Gas tax holiday is Biden's latest price-spike pothole with Hill Dems

President Joe Biden’s gas tax holiday is too little, too late for vulnerable Democrats running for reelection this fall.

Four months after incumbents in tough races pressed Biden for a gas tax reprieve to quell consumer anger over high prices, he tried to signal he’s listening by proposing a three-month suspension of the 18.4-cent per gallon fuel levy on Wednesday. Yet those same Democrats who once asked the president for help want a lot more.

Biden’s break-glass moment on gas prices fell flat in the Capitol, with Democratic leaders keeping their distance and even those who support the idea privately wondering whether the White House has a longer-term plan. Even if the holiday had a chance of becoming law, lawmakers in Biden’s party say it’s far too limited a remedy.

Summing up her view of Biden’s handling of rising prices, Sen. Maggie Hassan (D-N.H.) said: “He has been slow to react to it. … People need relief now.” Hassan, who’s facing a tough race this fall, was among those who initially floated a gas tax holiday.

The party’s gas tax flap is the latest sign of the disconnect between the White House and Hill Democrats on how to tame voter fury over inflation, which is now threatening both Senate and House majorities. Once hopeful that the cost of gas, food and rent would recede by the midterms, Democrats are now begging Biden to go beyond the optimism he’s offered in public and treat price spikes like a full-fledged economic crisis.

“I just think we need more clarity. And we need to make it crystal clear that it’s our Number One priority,” said Rep. Elissa Slotkin (D-Mich.), who also co-authored a gas tax holiday bill in February. “If it were up to me, this would be one of the lead things in every White House briefing.”

White House officials insist they’ve long recognized the problem but say much of it is out of their control. Biden has warned for months that sanctions imposed on Russia over its invasion of Ukraine would have domestic repercussions by squeezing oil supplies. Congressional Democrats passed a $1.9 trillion coronavirus aid law last year that many experts say has overheated the economy, exacerbating the intraparty tension.

The White House also has abandoned its early view that inflation would be temporary; now Biden’s entire domestic agenda centers around efforts to cool rising prices.

“I fully understand that the gas tax holiday alone is not going to fix the problem, but it will provide families some immediate relief,” Biden said on Wednesday. “We’re doing everything we can to reduce this pain at the pump now.”

Some House Democrats might take issue with that statement. Last week, a team of top White House advisers trekked to the Capitol to talk economic messaging with caucus members. At the end, about a half-dozen Democrats — led by a visibly angry Rep. Dean Phillips (D-Minn.) — lined up for a heated Q&A where several sought answers beyond the talking points, according to multiple people in the room.

But to many of those questions, the response was, “We hear you,” according to attendees, who spoke on condition of anonymity to discuss internal conversations.

One Democratic lawmaker who attended the meeting described frustration after the White House decided to pivot to the gas tax holiday, lamenting that the president’s aides have lagged “on issue after issue.” That member then compared the Biden team’s approach to asking members of Congress whether or not they were familiar with the classic TV show “Friends.”

The administration in March used perhaps its most significant tool for easing gas prices by releasing oil from the nation’s strategic reserve. But with costs still rising and growing pressure to recognize the urgency, White House officials landed on a revival of the gas tax holiday that also calls for governors to suspend their own state-level taxes.

And Hassan, for one, wasn’t impressed: “I think that we should be suspending the gas tax for at least the next year. So no, I don’t think 90 days is enough,” she said.

Sen. Mark Kelly (D-Ariz.) said that beyond lifting the gas tax, “there is more that we can do, more that the administration should do.” Reelecting Kelly, Hassan and Sens. Raphael Warnock (D-Ga.) and Catherine Cortez Masto (D-Nev.) are Democrats’ best hopes of holding the Senate majority.

Other Democrats are more willing to give the White House some credit for trying as high gas prices remain one of the biggest political perils facing them in the midterms — even if there’s little guarantee of actual impact.

“The White House wants to be doing something,” House Majority Leader Steny Hoyer, who has been skeptical of the tax holiday, said of the timing. “It is something you can do that seems to be relief.”

White House officials began examining the gas tax suspension back in February, when Hassan, Kelly and others first introduced legislation that would’ve paused the levy through the end of the year. But Biden declined to endorse the concept at the time amid pushback from economists, and questions from aides about whether it would make a difference for consumers.

Now that the White House has made its late embrace, some Democrats said they worry it’s part of a pattern for a White House policymaking machinery that appears too slow and indecisive in responding to urgent challenges.

Beyond pump prices, lawmakers gripe that Biden hasn’t made decisions on student loan relief and lifting tariffs on China. Democrats also want a stronger push from the White House to finish a bipartisan manufacturing bill that is now likely to slip past the July Fourth recess, a year after it first passed the Senate.

Then there’s Biden’s long-dead domestic policy package, which the president could not clinch in discussions last year with Sen. Joe Manchin (D-W.Va.). On Wednesday Manchin and Senate Majority Leader Chuck Schumer met again to discuss a path forward, the seventh time the pair have met in recent months.

The White House believes that a potential party-line bill tackling climate change, taxes, prescription drugs and deficit reduction will have the greatest effect on the party’s political fortunes.

Yet in the interim, senior officials appear open to trying almost anything — even if its views of its own tactics can at times seem contradictory.

Energy Secretary Jennifer Granholm is set to meet Thursday with the CEOs of major oil companies in what she billed as a session to hash out “how can we be partners” with the industry. But White House press secretary Karine Jean-Pierre downplayed the prospect that the meeting would produce immediate results, calling it a “first step.”

Meanwhile, Biden is excoriating companies like Exxon for accumulating record profits, airing rhetoric that progressives have spent months encouraging his White House to adopt.

“If there aren’t steps taken soon to get real relief to people at gas stations where they are getting mugged … citizens are going to come up to their senators and say: ‘I’m furious,” said Senate Finance Chair Ron Wyden (D-Ore.), who is up for reelection. He prefers targeting oil companies over the short-term gas tax holiday.

The White House has yet to embrace such policies, such as last month’s House-passed bill designed to crack down on price gouging by oil and gas companies.

Marianne LeVine contributed to this report.

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