Earlier in the presidential campaign, when John McCain and Hillary Rodham Clinton called for a summer holiday on the 18.4-cent-per-gallon federal gasoline tax, Barack Obama dismissed the tax vacation as an election-year gimmick that offered financially squeezed families "just pennies." I wrote that, unlike Clinton and McCain, Obama "stood tall in opposing the gas-tax holiday."
Now we know why. Obama must have seen the gas-tax holiday as chump change in the wondrous store of campaign gimmicks. When Obama panders, he panders big-time. Witness his proposed "emergency energy rebate" that -- on the heels of this year's $600 per taxpayer stimulus package rebate sent to taxpayers this year -- promises additional $500 checks for American workers or $1,000 per family "as soon as this fall." (Is there an income cap for how Obama defines eligible "working families"? The campaign did not get back to me on that by my deadline.)
To hear Obama, the check is practically in the mail. Obama argues that his plan is fiscally responsible because he would pay for it by levying a "reasonable" tax on oil companies' windfall profits. The candidate has pointed to Exxon Mobil's record profits -- $22.6 billion in the first half of this year -- to justify his raid on its earnings.
Less reported, Investors Business Daily editorialized, are the record taxes Exxon Mobil paid in the same period -- $61.7 billion. Also, "Exxon made a dime on a dollar in 2007. The oil and gas industry as a whole made 8.3 percent, compared with 8.9 percent of all U.S. manufacturing." So why whack Big Oil?
According to Stanford economist John Taylor, who is a McCain adviser, raising taxes on oil companies likely "will raise the price of gasoline."
If critics are right, and a windfall profits tax raises gas prices or leads to a drop in domestic oil output, which only worsens America's chronic dependence on foreign oil, then what? Another emergency energy rebate check?
In a clever effort to dress up his big-time pander as a high-minded position, Obama has suggested that McCain is "in the pocket of Big Oil." Obama points out that McCain wants to lower Exxon Mobil's tax bill -- which is true, because McCain wants to lower all the corporate tax rates to 25 percent to create jobs.
McCainiacs respond by noting that Obama voted for the 2005 omnibus energy bill -- signed by President Bush -- which gave oil companies specific tax breaks. For that very reason, McCain voted no.