Tuesday, April 20, 2010

The Coming Gasoline Tax Increase

PresObama.jpgLast week the Obama administration received wide attention for its opposition to increasing the federal gasoline tax. In response to a Senator's question about whether the White House does in fact hold that view, Deputy Secretary of Transportation John Porcari affirmed in front of the Environment and Public Works Committee:
"That is still...the position, and I would add, Senator, as we are in the beginning stages of a recovery it is as important as ever to make sure that recovery is accelerated in every way possible."
Porcari's statement is clear and straightforward: President Obama does not support higher gasoline prices because they would undermine economic recovery.

The statement is also completely untrue.

While the Obama administration may pay lip service to the idea of not unilaterally raising the gasoline tax, in reality the President does support higher gasoline prices, specifically through his unwavering support for a devastating new energy tax.

Last summer, as the House was about to pass the Waxman-Markey cap and trade bill, President Obama urged members of Congress to support it, calling the measure "a historic piece of legislation that will open the door to a clean energy economy and a better future for America."

But that particular Obama-endorsed energy tax would have raised gasoline prices by $1.38 per gallon, the same thing as raising taxes on every American motorist.

In addition, researchers at Harvard University recently found that President Obama's own energy policy would require dramatically higher gasoline prices. Their study concluded that to meet the President's emissions reduction targets, gasoline prices may have to spike to $7 per gallon.

Even the forthcoming energy tax being drafted by Senators John Kerry, Lindsey Graham, and Joe Lieberman is set to include a carbon fee on transportation fuels, a fancy way of raising gas prices without actually calling the measure a tax. (Kerry, Graham, and Lieberman have tried to overshadow that fact by allowing for more offshore drilling, but the fact is the bill will not pass if it includes those drilling provisions.)

The Obama administration has promised to work with the trio of Senators on passing their energy tax once the draft is released.

Perhaps Transportation Secretary Ray LaHood's recent pronouncement was more prophetic than he intended: "This is the end of favoring motorized transportation at the expense of non-motorized," LaHood recently wrote on his blog.

Despite statements to the contrary, it's clear that the Obama administration supports higher gasoline prices, which is actually part of its broader strategy to impose higher energy costs on all Americans.