On 6/22/2022, Joe Biden called on Congress to suspend federal gasoline and diesel taxes until the end of September, framing the move as necessary to provide relief to American consumers but itself not enough to resolve the problem of surging energy prices. At issue is the 18.4 cents-a-gallon federal tax on gas and the 24.4 cents-a-gallon federal tax on diesel fuel. “By suspending the 18-cent gas tax, federal gas tax for the next 90 days, we can bring down the price of gas and give families just a little bit of relief,” Biden said in a speech from the White House. Biden also called on states to take steps to remove their own taxes on gas and diesel. And he told oil refining companies to increase their capacity ahead of their planned meeting this week with administration officials.
Biden’s decision to call for a federal gas tax holiday — a move once derided as a gimmick by Barack Obama and viewed skeptically by leading economists — almost certainly won’t make it through Congress, especially as it faces blowback from the President’s own allies on Capitol Hill. But Biden cast the move as a way to give some relief to families as he tries to find solutions to one of his top political problems.
Republicans widely oppose lifting the gas tax. Even some Democrats, including House Speaker Nancy Pelosi, have been cool on the idea. And in the past, senior Democrats — including President Barack Obama on the campaign trail in 2008 — have cast a gas tax holiday as a “gimmick.” On 3/31/2022, Speaker Nancy Pelosi (D-Calif.) poured cold water on the idea of suspending federal gas taxes as a way to reduce the cost of higher gas prices for consumers. “There’s a lot of pro showbiz. ‘Okay, let’s do something, that’s it.’ But it doesn’t necessarily end up in the consumer’s pocket,” Pelosi said at a press conference at Capital. Pelosi acknowledged that a proposal put forward by some Democrats in recent weeks looks attractive in principle. But she argued that it doesn’t help consumers much in the long run because it doesn’t need to pass the savings on to oil companies. In addition, suspending the gas tax would take away the primary source of funding for the Highway Trust Fund, which finances roads and mass transportation.
In 2008, Barack Obama bashed a “gas tax holiday” as a “gimmick” and not “real relief”. “For us to suggest 30 cents a day for three months is real relief, that that’s a real energy policy, means that we are not tackling the problem that has to be tackled,” Obama said.
Even CNN wasn’t going for it. Matt Egan gets that it could increase demand and is raising the alarm that it could make inflation worse. It polls well, but it doesn’t mean it’s good to do, Egan said. He says Biden’s proposed gas tax ‘holiday’ “this does nothing”. And CNN’s John Harwood admits Biden’s gas tax proposal “doesn’t solve the underlying problem”.
White House Advisor Heather Boushey so clear Biden cares about lower gas prices, still must transition. She says don’t worry about a recession, there’s enough wiggle room.
Energy Sec. Jennifer Granholm world upheaval allows us to act strategically about going green.
Fed Chair Jerome Powell on Wednesday testified before the Senate Banking, Housing and Urban Affairs Committee on inflation and the US economy. Powell was asked if the war in Ukraine is the primary driver of inflation in the US. “Would you say that the war in Ukraine is the primary driver of inflation in America?” Powell was asked on Wednesday. “No. Inflation was high before, certainly before the war in Ukraine broke out,” Powell said contradicting Joe Biden. Powell also told Congress that he anticipates ongoing rate increases as he tries to tame inflation.
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Biden proposed gas tax holiday, Pelosi says Gas Tax Holiday “Showbiz,” Obama says “Gimmick”.