The U.S. House of Representatives, responding to citizen complaints about high gas prices, voted yesterday to pass the "Gas Tax Relief Act of 2007". In an effort to lower consumer burden during the summer driving months, Congress has rolled back the 18.4 cents per gallon federal tax on gasoline, and sent a strong message to the individual States whose gasoline taxes are as high as 33 cents per gallon to do the same. If the States were to follow the Federal Government's lead this could mean a reduction in gasoline prices by an average of 40 cents per gallon, with the higher taxed States saving as much as 51 cents per gallon.
If you are wondering why you have not read about the "Gas Tax Relief Act of 2007" in the newspaper, the answer is simple. There is no such legislation being proposed in Congress.
What the House of Representatives voted on yesterday was the "No Oil Producing and Exporting Cartels Act of 2007", or NOPEC. The bill which passed by a 345-72 vote, would revoke the sovereign immunity OPEC members currently enjoy from U.S. legal action and allow the Justice Department to sue them in U.S. courts.
Rather than pass legislation which would have an immediate impact on American consumers, the House decided to pass legislation which would take years to show any results. Unfortunately, this legislation, if passed into law, may actually produce higher gasoline prices if OPEC decides to retaliate by lowering production.
Approximately 40% of our country's oil is provided by OPEC members. It would not be a wise decision to make enemies of them by filing lawsuits in U.S. courts. As an alternative, Congress should be looking for ways to lower America's dependence on OPEC, either through alternative means of energy, or alternative sources of oil.
For over 20 years the controversy over drilling for oil in the Arctic National Wildlife Refuge (ANWR) has been ongoing, with several attempts to open the region for drilling defeated. In the 1990s, President George H.W. Bush's National Energy Bill authorized drilling in ANWR, but a filibuster by Senate Democrats kept the measure from coming to a vote. In 1995, Republicans prepared to take up the battle again and included a provision for ANWR in the federal budget. President Bill Clinton vetoed the entire budget and expressed his intention to veto any other bill that would open ANWR to drilling.
In 1998 a U.S Geological Survey estimated there to be at least 5.7 billion billion barrels of recoverable oil, with possibly as much as 16 billion barrels. If drilling were to take place in this region the influx of oil into the market place would cause prices to go down, effectively ending the "crisis".
Congress has largely ignored alternative means of reducing consumer gas prices and opted for judicial action instead. Interestingly, the bill only refers to foreign States who attempt "to set or maintain the price of oil, natural gas, or any petroleum product." Apparently, domestic States would be considered exempt from this legislation.
Currently there are about a dozen States which have price controls on gasoline, not to stipulate a maximum price, but to set a minimum price. Recently, in Wisconsin, a gas station owner was threatened with a lawsuit from State regulators unless he raised his prices. The service station owner had offered a 2 cent per gallon discount to senior citizens. The Wisconsin Department of Agriculture said those deals violate Wisconsin’s Unfair Sales Act, which requires stations to sell gas for about 9.2 percent more than the wholesale price.
Rather than address solutions which Congress has direct control over, they have decided to do what most Americans do when they are unhappy. Sue!Powered by Sidelines