If there's any surprise to be found in The New York Times editorial "Pain at the Pump And Beyond," it's that the Old Gray Lady almost acknowledges the effects of supply and demand on the price of gas. Watch carefully, or you might miss it! "The Bush administration can’t be entirely blamed for the pain at the gas pump. But its shortsighted energy policies — zealously focused on increasing the energy supply, with little attention paid to conservation and greater fuel-efficiency — means the country is far too dependent on oil that is both ruinously expensive and ruinous for the environment. There are several reasons for oil’s dizzying price spiral. Soaring demand in fast-growing developing countries like China and India means there is little oil to spare. The turmoil in financial markets — the White House can take a good chunk of the blame for that — has driven prices even higher, as investors have bought oil and other commodities as stocks and the dollar plunge." There's more Bush bashing (believe it or not), but the ed gets strange when it argues that the U.S. should raise taxes on gas. Huh? Sympathize with consumers for high gas prices, blame Bush and then argue we should be paying MORE at the pump? I guess rhetorical consistency is the hobgoblin of little minds.
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I’ll take the bait on this one (this comments section is just asking for a left-right showdown) and defend the New York editorial.
I think that the editorial hinges on one assumption, “that the era of cheap oil is truly over”. If that is the case, it is wise encourage the use of other energy sources, and a means to that end is taxation. If cheap gas is gone and resources for petrol are only to get more rare later. It would make sense to anticipate, as high prices are going to nip consumers in the butt whether the gas is taxed or not.
As an expat living in France, my transportation habits have changed radically from my time in the US. A large portion of the change is due to the fact that gas costs so much, but also due to the alternative transport infrastructure available here.
Taxation would make people change their habits, but the infrastructure isn’t available yet in the US to offer real transportation alternatives. The US is in large comprised of suburb housing and shopping malls tailored to individual transportation. Gas won’t stay around for ever, so some change will need to be done, either to public transportation, or the energy used by cars (hydrogen, electric, hybrid, etc…). Making gas more expensive now will help anticipate the transition.
Of course, we could just take the path of ignorance, and face the problem when it becomes unbearable.
The NYT is all about money, and collecting more of it, from calls to increase fuel taxes to their support of congestion pricing.
In their minds, everything can be achieved though taxation, even happiness.
http://www.nytimes.com/2007/11/12/opinion/12mon4.html?_r=1&oref=slogin
“If growing incomes are not increasing happiness, perhaps we should tax incomes more to force us to devote less time and energy to the endeavor and focus instead on the more satisfying pursuit of leisure.”
virages I think that the editorial hinges on one assumption, “that the era of cheap oil is truly over”. If that is the case, it is wise encourage the use of other energy sources, and a means to that end is taxation. It's a bit confusing to me. If the era of cheap oil is over, we should tax it MORE? How does raising the price HELP people feeling pain at the pump? Doesn't that INCREASE their pain? Oh wait, I get it: higher gas prices increase their pain and makes consumers use less fuel which is better for… wait… don't tell me… the environment! So that's OK! Never mind that it's a regressive tax that hits the poorest hardest. Of course, the average consumer will benefit from alternative energy sources that will replace oil because alt. energy will be so much cheaper. Hang on; that's not it. Oh right, because the globe won't cool. I mean, warm. Look, you can't have it both ways: soothe gas price shocked consumers by blaming the "bad guys" and then tell them you want to increase gas prices. That's several kinds of stupid.
Yep, we can raise taxes on gasoline to encourage energy efficiency, but it will devastate the American heartland and suburbs, where mass transit infra-structure doesn’t yet exist or is impractical.
These taxes will cause inflationary chaos exactly when inflation is again raising its ugly head.
The current free market / speculative futures market price rises are already having an effect in the US.
I’ve always wondered if a tax like this would hit the poorest the worst or the wealthy the worst. The poor certainly don’t have access to much in the way of reliable vehicles, but they certainly don’t travel as much, nor do they typically buy the big SUVs or super-sports cars that drink considerably more gas by virtue of being way out of their price range.
A majority of the consumption is still done by the middle-class, but it still makes me wonder which of the two would be hit the worst.
As much as I dislike the current administration you really can’t put all the blame on them. And raising taxes sure as hell isn’t going to do anything to help if history is any indication.
There’s more Bush bashing (believe it or not), but the ed gets strange when it argues that the U.S. should raise taxes on gas. Huh? Sympathize with consumers for high gas prices, blame Bush and then argue we should be paying MORE at the pump? I guess rhetorical consistency is the hobgoblin of little minds.
I’m pro gas tax and I concede your point. Now is not the time to be talking about raising taxes on gasoline. The editorial should have been clear about that. If a higher tax had been there all along, however, many people would have made different decisions about which vehicles best suit their needs. That’s the very reason automakers favor higher taxes over higher CAFE standards. Create a consistent demand for fuel efficiency and CAFE will take care of itself. Otherwise the business case for building high CAFE standard vehicles with associated high price tags just isn’t there. If oil drops to $65 a barrel later this year, as one of your recent blurbs suggests, then the current trend towards better fuel efficiency versus the traditional desire for a powerful, bump-soaking family barge will slowly start to dissipate. Same as it ever was. That is when politicians should seriously consider sticking their tongues on that third rail.
In 1980 there was thousands of columns written stating the era of cheap oil is over. History repeating?
” means the country is far too dependent on oil that is both ruinously expensive and ruinous for the environment ”
Oil has really ruined the USA.
I suppose it’s easy for someone who writes for the NYT, who probably lives in an apartment 10 blocks from their building, to write about the ease of reducing everyone else’s dependence on gas.
For everyone else who doesn’t have the option of mass transit to and from work, it’s not so simple.
I’d love to drive my car 5 minutes up the road, hop on a train for $2 and ride to work. But that option doesn’t exist for the majority of Americans.
Our country is built on the concept of the open road, suburbs, etc. Unless you’re going to take those extra gas taxes and establish some sort of countrywide “superfund” to bring mass transit to every town in America, the notion of raising gas taxes to make people reduce their travel just shows how out of touch the writers are with the country in which they live.
Everyone I know is looking for ways to drive less right now. Putting $60-80 in your tank 1-3 times per week hurts, I don’t care how much money you make. How ironic is it that some people can’t afford to go to work anymore?
I believe in NYS we also have a sliding gas tax anyway. So the tax increases as the cost of gas goes up, it’s not a fixed percentage.
In the southeast we barely have any alternatives outside of buses. But that’s a result of the population distribution of this area. The South is and always have been more rural. This editorial offers no real solutions for us, and the rest of the nation. Perhaps we should divert all of the Federal dollars New York receives for it’s infrastructure to the southeast so we can be more like them.
@Robert Farago:
Look, you can’t have it both ways: soothe gas price shocked consumers by blaming the “bad guys” and then tell them you want to increase gas prices. That’s several kinds of stupid.
I think a knee-jerk anti-tax, anti-regulation (and apparently anti-New York Times) mindset might have more to do with your spin on the op-ed than simple frustration with logical inconsistency.
I don’t see anything in the article that indicates it was written to “soothe gas price shocked consumers.” The article critiques what is indisputably a bad energy policy, one that exacerbates oil price fluctuations. They point out that some of the true beneficiaries of high oil prices are authoritarian regimes. They then suggest that higher taxes at the pump are a means to increase efficiency and curb demand, a move some TTAC commenters have expressed support for in the past.
In the southeast we barely have any alternatives outside of buses.
Exactly. If it weren’t for half ton pickups and body on frame SUVs folks in the Southeast would be stuck walking or riding the bus. What other choices do they have?
BuckD :
I think a knee-jerk anti-tax, anti-regulation (and apparently anti-New York Times) mindset might have more to do with your spin on the op-ed than simple frustration with logical inconsistency.
Guilty as charged re: knee-jerk anti-tax and anti-regulation. I believe governments are the least efficient organizations on planet earth, and regulations are more often designed (or redesigned) to placate special interests than represent the people’s best interests.
I am not against taxes or regulations per se; I just come at it from a deeply skeptical perspective. In case you hadn’t noticed.
Anyway, the opening paragraph of the editorial clearly signals (to me) that the NYT is trying to sympathize with motorists.
The surge in the price of energy couldn’t come at a worse time. The average price nationally of regular gasoline has shot up to a record $3.28 a gallon. Combine that with the collapse of the housing market and the seizing financial sector, and it is putting a boot to the gut of an economy that is either already in a recession or close to one.
If I’m wrong– if the NYT isn’t expressing concern for the average Joe– well, that’s even worse.
RF It’s a bit confusing to me. If the era of cheap oil is over, we should tax it MORE? How does raising the price HELP people feeling pain at the pump? Doesn’t that INCREASE their pain? Oh wait, I get it: higher gas prices increase their pain and makes consumers use less fuel which is better for… wait… don’t tell me… the environment! So that’s OK! Never mind that it’s a regressive tax that hits the poorest hardest.
Yes. We should tax it more. (Actually, we should tax oil more.) So that we use up the remainder slower, and have greater incentive to lighten up cars and develop alternatives to oil. (I’m about to spend $5,000 on roof insulation for my oil-heated house.) Maybe we should tie a gas tax to gas stamps.
Surely a significant part of the oil “price increase” must be directly related to the dramatic fall of the dollar relative to other currencies. In 2001 a Euro was worth about $0.84 and it is today worth about $1.56. Thus the oil price is not increasing at a rapid rate, but the dollar has lost nearly 85% of its value in seven years.
The “price increase” is largely a reflection of the lost value of the dollar. At the same time, spurred on by cheap money in the U.S., we have increased fuel consumption dramatically. As Walt Kelly so eloquently said, “We have met the enemy, and he is us.”
Good point about the price of the dollar as related to oil and for that matter gold. Just what is propping the Euro at such heights?
Personally I like cheap gasoline.
Gas taxes rule. They are fabulous. I love cars and I hate spending money and taxes in general bother me but a gas tax is the most sensible and utterly fair way to fund our transportation needs and shepherd people into more sensible vehicle choices.
It’s real great to sympathize with Joe Consumer, and there are many “pain at the pump” stories out there doing so, but anti-gas tax stories never want to cop up to the fact that it was the wanton usage of this depleting resource that got us to this point in the first place. $1/gallon gas? Hell yes I’ll buy that Hummer! I need it because it snows 3 times a year where I live and I have 2 kids! $4/gallon gas? Gosh I bet we’d all fit into that compact wagon that gets twice the mileage…
A gas tax is the only truly fair way to get needed infrastructure funding (I’m from MN where our bridges fall down) from the people that use it most, either by driving on the roads the most and using gas or by driving humongous inefficient vehicles. It is more of a user fee than a tax and people can cry about it all they want, but if they want to ease the pain they had better make more suitable vehicle and lifestyle choices in the future.
My environmentalist friend recently went food shopping. He said everything has gone up in price. Shocking!! I told him it was because higher gas prices mean higher prices for everything. Gas truly is the “lifeblood” of the economy.
He blamed it on price gouging by the oil cos. Nonsense. Environmentalists won’t let us drill for new oil, which means we can’t increase supply. And if you don’t increase supply, the supply you have goes up in price. The true gouging is from gas taxes.
Simple. But why don’t they get it??? My “green” friend was going to farmer’s markets to save his precious environment. He stopped going. I guess buying a wormy apple for a dollar a piece was beyond even his sensibilities.
Robert, taxing is one of the last resort of governments to cash in besides pushing fed to print up banknotes. For instance, in UK , for a liter of fuel that costs $1.32( 2004 data), government sucks in taxes 99cents! So we can see that oil prices even being so high, haven`t given the government a reason to decrease taxes on fuel. And Robert, you know what, the governmet doesn`t give a shit if that fuel is being burnt in a Toyota Tundra or domestic Explorer.
The solution is obvious. We’ll just shrink the country. That way we can be more like the European countries. No more yards (except for the wealthy). No more gardens (except for the priveledged). Everybody living the dream of apartment life. If only we were already living that dream, that utopian lifestyle, now.
@rpenna $60-80 gas per week?
I live in a town with little mass transit (buses only) that I haven’t ridden on in decades. I drive my own car with no passengers. My girlfriend and all my extended family have their own individual vehicles.
I drive about 7 to 8 miles each way to and from work. I drive a 4 door 4 cyl car (not a hybrid) and haven’t put gas in my car in over a month even though I’ve driven the car 5 days a week without fail.
Even at $3.25 a gallon my fill up is under $50 and barring unusual driving I never put in a full tank. I only happened to have a full tank last month because someone else filled it up. I’ll probably put some gas in the car this week but I’m not sitting on empty.
I honestly don’t understand the driving that is costing someone $80 a week for gas when I’m paying around $10 a week for gas. Even if I did understand it I wouldn’t call it normal (as you probably don’t consider my driving normal).
What’s the statistical average for the nation as a whole not some outlier stat?
Personally, I think it is impossible for the New York Times, or anyone else, to make an educated statement about our energy policy until we know all the details of the Energy Task Force meetings.
I’m pretty sure that will never happen, but hey, we American citizens are all free to write to Dick Cheney asking him for the details – I’m sure he will be perfectly forthcoming with us, his employers.
Until then, I’ll happily wave my American flag, burn my $4.00 fuel for 15-22 mpg, and blame the liberals and their taxes…it’s so much easier than following the money.
Seriously though, I’ll pay what the market asks without complaining. If we choose to tax fuel, I won’t be happy, but I’ll deal with it; I will adapt – or evolve – to meet the changes I’m presented with.
I just get sick of hearing the chickens whine about $4.00 a gallon gas when they voted for Colonel Sanders….twice.
btw http://www.epa.gov/climatechange/emissions/ind_calculator.html says 231 miles/week is about average in the United States per vehicle.
You’d have to be getting under 10 mpg at $3.25 a gallon if you payed $80 for gas to drive 230 miles a week.
Paying $4/gal sucks for people who drive cars that average 25 mpg too, you know.
to those who live 20 miles from a grocery store or small town, i have absolutely no sympathy – you chose to live there, knowing that fuel is something you rely on for subsistence.
to those who say the “If the era of cheap oil is over, we should tax it MORE” I say that is EXACTLY what we should do. until folks living in exurban and rural america have to make an actual, real choce of “fill up the car or feed the kids” we won’t get out of our current mess. who said you need anything bigger than a sedan, small wagon, or small SUV? You have 5 kids, well, pay the price. I mean that literally.
though a gas tax would hit the poorest most, most of those it would hit the worst already live in inner cities of large urban areas with some form of mass transit.
“if oil drops to 65 bucks a barrell…” well, it will then still be about 5 times more than it was just a few years ago. brilliant.
for those in the rural southeast, BUY A SMALLER CAR!!!! MOVE!!! remember the old sam kinison routine about the starving ethiopian children? HET OUT OF THE DESERT!! buy a corolla, a focus, a VW diesel, something, but GET RID OF YOUR DAMN ASPEN, TAHOE, OR SEQUOIA!!! no, you don’t need a car that big. ever. ever. ever.
“Our country is built on the concept of the open road, suburbs, etc.”
BULLSHIT. our country is built on the concept of freedom, and freedom comes with a price. always has, always will. i CHOOSE to live in an urban area, in a small house (
Ah, but we’ve forgotten to figure in the Special Surcharge to the $4 per gallon of gas we’ll be paying even without new “gas taxes”.
It’s called the Iraq Tax. What is it, right now clocking at about $12 billion per month? None of which we’re paying on a cash basis either, so figure in the interest on the deficit and the foregone opportunities (to spend it on R&D for greater energy efficiencies, infrastructure improvements, innovation etc.) and the ultimate price goes even higher, to be paid past the next election cycle of course.
And you can cite whatever Invasion Rationale of the Month(tm) that’s been fed to us over the past five years, but in the end I have my own skepticism we’d be over there if Iraq’s main economic product was broccoli and camel hair rugs.
The current US economy is based on cheap energy – just go to your local supermarket and look at where the food comes from (Asparagus from Brazil!?). As energy prices increase the market will respond by finding ways to deliver goods and services by using changes in operation and technology to reduce the use of energy. However, this change will take time and by hiking the price of energy even more now it will only increase the pain and not necessarily increase the rate of change as some of the alternative technologies are still under development.
However, what needs to happen is that retail energy prices should not be permitted to reduce significantly so that we continue to motivate businesses to seek lower energy use alternatives. With steadily increasing energy costs the market will have an opportunity to adjust and we can stay on track to rid ourselves of our foreign energy addiction.
Most people I know that favor high gasoline taxes tend to be left of center politically, which I find strange. Particularly since these same people seem tend to want to stick it to the rich with taxes (so to speak). Fuel taxes, like sales taxes, are regressive forms of taxation. That means they apply to equally to rich as well as poor. Since the rich have presumably greater incomes, a gasoline or oil tax has a relatively lower impact on them on a percent basis.
For example, a rich guy makes $1 million a year and spends $5K on $1600 gallons of gas to fuel the cars he drives around. Say the Feds impose $1 per gallon additional taxes and his annual fuel costs go up $1600 to $6600 per year. That tax takes $1600 or 0.16% of his annual earnings. It’s a small drop in the bucket. He hardly notices and keeps driving his H2.
Meanwhile Joe and Jane Sixpack have a combined annual income of $75K. They also spend $5000 a year on 1600 gallons of gasoline. The same tax hike takes $1600 out of their pockets, which is 2.3% of their gross income. On a percent of income basis, a $1 per gallon tax increase has a 14 times greater impact on the Sixpacks than on the Rich guy. In the end, Joe trades in the car he actually likes for a used Chevy Aveo and Jane buys a Metro pass where she gets groped while packed on a subway next to some guy with B.O. and bad breath.
So who’s looking out for the little guy?
Raising taxes on the poor (i.e. a gas tax) is a poor idea.
Soak… maybe not the rich… soak the war profiteers!
To reduce gas consumption to Euro levels, we’d have to return to the cities. Unfortunately, they can’t accommodate us in the near or intermediate term. The infrastructure capacity simply isn’t there – gov’t services, private housing and so forth. Many cities are marginally competent in providing those to their existing residents. Even if you assume increased tax revenues now, you can’t scale up services now – it takes years.
Plus if you wanted to make this happen voluntarily, you’d need to fix what in many cities is a corrupt and ineffective government. I’m a tax and corruption refugee – after 12 years, I moved from a city to be closer to my suburban job. I don’t know what it would take to get me back there, but I’m confident circumstances won’t change enough so that it becomes a viable option.
I am for a gas tax, but I know it will hurt the average guy, so I want his income taxes reduced in compensation. (I know, RF, I know. The cut will never come.) If only we could go to ONLY consumption taxes. That would DESTROY inflation because the dollar would rocket.
At any rate, I stopped reading the NYT, just because of this kind of stupidity.
If the NYT is for a gas tax, I may need to reconsider my position. They are rarely on the correct side of anything outside the social page.
RF: If the era of cheap oil is over, we should tax it MORE?
Yes, exactly. The best cure for high prices is high prices, and the best way to encourage alternatives and correct for externalities is to tax behavior (using gasoline) directly. Far more effective than CAFE or any similar BS.
I am for a gas tax, but I know it will hurt the average guy, so I want his income taxes reduced in compensation.
Nice thought but those at the low end of the income spectrum — those that would get slammed the hardest by this kind of taxation — don’t pay any income taxes.
Also, not to point out the obvious, but raising the top-bracket income tax rate is not going to reduce gasoline consumption. The reason people don’t like things like gas taxes is because they are effective – they force YOU as an individual (not some faceless “rich guy” who you believe to be oppressing you) to alter your behavior or face negative economic consequences.
Everyone wants gasoline consumption to fall, but they also don’t want to alter their own behavior. You don’t need a math Ph.D. to figure out that if huge numbers of people don’t reduce consumption, then consumption just doesn’t get reduced meaningfully. So yes, unpopular taxes (almost by definition) are required to make major behavior changes happen.
Yes, exactly. The best cure for high prices is high prices, and the best way to encourage alternatives and correct for externalities is to tax behavior (using gasoline) directly.
Even if conservation goes up in the US due to punitive fuel taxes, global consumption would continue to rise. All we’d accomplish (other than making millions of Americans miserable) is making crude oil less expensive for the Chinese and Indians to buy. Unfortunately, we can’t tax them.
Can someone remind me again why we want to reduce gas consumption? This is the idee fixe informing this whole debate.
If it’s to free ourselves from foreign suppliers, why not drill at home? Everywhere. Or tax imported oil (as opposed to domestic supplies). Or take all taxes off natural gas (then you’d see a whole lot of LNG-powered cars).
If it’s to stop the planet from warming… well, I’m fucked on that one.
RF,
If you believe oil is a limited resource, then conservation is a good thing. Also, even if you do not care about “climate change” there is still the pollution.
William,
Anyone not paying income taxes should spend more energy figuring out how to earn more than whining about a gas tax. If they aren’t driving to work, maybe they need to drive less.
Also, we can’t tax foreigners, but by moving to a consumption tax over an income tax we can make them share in the pain. Instead we tax our more expensive labor, making it even more expensive, and destroy the competitiveness of our own products.
How about we quit blaming the rich, and put the poor to work by not taxing the one thing they have – their labor?
darian,
I’d move closer to work in a heart beat if I could. But I can’t. I’m divorced (and remarried now) with kids. I have to stay in the same county as my ex-wife because of our agreement. Factor in that there are no decent paying jobs in the county I live in and I have to commute 30 miles (minimum) each way every day to make ends meet. Some of us really don’t have an option.
My wife and I have made changes to save gas and money, and when our current vehicles are paid off we’re downsizing (not that we have big vehicles now – a 4 door V6 sedan and a mini-van). Fortunately we can car pool and that helps tremendously.
Back to the percentages of income a tax like this would incur – even with a greater impact on the lower income people the wealthy are paying more. If the goal is to force people to reduce their consumption and to fund public transportation, this would work. I do agree that it doesn’t help slow world-wide consumption.
Nice thought but those at the low end of the income spectrum — those that would get slammed the hardest by this kind of taxation — don’t pay any income taxes.
That doesn’t necessarily mean they couldn’t receive a check. Gas tax revenues could be earmarked for the sole purpose of funding a yearly rebate much like the one being implemented this year. And the income phaseout levels for receiving a check could be at much lower levels than established for this year’s rebate program. The little guy could come out ahead while still having a strong incentive to consider fuel efficiency when making life choices.
I HATE THE IDEA OF AN ADDITIONAL GAS TAX!! I live just outside of Pittsburgh, the tunnels slow down traffic any which way you come into downtown, where I work. I ain’t moving any closer to that God forsaken, corrupt, already dead just not buried yet city! I’m just here for my kid to get her degree and then I’m out. A 30 minute drive is 50 minutes in and 90 out. Usually because of rubberneckers watching some guy deal with a flat tire.
Once the government gets it’s feed bag on with the extra money from additional gas taxes, they’ll never let it go. Just like every thing else they take from us. When was the last time the government lowered your taxes? They already make some of the highest profits from gas anyway. Notice them even talking about lowering the taxes?
@darian
Fair enough, I’ll use your numbers.
Commutes for us are about double yours, 16 miles each way, 32 miles per day.
Unleaded regular is 3.50/gallon. Let’s say we average 20 mpg.
You say you drive 5 days a week. I’m going to assume you don’t have any kids and aren’t married. I am married, so double those numbers for the second car, and we have to take the kids to extracurricular activities, but I won’t even add those miles.
So, 32 miles per day, 2 cars, at $3.50 per gallon, at 20 mpg, is $11.20/day. That’s $56/week just to go to and from work.
I can certainly afford higher gas prices. I can afford the price of eggs, milk, corn and bread doubling. Oil is a commodity, just like foods. Should we tax corn so people eat more eggs?
I have friends who make 1/5 of what I do. Their costs at the grocery store and the gas pump are the same as mine. I’m not going to tell them to move to the city and eat less.
I feel bad for everyone. If you spend $10/week on gas, that’s great. $10 is not very much, unless you consider that 8 years ago you were spending $4/week. If you look at the percentages, they suck, no matter how much or little you’re spending.
The root of our problem is we lack the regulations to curb borrowing. People have borrowed themselves into holes that can’t dig out of. Not just people, either. Lenders, investment firms, everyone. This leads to the fed having to devalue the dollar by lowering interest rates just to save major firms (cough bear stearns cough) from failing because they’ve leveraged themselves to the hilt.
It’s all a mess, but there are alot more people to blame than the guy in the Hummer, even though I share you sentiments on him.
rpenna –
i’m married, kids, 2 cars, both driven regularly-
i suppose the real point i am trying to make is the guy in the hummer is bad, but so is the mom in the minivan, and the dad in the mid size crossover is not great either – i have 2 smallish cars, and we can drive 400 miles to visit the in-laws in either car – since when did each child in america deserve a captains chair, personal video unit, and cooled beverages of their choice?
i’m rambling, i know, but sometimes ya just gotta let it blurt.
i fell better already.
darian: i have 2 smallish cars, and we can drive 400 miles to visit the in-laws in either car
We have a Ford Focus, and I just spent the weekend traveling three hours each way to visit the inlaws – over very hilly terrain that includes the Pennsylvania Turnpike. Let’s just say that the next car will have to be roomier and more powerful.
darian: …since when did each child in america deserve a captains chair, personal video unit, and cooled beverages of their choice?
Because of child seat laws, for one thing. Now all children have to be strapped into a seat, whether they like it or not, and many of them don’t like it. Hence, the emphasis on comfort, videos and cooled beverages, to keep junior (or missy) quiet, and mom and dad sane for lengthy trips.
Maybe you were blessed with angelic children who are perfectly quiet and never put up a fuss on long trips.
Good for you! Not every family is so blessed. Just as everybody can’t live in Manhattan (with a summer place in upstate New York for when city life gets to be too much), not everyone has perfect children who are content to survey the passing scenery on long trips.
A gas tax’s purpose isn’t to help reduce consumption of gas. Its purpose is to re-distribute income. Take income from poor people and then give it back to them as a reward for living the way the government says they should. Take income from rich people and give it to the poor people. Take income from America and give it to developing countries. Ultimately it would serve as a way to make American more socialistic.
If reducing consumption of gas was desired, laws would be enacted to encourage workers to telecommute. Public transportation would be expanded and improved. Ethanol additives to gas would be eliminated. Nuclear engergy would be expanded. Truckers would be limited to 55mph. Gasoline blending standards would be controlled at the federal rather than state level. Etc.
Landcrusher:
I don’t disagree with you about taxation policy on our most expensive labor. I was playing devil’s advocate because I think it is hypocritical of “class warriors” to favor punitive gasoline taxes. But…
If we have passed Peak Oil, which I don’t think we have, then the market will take care of itself through high oil and gasoline prices, as is happening today. This phenomenon is already occurring on a global basis. However, if the U.S. government were to unilaterally force a punitive tax on domestic consumption, it would create an imbalance in the global market to the benefit of China and India. Fueled with cheap fuel, those countries would expand at an even greater rate. Our existing trade imbalance would become even greater. Oil consumption would explode in third-world economies with the lowest standards of carbon (if you care about that) and pollution emissions. How is that environmental progress? How does that benefit U.S. workers (at any point on the income spectrum)?
I believe that if things continue as they are (i.e. no fuel tax) two things will happen that will alleviate the current fuel crisis. First, the high international cost of crude oil will slow growth in China and India resulting in a moderation in the growth of their oil imports. Of course, their economies will continue to grow but at a more controlled rate. Second, the higher prices will change the economics of alternative transportation fuel sources such as diesel and shale oil (I don’t see EV or hydrogen technology as having any near term impact and Ethanol is a disaster on many levels). By itself, the Green River Formation (shale oil under Utah, Colorado and Wyoming) has more fuel oil in it than all of the known crude oil reserves in Saudi Arabia. Following current trends, that’s enough oil to keep American industry running and cars rolling for 200 years. In other words, there’s no fuel shortage – and I haven’t even mentioned natural gas.
That doesn’t necessarily mean they couldn’t receive a check. Gas tax revenues could be earmarked for the sole purpose of funding a yearly rebate much like the one being implemented this year. And the income phaseout levels for receiving a check could be at much lower levels than established for this year’s rebate program. The little guy could come out ahead while still having a strong incentive to consider fuel efficiency when making life choices.
So in this wealth distribution scheme the little guy benefits by giving the Federal Government an interest free 6-month loan every time he purchases the gas he needs to get to and from work? I don’t buy that. In this scenario, the little guy’s still getting screwed.
Plus, eventually he’ll lose his job to some guy in China or India who gets to and from work in a car burning much less expensive untaxed gasoline.
to those who live 20 miles from a grocery store or small town, i have absolutely no sympathy – you chose to live there, knowing that fuel is something you rely on for subsistence.
As if distance to work/grocery store/mall is the only consideration to make when you’re settling down somewhere. Ever consider that some folks don’t want to live near a city because they don’t want to put up with crime, parking, bad schools, etc., or just maybe they want to have a backyard?
But I guess now that we’ve made smoking and SUV driving a sin of society, now we’ll have to go after those who want to have a home they can call their own.
So in this wealth distribution scheme the little guy benefits by giving the Federal Government an interest free 6-month loan every time he purchases the gas he needs to get to and from work? I don’t buy that. In this scenario, the little guy’s still getting screwed.
In your scenario the little guy is a saint driving a Honda CRX to and from work. It ain’t so. Cheap oil has a price. You say there is no oil shortage. Well, I guess there is no blood shortage, either. One way or another the little guy is getting screwed. Make no mistake.
Plus, eventually he’ll lose his job to some guy in China or India who gets to and from work in a car burning much less expensive untaxed gasoline.
No doubt. Those Chinese and Indian little guys will be living the high life at our expense. Totally.
Darian said – “since when did each child in america deserve a captains chair, personal video unit, and cooled beverages of their choice?”
I will tell you when. They deserved it the day their parents paid for it. No sooner, no later. No one is “bad” because of their choice of car. They may be foolish, but not “bad”. Driving a Hummer is not immoral.
Will,
I hear you, but you are missing the flip side. The Fair Tax folks are headed in the right direction http://www.fairtax.org
If we tax consumption, then the world wide producers are actually helping us pay our taxes. Since we instead tax production, we are just subsidizing ALL imports and outsourcing.
Another tax system to consider is the one that the US military used (uses?) in Italy. Each month you are allowed to buy a limited amount of fuel based on the size of your car engine. A compact car (I had a Rabbit and a ’72 Beetle during that period) would get me 300 liters (80 gal) a month. For that I paid a bit more per gallon than family was paying here in the states.
If I used all of those fuel coupons I could continue to buy an unlimited amount of fuel at the same prices the Italian civilians paid or nearly $5 a gallon back then (’91-’94). With the coupons I could buy fuel at something around $1.25 when gasoline in the states was around $1 per gallon.
Unofficially we traded those gas coupons among ourselves. If I wanted to vacation and travel with my car I had a few buddies who lived in the barracks and burned almost no fuel per month and I could make a deal with them to buy their coupons and vice versa. In three years I travelled all over that country and only once purchased fuel at Italian prices. $50+ to fill up my little VW Rabbit. I about choked because otherwise it would have cost $15 or so.
So how do we apply this to America?
Gas cards for everyone. You slide your card before you pump. This resets the price to a lower price. Once the allotment is used, the pump stops, beeps to remind you and if you like you can continue to pump at a higher price all you want. Say a 20% increase in the price.
I see no reason to strictly enforce who burns the reduced tax fuel as long as a card was swiped with fuel allotments left on the account. The allotments could be monthly since the recent credit crunch has proven that some folks can’t manage their finances. Give them a year’s worth to burn and some would burn through it in 4 months!
I used to not care what folks drove but as their habits impact the prices I pay, I care alot.
Where do my politics lie? Generally just right of center. Yes Hillary gives me the heebie-jeebies! But know after a couple rounds of George, so does he and his family. Let’s see – we’ve had a Bush or Clinton in the White House in some capacity since 1980? Let’s try something new next time… VBG!
We drive a 25 mpg CR-V and a 34 mpg VW Cabrio. We have chosen to live in a small TN town where my commute is purposefully short and we are working at shortening my wife’s commute so that we can carpool more effectively. Right now we carpool several days a week but she has 20 more miles to travel after she drops me off at work. Not good.
Our family and friends in Nashville, Knoxville & Chattanooga travel MUCH further per week to work and play. The distances they drive and the cars they wear out boggles my mind. I don’t want to live like that.
What could our small town change to save our fuel?
Synchronize the traffic lights. I get stopped at most of the lights when crossing town to work.
Another idea: build a bike path that divides town and does not simply exist as a sidewalk. I could bike to work except it is dangerous because of the traffic and road design. Sidewalks are not a solution b/c of the constant intersections and business entries. We have two main streets. Put a bike trail somewhere between them.
Another non-traditional (in this part of the country) would be electric streetcars (overhead power). Our town is small enough that they could circle the town with one or two streetcars. Not a exhaust belching bus that looks like a streetcar. Not a traditional bus either. A streetcar that could carry a person up and down the two main streets and to the university. That will never happen b/c of the cost. Would be in the millions.
I can’t see much changing until gas doubles or triples. Too many people can afford to cut back in other parts of their budgets and still buy gas. They might have to give up $50 meals at the local eatery or $4 coffees, or park the Hummer but they’ll still buy gasoline.
If gas triples I expect we’ll see the value of downtown land to jump as well. Folks will be jockeying for those apartments above mainstreet offices and businesses.
Ohh this has been a fun thread… I’ll try to cap it on both ends.
In response to Mr. Montgomery, I don’t think that a gas tax would make gas cheaper for China and India. With that logic, we should be burning it as fast as possible so that our neighbors won’t have as big piece of the pie as us. To be blunt, it’s childish reasoning.
A tax would make fuel more expensive, would remove our bloat and wastefulness across the population. I am a firm believer that we are a resourceful lot and we can figure a way solution to more efficient transportation if we challenge ourselves to it. On the other hand we can keep our modes of oversized energyvorous transportation and be slammed when the prices truly go up.
As I said in another thread, taxation instead of industry regulation (CAFE) is a win-win proposition for both left and right leaning schools of thought. Tax gas a bit, and the free market will be clamoring for efficient automobiles, the industry will naturally follow.
In response to Mr. Montgomery, I don’t think that a gas tax would make gas cheaper for China and India. With that logic, we should be burning it as fast as possible so that our neighbors won’t have as big piece of the pie as us. To be blunt, it’s childish reasoning.
Let me put it this way. If somehow overnight China and India implemented a conservation plan (or economic downturn) that reduced their consumption 5%, don’t you think prices for the US would fall dramatically? OPEC would have to scramble to decrease production to prevent a glut that would force the market prices to crash to unsustainably low levels.
It is the speculation that Asia will continue to consume more that has (largely) driven prices to these high levels. Similarly, if our consumption goes down as the result of draconian taxation, prices for them go down on the increased availability. And yes, if we went on an oil-burning binge it would drive up oil futures prices in the global markets. It’s not childish reasoning. But it is simple economics.
“Exactly. If it weren’t for half ton pickups and body on frame SUVs folks in the Southeast would be stuck walking or riding the bus. What other choices do they have?” – Strippo
Dude. It takes trucks to ship all of those veggies and fruits into the street markets in large cities. Or are we to assume that New Yorkers are all backyard gardeners?
William, you (and many others) seem to have a skewed view of how much oil China consumes vs. the US. I encourage you to check out this handy tool from the EIA. The figures are from 2006, but even with an additional full year of Chinese and Indian growth added to the data, I am confident the US consumes more than twice as much as both countries combined. For now, and for the foreseeable future, US consumption is the largest driver of world oil prices, and therefore US gas prices.
A 1% drop in consumption in the US will be more effective at reducing US gas prices than a 2% drop in China and India combined.
“Exactly. If it weren’t for half ton pickups and body on frame SUVs folks in the Southeast would be stuck walking or riding the bus. What other choices do they have?”
Mules.
“Exactly. If it weren’t for half ton pickups and body on frame SUVs folks in the Southeast would be stuck walking or riding the bus. What other choices do they have?” – Strippo
Dude. It takes trucks to ship all of those veggies and fruits into the street markets in large cities. Or are we to assume that New Yorkers are all backyard gardeners?
Ah. I wondered what the deal was with all those F-150s in Manhattan with Mississippi plates.