On Tuesday’s broadcast of Newsmax TV’s “The Record with Greta Van Susteren,” Economics Professor at the University of Chicago Booth School of Business Austan Goolsbee, who served as Chairman of the Council of Economic Advisers under President Barack Obama, stated that if President Joe Biden goes through with the federal gas tax holiday he’s considering, the revenue from the tax that would go to the Highway Trust Fund would be borrowed and that because we’re in a situation with constrained oil supply “it might very well be that the refineries simply raise the price” and “the consumers’ actual benefit might be even smaller than what it first looks like.”
Goolsbee stated, “I think the money that would go to the federal Highway Trust Fund, they would just have to borrow it. I think the bigger problem that people should think about is in an environment where the supply is constrained, when you get rid of the tax — if you got rid of the tax, it might very well be that the refineries simply raise the price and they say, hey, thank you very much. You, basically, rather than cutting the tax and getting it passed through to the consumers, did a thing that got passed through to the refineries. So the consumers’ actual benefit might be even smaller than what it first looks like.”
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