The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“AMERICANS NEED GAS TAX FREEDOM” mentioning the U.S. Dept. of Energy was published in the House of Representatives section on pages H5141-H5143 on May 15, 1996.
The publication is reproduced in full below:
AMERICANS NEED GAS TAX FREEDOM
The SPEAKER pro tempore. Under the Speaker's announced policy of May 12, 1995, the gentlewoman from California [Mrs. Seastrand] is recognized for 40 minutes as the designee of the majority leader.
Mrs. SEASTRAND. Mr. Speaker, approximately a week ago we celebrated Tax Freedom Day. It is interesting because this year, in 1996, it is 6 days later than we celebrated Tax Freedom Day in 1993. This is the day when across America, hardworking families, moms and dads, keep their paycheck, and they have the dollars to stop funding government at all levels, and the dollars after Tax Freedom Day actually go to their families and their children and to do the things they want to do with their dollars.
Americans do not need to look any further than their 1995 tax return to see the difference between Republicans and Democrats. Republicans want Americans to keep more of their paychecks. Republicans want families to save for their futures, and they want more for the families and for our communities across this Nation.
We kept our promises to the American taxpayers by passing the first ever balanced budget in 25 years. We passed the $500-per-child tax credit and the repeal of Clinton's assault on working seniors. We want seniors to keep more of what they earn.
But unfortunately President Clinton chose to veto these key provisions which were meant to put back power to where power belongs, and that is into the hands of working taxpayers, the working families, moms and dads across this Nation.
It is interesting because Washington values here on Capitol Hill are so very much different from the folks across America, and in particular the folks on the central coast of California. I am very privileged to have the right to be voted in by constituents on the central coast of California, to represent them. I represent two wonderful counties, San Luis Obispo County and Santa Barbara County.
It is interesting to note, because in 1993 we had a severe gas tax hike. It was part of the largest tax hike. It was part of the largest tax hike in history. In fact, $4.8 billion alone went to an annual gas tax, and I want to remind everyone that that is 30 percent to the Federal gas tax, a 30-percent increase. I might also remind people that not one Republican voted for the gas tax. It was part of an overall tax increase of $268 billion, an entire package. But again, as I said, $4.8 billion was the gas tax.
When politicians raise taxes for some reason they do not seem to save the money. They spend it. People on Capitol Hill here in Washington, DC, when they can get a dollar here, a dollar there, eventually they spend it. Spending in 1992 was $1.3 trillion, almost $1.4 trillion. But spending in 1995 was $1.57 trillion, almost $1.6 trillion, an increase of $190 billion.
I know I cannot fathom what $1 billion is. It is very hard to work in these numbers. I can identify with working families on the central coast of California. We deal not in those type of numbers. Only in government do we deal in billions and trillions.
But I know that the gas tax hits the low- and middle-income Americans the most, those that need a helping hand from those of us that are trying to help them here in Washington. I want to help those people, because I know it hits them, those that we always say we care the most about.
Perhaps you have seen that famous quote of President Clinton. It was stated in Houston in October of last year, and he was talking about raising $268 billion of tax increase, and he admitted, ``Even I think I raised taxes too much.''
I agree, and I think we here in Washington, DC, here in this House and this Senate, and we should have the President help to roll back President Clinton's tax hikes.
We have seen definitely that there has been a gas price increase and it has been caused by market-driven events, many reasons, and it really affects the central coast of California. In fact in Santa Barbara alone, the city of Santa Barbara, we saw perhaps the highest prices in Santa Barbara than were seen across this Nation, in some instances over
$2 a gallon.
So we wonder, why are the retail prices up? I have a response here from the Department of Energy. On April 30, 1996, the Department of Energy told Senate staff that the recent increases in retail gasoline and diesel prices are due to many reasons, and here are some of the factors:
First, tight world crude supplies following a colder than normal winter.
Second, lower U.S. private crude and petroleum stocks due to, well, a colder than normal winter. Market decisions by companies to hold minimal inventories of crude oil in anticipation of the United Nations agreeing to allow Iraq to begin exporting oil.
Third, higher corn prices than have reduced ethanol production.
Fourth, normal spring refinery cutbacks while they reconfigure to decrease heating oil production and increase gasoline production for the summer driving season.
And, finally, fifth, in California, my State, particular shortages because of California's required introduction of a particular form of reformulated gasoline. The shortages were due to production run problems at several California refineries.
It is interesting, just recently in the Washington Post one of the reporters said today's prices are set by the absence of refining capacity and unnecessary environmental regulations, and that really does apply to California. We are all interested in cleaner air, but there is a price to be paid.
Overall, retail prices of motor fuels in the United States have increased sharply since the winter to their highest level since 1990. Especially in California, we are preparing for the tourist season. Tourism is very important to the central coast of California and so we are preparing for that busiest season and concerned about whether the folks are going to come.
But with gas prices soaring all over the country and especially, as I said, in my own backyard, I want to do something to help ease the burden of those rising gas prices. I think we need some relief and some immediate relief.
I have introduced a bill that would temporarily repeal the Clinton gas tax until 1997 to allow the oil markets a chance to recover from a shortage in supply. The bill is H.R. 3415.
Again, the central coast of California, every time I go home, and that is every weekend, folks will tell me that they just are overtaxed. They need some relief from the paperwork and the burdens of regulation, from all levels of government, and they wholeheartedly agree that immediately they would like to see saving some of that 4.3 cents that we pay because of the Clinton tax hike. They would like to put that in their pocket. They think it would relieve California and the central coast gas pains. It is amazing the good support I am getting on the central coast of California, and I think this is typical across this Nation.
But it is interesting because we hear a lot of naysayers on Capitol Hill here in Washington, DC. They say, the attitude is, why do we have to reduce the taxes? They just do not get it. They just do not understand the needs of working folks across this Nation and especially the folks in California.
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Here in Washington on the Hill, you can have an apartment and you just walk to the office. Some people do not even own a car. Not so, not so from where I come from. Some people make, well, they can make a 100-
mile round trip just going to the supermarket. California is different. I am sure this is also true in many of our rural areas across this Nation.
Well, my proposal to repeal the Clinton gas tax and return the money where it belongs, to the hardworking taxpayers, I hope you would consider what this means, not only cutting, putting the 4.3 cents in your pocket, but what it means to the other things you have to pay for, the transportation prices. When you think about the trucking industry and what we get delivered to our cities and areas, and how important gasoline is to moving our goods and services across this Nation, well, we have to sit back and think about all the things we buy: Our food, the cattle industry, the produce industry. Or if you just want to move from one place in these United States to another, all of this is done with gas.
Again, that 4.3 cents per gallon is going to mean lower dollars, lower transportation costs. Recent studies have documented the positive effect of repealing the Clinton gas tax. It would reduce taxes by almost $5 billion a year, and $550 million in California alone.
In addition, you know, we would recoup some of the jobs lost to that tax increase. The gas tax of 1993 is responsible for the loss of 8,000 jobs in California alone, and 69,000 jobs nationwide.
Earlier this year President Clinton and many of his Democrat colleagues who serve in Congress had the opportunity to cut taxes for the working American families, but they were committed to protecting Washington spending, and I believe they should be given another opportunity to reduce the tax burden of the American people.
Let us repeal the 1993 Clinton gas tax. Retail prices of motor fuels in the United States have increased sharply since the winter, to their highest levels since 1990. The Federal excise tax on gasoline was first enacted in 1932, and 1951 for diesel fuel. We started, as usual, with initial levels of 1 and 2 cents per gallon respectively, and then the taxes were raised gradually to 4 cents by 1959. From 1983 to 1993, there were five Federal tax increases on gasoline, raising them to their present levels of 18.3 cents a gallon.
Sometimes I think we do not realize how much we pay on an average gallon of gas when we fill it up. I should say of that 18.3, 14 cents goes into the highway trust fund and the 4.3 cents, well, it just goes into the general fund.
Now, that is the Clinton tax increase of 1993. I think it is important to stop here to repeat that. Only 14 cents of the 18.3 cents of Federal taxes on each gallon of gas that you purchase at the pump, only 14 cents goes into the trust fund for the roads, the bridges, to take care of those potholes when you are traveling along the freeways.
The 4.3 cents of the tax hike went to the general fund. I get a lot of postcards because people say maybe we could keep that money and fix the pothole on the freeway that I drive every day and let us not give it back. I would rather see the pothole filled up.
But, ladies and gentlemen, the 4.3 cents, the tax hike of 1993, does not go for your highways, for building bridges. It does not go for mass transit if you like in an urban city. In fact, the tax you are paying on your airline ticket today on the aviation fuel, that does not go for helping meet your transportation needs. It just goes into the General Fund, and only again in Washington, DC, do you have people here that feed the bureaucracy for more spending. It is dedicated, the 4.3 cents is dedicated to finance Washington spending on the bureaucracy.
Let me give you an example, in Santa Barbara County. I just heard there is consideration that we may have a measure on the November ballot to raise several million dollars to offset $100 million of backlog in maintenance on our county roads.
Well, here I have 4.3 cents that is just going into the general fund, when locally now the folks in Santa Barbara County may be asked to consider raising several million dollars to take care of backlog in maintenance. Something is wrong here.
The Congressional Research Service, a nonpartisan organization, estimates that, other things being equal, repeal of the 4.3 cent fuel tax would cause refiners, importers, and terminal operators to decrease wholesale prices by about three-fourths of the overall excise tax. I would say about 3.2 cents. Retail gasoline prices would tend to decline, and any decrease in the prices of gasoline and other motor fuel would tend to increase the demand for fuel and for complementary goods and services by reducing the cost of the vehicular transportation and related travel relative to the other costs and services. Therefore, the demand for substitute goods and services such as home recreation and other activities would tend to go down.
A decrease in the gasoline tax would increase, and I underline this word, household's disposable income, reduce business costs per unit of output, and would increase total demand for goods and services, thus having an expansive effect on economic activity.
Now, there have been questions asked about the bill to repeal the tax on gas from 1993, and one in particular is that even if the Clinton gas tax is repealed, it will not necessarily be passed on to the consumer.
Well, my bill, H.R. 3415, contains language that states the benefits of the tax repeal should be passed on to the consumers, and it requires that the Comptroller General of the United States conduct a study to assure pass-through of such a repeal.
It was interesting, because a colleague on the other side of the aisle just recently brought up his concern that passing that gasoline tax repeal will simply line the pockets of the big oil companies and will not be passed on to the consumers. I understand that concern. But certainly retailers I believe will always try to slowly drop the price of gasoline. However, the Department of Energy is predicting normal supplies and prices this summer.
Moreover, both world and domestic crude prices have fallen every day since early last week, and well before the President's announcement regarding SPR sales on Monday of last week. With gasoline prices expected to decline through this summer, market competition and full supply marketplace will make it very difficult, I believe, for retailers to keep the 4.3 cents if the tax is repealed.
I would just say other questions have been raised about the costs associated with this bill, and the answer to that is that we have the offsets, and they are found in reducing the size of rampant travel and other expenses at the Department of Energy. We also are going to look to the FCC auctioning off broadcast spectrums, and the Committee on the Budget chairman, Mr. Kasich, has assured us that we are on target to balance the budget by fiscal year 2002, even with this temporary repeal of the Clinton gas tax.
Well, Mr. Speaker, I guess it is the old story, the Democrats never met a tax increase the did not like. I would like to quote the minority leader from the Senate:
Well, it seems to me the Republicans' only issue, I am sure if you talked about the weather, they would come up with a tax cut, if you talked about heart problems, they would come up with a tax cut, and any problem that you think of in this country can be fixed with a tax cut, if you listen to Republicans. Again, we have got high prices. Let's not look at resources and supply and demand. Let's have a tax cut.
That is the Senate minority leader on April 29 of this year. Again, yes, I am looking to a tax cut, because I know how important it is for my folks to drive up to that pump, to fill up their tank and have to travel many miles on the central coast of California, and 4.3 cents in some tax relief to them is very important. And I make my case, the Democrats never met a tax increase the did not like.
From the way the Democrats are defending this tax hike, charging that its rollback will not get passed on to the consumers, it sounds like they cannot wait to increase gas taxes again.
As I said, I go home every weekend, and my constituents are telling me that they would like to see some relief. The students at U.C. Santa Barbara, the students at Cal Poly that have to travel miles, they want to see some relief. The cattlemen that take their cattle to and from market want to see relief. The produce industry, which is very big, taking the lettuce to market, it is very important and they want to see tax relief. And just the average mom and dad want to see tax relief so they can take the kids to school, get to work, get to the grocery store, get to little league, and do all the important things that are important in their life.
I believe, yes, that the best way to lower gas prices and relieve not only the central coast of California gas pains, but our Nation's gas pains, is to repeal the Clinton gas tax. It is time. It is time we let working men and women keep more of their hard-earned dollars, and not have the bureaucrats here in Washington say that they know best how to spend those hard-earned dollars.
Mr. Speaker, since its imposition in October of 1993, the gas tax has taken $613 million out of the economy. That is money that Californians could have had. Repealing the gas tax also would reduce taxes, as I said earlier before, by almost $5 billion annually. And I want to repeat this number, it would reduce taxes in California by $550 million. A repeal of the gas tax, I am summarizing here if you notice, the repeal of the gas tax would recoup the jobs most to the tax increase. If you recall, I said we lost 8,000 jobs in California, and I want to work for those 8,000 jobs, get them back, and I am going to work for the 69,000 jobs that we lost nationwide.
The Democrats love big government. They are so wedded to the old status quo that they are willing to deny American families, including those on the central coast of California, an annual $48 tax break. I think you all would remember that last year, or I should say last election, we heard slogans like ``It is the economy, stupid.'' Well, I guess that if there was a slogan to be had this election time, we should remind people that it is the paycheck, stupid. The folks need to see more of the dollars kept in their paycheck and spend those hard-
earned dollars as they best decide.
I would say, let the bureaucrats here decide how they are going to tighten their belts, and put their agency and their particular program on a diet. I would rather have the folks on Capitol Hill here in the bureaucracies decide how to tighten the belt, rather then my folks on the central coast of California.
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