Mixed Messages From Critic of NY Gas Tax Holiday

Following the lead of John McCain and Hillary Clinton, the State Senate voted yesterday to suspend New York’s gas tax for the summer. The move was largely symbolic, as the governor and Assembly speaker have both indicated they won’t support the bill.

Senator Liz Krueger, a Democrat from Manhattan, immediately issued a statement condemning the measure:

S.7594-B, introduced by Senator Andrew Lanza (R-Staten Island), would exempt gasoline and diesel from the State’s excise tax, Sales Tax, and Petroleum Business Tax, from May 23, 2008 to September 2, 2008.  These taxes are currently used to provide funds for highways, roads, bridges, and mass transit.  By suspending the taxes the Senate Republicans will create an estimated $600 million budget gap for these necessary services.

"This bill is obviously meant to prey on the desperate need for relief of New York’s suffering drivers," said Senator Liz Krueger.  "In reality this bill will only worsen the economic crisis in New York, and at best result in little to none of the intended aid.  Increased demand will lead to higher prices and negate any positive effect the gas tax holiday was meant to have."

So far so good, but then Krueger serves up a cocktail of alternative policies meant to ease the burden on drivers. Even in relatively rail-rich New York, transit doesn’t enter the picture.

Among the ideas she floats, which were all proposed by Senate Democrats and rejected by Republicans:

Initiating a middle income gas and diesel fuel tax rebate program, which will give a $100 tax rebate to all New Yorkers, who earn $75,000 or less, that live in and have a vehicle registered in New York.

Instituting criminal penalties for price gouging and increasing fines of offenders to $25,000. 

But if the goal is to lower people’s transportation costs, why reward only car owners? How about packaging that relief in the form of incentives to take transit instead of driving? And why promote the idea that gas prices will go down if only those "price gougers" along the supply chain would stop taking advantage of innocent consumers?

While Krueger does mention conservation and reducing the gas consumption of the state’s vehicle fleet, encouraging non-government workers to drive less is noticeably absent from her proposals. As the summer driving season gets underway, will any politician outside the second smallest state in the union have the guts to talk about mode switch?

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