Remember that $0.16 Joe Biden saved you last Fourth of July? In 2022, he is taking summer savings to a whole new level — a bit less than $16, to be exact.
Earlier this week, President Biden called for a three-month pause to the federal gas tax — which sits at slightly over $0.18 per gallon of gasoline — because he “understands that high gas prices pose a significant challenge for working families,” according to the White House.
Despite the publicity that has surrounded the move, a new report from the University of Pennsylvania’s Wharton School revealed that President Joe Biden’s proposal would save Americans a total of $4.79 to $14.31 from July to September.
Indeed, Penn Wharton Budget Model explained earlier this year that because the United States’ gasoline market is “typically characterized by inelastic supply and inelastic demand in the short run,” there would not be a significant change in gasoline consumption spending. Savings would be most tangible in states like California, where the average cost of gas is the highest in the nation, while savings would be lowest in the Rocky Mountain and Gulf Coast regions.
The national average price of gasoline is $4.93 per gallon as of Friday, according to AAA. In California, the average price is $6.35 per gallon; in Colorado and Louisiana, average prices are $4.91 and $4.47, respectively. Earlier this month, average costs surpassed $5.00 per gallon.
Inflation, however, cost the typical American household $3,500 in 2021, according to another Penn Wharton Budget Model analysis.
Sen. Joe Manchin (D-WV) said on Wednesday that he would not vote for the federal gas tax suspension since the policy does not guarantee that the amount would “penny-for-penny come off of that price.” Conservatives have mounted a similar argument.
“President Biden’s proposed temporary gas tax suspension is a band-aid solution to runaway gas prices,” Job Creators Network President Alfredo Ortiz said in a statement provided to The Daily Wire on Wednesday. “To truly show leadership and meaningfully reduce Americans’ pain at the pump, Biden must fundamentally reshape his party’s environmental policy, strongly backing the production and distribution of traditional energy. Only with vastly increased supply can gas prices significantly fall.”
Combined with state taxes, the typical American driver pays $0.571 in gas taxes per gallon, according to the American Petroleum Institute.
On Sunday, Treasury Secretary Janet Yellen told ABC News host George Stephanopoulos that pausing the federal gas tax was on the table for President Biden. “Gas prices have risen a great deal, and it’s clearly burdening households,” Yellen said. “So he stands ready to work with Congress, and that’s an idea that’s certainly worth considering.”
Meanwhile, Energy Secretary Jennifer Granholm lauded the suspension as a way to provide families relief from “Putin’s Price Hike” — but also argued that the “only way out” of “boom-and-bust cycles” in energy prices is “deploying clean energy.”
“The real truth is that as long as our nation remains overly reliant on oil and fossil fuels, we will feel these price shocks again,” Granholm said. “This is not going to be the last time. The next time there’s a war, the next time there’s a pandemic or another hurricane, these extreme weather events we are experiencing — they will impact the access that we have to fossil fuels.”