Democrats Step Up Debate on Gas Tax

Sen. Hillary Rodham Clinton attends a rally at Guilford College in Greensboro, N.C., with Gov. Mike Easley.
Sen. Hillary Rodham Clinton attends a rally at Guilford College in Greensboro, N.C., with Gov. Mike Easley. (By Elise Amendola -- Associated Press)
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By Dan Balz and Peter Slevin
Washington Post Staff Writers
Saturday, May 3, 2008

RALEIGH, N.C., May 2 -- Democratic presidential candidates Hillary Rodham Clinton and Barack Obama escalated their debate Friday over rolling back gasoline taxes, with Obama criticizing her plan to suspend the tax this summer as a costly "political stunt" and with Clinton casting the issue as a choice between standing with consumers or the oil industry.

Clinton, sounding a populist tone throughout the day, leveled a sharp blast at energy traders, OPEC nations and the energy industry. She called for a federal investigation of possible market manipulation and urged a much tougher stance toward the energy-producing nations, including possible action before the World Trade Organization.

With both candidates vowing to help turn around the economy, the debate over the gas tax has emerged as one of the most substantive domestic disagreements between Clinton and Obama in their long battle for the Democratic nomination. Although the prospects of congressional action appear minimal, the two have approached their debate confident that it can help them in the short term.

But the dispute also has highlighted the fundamental differences in the broader messages that each is driving home to voters before Tuesday's primaries in Indiana and North Carolina. Obama portrays the proposal to suspend the gas tax as a meaningless gimmick that embodies the worst of the old politics and his opposition to it as evidence that he will change the system. Clinton sees the proposal as proof of her willingness to stand with hard-pressed families against the power of corporate interests.

After sparring long distance, the two candidates both appeared Friday evening at a Jefferson-Jackson Day dinner held by the North Carolina Democratic Party, although they did not cross paths. Both stressed the importance of party unity once their battle is over, then quickly resumed their debate over a gas tax holiday.

Like Clinton, whose recent theme has been "jobs, jobs, jobs and jobs," Obama has focused on the economy. He opened a news conference in Indianapolis by saying that wage and job numbers released Friday provide further evidence of an economy that has grown "worse and worse in recent months."

He pivoted immediately to criticize Clinton and the gas tax proposal. He described the idea, which Clinton and Sen. John McCain, the presumptive Republican nominee, support in different forms, as an example of Washington politics that have "been more about scoring points than solving problems."

"At best, this is a plan that would save you pennies a day for the summer months," he said in a message he repeated at a steel mill in Munster, Ind. "That is, unless gas prices are raised to fill in the gap, which is just what happened in Illinois, when we tried this a few years ago."

Obama said the "McCain-Clinton gas tax gimmick" has little support in Congress. He invoked the comments of House Speaker Nancy Pelosi (D-Calif.) and House Majority Leader Steny H. Hoyer (D-Md.), as well as those of Sen. Tom Harkin (D-Iowa) and New York Gov. David A. Paterson (D), a Clinton superdelegate. Obama also disputed Clinton's assertion that a divided Congress could tax oil companies to make up the difference.

"Unless you can magically impose a windfall-profits tax on oil companies overnight to pay for the holiday," Obama said, "it could imperil federal highway funding, and cost Indiana more than 6,000 jobs."

In North Carolina, Clinton fired back, criticizing Obama for opposing the idea altogether and McCain for his unwillingness to force oil companies to bear the cost.

"We have a choice," she said in Hendersonville, in western North Carolina. "We can choose to have you continue to pay the federal gas tax this summer, or we can choose to try to make the oil companies pay it out of their record profits. This is the kind of choice that I believe we should be trying to make, because I know where I stand and I know where my opponents stand."

She said that while the nation needs a long-term energy plan, the issue now is whether leaders will provide short-term assistance, however small, to families whose budgets are stretched by the increase in gas prices. "I want the Congress to stand up and vote," she said in Kinston. "Are they for the oil companies, or are they for you?"

Her campaign also released a new ad in Indiana attacking Obama on the issue, a spot that says her plan would "save families $8 billion" and notes that "Obama would make you keep paying that tax."

Going after the oil companies was only part of Clinton's energy message. She accused energy traders of manipulating oil prices and called for the Justice Department and the Federal Trade Commission to investigate. "It is a fact they are manipulating the oil and gas market," she said.

As for OPEC, she said it is time for the United States to get tough with the cartel, and called for "some creative lawyers" to figure out how to take OPEC nations before the World Trade Organization for relief. "This is not a free ride anymore," she said.

Clinton also called for releasing oil from the Strategic Petroleum Reserve to help hold down prices.

All week in Indiana and North Carolina, Obama has been trying to counter the populist appeal of the proposed three-month tax holiday by repeating estimates that pegged the average savings at $28 per family, or about 30 cents a day. That would not pay for a daily cup of coffee at 7-Eleven, he likes to say.

Obama also continued to fight perceptions that he is an elitist who is not in touch with working-class families, a group whose votes he has struggled to win and that is now seen as the critical constituency in the Democratic primaries.

"I do think one of the ironies of the past two or three weeks is this idea that Michelle and I are elitist, pointy-headed intellectual types," said Obama, whose young mother became a single parent by the time he was 2. "The fact is, our lives more closely approximate the lives of the average voter than any of the other candidates."

Obama has made millions recently from his best-selling memoirs. His wife, Michelle, is a hospital executive whose salary climbed to $275,000 in the year before the presidential run. But when Obama moved to Chicago after college in the mid-1980s, he earned $1,000 a month as a community organizer.

Slevin reported from Indiana with the Obama campaign. Staff writer Shailagh Murray in Indiana contributed to this report.

© 2008 The Washington Post Company