All the things Biden is 'considering'

President Biden has a lot on his mind. Within the coming weeks, he needs to make decisions on several politically touchy issues that could help Americans weather high inflation, while also risking a backlash from voters getting fed up with government giveaways.

Biden said on June 20 he’s “considering” a gas-tax holiday, and if not that, a way to issue rebate cards to drivers to help cope with gas prices averaging roughly $5 per gallon. Biden has also told the nation’s biggest oil refiners that “my administration is prepared to use all reasonable and appropriate federal government tools and emergency authorities to increase refinery capacity and output in the near term.” That suggests Biden could pursue some kind of executive action to increase oil and gasoline production and bring prices down.

Another idea Biden is noodling: A rollback of some of the tariffs Donald Trump imposed on billions of dollars’ of imported goods, mostly from China. In April, the Peterson Institute for International Economics published research arguing that reducing or eliminating those tariffs could cut the inflation rate by 1 to 2 percentage points and save the typical family $800 per year.

The biggest move Biden is mulling is whether to forgive student debt. Democrats generally favor this idea, but they disagree on how much debt to forgive. Biden has said he favors forgiveness up to $10,000. More liberal Democrats such as Sen. Elizabeth Warren of Massachusetts and Sen. Bernie Sanders of Vermont want the government to cancel at least $50,000 per borrower. The Biden White House has been teasing some kind of announcement for weeks, but Biden is taking longer than expected to pull the trigger.

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All of these are decisions Biden would rather not make on his own, since they’re likely to be divisive and cost him some political support, even if they please some voters. And some of the things he can’t do even if he wanted to. Biden cannot suspend the 18.4-cents-per gallon gas tax by executive action, for instance. Congress would have to pass a law. What Biden is considering is whether to formally ask Congress to do just that and put the effort into lobbying for it and forming a coalition of legislators willing to vote for it.

Yes, Biden is hesitating

Is Biden dithering? Most likely, yes. Each of these issues entails a complex political cost-benefit matrix, and it would be sensible for the White House to game out the best way to maximize gain while minimizing loss. A gas-tax holiday, for instance, would deprive the Highway Trust Fund, already depleted, of money that finances infrastructure construction and repair, which is already vastly underfunded. House Speaker Nancy Pelosi shot down the idea back in March. Biden probably couldn’t get green-energy Democrats to go along, which means he’d need some Republican votes. The White House has to figure out if it’s better for Biden, politically, to push for a gas-tax holiday he might never get than to do nothing. There’s no obvious answer.

Several states have suspended the state tax on gasoline, and a few are considering gas-rebate cards or stimulus payments to help with gasoline costs. But there’s a sound argument against any government subsidy for gasoline purchases: Anything that lowers the cost to consumers might increase demand, which could push prices up rather than down. High gas prices, while uncomfortable, do incentivize drivers to become more efficient and use less, which over time typically helps bring prices down. Disrupting that self-correcting market mechanism might be unwise.

Intervening in oil and gas markets carries its own risk. Biden has already authorized the largest-ever release of oil from the U.S. reserve, and it’s not clear the government can do much more to generate more oil supply, given that refineries producing gasoline are operating at or near maximum capacity. Fossil fuel drillers say they might produce more if Biden were to relax his push for carbon reductions, one thing Biden seems unwilling to do. By threatening “emergency authorities” instead, Biden may be talking tough, for the benefit of voters, without much muscle backing him up.

Biden wants to have his cake and eat it, too

If Biden lifts the Trump tariffs on Chinese imports, he’d be opening himself to charges that he’s “soft on China” at a time when both political parties want to be tough on China. Again, there’s benefit to saying he’s considering a tariff rollback, without the penalty he’d pay for actually doing it.

Student debt relief may be one promise Biden can’t dodge. Biden has made clear that he favors up to $10,000 in student debt relief, provided Congress does it through legislation. But Democrats don’t have the votes and Republicans won’t help. Biden has signaled he may wipe away up to $10,000 in student debt through executive action, perhaps setting an income threshold for need. He can then tell young voters and others struggling with excessive debt he took bold action on their behalf.

There will be howls of protest. Here's a preview: The Committee for a Responsible Federal Budget estimates a gas-tax holiday and student-debt relief combined would cost the U.S. government $250 billion in foregone revenue over a decade.

"These policies aren’t solutions," CRFB president Maya MacGuineas said in a June 21 statement. "They are gimmicks that shift costs onto taxpayers and consumers."

There are better ways to target that amount of aid to the neediest Americans. And college graduates who paid off their debt or worked their way through school are likely to feel ripped off.

So Biden is probably gaming how to make this announcement in a way that will echo loudly among the beneficiaries while generating the least amount of negative coverage. On a holiday weekend, when everybody’s at the beach? On a college campus at the start of the fall term? Via TikTok? A month before the November midterm elections? It’s all under consideration.

Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman.

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