THE PROGRESSIVE CONSERVATIVE, USA
An Online Journal of Political Commentary & Analysis
Volume IX, Issue # 224, November 30, 2007
Dr. Almon Leroy Way, Jr., Editor
Government Committed to & Acting in Accord with Conservative Principles
Ensures a Nation's Strength, Progress, & Prosperity
PAIN AT THE PUMP
By Dr. Ron Paul
GOVERNMENT INTERVENTION & ENERGY COSTS: HIGH TIME TO TAKE AN HONEST LOOK AT THE U.S. GOVERNMENT'S
DIRECT & INDIRECT ROLE IN INFLATING TRANSPORTATION FUEL PRICES AT THE GASOLINE & DIESEL PUMPS -- THE IMPACT
OF TAXATION, MONETARY POLICY, & ENVIRONMENTAL REGULATIONS ON FUEL PRICES -- THE PROPOSED AFFORDABLE GAS
PRICE ACT OF 2007 & WHAT IT WOULD DO
FULL STORY:
Last week, Americans traveled approximately 2 billion miles to celebrate the Thanksgiving holiday with family and loved
ones. While you cannot put a price on time with family, Americans sure felt the pain of higher fuel prices at the gas pump. It
is time to take an honest look at the government's direct and indirect role in inflating those prices.
Taxation is the most direct way government increases Americans' cost at the pump. The national average price of gas now is
well over $3.00 per gallon now, $4 in some areas. Federal taxes take 18.4 cents, while state and local taxes average another 28.5
cents per gallon. That's an average of 47 cents per gallon Americans are paying just for government, but that is just the tip of
the iceberg. Less directly, our loose monetary policy gives taxpayers double jeopardy at the pump, simultaneously increasing
prices and undermining purchasing power. Wages always lag behind price increases, making average Americans feel as
though they can never quite keep up, never quite get out of debt. Not to mention the ripple effect of higher diesel costs on
the trucking industry. When trucking and shipping is more expensive, everything is more expensive.
The indirect costs government imposes on gas prices are much more serious. A major bottleneck that causes gas prices to
surge is our very meagre and vulnerable refinery capacity, due mostly to regulatory red tape. Environmental regulations and
litigation have kept our existing refinery capacity barely adequate. In fact, no new refineries have been built since the 1970s
and these are operating at capacity, which makes our gasoline market especially vulnerable as demonstrated by skyrocketing
gas prices in the aftermath of Hurricane Katrina, when many coastal oil facilities were brought to a halt. In addition, many
foreign refineries don't have the ability to produce the specialized blends of gasoline mandated by our government, and
therefore 90% of our gasoline is refined in the United States under extreme regulatory burden. When our domestic refineries
are damaged or jeopardized, there are few options other than soaring prices or long lines.
I have introduced into the U.S. House of Representatives the Affordable Gas Price Act (HR 2415) to deal with some of these
issues. My bill would suspend federal fuel taxes when prices rise above $3.00 a gallon, giving some immediate relief at the
pump. It would also repeal misguided legislation that causes more investment in attorneys and nuisance litigation than in
actually producing affordable gasoline and strengthening our refining capacity. Also, it would open up the Arctic National
Wildlife Refuge (ANWR) for oil exploration and repeal the federal moratorium on off-shore oil drilling.
In the past, much of government intervention in the oil industry has been counter-productive and has resulted in disastrous
unintended consequences. This Thanksgiving, I was grateful for every mile Americans can still afford to travel to be with
family. I am working hard in Congress to reverse the costly trend of government interference and return markets, including oil
markets, to true economic freedom.
LINKS TO RELATED TOPICS:
Political Economy -- Philosophies, Systems, & Public Policies:
Government, the Economy, & Economic Prosperity
Fiscal Policy: Taxation & Government Spending
Political Environmentalism Versus Human Progress & Prosperity:
Policy Issues Relating to Energy, Environment,
& Natural Resources
Dr. Ron Paul is a Republican member of the United States House of Representatives, elected from and representing the Fourteenth
Congressional District of Texas. Congressman Paul is considered to be one of America's leading spokesmen for constitutional
government, the rule of law, liberty under law, the private enterprise system,, free market economics, sound monetary policy, and
fiscal restraint on the part of the U.S. national government.
Currently, Congressman Paul is a contender for the Republican Party's nomination as its candidate for U.S. President in the
presidential election of 2008.
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THE PROGRESSIVE CONSERVATIVE, USA
An Online Journal of Political Commentary & Analysis
Dr. Almon Leroy Way, Jr., Editor
Conservative & Free-Market Analysis of Government, Politics & Public Policy, Covering Political, Legal, Constitutional, Economic,
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Conservative Government Ensures a Nation's Strength, Progress, & Prosperity