During his State of the Union address, President Trump called on Congress to create an infrastructure plan with “at least” $1.5 trillion in funding, reviving his rhetoric from the 2016 election aimed at rebuilding the nation’s deteriorating roads and bridges.
But Trump's desire to launch a major spending proposal — especially after the passage of large corporate tax cuts last year — has left some traditional penny-pinching conservatives wondering how to pay for it. His State of the Union address reignited an old debate among Republicans over doing something they are prone to hate: hiking the federal tax on gasoline.
The possibility of raising the gas tax -— which has not been increased since 1993 — to pay for an infrastructure plan has so far gotten a mixed reception from Republicans.
And oil companies — traditional GOP allies on a host of energy and environmental legislation — have failed to take a united position over raising the gas tax and making their primary petroleum product more expensive to consumers.
“I'm not for raising the gas tax,” John Cornyn of Texas, the No. 2 Republican in the Senate, told an audience last week.
In the House, Rep. Bill Shuster (R-Pa.), who chairs the Transportation and Infrastructure Committee that would consider a infrastructure legislation, is urging fellow Republicans to eat their vegetables and support a gas tax hike. “Nobody wants to raise any taxes,” Shuster said last week on Bloomberg TV, “but this is something that’s understandable and efficient.”
Similarly, groups that represent the oil sector and donate to Republicans are divided on whether to support hiking levies on transportation fuel — or plan to sit out the debate altogether
“Historically, we’ve not taken a position on the gas tax,” Jack Gerard, the outgoing head of the American Petroleum Institute, the nation’s largest oil lobbying group and a major backer of Republicans in Washington, said in an interview ahead of the State of the Union speech.
“That is an appropriate role for government” to set that tax, Gerard said, adding that “as long as those dollars are dedicated for their stated purpose to build highways, et cetera.”
Meanwhile, the U.S. Chamber of Commerce, another lobbying force in Washington with many oil and gas companies as members, has backed raising federal fuel taxes by 25 cents.
Under the chamber’s proposal, that 25-cent raise would apply to the current taxes rates of 18.4 cents per gallon on gasoline and 24.4 cents per gallon on diesel fuel. The business association estimates such a tax hike would raise $375 billion in additional revenue over the coming decade.
“I’ve been pushing this for a long, long time, but now gangs of people are pushing it,” Thomas J. Donohue, president of the chamber, told The Washington Post in an interview last month.
Donohue acknowledged that it would be “a tough vote.”
That proposal is too tough, apparently, for archconservative oilmen Charles and David Koch. Koch-affiliated groups say that a gas tax hike would undo the recent GOP tax cuts.
“Our organizations worked hard over the past year to support your efforts and the efforts of tax-cutters in Congress to provide American families much-needed and long-overdue tax relief,” Americans for Prosperity and Freedom Partners wrote in a letter to the White House last month. “But increasing the gas tax would effectively undermine recent tax cuts by clawing back hundreds of billions of dollars — roughly 25 percent of the total benefit from tax reform.”
Trump has at times flirted with the idea of raising the gas tax. Last year, he mused in a private meeting about raising the gas tax to 50 cents per gallon, almost triple the current level, The Post’s Damian Paletta and Erica Werner reported. In October, Trump’s chief economic adviser, Gary Cohn, pressed House Republicans to consider a gas tax hike, as well.
The Highway Trust Fund, which pays for repairs to road and mass transit systems, has been left depleted in the face of 25 years of inflation without a similar increase in the gas tax.
Motorists, often obliged to commute to work and pick up kids from school, need to purchase fuel even as the price rises — meaning much of the burden of paying for a gas tax hike would fall to consumers.
|You are reading The Energy 202, our must-read tipsheet on energy and the environment.|
|Not a regular subscriber?|
— Zinke’s Sunshine State burn: State attorneys general are spoiling for a fight over Trump’s offshore oil and gas drilling plan, The Post's Darryl Fears reports. Three state attorneys general he interviewed said they were irked by the deal Zinke struck with Florida Gov. Rick Scott (R) to exempt the state from drilling off its coastline. A dozen state attorneys general co-signed a letter Thursday that called on Zinke to cancel the proposal.
Over the weekend, Zinke met with South Carolina Gov. Henry McMaster (R) and North Carolina Gov. Roy Cooper (D) over each of the states' requests for a Florida-like exemption. A spokesman for McMaster said the pair "had a good, productive conversation over lunch," but that "[n]o final decision was made,” per The Post and Courier. Cooper said Zinke "was pretty positive about what we said," per The News & Observer. He added Zinke "didn’t make any promises to us."
— Hartnett White out: The White House has withdrawn the nomination of Kathleen Hartnett White, chosen by Trump to lead the Council on Environmental Quality, after she became one of Trump's more controversial environmental nominees following a bruising confirmation hearing in the Senate Environment and Public Works Committee.
In a statement, Hartnett White said the decision to pull her name was in “the best interest of facilitating confirmation of the President’s nominees throughout his administration, as well the needs of my family and work.” The Post first reported the news over the weekend.
— Pruitt says Obama weaponized EPA: EPA chief Scott Pruitt criticized the previous administration for “weaponizing” the agency in an interview with the New York Times podcast “The Daily” on Friday. "The agency took a perspective for a number of years that is prohibition. Though we’ve been blessed with natural resources that help us literally feed the world and power the world, that we should not develop those natural resources that we should put fences up and we should prohibit that," Pruitt said. "And so in some respects ... the rulemaking that was being deployed by the agency was weaponized in the sense it was picking winners and losers."
— Op-ed oops: A spokesman for the Interior Department has apologized after Deputy Interior Secretary David Bernhardt faulted the Obama administration for blocking the approval of two coal mines in an opinion piece in the his hometown Daily Sentinel from Grand Junction, Colo. In the piece last month, Bernhardt touted the Trump administration’s move to expedite expansion for two coal mines in Colorado, citing an Obama-era moratorium on new leases for coal mines on federal land. But while the Trump administration did lift the moratorium, the Obama administration had not in fact blocked the two mines, The Hill explains.
— From household aide to EPA: A contractor married to a former household aide to President Trump and Melania Trump is now working at the EPA, Politico reports. Steve Kopec, who previously ran a New Jersey-based contracting business, started a role as special assistant in the EPA’s Region 2 office in New York.
— ExxonMobil unfazed by global climate policies: In a report Friday, ExxonMobil concluded global trends, such as carbon-cutting agreements like theParis climate accord and growth in electric-car use, would pose “little risk” to the company’s oil and natural gas investments. The analysis fulfills the demands of shareholders who successfully pressed the oil giant to report on the impact of global measures designed to keep climate change to 2 degrees Celsius.
Some independent analysts took issue with ExxonMobil's conclusions, suggesting "electric cars could catch on more quickly as battery prices drop and as countries like China — one of the world’s biggest emerging markets for cars — push more aggressively for adoption of electric vehicles," per the New York Times.
— 'Nother nuke plant, shuttered: One of the oldest nuclear power plants in the nation will close its doors a year ahead of schedule. Exelon will shut down the Oyster Creek power station in New Jersey in October over “costly regulations in New Jersey requiring it to install new cooling towers,” the Washington Examiner reports, joining firms operating from California to South Carolina to either announce the closure of existing nuclear plants or cancel plans to construct new ones in the face of cheap natural gas, wind and solar generation.
— The future of cars, but maybe not of manufacturing: "[W]hile Tesla may eventually reinvent the automobile," Caroline O'Donovan of BuzzFeed News reports, "it hasn’t yet reinvented automobile manufacturing." At Tesla's Fremont, Calif. factory — the only nonunion U.S.-owned car plant in the country — 15 former workers "describe it as a backbreaking job that placed workers under tremendous pressure to produce — a result of the company’s ambitious production targets — that they say led, in some cases, to lifelong injuries."
- The Hudson Institute holds an event on “Environmental Policy in the 21st Century: The Future of the Kigali Amendment.”
- The Solar Power Northeast conference begins.
- The House Natural Resources Subcommittee on Federal Lands holds a hearing on national monument bills on Tuesday.
- The House Energy and Commerce Subcommittee on Energy holds a hearing on nuclear infrastructure on Tuesday.
- The Senate Energy and Natural Resources holds a legislative hearing on various bills on Tuesday.
- The U.S. Energy Information Administration’s holds a presentation on the Annual Energy Outlook 2018 on Tuesday.
- The House Natural Resources Subcommittee on Indiana, Insular and Alaska Native Affairs holds a hearing on tribal land bills on Tuesday.
- The National Association of State Energy Officials 2018 Energy Policy Outlook Conference begins on Tuesday.
- Infocast’s Wind Power Finance & Investment Summit begins on Tuesday.
- The Senate Energy and Natural Resources Subcommittee on Public Lands, Forests, and Mining holds a legislative hearing on Wednesday.
- The Senate Environment and Public Works Committee holds a hearing on “The Impact of Federal Environmental Regulations and Policies on American Farming and Ranching Communities” on Wednesday.
- The Senate Energy and Natural Resources Committee holds an oversight hearing on energy infrastructure on Wednesday.
- The Women’s Council on Energy and the Environmental holds a Lunch & Learn event on battery storage on Thursday.
— Sorry, but: Punxsutawney Phil, the world’s most celebrated groundhog, saw his shadow on Friday, forecasting six more weeks of winter: