Obama is expected to propose a $10-a-barrel fee on oil in his budget plan next week to help pay for lower-carbon transportation projects, the White House said Thursday.
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Politico reports that Obama’s plan would spend $20 billion a year on new transportation initiatives and beef up the Transportation Investment Generating Economic Recovery, or TIGER, grant program.
That would include making high-speed rail a viable alternative to flying in major regional corridors and invest in new rail technologies like maglev, the White House said.
The plan would create a new Climate Smart Fund that provides bonus funding to states that use existing formula funding to cut carbon pollution in the transportation sector – for example by encouraging better land use planning, investing in clean vehicle fueling infrastructure or increasing use of public transportation.
However, the plan doesn’t seem likely to go anywhere with opposition from the Republican-controlled Congress. The added cost of gasoline would create a clear incentive for the private sector to reduce the nation’s reliance on oil and drive investments in clear energy technology. Last year, congress did pass a transportation bill, though the White House called it “merely a first step towards what our economy needs, with only a modest increase in infrastructure funding”.
In his past year in office, Obama promised to be more bold (reckless?) in pushing his agenda, and one thing that has long irritated him about our great country is our consumption of oil.
“Any kind of additional tax to the oil industry, at a time when companies are posting huge losses – they’re cash-flow negative and are just trying to survive – is a awful idea and would have huge consequences, particularly for the State of Alaska, which depends to such a high degree on the health of the oil industry”, Erkmann said. It also comes at a time when the energy industry has been crushed by the dramatic crash in oil prices. That said, House Speaker Paul Ryan remarked that the plan was “dead on arrival in Congress”, suggesting the plan budget item carried little chance of success. If approved, the move could place further pressure on oil companies that are losing revenues amid plummeting prices – down approximately 75 percent since June 2014.
“Instead of hearing from an administration unconcerned with our $19 trillion in debt, we should focus on how to reform America’s broken budget process and restore the trust of hardworking taxpayers”, Enzi said.
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Kirby said the tax would ultimately be passed along to USA consumers, who have benefited from low gasoline prices.
