthews Meltdown Mode and I had to change the channel.
But, that said, both CNN and MSNBC have shown a bit of a different slant of late.
They’re finally starting to realize that there’s money in them thar liburals, don cha know.
You don’t need to run a poll to know that the average Indiana voter doesn’t read Tommy Friedman and has no clue of wtf elasticity of supply means. -Javier A
So you’re basically saying you know it’s pandering to the lowest common denominator, the low information voter, and you’re okay with it because it’s your candidate who is doing it?
You may me fucking sick. Get the hell out of my party.
Your avowed neutrality is putting a strain on intellectual honesty, CB– it’s abundantly clear at this point in the race that Clinton would be happy to win no matter what it takes. -JRD
I, too, completely agree.
This from 2MillionLightYearsToAndromeda at TP:
Full unedited story at: http://www.afterdowningstreet.org/node/33094
BTW, has anyone seen ExxonMobil’s first quarter profits? I saw Shell and BP (a whopping $13,000,000,000 combined!!)
lucidthinker: “Why are we making a campaign issue out of saving Americans LESS than 75.00 over a three month period?”
Good question. Notice, though, that $75 in three months can be annualized to $300, making the gas tax holiday as effective as the “stimulus” being deposited this week.
Bush, McCain and Hillary all are promising to use the magic wand to lower gas prices.
Bush pimps the ANWAR scheme as panacea for the pain and now McCain and Hillary are shilling for this phony tax holiday.
You’d think people would get tire of more the same.
Thanks for doing the math lucidthinker. There’s an easy ad for Obama:
“In the spring of 2006, a gallon of gas rose to $2.80. Republicans offered Americans $100 dollars to help them cope with the expense and the American people said it was an insult.
Now gas is nearing $4.00 a gallon and Senators McCain and Clinton want to give Americans … $75 dollars.
McCain/Clinton. They’re not good at math, they’re not good at listening, they’re not good for America.”
It’s a bad idea all right, but nothing in comparison to the colossal waste of $160 billion in the superpander of the century so far – the tax rebate stimulation plan. Now where did the candidates line up on that fiasco?
Think how much good could have come from investing that sum in long term solutions to the energy crisis, global warming, deteriorating infrastructure and fixing our broken health insurance system.
But no, we couldn’t do that. We had to pander to the people, and squandor an opportunity to act responsibly with a plan that would bolster the economy long term, create jobs, and solve real problems. No, we had to throw money at people in the hopes they’d use it buy more useless trinkets at Wal-Mart.
Where’s the outrage?
It shows a very ugly side of the Clinton administration and their love for Marc Rich and need to protect our “economic interest” in the Mideast.
I guess I’ll say it again. There were two presidents that lied this country into war with Iraq on the grounds of WMD – one was Bush and the other one was Bill Clinton.
Hillary Clinton, like Bush is loyal to Big Oil and NOT to American citizens – she lied the same as Bush lies – so it’s going to be a “we can’t get out of the war in Iraq because terrorist will take control of the oilfields if we leave” redux. Marc Rich was all you ever needed to know about the Clintons.
Good question. Notice, though, that $75 in three months can be annualized to $300, making the gas tax holiday as effective as the “stimulus” being deposited this week.
I realize I’m sounding like a broken record here but there is NO guarantee that the cut in price will remain throughout the summer. In fact, the greatest likelihood is that it will become an extra 18 cents in profit for the oil companies.
Is there any way to prevent that from happening that I’m not seeing? Gas prices go up in the summer…so they’ll drop them down 18 cents Memorial Day and each week when prices go up due to summer demand (and all the other assorted reasons), they’ll tack on several extra cents. Soon the “non-taxed” price will include an extra 18 cents that no one saw being added specifically.
Then comes fall and the return of the 18 cents. Added on to the already inflated by nearly that amount price. Basically Clinton & McCain are begging oil companies to make more money from a gallon of gas at our expense.
The gas tax “stimulus” is a little different from the other stimulus in that you have to BUY MORE GAS to get more of a benefit. Aren’t we aiming to BUY LESS?
Last night NPR had an economist on who pointed out that if you lower the price, you increase the demand, and in the summer prices normally go up because of increased un-met demand, so that if you take off the 18 cents (which doesn’t matter a rat’s ass when you’re paying $3.95/gal as I am here in Lost Angles), the end result is that if this encourages people to buy more gas, it will end with the price rising at least that much a gallon. The result is the government out the money, the motorists are out the money, nothing has been saved, and Mrs. Billy-J – that Goddamned Corrupt Mendacious Bimbo – has another “made things worse” to put on her resume (in addition to “making it worse for the next woman who runs for office and any woman who depends on the gains of feminism,” and “made it worse for universal health care”) – she’s almost as good at making things FUBAR as The Slickster was.
Barack should address the Real Reason we have high gas prices, especially there is gas-a-plenty in Iraq!
Do McCain and Hillary understand how our government / constitution work?
It is the Legislative branch that raises taxes not the Executive branch.
If this is such a great idea why haven’t either of them introduced a bill into the Senate to create this “holiday”?
Horrible pandering.
Rubbish. She’s quite happy to win that way. And although she may be smarter than this cheap pandering, she has more than demonstrated that she is not better than it.
She will say anything and do anything …
Sure, go ahead, reduce or eliminate gax taxes temporarily. Just make sure that they come back higher once gas prices stabilize and when they do come back they come back levied as a percent of the price of gas, not as a flat rate per gallon.
Back in the early ’90s, when gas was around $1.20/gallon, the 18.4 cent gas tax represented roughly a 18% tax on the cost of gasoline. Now, through the magic of inflation, the tax has been reduced to a third of its previous level. If the price of gas is $3.25 including the tax, then the tax is a 6% tax.
Let’s be clear here, this gas tax holiday is a lot like your vacation from work. You have to work OT (twice as hard) to clean out your in box before you leave and no one does your work while you’re gone so you have to work OT when you get back too. So you win yet you lose.
In the case of the gas tax, you get a break, the oil companies take it away and you get to pay for the break with your federal tax dollars….hmmmmm. Sounds like a deal to me.
I’d just like to point out that the “gas tax holiday” did little to help people in Illinois when local politicians tried that crap here..
Let’s move past the general consensus that the “gas tax holiday” is complete nonsense and that we need to support and advance alternative energy solutions. The best and most inclusive plan I have read to date is The Institute for Energy and Environmental Research’s (www.ieer.org) new publication, Carbon Free and Nuclear Free : A Roadmap for U.S. Energy Policy. Let’s look at these numbers and hypothesis and, if these precepts stand, bring this overall approach to the discussion as the blueprint for our (now non-existent) energy policy.