Worried that rising prices will hurt their chances in November’s midterm elections, moderate Senate Democrats are considering a gas tax holiday. Economists, predictably, are panning the idea as a political gimmick that won’t actually do much to curb inflation.
The economists are right, of course. At the same time, the Democratic senators are right. Bringing prices down at the gas pump wouldn’t necessarily affect the broader rate of inflation — what consumers save on gas they’ll probably spend on other stuff — but it would still be popular.
Which brings up a larger issue: Democrats are enamored of this idea right now because voters are mad about high gas prices. But Democrats might want to consider the notion that supporting policies to keep gasoline cheap is also a good long-term political strategy — and is not inconsistent with their goal of reducing carbon emissions to address climate change.
By now it’s clear that the solution to the pollution problems associated with burning gasoline isn’t more conservation, it’s more electric vehicles. And the EV market is genuinely booming — in no small part thanks to past and current policies Democrats have championed to subsidize EV purchases, build out a charging network and invest in battery technology.
For now, though, the EV market share remains relatively small. Most people still have gasoline-powered cars. So the goal should not be to make gas expensive so much as to keep boosting EVs, investing in mass transit and intercity rail, and generally doing everything possible to speed the extinction of the internal combustion engine.
As it happens, that’s just the kind of innovation-focused climate policy that is consistent with last year’s bipartisan infrastructure bill, the bipartisan energy bill that passed the year before that, and with the climate-focused tax credits that are the centerpiece of the legislation formerly known as Build Back Better. It’s also very much in line with the initiative to spur decarbonization in the industrial sector that White House rolled out last week.
It is not consistent, however, with President Joe Biden’s campaign promise to ban fracking on federal land or to halt oil and gas exploration in the Gulf of Mexico.
For Democrats in the 2020 campaign, those kind of promises were par for the course. Biden, one of the most moderate candidates, faced considerable criticism for not embracing a total ban on fracking. It’s simply taken for granted that any halfway progressive government would try to kneecap fossil-fuel production, with Biden for example resuming Obama-era efforts to block the Keystone XL pipeline.
At the same time, when Republicans blame Biden’s policies for scarce fuel supplies, the White House will note that it has actually approved many leases. And then, when environmentalists criticize it for approving so many leases, the White House will point out that court rulings have tied the administration’s hands. Further confusing the situation is a federal ruling last month annulling the latest leases in the Gulf of Mexico.
It’s safe to say that the administration itself is divided on what it wants to see happen. Some officials are true-believing environmentalists who want to keep as much fossil fuel in the ground as possible, while others are more pragmatic and want the economic benefits of more drilling. For the sake of keeping everyone on the same page, they seem to have agreed on a solution: Try to block new drilling, then accept rulings from conservative judges that allow it to continue.
Americans are used to thinking of Democrats as a fairly moderate center-left party, especially when compared to its counterparts in countries that have universal health care. But on this issue, Democrats are the global outliers.
After last fall’s parliamentary elections, three left-of-center Norwegian parties controlled a majority of seats. Labor Party leader Jonas Gahr Støre hoped to form a coalition with the Center Party and the Socialist Left Party. But the Socialist Left, which won just 7.6% of the vote, insisted on a coalition agreement that would curb oil and gas production. Støre refused, and now leads a minority coalition with the Center.
In Canada, Prime Minister Justin Trudeau, seen by many American liberals as a kindred spirit, has long championed the Keystone pipeline. Just as Støre lost out on his dreams of a majority coalition over the issue, Trudeau’s soft line on fossil-fuel extraction helps explain why his Liberal Party suffers defections to Canada’s small Green Party.
For both leaders, the calculus is clear: Losing some votes on the left is worth the gains in the center.
Of course, Democrats could just say they are against both the production and consumption of fossil fuels, full stop, and pursue policies that made them more difficult. But the party does not seem to be willing to go that far. Biden has repeatedly urged OPEC to increase production for the sake of the global economy, only to be rebuffed by Saudi Arabia. Then there was the funny business with the lease litigation. And now there is the flirtation with the gas tax holiday.
The result is that they are in a bizarre dead zone. Democrats have successfully branded themselves as the party that wants to halt fossil-fuel production and reduce dirty energy, even though this image is unpopular. Meanwhile, environmentalists are aware that Biden has not come remotely close to fulfilling his promises on squelching fossil-fuel production. The president, for his part — because he doesn’t actually want oil and gas to be expensive — is asking Saudi Arabia for help and flirting with weird tax gimmicks.
A much better approach would be to own up to the fact that Democrats’ policy is basically the same as Støre’s or Trudeau’s. To wit: We strongly support investment in the green technologies of the future, but we also want to pump whatever’s in the ground now as long as fossil fuels remain integral to the global economy.
That would cause a bitter internecine fight. But if mainstream progressive politicians from fractious multiparty systems abroad can wage it, so can Democrats.
