Friday, April 28, 2006

Election Year Disaster

Congress has just had its worst nightmare come true: six months from an election, gasoline prices have gone through the roof and so have oil company earnings. The Republicans were already in trouble, what with corruption scandals and a president whose popularity is beginning to equal that of the missing Osama bin Laden. Now, however, incumbent Democrats are beginning to feel the heat. They can't just stand there and point at their opposition, saying "See? See what failures they are?" Democrats have to do something. But not just anything. The American public has become much too cynical for that. Election-year grandstanding isn't going to cut it for either party.

The NY Times offered Congress a few tips this morning.

The battle to see which political party can out-pander the other on the subject of gasoline prices is embarrassing. If American consumers are having sticker shock at the pumps, it's because of a series of policy failures that stretch back decades. The last thing the country needs now is another irresponsible quick fix.

...The main problem is not environmental regulations or even rapacious oil companies. It certainly isn't the fact that the Arctic National Wildlife Refuge has been kept off limits for drilling. Americans' outsized demand for oil and gasoline pushes up prices, and now that the economies of huge countries like China and India have taken off, there will continue to be more competition for the world's available oil. There are policy solutions for the problem of excess demand, chief among them higher fuel economy standards. But more than five years into the Bush administration, there has been only a minuscule increase in mileage standards for S.U.V.'s and no increase for cars.

The oil companies' mind-boggling profits have produced calls for a windfall profits tax. It would not be too difficult to set up a system that would capture a percentage of the companies' extraordinary profits, and the money could be used for long-term solutions, like research into alternate fuels and mass transit. That would be fair. Oil companies are indeed profiting from events that have little to do with their efforts. If some of those profits were taxed and flowed into the public treasury, the money could go toward public purposes.

...But their [poor and middle class families] problem is more than gasoline prices. It's their vulnerability to the price increases, which results from stagnating wages and a lack of savings. If the Bush administration had devoted as much political capital in the past five years to wage and job growth initiatives as it has to cutting taxes for the wealthy, these struggling families would be better able to weather higher prices at the pump.

Congress's frantic gestures this week are, at bottom, an attempt to divert attention from its past failures to act, and its resulting inability to shield Americans from the burden of high prices at the pump. But the pain of high gas prices will only get worse unless Congress changes its priorities, now.
[Emphasis added]

There will be no quick fix this time. Offering American families $100 to use towards gas purchases is as laughable as it is insulting. Halting the storage of oil in the federal reserve for a period of time sets the wrong precedent. Suspending clean air regulations only dirties the air. Americans will have to suffer through this because prices will drop little, if at all.

Instead, Congress should consider the future. In addition to raising mileage standards, it should also consider dropping the tariffs on Brazilian sugar cane based ethanol and demand car makers design autos that can run on it as they do in Brazil. It should fully fund research into alternative energy sources that would run industry as well as cars and trucks.

And to do this, Congress might consider repealing the tax breaks for the wealthy and for corporations (among them the oil giants). It might also consider tying the Emperor's hands when it comes to further war-making.

And that's just for openers.


Anonymous Anonymous said...

Yep, we're looking at a panic to be on the winning side, with an issue that gets right into everyone's pocketbook and says 'you gotta skimp somewhere else' every time they fill up. Here, the news stories are becoming common about what desperate families are forced to pawn to fill the tank to go to work where they're not making enuff to pay for their basic needs. There is a lot that Congress can do, none of it solved by the $100 stupid congressman trick. One is to cut the $10billion subsidies to resarch for the oil co's. The odds of the congress behaving in adult, responsible fashion are about nil, until after the next election when the thugs get thrown out.


6:39 AM  
Blogger Elmo said...

I can't believe they ever thought giving us all $100 would tide the masses over till election day...these guys are so far out of touch it's unreal!

10:05 AM  

Post a Comment

<< Home