The United States has some serious economic problems. The impact of increased tariffs is being felt by consumers. Inflation is churning right along. Gasoline is approaching $5 per gallon in most of the country. The leader of the Republican Party, Donald Trump, is watching his credibility on economic issues crater. The only things he brought back from his China trip were some souvenirs.
Trump’s response to the impact on consumers: “I don’t think about Americans’ financial situation.” Those are not exactly the words that Republican candidates were waiting to here. The attitude turns off voters across the entire political spectrum.
Kneejerk responses are Trump’s trademark. And so it was that he recently proposed that the federal government’s 18.4 cent per gallon tax on gasoline be waived for some unidentified period; diesel fuel is taxed at 24.3 cents per gallon. For how long, who knows? Maybe he can bring back the 50-year mortgage plan too.
The actual impact of a cut in the fuel tax, however, comes with consequences that cannot be ignored. The federal tax is a drop in the tank bucket compared to what vehicle owners will continue to pay for fuel.
An 18.4 cent per gallon cut in gasoline, if left in effect for six months, would cost the federal government an estimated $17 billion according to a report from Axios. The federal budget deficit is already approaching two TRILLION dollars this year. Remember when Republicans screamed about such things?
Lost revenue is not the only concern. Federal fuel taxes are devoted to funding the infrastructure needs of the federal highway system.
A cut in the Erie County government sales tax on gasoline has also been proposed. County budget director Mark Cornell has advised the County Legislature that when the county tax on gasoline was reduced four years ago the savings to consumers were negligible. A cut in the tax would, however, reduce sales tax revenues that are used by the county as well as distributed to local governments and school districts.
There is no guarantee about how much a potential federal or county cut in gasoline and diesel fuel charges will find its way into the pockets of consumers. Station owners and fuel providers will find a way to claim some of the savings for themselves.
It seems clear that Trump’s War against Iran has no end in sight. Whatever pennies he and his Republican colleagues might toss to consumers from the suspension of the fuel tax will be washed away by the inflationary effects the War is having on the costs of pretty much everything. He couldn’t care less.
The do-nothing-but-harm Congress
Donald Trump has both houses of Congress in his pocket. They talk a lot, but they rarely approve legislation. They occasionally eke out something after Trump intimidates members of Congress, requiring them to ignore their own principles and do his bidding.
The Senate did its part last year by confirming a rogue’s gallery of characters for the Trump cabinet. One-by-one he has been jettisoning them when their performance in office, personal behavior or both become unacceptable even to Trump.
So far, it’s been Noem, Bondi, Makary. Next up on hit list – Hegseth, Kennedy, Patel (snorkeling at Pearl Harbor!)?
The problem for Republicans this year is that all the damage Trump has done to the economy is not correctable between now and November. They will wear it as part of his loyal team.
The only major piece of legislation that the current Congress has passed, about a year ago, was the so-called “Big, Beautiful Bill.” When the truth was told about that bill Republicans tried to rename it as working families legislation, not to be confused with the diametrically opposed Working Families Party.
The search for a new name for the Big, Beautiful Bill became necessary when the details of the legislation became better known. Here are a few highlights:
Big tax cuts for the uber-wealthy dominate the bill.
Popular items in the bill such as the elimination of taxes on tips and overtime as well as tax reductions for seniors will expire in 2028, unlike tax cuts for the wealthy, which were made permanent.
Increases in deductions allowable in the amount of state and local taxes will also revert to the previous lower amounts in 2030.
The federal debt ceiling is raised by five TRILLION dollars.
The bill phases out clean energy credits while promoting fossil fuels. That will ultimately assist China, which is proceeding in the opposite direction.
Republicans attempted to pay for the revenues lost to tax cuts by slashing Medicaid and eliminating subsidies for people who had been using the Affordable Care Act for their medical insurance. Medicaid cuts total one TRILLION dollars over ten years.
Coverage has become unaffordable for millions who now have no medical insurance.
Drastic cuts in Medicaid are leading to the closure of hospitals in rural areas.
“Trump accounts” for children were created. Republicans are now admitting that that benefit was designed as a steppingstone for efforts to privatize Social Security, a long-time goal of Republicans.
The law repeals the tax on gun silencers, which undoubtedly makes criminals happy.
The mid-term congressional elections will give the electorate the opportunity to speak out loudly about the damage that Donald Trump and the congressional Republicans are doing. Even with the gerrymandering shenanigans, a Democratic House of Representatives is in reach.
Bluesky @kenkruly
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