Shame on John McCain…

For shameless pandering on the gas tax.

Both Hillary Clinton and John McCain are proposing to suspend the federal gas tax as a response to rising gas prices; despite the fact that most economist and energy experts think that this is a counterproductive proposal. Obama deserves credit for not joining in the pandering. He has rightly called it a “silly idea.”

I am more disappointed in McCain than Clinton; I didn’t expect better from Hillary. It is not that I think Hillary Clinton is so dumb that she really thinks suspending the gas tax is a good Idea; I think she is so unprincipled and ambitions that she will do whatever it takes to be elected. I expected more from McCain. In the past he talked sense about energy independence, ethanol, and global warming. McCain has to know this is a stupid idea and I thought he had more integrity than to pander with the best of them.

The federal tax on gas is 18.4 cents per gallon. What happens if we cut the tax? For one thing, the price will fall temporarily, which will increase demand for gasoline and result in another increase in price, then when the 18.4 cents is added back, the resulting price will be higher than it otherwise would have been. Another thing that will happen is that not all of the 18.4 cents will be passed on to the consumer. The oil companies will keep part of it.

The reason prices are so high is neither due to an Arab oil embargo nor greedy oil companies. It is primarily due to the increase in demand. The people of India and China are beginning to drive private automobiles. It is basic Economics 101. Demand is exceeding supply and prices are increasing. Another reason is the slide of the dollar. It takes more dollars to trade for the same amount of other currencies and therefore anything we import cost more.

Every administration since the late seventies has talked about energy independence and instead we have steadily moved toward greater dependence. Americans continue to drive more and consume more gasoline every year than they did the year before. Urban sprawl continues and people move further from urban centers. Instead of choosing energy efficient vehicles, people choose to drive gas-guzzling SUVs.

What are the negative effects of increased gas consumption?

(1) We finance our enemies. It is an unfortunate accident of geology that the countries with the most oil are ruled by fanatics and despots. Saudi Arabia is officially an ally, but it has a Muslim population that takes seriously the mandate of their faith to give alms. So, American dollars flow to Saudi Arabia, some of which ends up the pockets of devout Muslims and they give to the clerics who build Wahhabi Muslim schools throughout the world where people are taught the most violent and radical strain of the Muslim religion. Every time you fill up your SUV you are contributing to the radical Muslim cause and the training of terrorist. Also we are financing the anti-Americanism of the Venezuelan dictatorship.

(2) We are increasing the rate of Global Warming. Despite all of the concern about global warming and all the talk about combating it, we have not yet decreased the rate of increase in CO2 emissions. Feel-good environmental measures and exhortations to properly inflate your tires and change light bulbs and wear a sweater are not going to be sufficient to curtail global warming. It is going to take some pain and sacrifice.

In today’s newspaper there was an article, Small-car sales help Nissan end April with gain. The article said that while U. S. auto sales were declining that the sale of the Nissan Altima and subcompact Versa was showing gains. Honda, Toyota and Volkswagen are also posting increased sales. Americans are starting to fall out of love with their gas-guzzlers and to prefer small fuel-efficient cars.

In yesterday’s newspaper there was an article that said "Demand for gas eases slightly as more carpool.” Markets work. Supply and demand is not right-wing dogma. it is as true as gravity. People cannot change their behavior overnight however but we are starting to see a decrease in demand. If gas prices were high and people thought they would stay high we would see greater reductions in consumption. Overtime, the American vehicle fleet would shift to more fuel-efficient cars. and we would start to see a lessening of urban sprawl. The cost of gas would enter into the equation in many decisions consumers make. Conservation would be cost effective is prices were expected to stay high. Investment in alternative fuels and alternative technologies would be worth the investment if there were not an expectation that gas would stay high. If we want to continue the trend of reducing gasoline consumption then we do not want to lower gasoline prices.

It is best if we do nothing about high gas prices and let the demand for gas fall.

Hillary, I didn’t expect better from you. John McCain, shame on you.

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