Top Democrats push for federal crackdown on high gas prices | Policy

WASHINGTON (AP) — Citing growing concerns about high gasoline prices, Democratic leaders on Thursday announced an effort to give the Federal Trade Commission increased authority to crack down on companies that engage in price gouging.

In doing so, they downplayed the possibility of other options such as a federal gasoline tax exemption or offering oil companies more government incentives to increase production. Instead, they said the FTC needs more tools, including tougher fines and penalties and a team of dedicated experts to monitor the markets and tackle price gouging.

As voters worried about the rising cost of inflation, Democrats again signaled their intention in November’s midterm elections to pin much of the blame for high gas prices on oil companies. Democrats have accused oil executives of “scamming the American people” in a contentious hearing this month.

“There is no excuse for big oil companies to profit, raise prices or exploit families,” House Speaker Nancy Pelosi, D-California, said Thursday.

“Congress needs to do more to strengthen the FTC’s ability to crack down on potential gas price manipulation and price gouging,” added Senate Majority Leader Chuck Schumer, DN.Y. When the Democratic bills reach the House and Senate, “Republicans will face a dilemma: Which side are they on? said Schumer. “On the consumer side and lower gas prices? Or on the side of the big oil companies?

The average price for a gallon of gasoline was $4.14 on Thursday, according to the AAA Auto Club, and is significantly higher than in California and other western states.

President Joe Biden, aware of the political stakes, has vowed to do everything he can to appease” pump pain for american families, including the order to release record amounts of oil from the country’s strategic reserve.

Senator Maria Cantwell, a Washington Democrat who chairs the Senate Commerce, Science and Transportation Committee, said Congress has strengthened the power of the Federal Energy Regulatory Commission to investigate and punish market manipulation of the energy market. energy about two decades ago. This followed the Western energy crisis of 2000 to 2001, when Enron and its subsidiaries were found guilty of engaging in various market manipulation schemes.

She said the FTC needed a dedicated team of experts monitoring transportation fuels and monitoring suspicious pricing behavior, and that it needed the authority to issue fines and penalties that would result in corrective measures.

“We have to make sure there’s a police officer on the scene,” Cantwell said. “It doesn’t seem fair that we have more transparency on a product like wheat or corn than on oil.”

A draft description of the legislation says it would double the maximum penalty for manipulating wholesale oil markets up to $2 million a day for each violation.

The unit described by Cantwell would be tasked with identifying any manipulation or use of market power or other method of unfair competition to distort markets. Once he identifies such behavior, he could then advise the whole commission to prosecute the perpetrators and impose sanctions.

Oil executives, testifying before Congress earlier this month, said oil is a global market and oil companies do not dictate prices.

“We don’t control the market price of crude oil or natural gas, or refined products like gasoline and diesel fuel, and we have no tolerance for price gouging,” Chevron’s CEO said. Michael Wirth.

Industry groups have dismissed the use of the FTC to investigate price manipulation as a political stunt. “Using the power of the FTC to undertake political investigations of American energy companies will not lower gas prices one penny,” said Anne Bradbury, CEO of the American Exploration and Production Council, a trade association representing independent oil and natural gas companies.

“At a time of historic inflation and economic contraction, Americans deserve real policies that boost domestic oil and gas production,” she said.

Republicans also rejected the Democratic proposal on Thursday.

“My fellow Democrats are stepping up their efforts to shift the blame to political coverage,” said Representative Cathy McMorris Rodgers of Washington state. “The American people know this is not about a price hike or Putin’s price hike. That’s a price hike from Biden since the day he took office. »

The answer to rising gas prices is to increase production here in the United States, Republicans said.

“America is the world’s largest producer of oil and gas, and we must act accordingly. We can generate much more energy than we do today and unleash the vast resources beneath our feet,” Rep. Fred Upton, R-Mich., told Energy Secretary Jennifer Granholm during the a House Energy and Commerce Committee hearing.

But Democrats said oil companies made the choice to boost profits rather than increase production. Six companies at the April 6 House hearing, including Chevron and ExxonMobil, posted $77 billion in profits last year.

“Here’s the bottom line: They’re not using the money for domestic power generation,” Schumer said. “They’re using it for stock buybacks. They’re using it to drive up their stocks. We wouldn’t be here if the oil companies were using it to make the price of the American consumer cheaper.”

Some states have suspended their gasoline tax to relieve consumers at the pump. Many Democrats in Congress have also called on Congress to suspend the federal gasoline tax of 18.4 cents per gallon. But Pelosi said there was no guarantee the savings would be passed on to drivers.

“It’s good communication,” she said of the tax holiday, but it “may or may not have an upside.”

Some Democrats have introduced bills in the House and Senate to impose a windfall tax on oil profits, but the idea generated little momentum on Capitol Hill.

Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.

Source link

Comments are closed.