This, despite the experience of Indiana and Illinois, which saw at least a 60% decline in gas prices per dollar of tax cut.

Now you can argue about the efficacy of the policy, but to spread misinformation and lies is a bit ridiculous, no? TPM is basically now a haven for people who took Econ 101, barely understood it, and then stopped taking Econ because it was “too hard”.

The email I sent to WKJM, which should have authoritatively ended his nonsense, but apparently hasn’t.
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As one of the few remaining Hillary supporters still reading your blog, I’d point out that the latest talking point on your blog— that the gas tax holiday won’t lower prices— is completely indefensible. See this link, for a more detailed discussion.

http://www.salon.com/opinion/feature/200…

Or this one, which is pro-Obama: http://blog.washingtonpost.com/fact-chec…

It will lower prices, the question is how much, or how. Economists are saying it will reduce prices by something like 60%— the question is whether that’s insignificant. But again, it’s wrong to say that all economists (or even most) think it won’t reduce short-term prices. They think it won’t reduce LONG-TERM prices, but that’s not the point. The other thing I’d point out is that in all this Econ 101 talk, the basic assumption is that we have efficient markets right now, and I don’t think it’s clear we do.

Furthermore, Hillary’s plan was not made in a vacuum. It was made in response to McCain’s proposal. So while a number of folks out there have made the fair point that the policy goals achieved by Hillary’s plan (essentially a small wealth transfer from Big Oil to drivers) would be better achieved by progressive taxation and rebate checks, they’re missing the fundamental politics of the situation. Like it or not, people out there are angry about gas prices. It’s literally the top issue that people are writing in to Congress about (more than housing, more than Iraq). In the likely event that Obama is the nominee, this will be a potent issue for McCain. Given how sensitive both Congress and the Administration are to this recession, I suspect that such a proposal might even have a chance of getting passed. (Does anyone who reads TPM remember the Bush tax cuts??? Those were also derided by economists and wonky Democrats, and yet passed with some Dem support.)

Hillary found a clever way to defuse the issue and turn it on its head: blame Big Oil. This allows the Dems to hammer back on the GOP for higher gas prices, and since we all know the GOP will do everything they can to block a windfall tax measure, it allows us to blame them for not passing the gas tax holiday. Now Hillary can’t say any of this. But we can all read between the lines, can’t we? Furthermore, this sets up the next Dem administration with the ability to try to change the tax structure on energy production, which is anything but an efficient and competitive market.

Obama’s position essentially puts him in the very untenable position of favoring higher gas prices for consumers. It may be better policy in the abstract, but it’s probably a political loser. I feel strongly that Obama and his supporters in the media and blogosphere are letting the perfect be the enemy of the good here. Hillary’s plan is not great policy. However, it’s good policy, esp. compared to the alternative (McCain’s plan passing), and more importantly it’s GREAT POLITICS, not just for her, but for the Democratic Party.

Finally, I’d point out that you all are missing a major point here: this isn’t a energy bill, this is a very minor form of short term cash relief for households, esp. struggling households. In the long run, this will have zero impact on energy consumption or production in this country. If you want to talk about energy policy, let’s look at their bigger plans. Let’s talk about Obama’s continued support for ethanol, or the totally coincidental fact that he takes a ton of money from the Corn Lobby (but not registered lobbyists). Let’s talk about bad vs. good energy policy. But let’s not confuse this debate over a 3 month tax holiday with energy policy.