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Gas Tax Holiday Plan Provides Fodder for Campaigns

Presidential hopefuls Sens. Hillary Clinton, D-N.Y., and John McCain, R-Ariz., have raised the idea of suspending the federal gas tax for the summer. A tax policy expert explains whether a gas tax holiday is politically or economically feasible.

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  • JUDY WOODRUFF:

    Now, another economic issue that's on the minds of many Americans: rising gasoline prices. It's on the minds of the presidential candidates, too. Gwen Ifill has the story.

  • GWEN IFILL:

    Fuel prices are setting new records. A gallon of regular unleaded gas costs on average $3.60 a gallon. Economists say that's headed to $4 this summer.

    The subject has become Topic A on the campaign trail. Hillary Clinton arrived at an Indiana gas station today in a Ford pickup, followed by a fleet of 10 SUVs.

    SEN. HILLARY CLINTON (D), New York: I want to go after the oil companies. I think it's past, way past time.

  • GWEN IFILL:

    After factory worker Jason Wilfing pumped the gas — Senator Clinton paid — she pitched one approach to lowering the bill: a summer-long federal gas tax holiday. Later, she talked about it at a South Bend sheet metal factory.

  • SEN. HILLARY CLINTON:

    Make the oil companies pay the federal gas tax this summer. Now, some people say, "Well, that's not a lot of money." Well, it depends upon what you do for a living and how far you drive to work.

    If you're a trucker, it's a lot of money. If you're a farmer, it's a lot of money. If you commute 60, 70 miles, it's a lot of money.

    And my opponent doesn't believe in any kind of gas tax holiday, and Senator McCain is for a gas tax holiday, but he won't pay for it. That's not acceptable, because the money then won't go into the Highway Trust Fund and we'll get further and further behind in taking care of our roads, which is not a good idea.

    So here's what I want to do: impose a windfall excess profits tax on the oil companies.