President Biden and some other members of the Democratic party would like oil companies to bring down gas prices, which they see--correctly--as being a drag on the economy. However, the president’s proposed windfall profits tax will not achieve lower gas prices. An additional tax on U.S. oil companies would ultimately deter investment into the sector.
Lower energy prices are desirable for a stronger economy. Economics teaches us that to reduce prices, we must increase supply. There is also the expectation that if there are higher potential profits, firms will invest a sizable portion to produce more.
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