President Bush on $4 Gas: “I hadn’t heard that.”
Blog Post About DMI's TheMiddleClass.org
When it comes to gas prices, President Bush has shown himself to be pretty clueless. Sure, the President isn't filling up the tank of his presidential motorcade himself, but you would hope that he would have at least a basic idea of what normal Americans are facing at the pump. The following dialogue (taken directly from the White House transcript) took place between Bush and a member of the press on February 28.
"Q: What's your advice to the average American who is hurting now, facing the prospect of $4 a gallon gasoline, a lot of people facing -
THE PRESIDENT: Wait, what did you just say? You're predicting $4 a gallon gasoline?
Q: A number of analysts are predicting -
THE PRESIDENT: Oh, yeah?
Q:-- $4 a gallon gasoline this spring when they reformulate.
THE PRESIDENT: That's interesting. I hadn't heard that."
Now that a member of the press has alerted Bush to the fact that Americans are becoming increasingly worried by rising gas prices, you'd think that he'd give good legislation, like the Renewable Energy and Energy Conservation Tax Act, another look. However, on February 26 Bush announced he intended to veto the bill, which seeks to create and extend tax credits for renewable energy by repealing oil company subsidies.
Ironically, Bush has rightly said in the past that perhaps tax breaks to Big Oil aren't propelling us away from dependency on foreign fuel. In 2005, Bush said,
"I will tell you with $55 oil we don't need incentives to oil and gas companies to explore. There are plenty of incentives. What we need is to put a strategy in place that will help this country over time become less dependent. It's really important. It's an important part of our economic security, and it's an important part of our national security."
And the cost of one barrel of crude oil the day this bill passed the House? $100.83, or almost twice the amount that Bush mentioned when saying that tax incentives weren't necessary. This morning oil was selling for nearly $104 a barrel, setting an all-time record.
The Renewable Energy and Energy Conservation Tax Act, which passed in the House and is awaiting a vote in the Senate, creates $18.5 billion in tax credits for renewable energy and energy efficiency improvements, which are offset by repealing $18.5 billion in subsidies for oil companies. Tax incentives in the Act include $6.6 billion in tax credits to companies that generate power using sources such as hydropower, wind energy, and biomass. There is also a tax credit for businesses and homeowners who make energy efficiency improvements and invest in fuel cells or solar power. Other credits include $450 million in credits for renewable fuels, a credit for purchasing energy-efficient plug-in hybrid vehicles. The Act also authorizes bonds to state and municipal programs that reduce greenhouse gas emissions and bonds for power providers can use to generate renewable electricity.
Overall, this bill makes sense. Not only will it help cut costs, but the bill works towards long-term goals of reducing dependence on foreign oil and decreasing global warming and greenhouse gases. As TheMiddleClass.org says,
"Today, as middle-class consumers struggle with the high costs of gasoline and home heating oil and are increasingly concerned about the threat of global warming, federal incentives that spur energy efficiency and promote renewable energy couldn’t be more timely. By reviving the abandoned provisions of the 2007 energy bill, this legislation offers the substantial public investment necessary to jump start the development and promotion of renewable energy sources and energy-efficient technologies. In the short term, this investment will create jobs producing renewable energy and technology. In the long term, new energy sources and more efficient technology promise environmental and public health benefits, as well as lower costs, for the American middle class. The bill also funds the investments in an appropriate way: by repealing taxpayer subsidies to the oil industry, which is already making booming profits at the expense of middle-class consumers."
An editorial in today's Times comments that as soon as the bill passed the House, some members of the Senate started to complain that repealing industry subsidies would discourage investment in domestic oil production. The Times writes,
"What will it take to wake the Senate up? It should be clear to even the most obtuse members that a country that consumes one-fifth of the world’s oil but has only 3 percent of its reserves cannot possibly drill its way to energy independence."
Oil companies aren't hurting for profits -- Exxon Mobile makes $77,245 in profits every minute -- and would certainly continue to prosper even if the proposed subsidies were repealed. Bush may not be shelling out big bucks when he fills up the tank, but he should be aware that the the rest of the country is paying for America's lack of foresight on energy issues.