Wow. Our experiment is off to a great start—let's see if we can finish it off sooner than expected.
The LA Times scratches its editorial chin today over the prospect that California's cap-and-trade program will increase the price of gasoline next year:
Gas prices already have risen by close to 50 cents a gallon since the beginning of the year, for reasons that have nothing to do with AB 32. The prospect of adding 15 cents more — though it's relatively minor compared with the overall price increase — is daunting to many drivers. Assemblyman Henry T. Perea (D-Fresno) has introduced a bill to delay the extension of the law to transportation fuels for three additional years.
That won't do at all....The state must give drivers strong incentives to take fewer trips, carpool, use public transit and purchase electric or fuel-efficient vehicles. At the same time, state officials must remain sensitive to the effect a price increase will have on low-income and working-class Californians, especially those who commute long distances in areas where robust public transportation systems have not been built.
....The best solution to this dilemma was proposed this year by Senate leader Darrell Steinberg: Rather than extending AB 32, impose a carbon tax on gasoline, at least for a transitional period. But make it revenue-neutral by giving the money back to taxpayers — and especially low-income taxpayers — through tax credits on the state's personal income tax.
Huh? Why should we replace one tax with another, and then rebate some of it to low-income taxpayers? If that's what we want to do, why not just keep the cap-and-trade fees we already have and offset them with Steinberg's tax credits? What am I missing here?