June 11, 2008
The Columbus Dispatch on the Candidates' Energy Plans
By Jack Torry
Democratic presidential candidate Barack Obama wants to sock the oil companies with an excess-profits tax. Republican presidential candidate John McCain wants to temporarily suspend the federal gasoline tax.
With gasoline prices at $4 a gallon, energy is the talk of presidential candidates and members of Congress. Yesterday, Senate Democrats were thwarted by Republicans in their effort to punish oil companies with an excess-profits tax.
But economists and tax analysts say that neither Obama, senator from Illinois, nor McCain, senator from Arizona, nor other lawmakers have offered any real solutions that will bring down the price of oil from the current $131 per barrel.
They point out that President Carter and Congress levied an excess-profits tax on oil companies in the 1980s and the tax raised only a fraction of the revenue originally promised. They say that suspending the 18.4-cent-per-gallon gasoline tax would not have a significant effect on the price of gasoline.
"What's remarkable is throughout all the rhetoric about bringing change to Washington, a windfall-profits tax is a repeat of one of the biggest economic mistakes of Jimmy Carter's presidency," said Scott Hodge, president of the Tax Foundation, a nonpartisan tax research organization in Washington.
Eric Toder, a senior fellow at the Urban Institute in Washington, said that suspending the federal gasoline tax "doesn't produce more energy. It probably would produce somewhat lower prices to consumers, but not the full amount of the tax."
