Biden Considers Plan to Address High Gas Prices That Could Worsen Inflation

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Posted: Jun 21, 2022 11:15 AM
Biden Considers Plan to Address High Gas Prices That Could Worsen Inflation

Source: AP Photo/Evan Vucci

President Biden said Monday he will soon make a decision about whether he should pursue a temporary pause on the federal gas tax.

"Yes, I’m considering it," Biden told reporters near his home in Delaware. "I hope to have a decision based on the data — I’m looking for by the end of the week."

A break from the 18.3-cent-per-gallon federal tax would require congressional action, but Republicans have been quick to dismiss the idea as a gimmick, which is what Barack Obama also once considered it.  

On the campaign trail in 2008, the then-senator said a gas tax holiday was only something lawmakers would do to “say that they did something.”

"Oil companies like Shell and BP just reported record profits for the quarter and we're arguing over a gimmick to save you half a tank of gas over the course of the entire summer so that everyone in Washington can pat themselves on the back and say that they did something," Obama said at a 2008 speech in North Carolina.

Biden’s comment comes as his administration is exploring its options to deal with record-high gas prices nationwide. 

The president accused oil companies of profiteering in a recent letter, but ExxonMobil came out swinging in its response. 

According to AAA, the average gas price nationwide is $4.96, down from a high last week topping $5. 

There are also concerns about what a gas tax holiday would mean for inflation. 

“While the gas tax holiday may reduce prices at the pump, it will further increase demand for gasoline and other goods and services at a time when the economy has little capacity to absorb it,” the Committee for a Responsible Federal Budget warned in a February report. “The result could be even higher rates of inflation in 2023.”