No one is more sensitive to the gas price increases in California than Bill Clinton. The state is considered essential to his bid for re-election. The president quickly directed the Energy Department to investigate the factors that produced the price increases and ordered the sale of 12 million barrels of oil from the strategic petroleum reserves.
The Justice Department's antitrust division began a probe to determine whether the oil companies had engaged in price-fixing.
Senate Minority Leader Tom Daschle of South Dakota commented, "Just before the tourist season begins, it's interesting that these prices would go as high as they are. I have a feeling it has a lot more to do with profits than it does with taxes."
Daschle was referring to Clinton's 1993 4.3 cent-per-gallon increase in the gasoline tax, which Republicans want to repeal. The administration says it's willing to discuss it. But that would throw off the revenue estimates for deficit reduction unless the lawmakers can find a way to make up the difference. Or doesn't balancing the budget mean much anymore?
As for the sale of oil from the strategic reserve, Clinton is taking heat for "shameless pandering for the presidency." Rep. Bob Livingston, R-La., chairman of the House Appropriations Committee, said Congress required the sale, in legislation approved last week, to offset increased spending on education.
It's easy to demagogue when gas prices go up, and Clinton is wasting no time doing it by hinting that the oil companies are to blame. But it's not hard to find unsinister explanations. Oil stockpiles were depleted by the unusually cold winter. California has a new requirement for emissions-reducing reformulated gasoline. The oil companies expected that Iraq would be permitted to resume oil exports, and kept production down.
The strategic reserve was intended as a buffer against another oil embargo, not as a way to offset price increases or balance the budget. This sale could set an unfortunate precedent.
The likelihood is that the surge in prices is temporary and will soon subside as world oil supplies increase. The politicians are responding to the gas-buying public's unhappiness with price increases, but the posturing isn't likely to accomplish anything constructive.
The bill would limit punitive damage awards to $250,000 or twice a plaintiff's compensatory damages, such as medical costs and pain and suffering, whichever amount was larger. Small companies would be required to pay no more $250,000 or twice the compensatory damages, whichever was smaller.
Clinton should realize that the cost of vetoing this moderate bill will include the risk of enraging voters who are no fans of the plaintiffs' lawyers.
Nationalist sentiment led to the cancelation of U.S. bases privileges to the detriment of Philippine security. But that didn't satisfy the leftists. They want nothing to do with the U.S. military, regardless of security considerations. Yet it is widely acknowledged that the Philippines can't defend itself.
Fortunately for both countries, the government of Fidel Ramos takes the position that the constitutional prohibition on foreign bases and troops does not apply to military exercises.
Rupert E. Phillips,CEO
John M. Flanagan,Editor & Publisher
David Shapiro,Managing Editor
Diane Yukihiro Chang,Senior Editor & Editorial Page Editor
Frank Bridgewater & Michael Rovner,Assistant Managing Editors
A.A. Smyser,Contributing Editor