President Carter began yesterday to unveil portions of his energy program to key mebers of Congress and immediately ran into objections to one of the keystones of that program - a standby gasoline tax of up to 50 cents a gallon.
While there was praise generally for the President's somber energy speech on national television Monday night, the initial congressional reactions to his energy proposals contained the seeds of the coming political battles over their enactment.
Senate and House members from energy-producing states questioned the wideon of putting a cap on the price of natural gas and complained that the Carter plan emphasizes conservation too much and development of new energy resources too little.
"It's all well and good that we do everything towards conservation, but we still have to be prepared for the day when the gas tank is on zero," said House Majority Leader Jim Wright (D-Tex.).
There were even more widespread objection to the proposed standby gasoline tax, which House Speaker Thomas P. O'Neill Jr. (D-Mass.) said would be "the toughest part" of the energy package to enact.
Carter, O'Neill said, "is going to have to compromise along the line, but we won't talk compromise until we come to that stage."
The objection to the gasoline tax encompassed philosophical doubts that higher taxes actually lead to increased conservation, a fear that the tax would impose an unfair burden on residents of rural areas and the poor, and uncertainty over adminstration plans to rebate some part of higher energy costs through the tax system.
The President and White House energy chief James R. Schlesinger briefed more than 50 members of Congress on the administration energy plan yesterday morning at the White House. One reason the congressional delegation was left confused about provisions to rebate higher energy taxes was because those provisions were then in a final state of flux.
White House sources said that late yesterday morning Carter and his chief ecnonomic and energy advisers decided to use an income tax credit as the advice to cushion the impact of higher energy taxes for low-income people. until then, the administration had planned to use the Social Security payroll tax for the rebate.
One White House source said the energy plan will call for a tax credit of between $20 and $30 that would be tacked on the existing $35 income tax credit. All federal taxpayers would receive the credit, but low-income taxpayers would benefit proportionately more than high-income taxpayers.
The President, who Monday night warned Americans that they face a possible "national catastrophe" if energy consumption remains unchecked, will unveil the details of his energy plan in an address to a joint session of Congress at 9 tonight. All three television networks will broadcast the speech live.
Last night, Carter convened a broad group of political and policy advisers to go over the speech, the most important policy pronouncement of his young administration.
Schlesinger is to brief members of the Cabinet and the White House senior staff on the plan this morning. Schlesinger will also unviel the energy package at a special briefing for the press this afternoon.
However, under a White House-imposed rule, reporters who attend the briefing will bot be allowed to quote Schlesinger by name, an apparent attempt to focus the maximum media attention on the President not this chief energy adviser.
According to congressional sources who attended the White House meeting yesterday, Carter tonight will propose.
A standby gasoline tax that would be imposed beginning Jan. 2, 1979, if gasoline conservation efforts are unsatisfactory. The initial tax would be 5 cents a gallon (on top of the existing 4-cent-a-gallon federal gasoline tax), and it could rise to 50 cents a gollon over a period of years if conservation doesn't take hold. The tax credit will be provosed to soften the impact of this and other higher energy costs.
A "gas-guzzler" tax that would be imposed on new cars as soon as the legislation is enacted. This provision would impose a tax of up to $2,500 on cars that fall far below fuel efficency standards and would provide rebates of up to $500 for cars that exceed the fuel efficiency standards. The fuel efficiency standard in 1985 would be an average of 27.5 miles per gallong.
A tax credit for home insulation that would amount to 25 per cent of the first $800 insulating cost, or a $200 credit, and 15 per cent on the next $1,400 of cost, amounting to another $210 credit.
Tax provisions which over a two year period would increase the cost of domestically produced oil to $13.50 per barrel, the same price now imposed by the Organization of Petroleum Exporting Countries (OPEC).
Setting the price of new domestic natural gas at $1.75 per thousand cubic feet. In effect, this would increase the price of gas sold in the interstate market, now set a federally regulated $1.45 per thousand cubic feet, but would lower the price for gas that is produced and sold in the same state. Contracts for this so-called intrastate gas are now at $2 per thousand cubic feet or more.
Mandating a conversion by 1980 to coal as the fuel in boilers that now burn oil and natural gas.
An increase in coal production from 665 million tons a year to 1.1 billion tons a year by 1985.
Establishing a 1 - billion - barrel strategic oil reserve by 1980.
Provisions for state to enact laws that would require public utilities to develop insulation package programs for their customers, with the bills payable on a monthly basis rather than in a lump sum.
One House member quoted the President as telling the congressional delegation, "The basic fabric of our society will be destroyed if we don't take action" on energy.
There was widespread agreement following the White House meeting that Carter has taken a courageous stand, that the energy crisis is real and must be dealt with and that enacting a strong national energy policy will be a difficult but not impossible task. But with that, the threads of agreement began to unravel as members of Congress took aim at specific portions of the administration plan.
Chief among these was the standby gasoline tax, with its implied threat to an automobile-dominated society.
Senate Democratic Whip Alan Cranston, for example, said he could not support a stiff gasoline tax unless there were special provisions for his home state of California and other parts of the West that depend heavily on the automobile.
Sen. Henry M. Jackson (D-Wash.), chairman of the Energy Committee handling regulatory aspects of oil and gas, said bluntly. "The gas tax is in trouble. It will not deter consumption. To do that, you'd have to set it so high it would be impossible to get it through."