Soaring gas prices make state and federal leaders do foolish things

Politicians are faced with an age-old mystery from time to time. Are they supposed to do a boring thing that makes tax sense, or a careless thing that makes people feel good, makes headlines, and improves polls?

Any choice, right?

When it comes to rising gas prices, the urge to resist the prudence can be overwhelming. Almost everyone drives, and despite the benevolent efforts of many politicians, almost everyone who drives still owns a gasoline car.

With gas prices exceeding $ 4 a gallon in many states, it comes as no surprise that President Joe Biden felt the need to do what the Washington Post editorial team called a “two-step ritual” under such circumstances seems necessary.

Step one: Order an investigation into the price gouging of the big oil companies when there is no evidence. Step Two: Release oil from the country’s strategic reserve, although the 50 million barrels it recently released only cover just over two days of consumption in the United States.

Barely the most conservative newspaper in the country, the Post said these things achieve only one goal, “to make it appear that the president is doing something about gas prices,” when in fact he is not.

But this behavior is hardly limited to Democrats. Ron DeSantis, the Republican governor of Florida, announced a few days ago that he would suspend the state’s gas tax. Completely.

He calls on the legislature to set it to zero for the time being, or at least until prices drop. With that he would no longer have to deal with confusing supply and demand. Take the tax away and gasoline costs drop about 25 cents per gallon instantly. Call out the applause.

In order not to be outdone, one of the leading Democratic candidates hoping to depose DeSantis next year immediately jumped on the governor for his announcement – but only because he wanted the legislature to convene now rather than until the next Year to wait.

It was no coincidence that DeSantis set his statement for the start of Thanksgiving weekend, just as the Floridians were filling up for the drive to Grandma’s house.

The elimination of the Florida gas tax would cost the state more than $ 1 billion in Jacksonville, according to Channel 4. But DeSantis doesn’t care, because these are unusual times – so unusual that many states that were once on the verge of bankruptcy are now rolling money. A report in The Hill earlier this year called it “an embarrassment of wealth funded by a booming stock market, rising wages for those at the top of the economic stratosphere, and what economists say is an unprecedented change in the way consumers do it.” spend their money money. “

We are buying more and more online, and a Supreme Court ruling a few years ago means we are also paying sales tax on those purchases.

By the way, Utah is one of the states with surplus, although it has never stared into the abyss of bankruptcy. A recent report from the Tax Commission said that individual income tax collections in October were 53.3% higher than at the same time last year. Corporate tax levies rose 108.7% and sales tax rose 15.4%.

Unlike politicians elsewhere, Utah legislatures tend to avoid gadgets like gas tax vacation. But they could struggle to deal with surpluses without cutting taxes somewhere for the next year, though the excess funds may be temporary due to federal aid and pent-up pandemic demand.

Gas taxes are a tempting target because fuel-efficient cars and hybrids make them less efficient anyway. But, as Jared Walczak of the Washington Tax Foundation wrote last week, it would make more sense for a state to pay off debts, support public employees’ pension funds, replenish rain accounts, or find other permanent tax breaks.

In other words, something boring and responsible. Something you can’t put on a campaign sign.

But being boring and responsible pays off over time. As the editorial page of the Washington Post reminds us, gas tax gimmicks will not reduce the nation’s reliance on oil or push them towards electric cars.

“If the presidents still two-step oil prices years later, it will be a massive national failure,” the Post said. The same goes for heads of state who want to look like heroes for a while.

I am not holding my breath.

https://www.deseret.com/opinion/2021/11/30/22810904/utah-surplus-president-biden-oil-companies-investigation-reserves-florida-gas-taxes-eliminated