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Every politician has a gas plan

Both parties are blaming each other for the high prices and offering solutions ranging from rebates to new drilling.

By WES ALLISON
Published April 28, 2006

WASHINGTON - The Democrats had used the nearby Exxon station the day before, and anyway Exxon Mobil was posting profits of $8.4-billion that afternoon.

So Thursday found House Republican leaders at a BP station about a mile from the Capitol with a couple of hydrogen-fueled cars and pledges to crack down on price gouging at the pump and to relax environmental regulations they say are boosting gas prices.

Earlier in the day, Senate Republican leaders had proposed giving drivers a $100 rebate on gas taxes and opening to drilling Alaska's Arctic National Wildlife Refuge - which, they repeatedly noted, would be pumping an extra 1-million barrels of oil a day into the American economy if Bill Clinton hadn't blocked such action in 1995.

Democrats, meanwhile, suggested that a $500 rebate was more appropriate and demanded that Congress revoke the $2.7-billion in tax breaks the oil industry received in last year's energy bill.

As gasoline flirts with $3 per gallon and the summer driving season - and the election - nears, politicians in Washington are scrapping over gas prices like kids over a greased watermelon.

No one wants to be caught without a plan, and no one wants to be stuck with the blame. All week, Republicans blasted Democrats for repeatedly blocking drilling in the Alaskan refuge and for helping to kill a plan last year to ease environmental regulations to help oil refineries boost production.

Democrats accused Republicans, including President Bush, a former oil man, of being too cozy with big oil and of allowing oil companies to collect record profits while enjoying billions of dollars in tax breaks.

All of which makes folks like John Olson, co-manager of Houston Energy Partners, an energy hedge fund, shake his head.

"It's basically silly season up there," Olson said. "In essence, as long as the United States is such a tremendously energy-intensive country, as long as China, India and the like are clawing their way up the consumption curve, we're going to have tight markets."

The U.S. demand for oil is up slightly this year. Meanwhile, new federal mandates for using more ethanol - a boon to farm-state lawmakers - has made gas more expensive in some areas because ethanol's chemical properties make it costly to transport to market, he said.

But with elections just six months away and voters spending $60 to fill up their Jeep Cherokees, lawmakers were more concerned with quantity than quality, regardless of the political prospects of their proposals.

By Thursday afternoon it was getting tough to keep up, as Republicans co-opted Democratic plans for alternative fuels and both parties assaulted oil and gas companies for being greedy, undeserving of congressional largesse and possibly crooked.

Bush, who also visited a BP gas station in Biloxi, Miss., asked Congress to give him the authority to raise fuel efficiency standards for cars - something Republicans have opposed in the past, but which Senate Majority Leader Bill Frist supported Thursday.

Sen. Robert Menendez, D-N.J., has offered a 60-day "holiday" from the federal gas tax of 18 cents. Reps. Edward Markey, D-Mass., and Diana DeGette, D-Colo., want to repeal the $2.7-billion in tax breaks provided in last year's energy bill.

Judiciary Committee approved a bill Thursday that would forbid oil companies from withholding gas to raise prices and establish a federal-state task force to ferret out price fixing.

The most comprehensive plan came Thursday from Frist, R-Tenn., Senate Energy Committee Chairman Pete Domenici, R-N.M., and other Senate Republicans. It would give drivers a $100 rebate on federal gas taxes, establish new rules against price gouging, repeal some tax incentives for the oil industry and give tax breaks to those who buy hybrid cars.

It also would open the Alaskan refuge to oil and gas exploration - the main reason Democrats said the plan is doomed from the start. Drilling in the refuge has come up in the Senate several times in the past two years, and it has yet to draw the 60 votes needed to survive a filibuster. But a vote at least would put most Democrats on record against it.

"It really is a token gesture connected to a policy they know can't pass, which is drilling" in the refuge, Sen. Debbie Stabenow, D-Mich., said. "Go right to the people who are causing the problems, the oil companies and their outrageous profits."

Stabenow is shopping her own plan for a $500 gas tax rebate. "Give people an amount of money that is really going to make a difference," she said.

House Republicans have adopted a more hodgepodge approach than their Senate colleagues. At the afternoon news conference at the BP station on Pennsylvania Avenue, where the price of regular unleaded was $3.09 per gallon, Speaker Dennis Hastert, R-Ill., said they probably would seek new standards for price gouging and ease rules that require different fuel blends in different cities to meet clean air standards, a move Democrats have opposed.

He tapped Rep. Adam Putnam of Bartow, the Republican policy chairman, to look for other ways to ease gas prices.

These are likely to include drilling in the Alaskan refuge and easing environmental restrictions to allow refineries to expand capacity, which Democrats have blocked, Putnam said. As for rebates and windfall-profits taxes on oil companies, he was far less enthusiastic.

So, too, were the oil and gas companies. Even as oil topped $70 per barrel, the industry responded to the congressional dueling Thursday with warnings: Killing some tax breaks and incentives would slow domestic exploration. Taxing high profits isn't fair and could adversely affect the market. High prices reflect supply and demand, not greed.

Over the next couple of weeks, Putnam said he will be "sweeping all the good ideas in the Congress . . . that are responsible and could have a meaningful impact on gas prices as soon as possible."

If you own a 2006 Ford Explorer, you can fill your tank up 1.5 times and drive 576 miles.

If you own a 200 6 Chevrolet Malibu, you can fill up just over 2 times and drive 912 miles.

If you own a 2006 Honda Civic, you can fill up 2.5 times and drive 1,151 miles.

If you own a 2006 Toyota Sienna, you can fill up 1.7 times and drive 501 miles.

Calculated using an average price of regular gas in Florida of $2.953 eia.doe.gov and combined miles per gallon figures compiled by www.fueleconomy.gov

[Last modified April 28, 2006, 02:27:29]