Biden’s decision to call for a federal gas tax holiday – a move once mocked by Barack Obama and viewed with suspicion by leading economists – certainly will not be done by Congress, especially in the face of backlash from the president’s own allies. On Capitol Hill. House Speaker Nancy Pelosi stopped approving the plan in a statement after Biden’s comments.
But he expressed the move as a way to give some relief to the families as he seeks to find a solution to one of his top political problems.
“By suspending the 18-cent gas tax and the federal gas tax for the next 90 days, we can reduce gas prices and provide some relief to families,” Biden said in a statement from the White House.
“I fully understand that the gas tax holiday alone is not going to fix the problem, but it will provide immediate relief to families, a little breathing room as we continue to work to reduce prices in the long run.
Biden called on states to take steps to eliminate their own taxes on gas and diesel. Ahead of a scheduled meeting with executives this week, he said the capacity of oil refining companies should be increased.
Combined, Biden said the wish list could reduce the price of a gallon of gas by $ 1. Yet that figure relies on a number of steps that are completely out of the control of the president — at least one skeptic who convinces Congress to approve his plan.
In his statement after Biden’s comments, Pelosi did not promise to bring a gas tax holiday to a referendum.
“We will see where there is consensus in the House and Senate on the way forward for the President’s proposal,” he wrote.
The move comes as Biden’s latest attempt to show that he is taking the lead in reducing fuel prices as Americans become increasingly frustrated with the financial burden. White House officials have been considering a gas tax holiday for months, but it has been put on hold due to concerns over how it could be obtained in Congress.
Republicans are widely opposed to removing the Cakes tax. Even some Democrats, including President Barack Obama, have called the gas tax holiday a “trick” during the 2008 campaign.
Nevertheless, in the face of growing anger and the start of the summer driving season, Biden decided that even small steps in the index range were worth taking.
“In the situation we are in today, this is not a gimmick. In an interview with CNN “New Day” on Wednesday morning.
The current federal tax on gas is about 18 cents a gallon, while the federal tax on diesel is 24 cents a gallon. Even if the savings are sent directly to the consumer by raising those taxes – this is not guaranteed – the savings for a refill are only a few dollars.
He also sought to use this opportunity to explain his conclusions that contributed to the rise in gas prices. The president backed a ban on Russian energy imports to the United States after Russian President Vladimir Putin’s occupation of Ukraine – a move that Biden agreed to at the time would raise gas prices. Imports from Russia make up a small portion of the US energy sector, with approximately 8% by 2021, of which only 3% is crude oil.
“We could have been blindsided by Putin’s murderous ways, and the price of gas would not have gone up as it did. I hope it would have been wrong,” Biden said. “I believed then and now that there is no other way to a free world.”
Economists are skeptical
Some economists say the savings to consumers will be lower as retailers raise the base price of gas.
“Whatever you think about the specialty of the gas tax holiday in February, it’s a bad idea right now,” Jason Furman, a senior economist in the Obama administration, wrote on Twitter. “Refineries are now more restricted, so supply is almost completely uncertain. Most of the 18.4-cent reduction will be pocketed by industry – a few cents may be passed on to consumers.”
Senior executives agreed with the criticism, but said Biden would pressurize companies to send savings.
“There is no time for profit now,” Biden said, adding that energy companies need to increase refining capacity and reduce prices to produce more gas for U.S. consumers.
“For companies that run gas stations and set those prices at the pump – this is war, global danger, Ukraine. These are not normal times,” he said. “Reduce the price you charge at the pump to reflect the cost you pay for the product.”
Biden searches for victims
The president has raised the heat on oil and gas companies in recent weeks as gas prices have risen, with the national average rising above $ 5 per gallon at one point in the past week.
Biden has blamed Russia’s war on Ukraine for raising gas prices, but called on oil and gas companies to do more than just cut costs and accuse the war of being “profitable.” On Tuesday he reiterated some of those arguments, saying the country needed “more refining capacity”.
“This notion that they have no oil for digging and cultivating is not true,” he said.
In response to the president’s criticism, the oil industry has largely said that it was the Biden administration’s fault that prices were so high that they regard them as limitations on domestic oil and gas production.
Chevron CEO Mike Worth said in a letter on Tuesday that Biden should stop criticizing the oil and gas sector and called for a “change in attitude” from the White House.
“Your management has often tried to criticize and sometimes discredit our industry,” Worth wrote in an open letter to Pitton. “These measures are not conducive to meeting the challenges we face and are not worthy of the American people.”
Biden responded later in the day: “He’s mildly sensitive,” he added: “I did not know they would hurt their feelings so quickly.”