At the time of this writing, Hillary has recently taken what many think is the final blow to her campaign. I tend to stay out of politics on the blog, but that doesn’t mean we still can’t pick apart what she said.
Clinton recently endorsed a gas tax cut proposed by John McCain. The idea is to suspend the federal gas tax from Memorial Day to Labor Day (international readers: thats basically our summer). The idea is to free up some money for all us poor people suffering.
Its our job, as educated individuals, to pick apart such proposals. Mom didn’t raise no idiot, but most moms did. Most of America is fixated in these little headlines and ignore the meat of the story, that’s why this Clinton plan almost worked.
Before we proceed let’s make sure we ignore the fact that Clinton never proposed this as a bill to Congress, knows full and well it won’t make it through Congress, and only said it to garner votes from us poor Americans.
So let’s take a look at why this tax cut is a bad idea. Don’t get me wrong, I’m big on cutting taxes, but this is the wrong place. The biggest flaw of the plan is the lack impact. While a headline about gas tax cuts looks great, estimates vary on the savings per person from $20-$50. Chump change even to us poor folks. Most of the gas tax is state, the feds only get 18.4 cents per gallon. Now if they took a % of the sale like most taxes, maybe a temporary suspension is worth a second thought, maybe.
Team Clinton (mascot: donkey) missed another important fact. If for nothing else, this tells me she knows nothing of economics, maybe she should read this blog. Removing a tax does nothing for the price of gas and oil. Remember most products you buy have the tax added in later. While the price you see at the pump will decrease, the wholesale price does not. Oil won’t drop as a result of this. A better plan would be something to decrease the price of oil. Or better yet, butt out and let the free market do its thing.
It is likely the tax cut would increase demand and the price of gas would go up. We could find ourselves with the same price we’re paying now only without a tax by the end of the summer. Then, come Labor Day, we’re worse off than before.
Thankfully this plan didn’t seem to work that well. It looks like America isn’t as dumb as I thought.