(The Independent Journal Review) Over the last year, there has been plenty of commentary about the spike in gas prices, now CNN has an interesting take on the dip in prices.
In June, the average price for a gallon of gas hit $5, but since prices have dropped. As of Friday morning, AAA reports that the average price for a gallon of gas is $3.91.
And according to CNN, Americans should take that dip in gas prices and view it as a tax cut — or even a “$100-a-month raise” — not a joke.
An analysis article published by CNN Business on Friday bears the headline, “America just got a $100-a-month raise.”
“Next time you stop at a gas station, think of it as a $100-a-month tax cut. Or a maybe $100-a-month raise,” it reads. “The steady drop in gas prices over the last few months has turned into an unexpected form of economic stimulus, coming at a time when the Federal Reserve is trying to cool the economy and battle rising prices with higher interest rates.”
Mark Zandi, the chief economist for Moody’s Analytics, told CNN that the decrease in prices “equals about $125 billion a year in savings for US households, or more than $10 billion a month,” as the outlet writes.
“And that’s just a direct benefit. Lower diesel prices bring down the cost of transportation for all goods, including food,” Zandi said.
The notion that the lower gas prices might be seen as a “raise” did not go over well on Twitter.
Patrick De Haan, an analyst at Gas Buddy, tweeted, “Or a $36.50/mo pay cut from a year ago, when prices were 73 cents lower.”
Check out some of the reactions below:
Yes, gas prices are down from June. It’s worth pointing out that the higher gas prices led people to change their driving habits, and drive less, to save money. And that the lower demand is likely playing some role in the decrease.
But they’re still higher than a year ago — not to mention that inflation in July stayed near a 40-year-high — and you can’t call that a “raise” or a “tax cut” when Americans are still spending more on gas.
If gas prices dip to at least the price they were when President Joe Biden took office, then maybe we can start talking about lower prices being a “raise.”
Reporting from The Independent Journal Review.
