Friday, June 06, 2008

McCain on the Economy: The Gas Tax Holiday.

We've dissected Mr. Obama's "plan" for the economy, let us now turn to what John McCain is proposing for helping the economy. The first topic is relief for increased fuel prices by a "holiday" on gasoline diesel fuel taxes. This has been much criticized by the Obamaniacs as "not an economic plan". Of course it isn't a central point to an economic plan, but it's something tangible that can be done immediately to provide some relief: a three-month suspension of the 18-cent Federal gasoline tax, and a similar suspension of the 24-cent diesel tax.

For a two-car family, a three-month tax suspension would save folks about $100. It's a not lot of money, just an inextravagant trip to the grocery store. But another important savings is that for commericial trucking: the suspension of the federal tax on diesel is equivalent to a 5% improvement in fuel economy for a large commerical truck. This is significant to trucking companies, who transport 70% of goods to the market. The Tulsa World has recently discussed the impact of fuel costs on these companies; for example, a reduction of fuel costs of 5% would save a company with a fleet of 1500 trucks around $400K in a three-month period. This relief will slow the rising costs of food and products to consumers. It is not the principal point to McCain's plan, but it is not inconsequential.

It's interesting to note that in spite of the Dem's claims for wanting to help average Americans, they have decided that it is more important to keep raking in $65M a day from the gasoline tax - which can then be redistributed for political patronage than give the average Joe a hundred-buck break on gas.

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