Outside editorial: Gas prices - Congress ducks harder choices

Posted: Wednesday, May 30, 2007

This editorial appeared in the Philadelphia Inquirer:

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In the spring of 2006, gasoline prices were approaching $3 per gallon, and Democrats seeking to win back Congress blamed the Republicans in charge.

"The American people can no longer afford the Republican rubber-stamp Congress and its failure to stand up to Republican big oil and gas company cronies," House Democratic leader Rep. Nancy Pelosi of California said at the time. She said Republicans had given the public "empty rhetoric rather than join Democrats who are working to lower gas prices."

A year later, Democrats control Congress, Pelosi is speaker, and gas prices are at a record nationwide average of $3.23 per gallon of regular unleaded, up from $2.87 a year ago. Some analysts predict gasoline will hit $4 per gallon this summer in many parts of the country.

Should we presume that Democrats are now in cahoots with Big Oil? No. Democrats can't control prices now, just as Republicans weren't responsible for rising gas prices a year ago.

World oil markets largely determine the cost of gasoline, which often climbs as the summer driving season approaches. Industry experts also blame a shortage of refinery capacity for almost weekly increases in retail prices since Jan. 29.

Maybe $4 gasoline will create enough outrage to get Congress to do what it hasn't: Take serious steps to reduce U.S. dependence on foreign oil.

Policy-makers haven't been nearly aggressive enough in encouraging higher fuel economy in new automobiles, even as sales of light trucks and SUVs reached 50 percent of the U.S. market.

What Congress can do is set long-term goals for reducing gasoline consumption and encourage diversification of fuel supplies. To date, the new Democratic majority has offered a strategy that is equal parts planning and posturing.

Democratic leaders have held hearings into alternative fuels, climate change and hydrogen research; they promise a package of bills by July 4 with incentives to promote alternatives.

But they also are grandstanding, such as the House passing a bill May 23 to stop oil companies from "price gouging." Never mind that a thorough investigation by the Federal Trade Commission after Hurricane Katrina in 2005 found no evidence that companies manipulated prices. The market responded to a devastating storm and limited supply with higher prices.

Though oil companies may not be gouging, they are certainly making enough to forego government charity. The House did vote this year to roll back $14 billion in subsidies to oil companies, but couldn't agree with the Senate on a version that might get past President Bush's veto pen.

The Senate is headed in a smarter direction, trying to raise gas-mileage standards for new vehicles from 25 miles per gallon to 35 m.p.g. by 2020. However, it needs to drop a loophole, inserted in committee, that allows the administration to ignore any target that wouldn't be "cost-effective" for automakers.

Senate Democrats' comprehensive energy proposal, waiting for debate upon completion of the immigration bill, also mandates 36 billion gallons of ethanol and other renewable fuels - something the president supports. Biofuels proposals, however, contain few safeguards for the conversion of forests or fallow acres to cornfields. Congress shouldn't jeopardize the land, air or water to produce more energy.

Amid this debate over the high cost of gas, Washington remains mystically silent about upgrading and investing in fuel-efficient mass transit. Systems continue to scrounge for money, threaten fare hikes, and plot service cutbacks to close their chronic deficits.

And few politicians speak this unpleasant truth: Even if oil prices fall, the U.S. government should keep pump prices right where they are (or even higher). It should levy a higher gas tax to discourage consumption and to raise desperately needed revenue to repair the nation's crumbling highways and boost struggling mass transit.

Any revenues left over perhaps could help close Social Security's long-term funding woes. Remember them?

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