refueling at the pump

Gas prices are at their lowest point since the Clinton administration, and Republicans are wasting no time thinking up new ways to increase the burden on consumers.

The Republican-controlled Senate is now proposing a gas tax increase that would be used to help make up for shortfalls in highway budgets. The proposed increase would add 12 cents per gallon to the price, regardless of the price at the pump.

The proposal is under consideration, thanks to incoming Republican leader of the Senate Transportation Committee, Senator John Thune of South Dakota, a huge proponent of the Keystone XL pipeline project. Thune says the highway fund is looking at “about a $100 billion shortfall.” Many KeyXL advocates use rising gas prices as a justification for the project but few of them explain that the result of KeyXL would be to  create more oil exports. Critics of the pipeline say there’s little to no cause and effect for gas prices in America should the Keystone XL pipeline be passed:

Senator John Thune thinks that 65% of Americans want the Keystone XL pipeline. Maybe 65% of Americans say that, but that “support” may signal that they don’t understand the real effects the pipeline would have.

Consider this subsequent poll that finds that 77% of Americans support restrictions on oil exports if those restrictions help keep domestic gasoline prices down. The absence of Keystone XL is a significant practical export restriction. As we’ve discussed here numerous times, TransCanada’s business case for Keystone XL is to make more money by clearing the North American glut, pushing its oil out to China and other global bidders, and raising our gasoline prices here in America.

Thune is not the only Republican suddenly lamenting that the gas prices are too low for consumers while pandering to big oil’s hyperbole. Obama’s presidency has largely been scapegoated for high gas prices every time that gas prices have risen, ignoring the fact that often states have raised their taxes to make up for budget shortfalls. Gas prices across the US have managed to  lower, despite these taxes that vary state to state.

Yesterday I reported that the Koch-funded Institute for Policy Innovation recently rolled out a low-key editorial page propaganda campaign against new EPA fuel efficiency guidelines. Merrill Matthews, a scholar for the think tank, complains in his editorials that inexpensive gas leads to increased fuel consumption – making driving so affordable that more consumers could take up the habit.

The federal gas tax currently sits at 18.4 cents per gallon. If the proposal is passed, the tax would be increased to 30.4 cents per gallon. State gas taxes range from 50.6 cents per gallon in New York to as low as 8 cents per gallon in Alaska.

In places like Erie, Pennsylvania, a federal gas tax increase will hit hardest just as residents are getting a reprieve from soaring prices. Residents already bear the burden of a fresh 9.8-cent-per-gallon increase that took effect Jan. 1 to fuel much-needed road and bridge improvements, less than a year after a similar 9.5 cent increase that took place on wholesale gas prices. The costs of wholesale gas price increases is almost always passed onto the consumer:

Just when the price is going down, they find some way to rip us off,” said Wanda Wofford, of Meadville. Wofford commutes to work daily in Albion, where she is a nurse at the State Correctional Institution. She estimates that she currently spends $400 to $450 a month for gasoline to and from work. An almost 10-cent-per-gallon increase in pump prices will severely limit discretionary spending, she said.

Look forward to hearing similar stories across the US if the new gas tax is approved.

And rest assured, the Republicans will make sure to blame Obama and the Democrats in 2016.

 

 

  • Ratcraft

    That’s funny, in my state of Washington the Gov Jay is trying to add to our high gas tax (one of the highest in the nation) to do the same thing, he is being thwarted by the republicans…….

  • cacodoxy

    That is just sad to hear. I filled up yesterday and barely broke a twenty dollar bill doing it. That was with a few perks from my store card but I was still happy to be paying that. The very last thing I want is to see prices go up again even for something like this. I don’t live in a rich state but our roads are still pretty darn good.