Apr 10
$4 gas, our senators have heard of that
By Denise Ross
What’s a US Senator to do when gas prices hit prices that are not only record highs but that seemed impossible during their last election campaigns?
Since the price of gas is, short of some serious hearings and legislation, not directly within their sphere of influence, a senator is left to express a bit of I-feel-your-pain and then move on to the blaming portion of the program. (Not blaming SUV-driving voters, however. That would be imprudent.)
During calls with reporters Wednesday, both Sen. Tim Johnson, D-SD, and Sen. John Thune, R-SD, acknowledged the pain and placed some blame, with the villians being identified as the Bush administration, oil companies and their profits, Congress and OPEC countries.
Said Johnson:
$4 gas would be devastating for the people of SD, with the agriculture and tourism industries getting hit extra hard. I will continue to support ethanol and cellulosic ethanol and wind energy. That is a long-term agenda.
In meantime, I will oppose high gas prices. Gas prices are going higher in part because India and China are burning more gas. At same time, the gas companies and oil companies are making record profits.
Diesel prices alone will be negatively impacting our state. Gas prices have a ripple effect. It will damage the profitabily of livestock and fertilizer and all other inputs that SD agriculture requires, apart from the tourism economy. And just getting around to areas we need to get around to in SD.
The Bush admininistration should be agreeing with Democrats about the need for a rollback on tax breaks the big oil and gas industry requires.
Said Thune:
When you start talking about $4 gasoline, that is a huge dent in our economy. Anything we can do to increase the supply of energy - there are a lot of things we need to be doing to grow our energy supply in this country. It affects every American’s pocketbook.
The Bush administration needs to be actively engated to try to keep production levels up around the world. 55 % of the cost of gas is oil; that’s the primary driver of cost. When you start looking at $110 oil and realize 65 % of our petro comes from outside the US, we’re very dependent on OPEC countries.
The administration should be jawboning those countries regularly, trying to get them to increase production and supply. We’ve got enormous demand around the world. China and India are growing at astronomical rates. Closer to home, we need to have more refinery capacity. We ought to be addressing that very directly.
I would encourage the Bush admininistration to increase blends on ethanol, to allow 20% and 30% blends. There are a number of things we need to be active on. We can’t just sit back and allow other countries around the world to dictate what the price is going to be. And right now, that’s what’s happening.
The high cost of fuel is directly related to the inaction of Congress on refining, drilling, increasing domestic supply. Fudnamentally, this is a supply problem. If we had more supply, we would see the pressure come off significantly. There have been countless failures of Congress’ inaction when it comes to adding more supply.
1 Comment so far
Leave a Reply
Unfortunately, there is not a lot the federal government can do, but the tax breaks for big oil should be eliminated with savings passed along to the consumer and oil could be released from the strategic petroleum reserve (instead putting oil into it as the Bush Administration wants to do). If the federal tax on gas was reduced, which theoretically could lower the cost of gas, it would hurt the revenue for the highway fund, which would then likely cost states like South Dakota.
The long term solution is to end the dependence on oil. But the Republicans in Washington have blocked efforts to do that for years.