Rick Klein is ABC News' Senior Political Reporter and author of The Note's morning look at the upcoming day in politics. Throughout the day, ABC News' political team contributes to The Note with the very latest news and analysis from the nation's capital.
To email Rick Klein, click here.
RECENT POSTS
- The Note's Must-Reads for Thursday, November 26, 2009
- Palin to Headline 'TEA Party Convention'
- GOP Strategist Predicts "Purity Test" Resolution Fails at RNC
- Democrats Divide on War Tax
- Gibbs: Obama to Emphasize Exit Strategy
- Price Tags: Costs Rise for Obama on Afghanistan
- The Note's Must-Reads for Wednesday, November 25, 2009
- ‘Top Line’ with Sally Quinn -- Inside the First Obama State Dinner
- GOPers to Biden: Stop Using Stimulus Jobs Numbers
- Exit Ramps: Democrats Grow Restless on Afghanistan Strategy
THE NOTE CATEGORIES
- 2010
- Afghanistan
- Bill Clinton
- CIA
- Congress
- Democratic party
- Environment
- Financial Reform
- GOP
- Gov. Mark Sanford
- Gov. Sarah Palin
- Guantanamo
- Health Care
- Hillary Clinton
- Immigration
- Iran
- Iraq
- John McCain
- Mitt Romney
- North Korea
- Obama Agenda
- Politics Live
- President Obama
- Republican Party
- Ronald Reagan
- Sen. John Ensign
- Senate
- Sonia Sotomayor
- Stimulus
- Sunday Shows
- Supreme Court
- Ted Kennedy
- The Note
- The Note Must-Reads
- Top Line
- Vice President Biden
- Virginia
MONTHLY ARCHIVES
« Previous | Main | Next »
Momentum for Gas-Tax Hike?
January 02, 2009 10:58 AM
ABC News’ Rick Klein Reports: Raising taxes ranks among the last things smart Democrats want to do with their newfound control of Washington. Raising taxes on gasoline -- where low prices constitute one of the few perceived bright spots for a struggling nation -- is a surefire political loser.
Right?
Don’t look now -- but momentum is starting to build from influential corners for an increase to the federal tax on gasoline.
The rationale: With a crumbling road-and-bridge infrastructure, and widespread interest in investing in renewable energy initiatives, widening a reliable revenue stream is tempting.
The thinking is that drivers can afford to pay more than the current 18.4 cents a gallon federal tax on gasoline (the tax is 24.4 cents a gallon on diesel), now that gas prices are well beneath $2 a gallon again.
According to the Associated Press, the National Commission on Surface Transportation Infrastructure Financing -- created by Congress to analyze ways to pay for federal transportation initiatives -- will recommend this month an increase in the federal gas tax of about 10 cents a gallon, and slightly more for diesel.
Environmental groups have long called for a higher gas tax as well, though they would direct the money toward renewable energy initiatives.
Last week, New York Times columnist Tom Friedman called on President-elect Barack Obama to endorse a higher gas tax -- something he has shown no indication of doing so far.
“I believe the second biggest decision Barack Obama has to make -- the first is deciding the size of the stimulus -- is whether to increase the federal gasoline tax or impose an economy-wide carbon tax,” Friedman wrote.
“Best I can tell, the Obama team has no intention of doing either at this time. I understand why. Raising taxes in a recession is a no-no. But I've racked my brain trying to think of ways to retool America around clean-power technologies without a price signal -- i.e., a tax -- and there are no effective ones. Without a higher gas tax or carbon tax, Obama will lack the leverage to drive critical pieces of his foreign and domestic agendas.”
The question for Obama: Will he want to risk political capital on an initiative that figures to be widely unpopular -- and one that feeds Republican perceptions of tax-and-spend Democrats?
Obama has expressed concern about raising taxes during a time of economic duress, though the issue of a higher gas tax wasn’t front-and-center in the campaign.
Obama did, however, split with Sen. Hillary Rodham Clinton, D-N.Y., (and Sen. John McCain, R-Ariz.) during the Democratic primaries, on the issue of a gas-tax holiday. Clinton wanted to suspend the federal tax when gas prices were soaring last spring, but Obama derided the idea as a “gimmick.”
“People are more concerned about looking good for the cameras and for politics than they are at actually solving problems,” Obama said in May.
UPDATE: I spoke Friday afternoon with Adrian Moore, one of the commissioners whose report recommends an increase in the gas tax.
He provided some interesting perspective: First, the commission sees the gas tax as the best way to fund infrastructure projects only in the short term, until technological innovations can allow a more fair way to charge drivers based on the mileage they drive (and wear down roads) and when and where they’re driving.
Second, the commission is also recommending a major revamping in how projects get funded, based on actual need instead of political horse-trading. And third, the recommendation for a higher gas tax was developed over the summer -- back when drivers were routinely paying $4 a gallon for gasoline.
“I have a lot of trouble with raising the gas tax, because the way we spend the money is so messed up,” said Moore, who is vice president of research at the Reason Foundation, a libertarian think-tank.
“The political reality is that it’s going to be difficult, because people don’t trust the system [of funding infrastructure projects],” Moore said. “Raising the gas tax would be a big mistake if we don’t change the system, to get rid of the waste, the silliness, and the politicization of the funding process.”
January 2, 2009 | Permalink | Share | User Comments (185)
You can follow this conversation by subscribing to the comment feed for this post.
"Since when is the government meant to control behavior?"
Since it's creation - never mind reading a bit about the Founding Fathers, you should probably start with Hobbes and Rousseau.
"Raising taxes is the easy way out and will not solve any problem or control behavior."
It's success at doing everything from providing for the common defense to creating the interstate highway infrastructure to even cutting teen smoking (the typical allowance is sensitive to an extra $1 per pack) is well documented. Providing bumpersticker opinions that are firmly and widely refuted by reality adds little to the discussion beyond noise.
Posted by: jhw539 | Jan 2, 2009 12:43:43 PM
Taxu: After eight years of getting what Republicans and 'their ilk' who elected Bush and a Republican House and Senate voted fore, I'm more than ready to get what I voted for in Obama (higher taxes on me personally, but a return of competence and a pragmatic respect for reality to the executive branch).
Posted by: jhw539 | Jan 2, 2009 12:46:46 PM
Well, either way, they're going to loose.
If you increase the tax to pay for the roads, you will make Americans drive even less, buy even more fuel-efficient vehicles, etc. In one way, this is good, for it will curb gas consumtion even more. The other way is that the Feds will have even less money from taxes to fix the roads. So in the long term, they're going to end up taxing something else to get the money.
The other side of the coin is that if they do not increase the gas tax and do not find another source of revenue, roads and bridges will decay and Americans will be stuck with fewer and fewer good roads to drive on.
So either way, it looks like a no win scenerio.
Posted by: GWP | Jan 2, 2009 12:48:25 PM
GWP: "So either way, it looks like a no win scenerio. "
One of your scenarios includes the US buying much less oil, which is sure to reduce the money going to the Middle East. While I realize the Saudis and our president are best friends for life, I personally see less money for Bin Laden's homeland (and a return to reality for oil-money-drunk Iran/Russia/Venezuela/etc.) a Win.
Posted by: jhw539 | Jan 2, 2009 12:56:32 PM
neither a borrower nor a lender be...
Posted by: hah | Jan 2, 2009 12:57:30 PM
Raising the gas tax in a recession when automakers and other businesses are lining up for a handout? Is there not a better way to convince people to drive less and use less fuel? Are the American people now deemed so stupid that the only way to curb their excessive driving habits (even in areas with no public transportation, no sidewalks and no alternative to driving) that the only way to solve a problem is to tax them more? I sure do miss the innovative American spirit - you know, the one where we tried to solve problems rather then learn to find ways to profit from them.
Posted by: Miss S | Jan 2, 2009 1:02:08 PM
Didn't Obama promise not to raise taxes on the middle class/ working class? Wouldn't gas tax indeed by a tax on the working middle class since we need our cars to work. Even worse, part of it again is to go to REDISTRIBUTE wealth from those that work to those that really don't in the form of EIC. Obama lied....he is so going to tax us that are members of the working class. But hey, with fewer of us able to afford to drive to work, Obama will be able to have less crowded roads for his gas gozzling limos and Suvs.
Posted by: chattyway | Jan 2, 2009 1:06:40 PM
The most important line in this story is buried in the ninth paragraph:
"...the Obama team has no intention of doing either [raising federal gas taxes or imposing an economy-wide carbon tax] at this time."
It MIGHT make sense to raise taxes on fossil fuels IF there was a low-cost, cleaner alternative already available. Currently there is not--like it or not, we're stuck running gasoline-powered cars and heating our homes with fossil fuels or electricity produced in fossil-fuel-burning power plants. I'd love to see this change, but I don't think changing it by making it more expensive for everybody (via a tax). I expect Mr. Obama understands the issue enough to realize this, which explains why he hasn't said anything about imposing these new taxes.
Posted by: Enough | Jan 2, 2009 1:10:41 PM
Miss S: "Is there not a better way to convince people to drive less and use less fuel? Are the American people now deemed so stupid that the only way to curb their excessive driving habits "
Speaking of so stupid, you do realize that there is data from just the last year showing, in big 10' high letters with flashing lights, that a $0.10 increase in the price of gas has negligible effect on miles driven (or the price of groceries, mail service, etc)?
Law making by whining that has no basis in reality has to stop.
Posted by: jhw539 | Jan 2, 2009 1:11:48 PM
As far as decaying roads and such....even today, every gallon of gas nets the government $.47 that is supposed to go improve roads, bridges and such. AS usual though, every time the government gets involved fraud, waste, and abuse occur. The government has wasted this money as they will any new tax money. BTW, Obama is scam artist and like he did with Rezko, he has worked with "builders" (think road construction now) to increase taxes only so his buddies can scam the government. The Rezko scam included Obama arranging for millions $$$$ of tax payer money to be used to "build" low housing projects and renovate others....most of these homes were condemned at total waste to the low income and tax payers. Obama involved in roads almost certainly means roads/bridges made subpar that will prove dangerous and be condemned later. History repeats itself often and Obama has a history of this.
Posted by: chattyway | Jan 2, 2009 1:13:05 PM
jhw539 "It's success at doing everything from providing for the common defense to creating the interstate highway infrastructure to even cutting teen smoking (the typical allowance is sensitive to an extra $1 per pack) is well documented."
-- I beg to differ with you that it was the tax money that makes the difference in solving problems, like smoking - education tends to make the biggest difference.
Those expensive anti-smoking, anti-drinking, anti-drug ads paid for by higher taxes actually do very little to curb behavior. The tax itself also has done little to change smoking or drinking behavior - people quit when they are ready to quit, not when a government tax instructs them to do so.
It's when the non-profit anti-tobacco, anti-drug, anti-drinking groups (like MADD) began going into the schools (for free - no tax dollars involved) and began working to prevent these problems early in a child's life (first and second grade) that the declines started happening.
A gas tax would make life very hard on a big part of the population - some people drive to work because they have no other option. Many poor people watch their pennies and even a slight raise in tax could cause them significant hardship, as we've seen in the past - when gas prices inch up even by a few cents poor people start to make difficult choices. I suggest you visit a soup kitchen or food bank to hear some of the stories about how people are really affected by these tax increases. The solutions don't come from raising taxes, they come from analyzing the problem and finding real solutions.
Posted by: C'est la vie | Jan 2, 2009 1:13:53 PM
The man isn't even in office yet, and already he's reneging on promises not to raise taxes. Frankly, with all the empty promises he made during the campaign, there's no way fund any of it without raising taxes. Sadly, truthfulness doesn't seem to register on the scale of qualifications to be POTUS. Sincerity, yes; truthfulness, not so much...
Posted by: V Van V | Jan 2, 2009 1:14:30 PM
Miss S ,that is NOT sop (standard operating procedure) these days.
the new american spirit is to CREATE a problem/problems where none existed previously,(or exacerbate current problems ) to throw taxpayer money at ,"providing much-needed new job growth..."
(with the accompanying increase in tax revenues ready and waiting to be duly misappropriated and gleaned ,eg T.A.R.P. = G.S.T.L = GOVERNMENT SANCTIONED TAXPAYER LOOTING )
Posted by: hah | Jan 2, 2009 1:15:54 PM
Raising gas taxes doesn't hurt?
http://www.lunsfordgastax.com/
It most certainly does...and when the price of fuel goes up, so does the price of everything else.
Posted by: chattyway | Jan 2, 2009 1:19:10 PM
jhw539 - Rarely do numbers tell the whole story and often studies and data are sadly misleading. Talk to some people who are struggling, you might find that there is another side to the story. Although ten cents per gallon might mean very little to you and the majority, I assure you, it would be a hardship on some people. Not all can just turn over additional pennies to the government. You may not have noticed, but times are tough right now and lots of people are struggling.
Posted by: Miss S | Jan 2, 2009 1:20:20 PM
Obama doesn't plan on a gas tax or carbon taxing us to death? Don't you Obamabots read or ever admit the truth?
http://online.wsj.com/article/SB122445812003548473.html
Obama must certainly does. Politiicans like Gore stand to make millions $$$$ off these increases.
Posted by: chattyway | Jan 2, 2009 1:22:32 PM
Now that gas is resonably priced again, lets have Obama and the Dems raise it back up again. Brilliamt idea , especially since the same people(Democrats) said that high fuel prices were ruining the economy a year ago. Keep It Up Democrats..... Obama/Biden, Pelosi, Reid, Frank, Dodd, Etc.
Posted by: ynot | Jan 2, 2009 1:23:58 PM
It's in their blood. The Democrats have to raise taxes. They can't stop. Tax and spend. Tax and spend.
Posted by: Lee | Jan 2, 2009 1:27:48 PM
*******The Obama Count*******
That will make 5 campain promises Obama has gone back on before his swearing in!!!
Posted by: yea right | Jan 2, 2009 1:28:09 PM
Angry Taxpayer said: "Just a reminder, if the gas taxes are raised, you can expect the price of gas to rise as well and this time, the federal government will have even more reason to not fight the higher cost. Their bottom line will depend on high gas prices (the tax is a percentage of the amount paid at the pump)."
Actually the tax is a flat tax per gallon, so the price of gas at the pump would have no effect on the tax amount.
Maybe we should just borrow more $$$ from the Chinese to pay for our road repairs. That seems to be the GOP way to avoid higher taxes: rather than tax and spend, they borrow and spend. Problem is, someday, someone will have to pay it all back.....
Posted by: SearamblerOne | Jan 2, 2009 1:31:13 PM
Post a comment
POLITICAL VIDEOS
THE NOTE BLOG ROLL
- ABC News -- George Stephanopoulos
- ABC News -- Jake Tapper
- ABC News Politics
- ABC News -- The Numbers
- ABC News -- The Blotter
- The American Prospect -- TAPPED
- The Atlantic -- Politics Channel
- The Boston Globe -- Political Intelligence
- Center for American Progress -- Think Progress
- Center for Responsive Politics
- The Chicago Sun-Times -- Lynn Sweet
- The Chicago Tribune -- The Swamp
- Drudge Report
- FactCheck.org
- FiveThirtyEight
- Heritage Foundation -- The Foundry
- The Hill -- Briefing Room
- The Hotline
- The Huffington Post
- The Los Angeles Times -- Top of the Ticket
- NPR -- Political Junkie
- National Review -- The Corner
- The New Republic -- The Plank
- The New York Times -- The Caucus
- Newsweek -- The Gaggle
- Political Wire -- Taegan Goddard
- Politico -- Ben Smith
- Politico -- Mike Allen’s Playbook
- PolitiFact
- Real Clear Politics
- Talking Points Memo
- Time -- The Page
- USA Today -- On Politics
- Variety -- Wilshire & Washington
- The Wall Street Journal -- Capital Journal
- The Washington Post -- The Fix
- The Washington Post -- 44

