Record high gasoline prices have Americans feeling the pinch every time they fill up.
That means a lot of folks are unhappy. And that has President Joe Biden and the Democrats feeling the pinch about their prospects at the coming midterm elections.
But what to do about it?
While many consumers blame the president for gas prices, there are a lot of factors that determine what we pay at the pump. These include market speculation on the price of crude oil, the cost of drilling, refining and distribution and how much profit oil and gasoline companies want to make. Something else that adds to the retail price of gasoline is federal and state taxes.
Right now Americans pay the federal government 18.4 cents for every gallon of gasoline and 24.4 cents for a gallon of diesel. State taxes add even more to the pump price. The revenue largely finances the building and maintenance of highways.
Taxes are the one thing the government can do to immediately bring down fuel prices in the short term. Well, maybe. But at a cost.
On Wednesday, President Biden asked Congress to suspend the federal fuel tax for three months. He wants states to do the same.
And he wants to do so without taking away from highway funding. How? Well, by borrowing of course. The federal deficit is down this year. Not the dent, but the deficit -- the amount we borrow each year. So his idea is to raise it up a bit to cover the estimated $10 billion cost of a three-month gas tax suspension.
Will suspending fuel taxes help consumers much? Maybe. But the federal gasoline tax has been the same since 1993. But prices have fluctuated by quite a bit over the years. As long as prices remain somewhat constant, consumers will save some money. If pump prices rise, then Americans will still be out more money and will soon forget the tax break.
The idea of suspending federal gas and diesel prices is pretty much show over substance. There's no guarantee it will offer consumers any real relief and making up for lost taxes by borrowing is just fiscal sleight of hand.
But at least the White House and Congress can say their doing something for the people (read that as voters.) And that's what really matters to them.