The Cynical Case for the Gas Tax Holiday: From EconLog to the NYT
I’ve finally made the Gray Lady: Today’s New York Times features my op-ed inspired by Sunday’s post, “I’ll Shill for Hillary.” I hope critics don’t misrepresent me as an economic apostate; I’m not dissenting from the standard analysis, just taking a broader view:
Why are economists so opposed? … When you combine fixed supply with flexible demand, it’s suppliers, not demanders, who pocket the tax cut. That’s Econ 101.
So far, I pretty much agree with the consensus. Economists might overstate the rigidity of supply — it’s possible that eliminating the tax could spur producers to find a way to squeeze out a little more gas — but they’re probably right that the Clinton-McCain proposal will not shrink the price at the pump. Nevertheless, I think it’s an idea worth supporting. In fact, I’ve got two arguments in favor of it, though I doubt that either candidate will want to repeat them in public.
If I am angrily misinterpreted, I’ll make a special effort to practice what I preach and look on the bright side: I’m in the New York Times. Sweet!
P.S. I may be on CNBC some time today to talk about the piece; look here for updates.
P.P.S. Now it looks like I’ll be on Neil Cavuto‘s 6 PM Fox Business show instead.
P.P.P.S. Here’s the Cavuto clip.