Backlash on gas tax holiday
A debate is raging in the U.S. -- one with strong echoes of the debate we didn't seem to have here in Canada over cutting the GST by two percentage points.
In the U.S., it's something called the "gas tax holiday" -- a proposal to suspend the federal tax on gas this summer; an idea first floated by Republican presidential candidate John McCain, but also endorsed by Democratic contender Senator Hillary Clinton.
The general view on this idea, just like the GST cut in Canada, seems to be: good retail politics, bad policy.
Unlike Canada, however, the economists are getting vocal with their opposition. Henry Aaron of the Brookings Institution has found 150 of them to sign this letter.
The difference is that the GST cut may have been bad policy, the gas tax cut is really, really bad policy. Having any Democratic candidate support it is just shocking.
Posted by: Darwin O'Connor | May 05, 2008 at 03:50 PM