Experts don’t have high hopes for a potential gas tax holiday’s benefit to consumers.
Also, the Group of Seven is in talks for a Russian oil price cap, and the Biden administrationis taking new action on illegal fishing.
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Experts see risk with little upside in gas tax break
Experts are warning that President Biden’s proposed gas tax holiday would do little to defray pain at the pump and actively take a toll on infrastructure and the environment.
The 18-cent federal tax, which Biden has said should be suspended for three months amid steep gas prices, is “very little money” for individuals, said Beverly Moran, professor of law emerita at Vanderbilt Law School.
- “It just doesn’t make any sense. If the government wants to do something to help people who are having problems with their, you know, the cost of gas, they can send out another check to people,” Moran told The Hill in an interview.
- “They aren’t even considering how they’re going to stop companies from just eating up the difference … keeping the same price and just pocketing the tax.”
Modeling by the Wharton School of Business at the University of Pennsylvania indicates that a gas tax suspension from July to September would only mean a per capita spending reduction of $4.79 to $14.31, depending on location, but would reduce overall government revenues by about $6 billion.
Meanwhile, in Congress: Progressive Democrats in Congress, meanwhile, are doubling down on their push for a windfall profits tax on oil companies which would be returned to consumers, arguing this would provide the greatest relief.
“I think the gas tax is a smaller, somewhat half measure,” Rep. Jamaal Bowman (D-N.Y.), the sponsor of one of two oil windfall profits tax bills, told The Hill. “Decreasing the amount of taxes that fossil fuel or fossil fuel companies have to pay doesn’t necessarily mean that that’s going to lower costs. And it doesn’t mean it’s going to lower costs as much as we need to lower costs.”
Moran agreed that the idea would be more effective than a break in the gas tax.
“Last time there was a windfall profits tax, it was [the presidency of] Richard Nixon, and that says a whole lot, that now Richard Nixon is a liberal in United States politics,” she said. “Yeah, there should be a windfall profits tax.”
Read more about the drawbacks here.
G-7 moves closer to backing price cap on Russian oil
The Group of Seven (G-7) countries are moving closer to endorsing a price cap on Russian oil — an untested plan that would seek to limit the Kremlin’s profits from selling the commodity worldwide.
- The idea has been floated in recent weeks as the United States and its allies search for ways to further squeeze the Russian economy to punish President Vladimir Putin for the war in Ukraine. Energy exports are the leading source of revenue for the Russian economy.
- The price cap has been a source of discussion during the G-7 summit in Germany over the past two days, where President Biden is huddling with counterparts from Germany, France, Italy, the United Kingdom, Japan and Canada. Treasury Secretary Janet Yellen first said last week that the U.S. was discussing the idea of a price cap with its allies.
How close are we? A senior Biden administration official told reporters on Monday that the G-7 countries were in “final discussions” about an agreement on a global price cap for Russian oil.
The official indicated that the G-7 leaders would endorse the idea and then direct their finance ministers to develop “mechanisms” for setting a global price cap for Russian oil shipments to nations outside of the U.S., Europe and the G-7.
- Speaking to reporters later Monday, White House national security adviser Jake Sullivan insisted that the G-7 members were united behind limiting Russian profits from energy.
- “There is absolute consensus across the G-7 that the purpose of our energy sanctions on Russia should ultimately be to deny revenue to Russia while at the same time ensuring a stable global energy market,” Sullivan said on the sidelines of the G-7 summit.
“There is also consensus emerging — although there continue to be discussions around it, so I don’t want to get ahead of the leaders on this — that the price cap is a serious method to achieve that outcome,” he said.
Still, specifics for how the plan would work are currently unclear. Sullivan said that while there is agreement around the broad idea, countries are trying to work through the specifics of how it would be implemented.
Read more about the talks here.
Biden, NOAA address illegal fishing
President Biden on Monday signed a national security memo aimed at addressing illegal fishing in international waters.
- The memo seeks to increase international coordination to address labor issues in the fishing industry and remove labor abuses from the supply chain, according to a White House fact sheet.
- It also aims to restrict the market for the products of illegal, unreported and unregulated (IUU) fishing and forced labor.
During this week’s United Nations (U.N.) Ocean Conference, the Biden administration is also poised to announce an alliance with the United Kingdom and Canada to combat fishing that is illegal or goes unreported.
In conjunction with the memo, the National Oceanic and Atmospheric Administration (NOAA) on Monday issued a proposed rule to address forced labor and other labor rights issues in the seafood industry.
Under the new rule, “we are making our definition of IUU fishing consistent with that of the [U.N. Food and Agriculture Organization],” a National Security Council official told reporters on a press call Monday.
- This proposal will allow U.S. officials to craft definitions that incorporate both the use of forced labor and comparable fishing laws between the U.S. and other nations, an official said.
- Meanwhile, a U.S. interagency working group comprised of 21 federal agencies is currently finalizing a five-year plan to address IUU fishing, officials said on the call.
Read more about the order here.
Jane Fonda: Biden needs to ‘get better on climate’
Actress and activist Jane Fonda says that if President Biden wants to run for reelection in 2024, he needs to “get better” on the climate change issue.
In an interview with The Washington Post published on Monday, Fonda told the newspaper that she is “sickened” about Biden issuing more permits for oil and gas drilling on public lands than his predecessor, former President Trump.
- Fonda said that Biden promised while campaigning for the Oval Office that he would not do any drilling on public land.
- “I am sickened by that, especially since I believe he understands what’s at stake. He promised during his campaign that he would not allow any more drilling and fracking on public lands,” The 84-year-old actress told the Post. “So it’s very, very disappointing.”
The “Grace and Frankie” actress also said that she believes Biden can be pressured into doing the right thing, saying how the upcoming midterm elections in November are “critical“ and noted that Biden has to be better on climate change if he wants to run for reelection.
“But he’s better than what could be. And I believe he can be pressured to do what’s right. That’s why the midterm elections are so, so critical. We have to fight with everything we have to pressure him and to back climate champions,” Fonda added.
“And we have to make it very clear to Biden that if he intends to run again, he’s going to have to get better on climate.”
Read more from The Hill’s Olafimihan Oshin.
ON TAP TOMORROW
The House Appropriations Committee will mark up budget legislation for the Energy Department and other agencies.
WHAT WE’RE READING
- Dems look to federal lands for red-state abortion access (E&E News)
- The world pledged to cut methane. Emissions are rising instead, study finds. (The Washington Post)
- Baltimore’s water system contains PFAS chemicals at levels above new EPA health advisory (The Baltimore Sun)
- G7 leaders debate fossil fuel investments amid energy crisis –sources (Reuters)
- Google’s Plan for 24/7 Carbon-Free Energy Ran Into Headwinds in 2021 (The Wall Street Journal)
And finally, something offbeat and off-beat: Please don’t.
That’s it for today, thanks for reading. Check out The Hill’s Energy & Environment page for the latest news and coverage. We’ll see you tomorrow.