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Time for a Gas Tax

In the New York Times, Robert Frank discusses the gas tax: "A Way to Cut Fuel Consumption That Everyone Likes, Except the Politicians." Indeed, it's not clear why a $2-a-gallon gas tax—which would then be refunded to Americans through reduced payroll taxes—is so politically unviable, except that it was unpopular when Jimmy Carter first proposed it, and has been stuck with a bad reputation ever since. But here's the bottom line: "In the warmer weather they will have inherited from us a century from now, perspiring historians will struggle to explain why this proposal was once considered politically unthinkable." Right, exactly.

Now there are some decent arguments that a gas tax would have an unfair impact on certain people in the United States: it would fall especially heavily on those who live in rural areas and can't easily adjust their driving habits. Perhaps regional tax credits of sorts could help those who are being disproportionately hurt, but yes, there will be quite a bit of pain. Moreover, there's some evidence that stricter CAFÉ standards on automakers could increase fuel efficiency more gently than gas taxes would (although drivers might just respond by driving more, and total fuel consumption wouldn't go down).

Still, the main point here is that reducing fuel consumption in the U.S. and somehow averting global warming is going to be a massive and radical undertaking—perhaps a near-impossible one. The idea that we can somehow achieve this by doing stuff that doesn't inflict any pain whatsoever is an unrealistic one.

Posted by Bradford Plumer on 02/17/06 at 12:05 PM | E-mail | Print | Digg this | de.licio.us



Comments

What about people without an income great enough to be responsible for income taxes? No one is going to get behind an initiative that would so obviously cripple the poor, they can't wait to be "credited" for that extra $20-40/week.

Posted by: Gary on 02/17/06 at 12:35 PM

I would perfectly happy riding on mass transit rather than car pooling. I was never given that choice. My tax money was used to build interstate highways, passenger trains and buses were closed down. I realy get mad when I hear how Europeans pay $5 or whatever, a gallon for gas and that's what Americans should have to do. My government has NEVER given any alternative to travel short or long distance but the automobile. It is time for a difference.

Posted by: Mike on 02/17/06 at 1:25 PM

Gary -- Most gas-tax proposals would reduce payroll taxes, which everyone who works pays. Of course, that leaves the growing ranks of the unemployed waiting around for a tax credit, so yeah, it's a real problem...

Mike -- Totally agreed. It would also be nice if we figured out how to control urban sprawl.

Posted by: Brad Plumer on 02/17/06 at 2:25 PM

Boy! You had me until, "The idea that we can somehow achieve this by doing stuff that doesn't inflict any pain whatsoever is an unrealistic one."

As an American, I can unequivocally state that "any pain whatsoever" is reserved for "them" not "us" (or U.S. if you prefer).

Also, I would like to take issue with the fact that you so cleverly hid the "$2-a-gallon gas tax" line smack dab in the middle of the first sentence, so while reading it, with my short American attention span, I missed it.

Have you considered pictures?

Upon having someone re-read it for me, I heard that you also wrote, "In the warmer weather they will have inherited from us a century from now, perspiring historians will struggle to explain...".

Now that's where this is all wrong. First, "warmer weather" is no big problem since only a select few will get to go to "cool heaven" and you're talinking about "a century from now". Those chosen few (me being one, obviously) will already be in "cool heaven" so what's the big deal?

Finally, as for "perspiring historians", they are in a cabal made up of themselves, scientists, and whistleblowers, who will all be in hell and who really cares if they "struggle" to explain to the unenlightened masses down there why they didn't just take it on faith that everything would work out.

Seriously folks, we will have hell on earth if something is not done. This proposal has been on the shelf for so long, you'd have to fire up a Caterpillar bulldozer with its belching exhaust just to clear the dust of it.

Best wishes to all. Keep up the good fight.

Posted by: AmeriPundit on 02/18/06 at 9:52 AM

If the purpose of a gas tax is to get people to drive less, wouldn't giving people back the extra money they spent by reducing payroll taxes undercut the purpose? If the net amount of money is the same, wouldn't people's behaviors remain the same?

Also, as a self-employed person who doesn't pay payroll taxes, but who uses a vehicle quite a bit in their business, I can't say it sounds like something I'm likely to support, even tho I'm a fairly radical environmentalist.

I also have to question this automatic assumption that many people seem to make that increasing the price of gas decreases the amount of driving people do. I think that's a bit of an optical illusion; you think it would be that way, but when you look more closely it's not that way at all. I've lived in LA, the most auto-centric city in the US, for over fifty years now. During that time the price of gas has gone up roughly ten times, from around .29/gallon to about 2.90/gallon. And traffic has also increased at least ten times. In fact, I'd swear that the higher it gets the more traffic there is. Certainly it's never been higher and there's never been more driving.

I've almost come to the conclusion that, since it generates more income for the oil companies and hence for all the tens of millions of people who own stock in them, higher gas prices actually put more money into the economy, generating more jobs and eventually generating even more driving. The exact opposite of what you would think.

Posted by: Mike on 02/18/06 at 11:27 AM

Why is the answer on the left always a tax? As if the government has ever done anything useful or wise with our tax dollars. I personally believe that global warming is a good thing. The sooner our dumb and useless species is extinct, the sooner the planet and and every one of it's other inhabitants can heal themselves.
Wake up people, there are no answers!

Posted by: R. Lowe on 02/18/06 at 1:39 PM

I sometimes wonder if people view oil production like a sales growth chart-ever climbing upward on a Cartesian graph. At least up to the point that the last drop of oil is removed from the ground and production would then drop strait down to the zero line. After all, oil is finite.

Unfortunately, oil production is more like a bell curve. The theory of a production bell curve was first introduced in 1956 by M. King Hubbert, a Shell Oil geophysicist from Houston. His theory was validated in the mid-70s. Even with the development of oil fields in Prudhoe Bay and the Gulf of Mexico, production in the US peaked in 1970.

If Hubbert’s Peak (Peak Oil) is valid then world oil production will follow a same bell curve. It’s not the point were oil will be completely gone that we need to be concerned about. It’s the halfway point, or after the peak, were production will fail to meet demand that will cause great economic turmoil for all classes.

In the spring of 1971 the Texas Railroad Commission announced a 100 percent allowable production quota for US producers. When we hear from the OPEC ministers that there will be no restrictions on production quotas for member nations we will know that the world peak has been met. After that it will be a bidding war to meet demand. As in all bidding, the individual who does not have the means to outbid others will go without.

Are we there now? Possibly. But if not, we are very close to it. Now is the time we must wake up. We need to stop thinking that “big oil” is to blame instead of the laws of physics, the constraints of global geology and the strong desires of consumers. We have to invest in alternative forms of energy production and fuels for transportation that will offset declines in oil production.

Unfortunately, we work in a capitalist economic system that is risk averse. In one article in Engineering News Record reviewing progress for the addition of new clean coal technology, this was said of the Federal push toward a technology known as coal gasification, “everyone is still on the fence and no one wants to be the first to make a commitment to this up and coming fuel.” With that kind of backing from Wall Street I fear for our ability to convert to anything before the peak is reached.

We can debate global warming until we are blue in the face. The fact that oil is a finite resource cannot be debated. The downward side of the curve is the world’s future. We must get ahead of it.

Posted by: D. Beers on 02/20/06 at 5:57 AM

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