The main notion behind the multi-trillion-dollar federal bailout was to pump aid directly and immediately to citizens who have suffered financial harm during the pandemic. That injection of cash will …
The main notion behind the multi-trillion-dollar federal bailout was to pump aid directly and immediately to citizens who have suffered financial harm during the pandemic. That injection of cash will then deliver a boost to a slumping economy, the thinking goes.
But while stimulus help was being delivered on the one hand, other parts of government were conspiring to grab that money right back again.
One especially hurtful scheme is a proposal working its way through state legislatures in Rhode Island, Massachusetts and other places that would tack on yet another gasoline tax — an especially big one this time.
It’s billed as a climate friendly move — a Transportation Climate Initiative (TCI) — found within green action bill packages. The theory is that loading gasoline up with more taxes will discourage driving, encourage alternative energy forms and raise money for environmentally beneficial projects.
But left to itself, the economy is already dealing with fossil fuels and the driving increase as it usually does.
A year ago, as the pandemic took hold and people stopped commuting or driving much of anywhere, gasoline prices plummeted to less than $2 per gallon. It was one of the few benefits of COVID-19.
Since the vaccine’s arrival, drivers have headed back to the road. Demand for gasoline is up to pre-COVID levels and then some, while prices have inevitably followed — nearing $3 per gallon now and forecast to head higher as summer approaches.
It’s one of the steepest fuel price jumps on record and comes at the very moment that government is spending money it doesn’t have to energize a still shaky economy and put people back to work — all while trying to stave off inflation.
Meanwhile, the auto industry is moving relentlessly toward a future free of fossil fuels — Volvo is among the latest — by 2025, all of its new cars will be either electric or hybrid. And the industry is generally doing this despite government, not because of any particular encouragement, for very practical, business-based reasons.
This gas tax push is really about revenue — prices are soaring even without the pain of an added fee. And this would be a regressive tax that most hurts those who can least afford to pay (the very ones that stimulus supporters aimed to help). The timing could not be worse.
Right now government needs to do everything in its power to give this recovery a fighting chance. Slapping on more taxes will not help.