The presidential candidates are fighting hard for your vote, and the economy seems to be one of the top issues. To soothe jitters over an economically turbulent near future, Senator Barack Obama proposed a second economic stimulus payment, similar to the one proposed and passed by President Bush and Nancy Pelosi earlier this year.
It’s dubious whether these payments have a direct effect on the economy. They may make some people feel better about the economy — depending on whether they receive a check or they subsidize the benefit for others — which may be a self-fulfilling prophecy. It’s more likely that these proposals designed to boost the economy, which have a nasty habit of showing up in election years or when approval ratings are low (is it just coincidence?), are created more for their public relations benefit.
Similarly, Senator John McCain is calling for a federal gas tax “holiday.” The 18.4 cent national gas tax and the 24.4 cent diesel tax, under this plan, would be suspended between over the summer. Originally planned for the time between Memorial Day and Labor Day, McCain’s campaign website hasn’t updated this issue now that we have passed the first summer holiday.
Someone who believes that gas prices at the pump are determined by supply and demand would argue that lifting a gas tax would simply allow prices to rise up the chain.
Neither a second economic stimulus check nor a gas tax holiday will on its own affect the economy much. It would be great to see some real economic proposals presented by our presidential candidates — ideas whose implementation would provide jobs, manage real inflation, and encourage business innovation while this country learns how to deal with globalization of the economy — rather than gimmicks designed to attract potential voters.
Let’s face it, though, it makes no sense to choose a candidate based on their economic policy, something the Office of the President has little control over thanks to the numerous people involved with setting policy and economic cycles. I can’t imagine that anyone in this country is undecided between McCain and Obama, but the final decision should be based more on who you want appointing Supreme Court justices and who you want initiating military actions (something that used to be left up to the Congress). These are the modern major powers of the Presidency with lasting effects.
McCain resurrects call for gas tax holiday, CNN Politics, June 9, 2008
Updated January 12, 2018 and originally published June 18, 2008.