$100 Gas Rebate Check Not In The Mail

(CBS/AP)  Senate Majority Leader Bill Frist, under pressure from business leaders, has retreated from a plan that would have used a tax increase on oil companies and other businesses to fund a $100 gasoline rebate for millions of motorists.

Frist, the Tennessee Republican, had proposed an accounting change that would have required oil companies to pay more taxes on their inventory of crude as a way to pay the one-time rebate which GOP leaders rolled out last week as they scrambled to find ways to ease public anger over soaring gasoline prices.

In a statement, Frist said he will still push the rebate, but abandoned the accounting change and said the Senate Finance Committee planned a hearing on the issue in the near future.

Frist gave no indication how the rebate, estimated to cost about $10 billion, will be paid for, although he said he still planned to "find a way to bring our proposals to the Senate floor for a vote."

The surge in gasoline prices has placed intense pressure on the GOP. A new CBS News poll found that 74 percent of Americans disapprove of the President Bush's handling of the gas crisis.

Even more think that the administration has not developed a good plan to get gas prices under control. In addition, 47 percent think that the Democrats would be more effective than the Republicans at keeping gas prices down. Only 20 percent thought Republicans would handle the situation better.

Appearing on CBS News' The Early Show, Frist pledged to review oil company profits, but he did not suggest there were any plans to tax such profits.

"The issue of profits is something we look at very carefully. We know that they (the oil companies) do need to make profits to be able to invest in increasing that supply increase exploration in places like offshore drilling as well as in Alaska. We need to make sure there's no price-gouging going on either the pump, at the local level, or the wholesale level," he said

The rebate proposal, meanwhile, seemed to have little appeal among motorists who would benefit.

Aides to several Republican senators, including some who support the proposal, said they have received generally negative feedback from the public in telephone calls and e-mails.

"There are some who say this is a Band-Aid and they want a real solution. .... There are people who say, `Do you think I can be satisfied so easily,'" said Don Steward, an aide to Sen. John Cornyn, R-Texas. He said almost all of the comments received about the rebate — which Cornyn has characterized as "a theatrical response" — have been negative.

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