With HillRod and McNasty calling for a summer vacation from reality gas taxes, populist posturing on the price at the pumps is hitting an all time high. It's one thing for presidential candidates to propose sweet, feel-good nothings. It's another when the sitting Secretary for Transportation disses the dollars that help fuel her agency's good works (and the rest). Although Mary Peters held short of weighing-in on the tax holiday proposal, the SecTrans did tell The Detroit News that "as family budgets strain under the burden of record gasoline prices, it is increasingly clear that fuel taxes are not only ineffective but also wildly unpopular. Increasing dependence on gas taxes to fund infrastructure makes zero sense when Detroit and other automakers are working so hard to make more efficient cars every year." Oh, so Detroit is going to solve the energy crisis, is it? Why didn't we see that one coming? Peters made no mention of what would be taxed so as to pay for such trivialities as roads and bridges. After all, if gas is cheap enough for us to all buy SUV's again, who needs the infrastructure?
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Detroit will build electric flying SUV’s for us. Forget about roads.
The smart thing for the federal gummint to do would be to emulate the food industry, with its shrinking coffee cans, candy bars and ice cream containers, by requiring gasoline to be sold by the liter. This would cut the unit price dramatically, and the intolerable gas tax of eighteen cents per gallon would become a much more affordable-sounding five cents per liter.
All this is moot if Hillary is elected; after all, just yesterday she said she’d break up OPEC with an anti-trust lawsuit or a WTO complaint. I’m dreamin’ of that good old 69 cents gas. Happy Days are Here Again!
Gas taxes are a fair way of distributing the cost of maintaining our roads as tax payements are proportional to the amount driven and to the size of the vehicle. Given the state of our transporation infrastructure maybe what we need is a couple of cents more tax per gallon so more bridges don’t fall down.
I’m not sure what Mary Peters is suggesting but if we abolish the gas tax the money will have to come from some other form of tax revenue. Roads need to be paid for and the governmentn only has tax payers money to spend so we end up paying for it either way.
It’s all fun and games until another bridge collapses.
All kidding aside, if Plugin Hybrids (or EVs) ever take off big time (a big if), an alternate method of funding roads may be necessary. Since some of these vehicle’s energy will be coming from the electicity grid and not fuel pumps, they will be paying disproportionately less in fuel taxes for the road they use.
Speaking of which, does anybody know if E85 (or even plain jane E10 for that matter) is taxed based on it’s full volume, or just the volume of gasoline it contains? If the latter, then widespread E85 adoption could also curtail gas tax receipts.
Hold on here, she does have a point:
“Increasing dependence on gas taxes to fund infrastructure makes zero sense when Detroit and other automakers are working so hard to make more efficient cars every year.”
If customers are rapidly switching to more fuel-efficient cars, and the federal government has also mandated fuel-efficiency increases in new cars, it makes little sense to depend on revenues from the gas tax to maintain roads and bridges.
If the CAFE increase works as its supposed to, gas usage should logically DECREASE. Which would also decrease revenues. I seriously doubt that infrastructure costs will decrease during that time.
What she is saying is that it’s time to explore other ways of paying for roads and bridges. Given that gas usage should decrease over the years (especially since it’s government policy, through CAFE, to bring this about, and market forces are ahead of CAFE), and infrastructure needs won’t decrease, it makes sense to look at alternatives to the gas tax as a revenue-raising device. I don’t think she is talking about abolishing the gas tax, or even supporting the proposed gas-tax holiday.
geeber: the solution, then, if gas taxes do not provide enough revenue to fund roads, is to raise gas taxes. I’d rather see gas taxes go up than my income taxes. The money has to come from somewhere.
If customers are switching to more fuel efficient cars, raise the gas tax accordingly. And if, ultimately, we need another source of revenue for roads and bridges, fine, but if we get rid of the gas tax now, most of the money that goes to it will end up with the oil companies or the oil oligarchies.
How much did it cost to build all these roads in the first place? Answer; a hell of a lot less (even in adjusted dollars) than what we pay for now in all the taxes that are SUPPOSED to go for road work.
The never ending cry for more tax money got disgusting decades ago. The question “How will we pay for (name your pet project) without the (name of your favorite) tax” just displays a lack of understanding of how money is created in the first place.
What’s the total number of U.S. dollars? Where did they come from?
Just a shot in the dark, but I would guess there are more cars manufactured in a year than there are scrapped. Also the driving population increases daily with more people getting driver’s licenses than those loosing them for whatever reason. My point is, even if fuel efficiency does increase, fuel savings are canceled out by more vehicles consuming fuel. Fuel taxes are one way to maintain the highways, but if they could cut the waste in government spending fuel taxes wouldn’t be necessary. Maybe the government should stop wasting money on projects like a million dollar study of ketchup viscosity and spend that money on improving the infrastructer.
How many here believe that gas prices would drop during the “holiday?”
polpo: the solution, then, if gas taxes do not provide enough revenue to fund roads, is to raise gas taxes. I’d rather see gas taxes go up than my income taxes. The money has to come from somewhere.
Which will further depress demand, which will ultimately reduce revenue.
What she is saying is that flat or declining gasoline consumption will result in flat or declining revenues. Meanwhile, the cost of building and maintaining infrastructure will NOT decrease (or even remain flat). She has a point.
She is not saying that we should eliminate or even greatly reduce gasoline taxes. We may not, however, be able to depend on revenues from these taxes as much as we do now.