The recent D&C Editorial Board op-ed strongly supporting a gas tax holiday cut sadly misses the point that cutting the gas tax is a cheap political stunt.

here is an open question to James Lawrence and crew- do any on you actually think that the temporary suspension of a gas tax will actually result in lower prices that will be passed on to consumers? That oil companies (distributers, those in the supply chain)  will gladly pass on the savings out of the goodness of their hearts?

Seriously, the market supports what we are paying now so suppliers will find some excuse to absorb the tax cut into the price. Once again, what is the purpose of the corporation? Maximization of shareholder value.

So the faux arguments of “it will be passed on the the customer” are nonsense. Maybe a couple of fill ups will be lower but eventually the price will rise to fill the void.

Exile posted some arguments from others including Paul Krugman. - go back and reread them. Remember the plunging dollar is a causal of the rise in oil prices as well.

But back to the editorial - Did the D&C editorial board just come back from a trip to Fantasy Island?

President Bush must use his leverage as a military supplier and global economic engine to push these countries to increase production.

Hope is eternal I suppose unfortunately memories are short at the D&C. This assumes President - lowest approval rating ever - Bush - actually has leverage. Didn’t we go through something like this a few years ago and Bush said he was going to talk to the oil producers - How did that work out?

But how much do we want oil? Enough to toss toss gas on a fire? Hey I’ll trade you some advanced military weapons for oil. Advanced military weaponry is one of the few things America still makes and controls the price in dollars. Then there is the whole economic engine thing. As we transition to a service economy - where are purchases being made? China. Capital is flowing away from the U.S and into China. The dollar is cheap.

But back to leverage. Who has it and who doesn’t.

Saudi Arabia can say we will start trading oil in Euros instead of dollars - then what our economy really crash.  China can say - hey you own us a lot of money and call in the debt. Please - the US has no leverage here.

Then there was this bit of brilliance as “the world” get dragged into the editorial.

This is a global conundrum. Gas prices in Germany are at $8 a gallon.

Yeah - Low dollar (1 euro = 1.6 dollars) but those freaking Europeans and their mass transit systems. Gasoline is not the driver of their economies as it is here.

Seems the D&C is looking for “feel good” over “function”. Gas tax cuts postpones the inevitable. dealing with a car centric culture.

We need to deal with Urban Sprawl, lack of mass transit, addiction to oil sooner rather than later.