Bush Rejects Windfall Profits Tax, Denies That There Is Oil Price Gouging
Bush has got this one right.
WASHINGTON — President Bush rejected calls by some lawmakers for a tax on oil-company windfall profits, saying the industry should reinvest its recent gains into finding and producing more energy.
“The temptation in Washington is to tax everything,” Mr. Bush said in an exchange with reporters in the White House Rose Garden. “The answer is for there to be strong reinvestment to make this country more secure from an energy perspective.”
With gasoline at over $3 a gallon in some areas, Mr. Bush said there was “no evidence” of price-gouging of consumers.
Mr. Bush said energy companies should use their increased cash flows to build more natural gas pipelines, expand refineries, explore “in environmentally friendly ways,” and invest in renewable sources of energy.
“That’s what the American people expect. They also expect to be treated fairly at the pump,” he said. “These oil prices are a wake-up call. We’re dependent on oil. We need to get off oil.”
The president announced a series of steps earlier this week designed to slightly ease upward pressure on gasoline prices, including temporarily halting the filling of the government’s emergency petroleum reserve and easing environmental standards on gasoline additives.
Mr. Bush said it was “important for the people to understand that one of the reasons why the price of gasoline is up is, there’s tight gasoline supplies. And one reason there’s tight gasoline supplies is, we haven’t built any new refineries since the 1970s.”
Exactly.
I’ve liked Bush’s response to gas prices so far. He has quelled complaints about price gouging by ordering an investigation into the matter (though one was already in progress by the FTC) and otherwise responded not by imposing price limits but by asking for a loosening up of regulations that will allow the free market to more easily adapt to changing prices.
This is as it should be. It seems to me that no matter what we do on the gas situation the future is going to be painful. America is very, very dependent on the substance yet consistent supply (thanks to undue regulation and geopolitics) is a problem. The best thing to do is to step back and let the decisions made by citizens in the free market dictate where this country’s energy market goes.
