Obama Drags N.C. Gov. Easley into the Gas Tax Fight

Mon, May 05, 2008 - 7:57 AM

Several key Democratic leaders and energy economists are convinced that Sen. Hillary Clinton's proposed gas tax cut will do nothing to actually lower the price of gasoline. The economic explanation is a bit complex, but essentially they say that the tight supply of oil would allow oil companies to pretty much immediately raise the price back to the same level as before the cut. The tax money that would have gone to the federal government would instead go to oil companies. (Clinton wants to impose a windfall profit tax on oil companies to make up for that loss, but regardless, economists say, the price of gasoline will stay relatively unchanged, or drop a small percentage of the 18.4 cent tax rate).

Still, her plan has proved politically popular with working class voters. But the chorus of elected officials denouncing a gas tax cut has intensified and, embarrassingly for Clinton, includes one of her key supporters in North Carolina -- Gov. Mike Easley, sort of. Last year, at a time when North Carolina was considering capping or cutting the gas tax or sales tax to provide relief to consumers, Easley was quoted in the Charlotte Observer calling a gas tax cut "a subsidy to big oil companies."

Naturally, Easley says he is supportive of Clinton's plan now, promoting it as he has travelled the state with her. But that hasn't stopped the Obama campaign from using his words against her in an ad that went up today. Here's the ad:



--Sean Mussenden