The Carter administration is considering proposing either a large increase in gasoline taxes, perhaps 50 cents a gallon, or some form of rationing to cut gasoline consumption by 500,000 barrels a day or more in 1980, according to the administration officials.
Key Carter advisers expect to have detailed versions of both approaches ready for a decision by the president and possible inclusion in the 1981 budget that goes to Congress in January.
Either proposal would be sure to face a rough reception in Congress, officials acknowledge.
A 50-cent tax would raise about $50 billion even after consumption was reduced. A tax of that magnitude would increase the consumer price index roughly 3 percent almost immediately, and probably another 2 percent or so within two years, administration economists estimate.
Most or perhaps all of the $50 billion would be returned to the public through Social Security or income tax cuts and direct payments to low-income families, Carter aides said yesterday.
Some of the president's advisers would prefer using about $15 billion of the proceeds, should the tax be imposed, to cover the expected deficit and balance the 1981 budget -- thus meeting one of President Carter's long-standing pledges. Other advisers, however, say that would constitute a net tax increase, just the wrong medicine for an economy expected to be just beginning to recover from a recession.
The rationing alternative is getting equal attention from administration analysts because it might restrain consumption without so great an inflationary impact.
Its price impact would depend, one official said, on whether people would be free to sell their unused ration coupons, the so-called white market system included in Carter's original standby rationing proposal rejected earlier this year by Congress. If they could not sell them, rationing too would drive up prices.
CBS reported last night that the Department of Energy has prepared a standby rationing plan to cope with a 20 percent gasoline shortage that would give ordinary motorists about 75 percent of their normal usage. To cope with lesser shortages, which is what the current policy debate is about, DOE is studying two alternatives, CBS said. Under one, each car would carry a sticker indicating one day each week on which it could not be driven. Under the other, gasoline for a given car could be purchased only on a set day each week.
The administration is anxious to cut gasoline consumption in 1980 partly as insurance against a major interruption in world supply, such as loss of the 3 million barrels or so of oil exported each day from Iran. Under international oil sharing arrangements, the United States would have to reduce oil consumption by several hundred thousand barrels a day in that event even though oil is no longer being sent from Iran to the United States.
Lower consumption might also help on the price side, easing tight oil markets in which some crude oil is being sold on a spot basis for more than $40 a barrel.
"There seems to be some real ambiguity in the minds of policymakers just what we are about," one analyst declared. "It's not clear whether we want to be in a position to adjust to a shortage equitably or loosen the market."
If there is any proposal intended to cut oil consumption in 1980, it will definitely be directed at gasoline, Carter officials stress. That is the only area left where a quick saving can be made. Such other steps as having industry and utilities switch from oil to natural gas are already being taken.
A draft of an "oil shortage contingency planning" document prepared by Deputy Energy Secretary John Sawhill recently declared that in the past, federal officials planning a response to oil shortages "have spent too much time on potential responses which have had little impact. These marginal actions include: increasing domestic oil production; mandatory demand restraint; fuels switching; environmental waivers; and voluntary conservation.
"These have been given high priority," the draft continued, "because they are viewed as relatively painless responses, but they are not very effective, as shown in the recent small shortage. They will be even less useful in a larger shortage . . .
"[The] greatest potential for reduction is use of automobiles for commuting, and in jet aircraft use. These also are the areas where the least has been done to reduce consumption during a shortage."
The draft goes on to suggest, as an option, decontrol of gasoline prices and using "price to allocate" available supplies, while making this "politically acceptable by placing a large tax on the sellers and rebate revenues to consumers."
Other options listed in the draft include a combination of price controls and the free market, with some gasoline free to be sold for whatever the market would bear, or "a simplified rationing scheme . . . "
Some Carter advisers think the public -- and Congress -- would not accept a rationing scheme unless faced with an actual shortage of oil. A bill Congress passed this year would permit rationing only when there is a 20 percent reduction in supply.
The administration would have to ask Congress to change this if it wanted to impose rationing in less drastic circumstances. Whether Congress would is questionable; it barely agreed to the 20 percent rule. Congress has also consistently resisted gasoline tax increases in the past.
Meanwhile, the Department of Energy is about to send to each governor a specific target for energy conservation in his or her state, as required by a law passed this year. Many of the governors, after a meeting with Carter at the White House last month, stressed they felt new cutbacks should come only if there is an actual shortage. The administration, on the other hand, wants the cuts in usage made even if there is no shortage.
Last year Americans used an average of 7.4 million barrels of gasoline a day. As a result of sharply higher prices and some shortages in May, June and July, consumption will average about 7.1 million barrels a day for all of 1979.
With prices likely to continue to rise in 1980, some administration analysts believe consumption will be well below the 7-million-barrel level even without new taxes or rationing.