Friday, May 02, 2008

Gas Tax Holiday - Dumb Idea

McCain started it; Mrs. Clinton seconded it; Obama rejected it. The federal gas tax holiday is not only a stupid idea, it once again shows how populist-based politicians are ill-qualified to lead the greatest nation in the world.

My concept of an average person/vehicle and their fuel usage is they fill-up once a week, put in 15 gallons of gas, and get 20 miles per gallon. Over the three month summer quarter, the "average" driver will save $32.50 (12 weeks x 15 gallons/week x $0.18 federal tax/gallon). As the price of gas increases, the federal tax is a decreasing percentage of the total.

I am all for lower taxes but a policy like a federal gas tax holiday will tempt people to drive more, thus raising gas demands and leading to even higher gas prices.

The politicians in favor seem to think you can cut taxes without cutting spending. McCain says the impact to road and bridge safety and repair will not be impacted because the cuts will come from other places. There is no magic, despite all of their hand waving and populist posturing.

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