When asked at the January 10, 2008 GOP debate what the government should do to respond to the looming recession, McCain responded:
How does McCain’s proposal to suspend the federal gas tax from Memorial Day to Labor Day violate those precepts?
McCain’s Holiday Would Cost $11 Billion. Suspending the gas tax — whose revenues are fully dedicated the federal highway trust fund that maintains our crumbling infrastructure — for three months would cost $11 billion. McCain has not said how — or if — he would replace those revenues. [CAPAF, 4/15/08]
McCain’s Holiday Sends More Money ‘Out Of Our Economy Immediately.’ The Wall Street Journal notes “Many economists have also questioned the wisdom of suspending or cutting gas taxes; doing so, they say, simply stimulates more consumption of gasoline.” In McCain’s own words, that increased consumption would send more money “out of our economy immediately” to oil-producing countries, “unfortunately, to fund terrorist organizations.” [WSJ, 4/15/08]
Cutting Transportation Investment Kills Jobs. The Wall Street Journal asked: “Relief — or fewer jobs? According to a white paper circulated on Capitol Hill last week by the U.S. Transportation Department, every $1 billion of federal highway investment supports 34,779 jobs.” McCain’s plan could put over 300,000 workers on an unpaid “holiday.” [WSJ, 4/15/08]
McCain’s Holiday Threatens ‘Fundamental Fiscal Underpinnings.’ McCain spokesman Brian Rogers said “general revenue transfers” would pay for the “holiday” — increasing the budget deficit by $11 billion. As Matthew Jeanneret, a spokesman for the American Road & Transportation Builders Association, says: “It might be good politics. But it is shortsighted, and it won’t do anything to stimulate the economy.” [MSNBC, 4/15/08]
McCain’s plan would push gas prices up and force policymakers to choose between killing jobs and infrastructure investment or blowing up the budget.