THE NEW OIL import fee will arrive at the service station pumps on May 15, raising the price of gasoline something close to 10 cents a gallon. There's a move in Congress to overturn the fee -- another foolish and reckless attempt to pretend that Congress can hold down gasoline prices for consumers. If Congress were living up to its real responsibilities, it would now be enacting a tax to raise the price of gasoline, over the next several years, to $2 a gallon.
For years Congress has been crippled by its inability to acknowledge in public that much higher prices are essential to protect this country and economy. Many of the members know it to be true, but it seems that there's never a good time to do anything about it. Four years ago, when the price of gasoline was 60 cents a gallon, there was talk of tax to cut consumption -- for there is no effective conservation strategy that does not require sharply higher prices.
Congress would have none of it. Higher taxes on gasoline would be too cruel, congressmen said, and too unfair -- and too unpopular in an election year. Cheap gasoline was the American way. The result was, of course, that Americans used more and more of it. That drove up imports and tightened markets abroad. When the Iranian revolution created a small shortage, OPEC had all the power it needed in that seller's market to double its prices. Now the price of gasoline is $1.25 a gallon, and Congress is full of people who are still crying that a higher tax would be too cruel and too unfair - and too unpopular in an election year.
Suppose, just for a moment, that Congress had been sufficiently foresighted in 1976 to impose a tax of 50 cents a gallon. Suppose that it had rebated the tax revenues, some $50 billion a year, by cutting working people's payroll taxes and some of the business taxes. There would be higher employment today and higher business investment. American gasoline consumption would have dropped 600,000 barrels a day, just as it has done over the past year, and that would have created a substantial world surplus of oil before the Iranian revolution. Oil prices would doubtless have risen in any case, but it is impossible to believe that they would have sustained anything like last year's destructive increases. Gasoline prices might be about where they are today. But $50 billion of that increase would be circulating back into the American economy, instead of going into the bank accounts of foreign governments.
The unemployment rate last month jumped to 7 percent, suggesting that the recession may be deeper and harsher than expected. One reason is the burden of the national oil deficits, which have the effect of a gigantic tax on the country -- a tax not rebated.
The principal defect in Mr. Carter's 10-cent fee is that it's too small. The only way for this country to protect itself from the next Middle Eastern oil crisis is to cut, fast and hard, the amounts of oil that it buys abroad. The country has now been through two similar oil crises, each followed by severe unemployment, rising inflation and eroded living standards. Americans have it in their power to free themselves from this cycle by burning less oil. But that will take a different kind of leadership from Congress.