By on December 27, 2008

While occasional NYT carmudgeon Ezra Dyer’s busy celebrating high horsepower motor cars, his paymaster’s editorial board has announced their desire to have the incoming administration tax the bejesus out of the go-juice fueling Dyer’s cool whips (Bryan?). After bemoaning the lowered price of fuel’s dampening effect on Americans’ desire to buy the fuel-efficient vehicles that Uncle Sam, in his infinite wisdom, has mandated, The Times gets down to business. “There are several ways to tax gas. One would be to devise a variable consumption tax in such a way that a gallon of unleaded gasoline at the pump would never go below a floor of $4 or $5 (in 2008 dollars), fluctuating to accommodate changing oil prices and other costs. Robert Lawrence, an economist at Harvard, proposes a variable tariff on imported oil to achieve the same effect and also to stimulate the development of domestic energy sources.” BUT WHAT ABOUT THE POOR PEOPLE? “In both cases, the fuel taxes could be offset with tax credits to protect vulnerable segments of the population.” Uh, is a major recession really the best time to raise the price of a basic commodity? No but…

“If the Obama administration is to meet its twin objectives of reducing the nation’s dependence on foreign oil and cutting its emissions of greenhouse gases, it needs to start thinking now about mechanisms to curb the nation’s demand for energy when the economy emerges from recession in the future.”

Interesting. Put that one on the back burner for us, will ya? Thanks.

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109 Comments on “New York Times: Tax Gas to $4 – $5 a Gallon Minimum...”


  • avatar
    ronin

    Look, this dude is a Harvard economist. He has been incredibly wrong about every aspect of the economy for the last several years. All hs predictions have shanked the goalposts by a mile. Instead of calling these jackasses on their incompetence, the media continues to hold up their drooling dribble as though it has any meaning, any viability, any credibility, any wisdom at all.

  • avatar
    NICKNICK

    Am I the only one that views Ivy League credentials as a liability? I generally hate generalizations, but the people that I’ve known and worked with that have Ivy League Degrees have been redistributionist nutcases. It seems as though you go to Harvard to have your brain wiped clean and reprogrammed with only socialist functions. They view all problems as ones stemming from “inequality” or “social justice.”

    And *these* are the people that your media turns to for *economic* advice? How can a Harvard MBA help your company when they’re programmed to destroy capitalism.

  • avatar

    While there are many good reasons to limit fossil fuel use, not the least of which are useless and dangerous countries that sell it…..

    The only good thing to happen to the average person in this land of bailouts for the rich are the huge drop in fuel prices.

    This does not mean buy an SUV, but take this one gift and don’t destroy it.

  • avatar
    Wheatridger

    I’m all for it, though I believe a fixed floor price of $3 would be more appropriate for these times. Look, there’s general consensus now that renewable energy is a key to our future. It’s one of the few likely businesses capable of sustainable growth, But how would you like to be managing one of these businesses in biofuels or the like when you have no assurance about future prices, even in the near term? It can’t be fun trying to carry out the summer’s business plan, drawn up under $4-a-gallon prices, in the current period of $1.50 gas.

    Meanwhile, as fuel prices whip up and down, what’s a consumer to do? Assume that today’s rock-bottom prices will last? That’s a big risk over the length of a five year new car loan. I wouldn’t take it, but I’ve never bought a car that wasn’t capable of averaging 25 mpg, either.

    It would not be so difficult to make this new gas tax revenue neutral. What you pay at the pump would come back at income tax time.

    I offer my answer framed in business logic, not Commie-baiting hysteria. I like cars. So far, I don’t much like electric cars. But I am an environmentalist. Don’t try to wedge me into these simpleminded “Ivy League” and “redistributionist” stereotypes you’re so fascinated with. That’s one big difference between the Right and Left these days. While the Left frets about society’s problems, the Right sneers about “those kind of people” who worry and fret so much. I say let’s talk about the problem instead of slinging axle grease at each other, so that tells you where I’m coming from.

  • avatar
    dhanson865

    Moan about it if you want. I don’t notice the difference between $2 gas and $4 gas (it got to $5.09 in my town this year, though I didn’t have to buy those weeks). It’s nice being able to avoid buying gas for 3 weeks. I never paid over $4.50, and even then I only bought a couple of gallons to hold me over until the price spike eased.

    If you drive reasonable distances in a reasonable vehicle it really doesn’t affect you much.

    I’d rather see gas taxes increase than see increases in income taxes, sales tax on food (and other basic services that are taxed like electric, water, phone), or property taxes.

    Even when I was making minimum wage back in the day gas prices were the least of my concerns. Gas could have been equal to minimum wage and it wouldn’t have changed my life to any significant extent. Since minimum wage is above $6 now imagine $6 gas to get a concept.

    I drove around a ton for a variety of reasons when I was extremely poor. I would have just driven less if gas prices were higher. It probably would have saved me money as the cars I drove ended up needing repairs that far outweighed the proposed difference in gas cost. With low gas prices, I as a young adult had no self control and no impetus to reduce my driving. Higher gas prices would have made the up front cost more noticeable and would have likely saved me some hidden costs down the road.

    Call me crazy or say the overall affect to the economy would be too great but I actually like the idea of higher gas prices based on the things I’ve directly observed in my life.

  • avatar
    Dr Lemming

    I don’t expect anything like this proposal to be approved (the Dems are afraid of raising any taxes). So in a very real sense this is an academic discussion…

    Gas prices in the US are artificially low relative to the rest of the industrialized world. This “magic of the marketplace” is the key reason why more people own gas guzzlers in the US relative to Europe and Asia. Just as importantly, variations on a gas tax generally pay for alternative modes of transportation in other nations. US metropolitan areas usually don’t have anywhere near as good of an alternative transportation infrastructure because the funding mechanisms just aren’t there.

    I can see some TTAC commentators arguing that I’m “anti-car.” Nope. I think that US gearheads would be well served by a more diverse transportation system, e.g., if everyone wasn’t clogging the freeways to get to work maybe driving would be a wee bit more fun. And as a nation we might spend fewer tax dollars on costly wars if we were less dependent on Middle East oil.

    Farago’s complaint about the proposal focuses on timing. I don’t know why that should be a problem, particularly if the tax increases were gradual and credits indexed to income level. At any rate, a tax that kept gas prices steady could be a very good thing. Predictability is quite valuable, particularly for small businesses with tight budgets and lots of incertainties in other aspects of their operations.

  • avatar
    Driver23

    Totally support this (and I am not a Prius driver). It has nothing to do with socialism, it is a basic economical stimulus. Socialist would ban high performance cars (like that London mayor tried to ban Porsches from London downtown). With higher priced gas you can still drive whatever you want – provided you can afford it. I think CAFE is socialism – blanket statement that a car company must produce efficient cars even if company business is sports cars. Higher price of gas simply makes it more expensive to drive powerful cars. BMW is a European company where gas has been 3x more expensive than in US and yet it is selling M3s there just fine. They are more expensive to purchase and more expensive to drive. But who says M3 should cost $60K? Sure, higher price of gas effectively means less people will be able to afford 300 hp cars. But so what? Capitalism is not about everyone having equal access to all goods (that would be communism).

    Higher price of gas will promote railroads, especially electrical, lighter and more efficient cars, turbo engines with smaller displacement, fewer steel parts and more demand for aluminum and carbon fiber – which will promote scientific research and overall technological progress.

  • avatar
    Rod Panhard

    Don’t most of the banks and investment houses that are feeding at the bailout trough usually hire ivy league economist types? At least this is what I understand from the locals who work in New York City and live in suburban New Jersey where I live.

  • avatar
    Detroit Todd

    I think we’d be more likely to see Congress vote for compulsory homosexuality than to pass a huge gas tax (even an incremental one). It would be torches and pitchforks time. With good reason.

    A tax on gasoline at this level would visit economic cruelty on the most vulnerable of Americans. The NYT authors should take a peek outside of Manhattan once in a while.

    The NY Times could start by visiting a single Mother of three living in a rural area, driving a 1991 Ford F-150 to work 22 miles one way to Wal-Mart to sell Chinese crap for $9.00/hr. Maybe this Mom could impress upon them that she and her family cannot wait until tax time to sort it all out for the year.

    This is not Western Europe. Our society, by and large, is based upon the automobile. Not mass transit. Not walking or bicycling. For better or worse, that’s what we’ve got right now.

    For the greenies, there are ways available to us to reduce CO2 emissions immediately, as opposed to the relatively long-term issues like improving mass transit, developing alternative energy, etc. For example, we could ban restaurant and bank drive-throughs. I remember when you used to have to get your fat ass out of the car to go get your triple-bypass meal. People lived.

    Don’t get me wrong, I want to do everything short-term and long-term to improve the environment. (Well, to be honest, I think breaking our addiction to foreign oil is the imperative. But improving the environment is nice, too.) That said, we should not attempt to solve our problems by vivisecting the poor.

    This NY Times piece is a classic example of ivory tower best intentions paving the road to hell for millions of Americans.

  • avatar
    creamy

    “A tax on gasoline at this level would visit economic cruelty on the most vulnerable of Americans.

    all the politicos would have to say is that they are doing it for middle- and low-income americans (after all, that’s what they said about the bailout).

    you raise taxes to start building more infrastructure and energy independence which means more jobs for americans in these troubled economic times, yo.

  • avatar
    Toshi

    Pigovian taxes are actually quite a well-researched and solid idea, anti-intellectual bias in the peanut gallery here aside.

    http://en.wikipedia.org/wiki/Pigou_Club
    http://en.wikipedia.org/wiki/Pigovian_tax

  • avatar
    Detroit Todd

    you raise taxes to start building more infrastructure and energy independence which means more jobs for americans in these troubled economic times, yo.

    When you raise taxes – especially a regressive tax like per gallon on gasoline – in the middle of a recession, you get a depression.

    Further, regardless of the merits, anyone who attempts to pass a gax tax increase right now will be committing political suicide. That alone ensures that it ain’t gonna happen.

  • avatar
    Detroit Todd

    anti-intellectual bias in the peanut gallery here aside.

    Speaking for myself, I’m not anti-intellectual. I’m pragmatic.

    There are studies upon studies showing that de-regulation and supply-side economics are good for the economy.

    Oops!

    I’m more focused on pragmatism than philisophy right now. I believe that the incoming administration will be, too.

  • avatar
    buzzliteyear

    What amazes me is that people here don’t seem to realize that we pay these ‘taxes’ anyway!

    Just because we subsidize our car-centric transportation infrastructure through income taxes, property taxes, health insurance premiums, higher prices for fish, etc., does NOT mean that those costs are not paid in some fashion.

    http://www.icta.org/doc/Real%20Price%20of%20Gasoline.pdf

    The point behind a severe gasoline tax is to have drivers pay those costs, rather than income earners, property owners, people with asthma, etc.

    I do share people’s skepticism that our government (as currently constructed) can apply a gas tax in a rational way, and cut other taxes to reflect the transfer of these subsidies to the gas tax.

    But there is nothing ‘socialist’ or ‘ivory tower’ about the idea that people who purchase gasoline (or anything else) should have to bear the full costs of that product.

  • avatar
    Corvair

    When the price of gas spikes back up again, these same illuminati will be shrieking that the government still needs the $2.00 – $3.00 per gallon tax for its bloated spending programs. Welcome to $8.00 per gallon when the economy recovers.

  • avatar
    creamy

    “Further, regardless of the merits, anyone who attempts to pass a gas tax increase right now will be committing political suicide. That alone ensures that it ain’t gonna happen.”

    but they’ll be doing it for us! (ok, ok, enough with the politico-slant)

    they gave trillions of dollars of our money to companies that may or may not have needed it when the majority of us didn’t want them to, raising a non-income-based tax is small potatoes compared to that, especially when the price of gas is lower again.

  • avatar
    troonbop

    “the Left frets about society’s problems”

    But many of the problems the left frets about are only a problem to them, and involve people doing things of which they disapprove. Inevitably there is a government solution enforced.
    Advocates for high gas prices remind me of a member of royalty who fretted about increased public transit a hundred years ago. After all, he said, it will encourage the lower classes to “ride about aimlessly”.

  • avatar

    Typical. As if other sources of energy don’t produce carbon.

    This is an anti-personal transportation jihad.

  • avatar
    jaydez

    This sounds like a great idea!

    except for one point. Unless you live in a major city there is NO alternative to driving your car to get where you need to go.

    I live in CT and work in Hartford. I live 15 miles away and need to drive to work because there is next to no alternative to driving to work. I could take the bus, but I still need to drive to the commuter lot 5 miles from my house… That and as the price of gas went up, so did bus fares. I could carpool. But I don’t know anyone going from where I go to my building at work. I would also still need to pay for gas to carpool.

    If they want to tax the hell out of the only way to get around in 99% of the country, they better have a good public transportation system EVERYWHERE.

  • avatar
    50merc

    No point in joining the argument, because at root the differences stem from basic cultural values.

    The NYT never met a tax it didn’t like. It waves away objections with “fuel taxes could be offset with tax credits to protect vulnerable segments of the population.” Since nearly half the population already pays no federal income tax (many even using a 1040 to get money from Uncle Sam’s ATM), the “offset” idea is revealed as another redistribution scheme for social engineering.

  • avatar
    Toshi

    Detroit Todd, I fail to see how mention of hypothetical near-broke F-150 driving Walmart employees and drivethroughs (seriously?) equate to “pragmatism”. They seem more like disjoint ideas, not a financial plan for a nation.

  • avatar
    NICKNICK

    Toshi–

    Believe me, there’s no anti-intellectual bias here. I do, however, have a strong case of anti-busybody bias. Intellectuals are fine and are welcome to spout off all the solutions to the world’s problems. I’m okay with that as long as it isn’t enforced at the point of a gun. Do you understand that ALL laws, if resisted, will result in death or prison (rape)? So understand that what they’re saying is, “you’re not paying as much as we think you should for gas. pay more, or we’ll have you locked in the rape cage.”

    social engineers are more than welcome to shout from the roof tops “help the poor! give money to schools! hire minorities!” when those recommendations turn into commands backed by death or prison is when i get a little “biased.”

    In addition, we’ll need some sort of administrative body to levy the taxes, enforce collection, and perform accounting duties. The last thing we need is more government employees. The federal government employs more people than our manufacturing sector. Understand that the government PRODUCES NOTHING and can only be funded by taxing the productive sector.

  • avatar
    Detroit Todd

    Detroit Todd, I fail to see how mention of hypothetical near-broke F-150 driving Walmart employees and drivethroughs (seriously?) equate to “pragmatism”. They seem more like disjoint ideas, not a financial plan for a nation.

    I need not have an answer to all of the country’s problems to know that a $5.00 tax on a gallon of gasoline is a disastrous idea.

    BTW, what’s wrong with banning drive-throughs? What a horrible waste of gasoline they are. Also, how about a 4-day work week, where we can?

    There are many ideas, big and small, that could help as far as energy goes. What we cannot do is financially murder poor people. That’s wrong, under any circumstance. I also think it’s unnecessary.

  • avatar
    rottenbob

    I think this is a good idea, as it will encourage Americans to drive smaller, more fuel-efficient vehicles (that means less pollution and less money going to the middle east). But the revenues of this tax should be funneled to a project for developing a battery/capacitor to be used in electric vehicles; I’m thinking something that can be fully recharged in ~5 minutes with a range of ~300 miles.

  • avatar
    buzzliteyear

    I think the main political problem with a gas tax (other than reflexive public opposition to all taxes) is that our massive subsidization of oil/gas consumption has altered the very structure of our society over the past several decades.

    When gasoline is cheap (= massively subsidized), buying a McMansion in an exurb and driving many miles every day to work makes rational economic sense.

    If the hidden subsidies that make such a lifestyle possible are suddenly removed and replaced with a gasoline tax, the people who made the above lifestyle choice (as millions have) are in deep doo-doo.

    This principle extends in to the fabric of our society in myriad of ways (zoning laws, public transportation infrastructure, airport locations, food distribution, FedEx and UPS’s business models, etc.)

    A sudden imposition of a gasoline tax would severely disrupt this societal fabric.

    The best proposal I’ve heard to accomplish the goals of a large energy tax while giving society time to adjust is to impose a gradually ramping tax.

    Start with tax on gasoline (or oil) of $0.02/gallon (or the equivalent on crude oil). Then, every month, that tax increments up $0.02/gallon.

    After one year, the tax is $0.24/gallon. Not enough to seriously hurt anyone, but enough to get people’s attention.

    After two years (and one month), the tax is $0.50/gallon. Now people are really starting to pay attention.

    After five years, the tax is $1.20/gallon, and people start to seriously consider selling their Hummers, moving closer to their jobs, etc.

    After 20 years, the tax is $5.00/gallon, and people/companies who rationally planned for this eventuality are rewarded for their foresight and energy efficiency.

  • avatar
    tesla deathwatcher

    Rottenbob, using tax money to pay for research into new battery/capacitor technology is not a good idea. Throwing money at a technological problem has never worked. Plenty of people are already seeking the holy grail of an advanced battery/capacitor for an electric car. What stands in the way is not lack of money, but the laws of physics and chemistry.

  • avatar
    Detroit Todd

    Understand that the government PRODUCES NOTHING and can only be funded by taxing the productive sector.

    Whoa. Just have to say something about that. The gubmint produced this here internet thingy that we’re talking on right now. (No, not Al Gore. The Defense Department.)

    I’m against the increased gas tax, but I won’t cop to that kind of statement.

  • avatar
    buzzliteyear

    NICKNICK wrote:

    Understand that the government PRODUCES NOTHING and can only be funded by taxing the productive sector.

    In the immortal words of Stephen Colbert: “I believe the government that governs best is the government that governs least…and by that standard we have set up a fabulous government in Iraq”…:-D…

    I guess all of the government-produced roads, bridges, tunnels, airports, utility services, clean air, clean water, safe food, safe drugs, etc. that I see within and outside of my home are a mass delusion…;-D…

  • avatar
    mfgreen40

    The one thing that bothers me about raising taxes is the gov. will just piss it away.

  • avatar
    Rev Junkie

    Just because gas has gone down by half doesn’t mean the sting of $4 gas hasn’t gone away. People still want to have efficient vehicles even though gas is around $1.50 (this is the only good that will come out of people believing in global warming, wanting to reduce their “carbon footprint” by getting a car with good mpg). The economy is in the crapper, so the low gas prices won’t prompt people to blow their money on a huge gas-guzzling truck. How many of the new Rams and F-150s do you see on the road today? I don’t see that many and I’m in the South!

  • avatar
    tesla deathwatcher

    The government did not produce the Internet. DARPA did fund some research on networking. Government funding of research is valuable. But the government employs 23% of all workers. That is way too many, in my opinion, for the good that we get out of it.

  • avatar
    mcs

    NICKNICK :
    And *these* are the people that your media turns to for *economic* advice? How can a Harvard MBA help your company when they’re programmed to destroy capitalism.

    Robert Lawrence is a Professor at the Kennedy School of Government. Harvard Business School (the place where you’d go to get an MBA) is very pro-capitalist – at least it was when I was there. The Kennedy School and HBS are on opposite sides of the Charles and very different.

  • avatar
    ronin

    The purpose of taxation is to fund government. Anything more than that is regressive and unfair- taxing the middle class, taxing the poor, and sucking earned wages and redistributing it to the government. Sure, Professor Lawrence is really very pro-capitalist, in a Bolshevik sort of way, with Trotskyite overtones.

    Why not $10 a gallon? If central committee control is good (central committee of course being made up of dept of treasury, federal reserve, congressional ways and means experts, and of course ivy league professors with consistent track records of utterly incorrect predictions), why not $50/gallon? It’s all for the children, the workers, the middle class.

  • avatar
    JG

    I loved buzzliteyears idea of an incremental tax. It all fell apart when he mentioned the rank and file doing something called rational planning.

    People will _really_ change when they get cold, hungry, or both. Until then, let’s hope for cheap gas, foreign oil, big screens, and SUV’s for all! We’re programmed to want it and fight if it’s going to be taken away.

  • avatar
    carlos.negros

    NICKNICK wrote: “Am I the only one that views Ivy League credentials as a liability?”

    Fear not, you are not alone. Your views are shared by the Bush administration, and to a large extent, the Republican party. In fact, science, unless funded by the coal, oil, gas, or pharmaceutical industry, is also considered a liability.

    But, if you look at the case for taxing fuel, I think there is a free market component which goes like this: Instead of subsidizing the purchase of fuel-efficient vehicles or taxing fuel-inefficient vehicles, tax fuel and let the market respond by demanding more efficient cars.

    The end result is a more efficient fleet, lower consumption, less money for OPEC, less money to fund terrorism; more expensive energy imports, more competitive domestic energy sources.

    It is not really so far fetched. Just because the NYT gives a guest columnist a soapbox, and just because the person has devoted his or her life to research in this area; does not make the position automatically wrong.

  • avatar
    twinspop

    The bottom line is this: Gas will be $4 a gallon again soon, and likely a lot higher than that. Would you rather that extra were being spent within America on projects to break our addiction, or being sent to line the pockets of extremist-friendly regimes?

    Here’s to hoping Obama and Congress have the nuts to make this hugely unpopular move. IMO, America’s long-term viability depends on it.

  • avatar
    John Horner

    Volatility makes it impossible to plan. Just a dozen weeks ago people were talking about a conspiracy to limit Toyota Prius availability … and now Prii are stacking up unsold at the docks and on dealership lots.

    A governmental move which put some stability under retail fuel prices would indeed be a good thing.

  • avatar
    dhanson865

    Corvair – When the price of gas spikes back up again, these same illuminati will be shrieking that the government still needs the $2.00 – $3.00 per gallon tax for its bloated spending programs. Welcome to $8.00 per gallon when the economy recovers.

    OK, gas is under $2.00 a gallon now. $2 to $3 tax takes it to $4.xx. Even with an economic recovery it would only be $3.xx + the $2 or $3 tax or $6 max and that is only if you ignore that they said the tax is for a floor. As in it would be waived if the price of gas exceeded $5 a gallon.

    Detroit Todd – I need not have an answer to all of the country’s problems to know that a $5.00 tax on a gallon of gasoline is a disastrous idea.

    Again where is this bad math coming from. Where did you see mention of $5 a gallon tax? This isn’t $x.xx + $5.00 = price. This is $x.xx + x.xx = $5.00. As in gas + tax = $5.00 not tax it by $5 even if that makes $8 a gallon gas.

    Get a grip everybody this isn’t the end of the world even if they do it. Use proper math and policy interpretation and this won’t scare you so much.

  • avatar
    Jeff Waingrow

    It’s curious that an anti-intellectual pose is adopted when some point needs to be made, but ignored completely when not as useful. Here’s an example: the conservative economist Milton Friedman, one of the premier economic theorists of the 20th century (and a Nobel laureate), was certainly an intellectual. So he’s ok, right? He taught at Chicago. That all right? Most important, he was a free marketer if ever there was one. So who’s “side” is he on? I’m afraid these arbitrary distinctions (and slanders!) are both specious and exceedingly self-serving.

  • avatar
    ttacgreg

    If We The People would get off of our lazy mental asses, pay attention to government as it is framed by the Constitution, and exercise something more than a grade school mentality and intellect when voting, then efficient, functional government can in fact be “government of, by and for the people”, and taxes are what we pay back to ourselves to construct civilization and public works.
    “Let the markets decide” is code for allowing mafioso rule of our lives. Let the market decide, it chooses economic booms and busts, and extreme polarizaion of wealth concentration, and even wars for profit (Halliburton and Iraq, anyone?). The free market is like nuclear energy or a wild horse, let it run free and wild, it is destructive. It must be harnessed and controlled for it to be beneficial.
    Government, “We the People” must through legal structures and tax incentives, direct the nation in noble and far sighted directions that shortsighted greed-lusted free market thieves would never do.
    High gas (or better, all non renewable carbon based energy)taxes will produce conservation, thus lowering the $$$$$ sent to oil kingdoms and oil mega corporations, and feed that money back to us in the form of beneficial public works.
    I’d gladly pay at least $3 per gallon tax on gas knowing that that tax money is used to better society’s economic, strategic, health security, and more.
    And hey, Ronald Reagan worshippers, it is idiocy to put people into government who claim government does not work, because of course they will then make sure it does not work, and smile and say “see it is true”.
    Gas should be 5-10$ a gallon.

  • avatar
    BMW325I

    How about a tax on the size of the engine? As much as I like cars I would plainly refuse to drive anything bigger than a motorbike if that passed. Or up the gas guzzler tax on the brand new trucks and suvs.

  • avatar

    A fixed floor is a bad idea. If the government tells you they are going to charge $4 for your gas if you price it lower, then you will just price it at $4 since you lose nothing by doing so… Government won’t really get that much revenue by a pure floor tax.

    How about we just pay for all road and transit based infrastructure and expenditures out of it? So rather than a floor, if we want to go fight oil wars, then we gotta raise gas prices to fund those wars. Or, more importantly, highways, roads, etc… (and isn’t it time we stop subsidizing cars with free street parking? I pay for my parking, why the hell should people be able to use public space to store private items?).

    Frankly taxes are going up no matter what. The government needs the money for public spending, and it has to come from somewhere. I have no problem with taxes, I am just sick of Republicans setting up programs to fail so that the money is wasted – I want return on my tax dollars.

  • avatar
    Pch101

    Oil dependency increases our trade deficit, because we need to import much of what we need.

    To support a trade deficit, the country has to effectively borrow money to pay for it.

    In essence, we are borrowing money from Asia, Europe and the Arab world, with interest, just so that we can send it back to Canada, Venezuela, Mexico and the Middle East.

    It really doesn’t make sense for the US to keep prices low on a good that it has to import in such large quantities, transferring large amounts of wealth to its opponents in the process. We are setting ourselves up for long-run economic failure, and I’m reluctant to wreck the country for the sake of somebody’s small block V-8.

  • avatar
    jkross22

    The NYT giving fiscal advice? How’s their circulation and profit looking these days?

    The inherent distrust of government is a relatively new thing. Unfortunately, most politicians now profit from being in office and afterward at the expense of the general population.

    This was less the case in the Harry Truman era.

    So, all you tax proponents – please take a look at what our gov’t has handed out to banks, GM, Cerberus, GMAC, etc. and tell me you have no concerns that they’ll actually spend these big tax increases on what they say they’ll get spent on.

  • avatar
    nonce

    Whatever you tax, you get less of. So it’s much better to tax consumption than production.

    But the unwashed masses are very irrational about gas taxes. Make ‘em pay five thousand dollars a year in income taxes and they’ll bend over and take it. Suggest switching that for four thousand in gas taxes and they’ll have a freaking fit. Behavioral economists will tell you this is because the gas tax is something they see frequently.

    Remember how every single economist in the nation came out against Hillary and McCain’s plans for a gas tax holiday? It was hilarious watching Clinton try to spin that on the news programs.

  • avatar
    Detroit Todd

    @ttacgreg,

    I agree with much of what you say. I think the “free-market” binge has brought us to yet another economic calamity.

    But I’m not going to live in one of these, and I will not drive one of these.

    We’re Americans. We’re supposed to innovate our way out of crises. And we will. We should have started down the road a long time ago (President Carter warned us, and was mocked for his trouble).

    BTW, no one has yet said what happens to the poor if this exhorbitant gas tax were to pass, other than they’re supposed to wait until tax return time to receive an “offset.” Under this proposed tax scheme, if mass transit is unavailable to you and you can’t afford to purchase an efficient vehicle, you’re screwed.

    In my opinion, the country needs another FDR (others’ mileage may vary). FDR didn’t set about reforming the country by cutting the throats of working people. He did quite the opposite.

  • avatar
    Pch101

    So, all you tax proponents – please take a look at what our gov’t has handed out to banks, GM, Cerberus, GMAC, etc. and tell me you have no concerns that they’ll actually spend these big tax increases on what they say they’ll get spent on.

    The purpose of the gas tax would be to reduce the consumption of oil. The proceeds of the tax should be used to pay off the debt that we incur by importing it. Since you can’t import for free, those who are doing the importing ought to pay for it.

    The banking system was brought down by ideologues who didn’t like the idea of regulating it, just because. Their failure to regulate encouraged bankers to use too much debt.

    You can now see what happens when the use of debt spirals out of control.

    Consuming more gas only adds to this debt problem. In effect, the same ideologues who brought you this crisis are setting you up for an even bigger one later.

    Either you pay the freight now by using less, or else you pay for it later, with interest.

  • avatar
    tced2

    The NYT thinks all your income belongs to the government. Thus we have discussions about how much lowering some tax “costs” the government. I am certainly tired of the eggheads at the NYT telling me what something should cost. We let markets determine the price – not some theoretical economist who has an agenda (he doesn’t want anyone driving any cars at all to save the environment). Well the United States isn’t like New York city – we have large distances to cover and can’t hail a cab.

    The government is incapable of truthfully distributing the tax on gasoline. It’s supposed to support road construction and maintenance. But each year there is a “surplus” (what is not spent on roads) and that “surplus” is spent on other things – plush carpet for the halls of governement, etc. ALL the money collected from sales of gasoline should be spent on roads. If any is “surplus” then lower the taxes – don’t spend it on something else.

  • avatar
    nonce

    I have to run, so this is a very back-of-the-envelope calculation:

    US gets $1.2 Trillion from income tax.

    US emits 6 billion tons of CO2 a year.

    So at $200 a ton, we can replace the entire income tax with a carbon tax. A gallon of gasoline makes about 20 pounds of CO2, so we’re talking about a $2 national tax on gasoline, in exchange for totally eliminating the income tax.

  • avatar

    The proceeds of the tax should be used to pay off the debt that we incur by importing it.

    The US government incurs little meaningful debt to pay for imported oil. Rather, it’s a wealth transfer.

    Regardless, paying off debt is pointless without a balanced budget spending rule with teeth. If we reduce deficits, politicians will fill the gap with other spending.

  • avatar
    reclusive_in_nature

    I’d love nothing more than to see the first socialist/elitist/what-the-hell-might-as-well-say-it-COMMIES that try to pass such legislation get thrown right out of Congress. Only a tiny minority of people want this. The rest of us (the proletariat as some would call us….) do not want gasoline taxed higher and it’s reflected in our elected officials. Don’t like it? There’s plenty of third world and even a few industrialized countries that’ll be more than happy to have you. I’m sure their ideas of forcing “the common good” on it’s people won’t bother you at all. To make a long rant short, THANK GOD WE LIVE IN A COUNTRY WHERE OUR PEOPLE DON’T PUT UP WITH THAT SHIT.

  • avatar
    Driver23

    Let’s begin with naming things their real names. SUV is not a truck and hence buyers should pay gas guzzler tax. For some reason V8 is taxed in a sedan and not taxed in an SUV. Just make sure truck definition implies flatbed and not luxury barge.

    Raising tax $0.01/0.02 per month is a great idea. For some reason people assume it will be impossible to drive cars with $8 gas. Well, get smaller mortgage, buy smaller car (yes, you DO can fit two adults and two children in a Corolla and no, you do NOT need SUV or minivan for this – just take less crap with you), spend less eating out (we are too fat anyway).

    Oh, and how about forgetting about green stuff and just make sure Arab countries stop getting our dollars? Remember whom you are paying when you are filling up.

    It is so sad to see how people are happy to fund communist China (remember where and how that t-shirt was made) and absolute monarchies of Middle East while screaming on top of their lungs about freedom, democracy and American traditions.

  • avatar

    WOW. Love how a post about an NYT article on taxation really brings out the Commies! -What fun!

    Dyer, at least in this case, seems like the Fire Marshall Bill of econ theorists.
    -The same way some traders will have “Wrong Way” Indicators. They don’t always know what’s going to happen, but they Do have one source who Reliably does Exactly the wrong thing at the Wrong time.

    Is this tax proposal Dyer’s idea of a little “NSFW You” Christmas present to all the people out there who may at least be getting ONE (1) break in the recession???!!? -that of $1.55 gas.

    I guess it’s fine if you’re a New Yorker and don’t own/drive a car, so you can say NSFW-Off! to all the B&T commuters???

    +You’d REALLY have to be a Commie to think that the USG is going to properly allocate Your money better than you would; (above a certain level of basic public services).

    The proceeds of the MADNESS of this idea would simply be used as Kobe-Mishima-Bacon Grease lube for the All-Night Nude Wrestling Triathlons in the basement of the Capitol building, with Dick Cheney greasing-down Nancy Pelosi in a vat of $100,000 bills, with the major Undercard being Karl Rove vs. Barbara Boxer in an olympic-size swimming pool full of the world’s most expensive Caviar, where they paddle gold-plated kayaks in a relay race to see who can roll the world’s biggest spleef with outlawed $20M Bearer Bonds as the wrapper.

    ->nothing more than PENNIES on the dollar would get near Anything that serves the public.

    THEN: The Prices of ALL GOODS go through the Roof. -For ALL people, even the downtrodden poor who have to walk to the bus b/c they can’t afford to gas the cars.

    And when they finally Do make it to the supermarket to pay for the milk, which is now $7.50 per gallon instead of $4 (remember that milestone?), they will be able to afford little else; -because anything that moves by Truck or non-electric Train will Forcibly have the costs baked in.

    ->b/c Producers, esp. those who can dictate prices (1 way/another) are NOT eating those costs.

    And then you get to the Lovely Land of truly Unintended Consequences.

    =>Whereby the Saudis and Chavezes of the world get the Intel, have a look and collectively say, “لماذا لا المسمار منها بعض أكثر؟ ” .

    ->Which of course, they do. And now the gas they sell Comes In To Us at $4+/gal and they let the USG either: a)Add the $2.50 tax to it if they still want to play Stalin, or b)Suck on the Vacuum that the 2nd-Mover-Advantage of the int’l Price-Collusion has just boomeranged back upon them, Thus Exporting EVEN MORE of our $$$ to the natural ‘hood of people who all own the T-Shirt and the Chromed Veyron that says “Osama Is My Homeboy” -right on the front.

    I guess this post was to serve as a bit of Year End Comic Relief at the expense of Ivory Tower Communists, but you could still borrow my textbooks and see if a Commie is capable of Synthesizing and Crunching the ISLM on the Folly of this most Ill-Timed, Auto-Immolationist of Pork-Barrell Reacharounds.
    (I don’t think he could; -better call Hicks.)

    Resume complainings of Fat Detroit Blockheads, moi tovarishshi.

  • avatar
    virages

    Sorry I’m late to the party in this thread. Let me say it, that my vote goes for the gas tax and it’s one of the issues that in my opinion should be raised in the US.

    However the issue of the impact that a gas-tax might have on the poor is real. Especially if it was enacted on a massive sudden hike. People with little means don’t have time to adapt. But if added progressively, the effect will be to get people to drive more fuel efficient cars, and choose wisely when buying homes in proximity to their jobs. I would agree with buzzliteyears progressive plan, but also add a little incentive that is presently being enacted here in socialist France.

    Some of the gas tax should be used for a “beater to the crusher” stimulus package. IE the govt. buys your polluting old car if it is sent to the beater and you buy a new fuel efficient car. This works in many ways. People with out many means can adapt in getting a new (cheap, economical, small) car with a trade in that is worth more than their old car (88 buick, 10 year old F150…). This at the same time gives a stimulus to the detroit automakers (if they are able to make efficient cars, cough*cobalt*cough!) without just a hand out that is squandered.

    There you are: Progressive gas tax plus “beater-to-crusher for new car” subsidy = Less CO2, plus aid to poor plus indirect stimulus to detroit if they make efficient cars that people want to buy. Thats my utopian idea. Until then I’m staying in France with my 5€ gas, and great food.

  • avatar
    virages

    For more info. The “crusher” subsidy here in France is €1500 for a car more than 8 years old… and is pretty well targeted to the low income person that wants to trade in his dilapidated Le Car or Supercinq for a shiny new €10K Logan… some dealers with the current market situation are doubling the subsidy along with other discounts… including the low CO2 subsidy that can be as much as €1000… this means that if you have a beater to put down, a new Twingo or Citroen C1 can be had for about 6K.

  • avatar
    menno

    My figures may be a bit off (being estimates) but it’s only by way of example anyway, so here goes.

    First; if we had any true patriots as politicians instead of seditionist treasonous thieves (Ron Paul and a few others excepted), they would have left alone the clear intent and words of the US Constitution, where it allows for taxation through import tariffs and (federal) excise taxes.

    So, it is self-evident that their ideas woulkd have worked well even through the great build-up of the oil based economy.

    As things happened: without proper import tariffs, the big oil companies started to locate, extract and send crude oil from “other” parts of the world, which had the obvious effect of keeping prices low, but also making it impossible for alternative fuels to take hold (such as, for example, gasoline derived from coal, as Sasol do in South Africa even now).

    How it could/should have been: import tariffs on crude oil would have obviously meant that energy companies would have a huge (profit) incentive to actually produce energy IN the United States FOR the United States. Necessity being the mother of invention, etc, we could have innovated our way towards alternative sources of fuel by gradually seeing fuel prices go up due to the simple reason that as US oil supplies diminished and imports increased, import tariffs on crude oil would have added to the fuel costs and US sourced alternatives would have naturally come along.

    Given that we now (foolishly, we can all no doubt agree) import some 2/3 of our energy needs, it is easy to see that as a nation, we essentially are being held by the short & curlies and are at the mercy of our national enemies. Therefore, ergo, it is simply common sense that in forms us that we clearly have gotten it wrong.

    Just one “for example”; by the early 1960′s, we were faced with a two pronged problem; air pollution (which NOBODY wanted) and by about 1968, “peak US oil” after which imports increased to 1/4 of our supply by 1973 when the Arabs got mad at us for not allowing the genocide of the Jews, and turned off the oil spigot.

    Interestingly, Rover, Austin, Armstrong-Siddely (UK), Volvo (Sweden), Chrysler, GM, Ford, Williams Research (US), and Fiat (Italy), and others, were working on gas turbines for automobiles.

    In 1961, Rover came “thaaaat close” to actually introducing a regenerative gas turbine automobile, which obviously could have been fuelled by coal-derived kerosene. The emissions of this 150 hp engine, called the 2S/150R (2 shaft, 150hp, regenerative) gas turbine were sufficiently low when tested in 1967, to pass the super stringient, then planned 1976 US emission standards (which in fact came about some 8 years later).

    A little American ingenuity, as seen in a 1976 Mechanix Illustrated article, could have solved two of the gas turbine’s major problems by the late 1970′s; throttle lag and city fuel consumption; the article in question was about the invention of a hydraulic hybrid system using Volvo hydraulic elevator pumps behind an IC engine running at constant speed and cycling on and off.

    A regenerative, single shaft gas turbine cycling on and off via a hydraulic hybrid drive (with regenerative energy recapture electronically enhanced), fuelled by coal derived fuel NOT imported into the US; NOT imported into the UK; NOT implorted into Germany, etc., would have obviously meant that the middle eastern tigers would have been neutered and defanged before they could threaten anyone with murder and mayhem due to the excessively high profits made from exporting what providence gave them under their feet.

  • avatar

    In my opinion, the country needs another FDR (others’ mileage may vary). FDR didn’t set about reforming the country by cutting the throats of working people. He did quite the opposite.

    Amity Shlaes has written extensively about how FDR’s policies in the 1930s extended the Great Depression. What ended the depression was the buildup to WWII.
    http://www.washingtonpost.com/wp-dyn/content/article/2008/08/17/AR2008081702079.html

  • avatar
    Detroit Todd

    (yes, you DO can fit two adults and two children in a Corolla and no, you do NOT need SUV or minivan for this – just take less crap with you),

    Why stop there? Really, a person only needs about 400 sq. ft. to live confortably. So, if yours is a family of four and your home is over 1,600 sq. ft., let’s tax the hell out of you! Heating/cooling/lighting that excess space is bad for the environment, and you should really get rid of a lot of crap anyway. Right?

    Oh, and let’s also say you’re allowed to use a certain amount of electricity/natural gas a month, whatever is deemed “necessary.” Let’s tax the bejesus out of your “overage.”

    Does every little Ian and Chelsea need his/her very own cellphone? What about the electricity usage and spent batteries in landfills? Let’s say only two cell phones per household are “necessary,” and levy a $100.00/month tax on any additional lines/phones. (We all managed to get through our childhood without phones, didn’t we?)

    There should be 1,000% tax on fast food, because of our obesity epidemic, the clear-cutting of rainforests to raise the beef, etc.

    Here’s the thing – I do believe we need to get off foreign oil and reduce our deficit. I’m not a conservative, and I do believe in government intervention into the economy. I also believe that taxes are the price we pay to live in a civilized society.

    BUT, I do not believe in onerous taxes based upon what others decide I really need, or don’t need. Where do you draw the line? Where do you start and stop?

    What happened to leadership in this country? Instead of asking everyone to go shopping on 9/11, where was the call to conserve energy and reduce our dependence on foreign oil?

  • avatar
    BenFarmer

    I think that the government could have a role in gas prices, but stabilizing them at a predictable level is more important than forcing them high or forcing them low. Consumers can adapt to gas prices at $4.50 or even $5/gallon. If gas prices go from $2/gallon to $5/gallon and you go from a car that gets 18 miles per gallon to one that get 40 miles per gallon the dollar cost to you is minimal. In the long term you can also move closer to work or get a job closer to home. There may be a cost in comfort and safety, but you can adapt to low prices or to high prices. The thing is, it takes time.

    What happens when gas prices spike? Well, you already have your car. You already have your house or apartment. It takes time and money to change that. You can’t turn on or off energy supply or demand to any great extent in the short run. You need time and a reasonable idea of what the future cost of gas will be, then you can make investments based on that price.

    I would like to see governments of the gas consuming countries get together and set a price per barrell that they agree is reasonable. Once the current economic mess gets straightened out (assuming it does) they steer the price of oil into that range and keep it there. If it goes lower they buy and store oil. If it goes higher they sell stored oil until the price goes back into the agreed upon range. I would say leave the price alone for now. The gas price collapse put $150-200/month back into the average family’s pockets and that is helping prop up the economy a lot more than most of the things the government is doing. In the longer term I would say shoot for $60-70/barrel to start with and set the target to go up about 5% per year. That will give consumers and businesses time to adapt and a handle on what they’re going to be adapting to.

  • avatar

    Charles Krauthammer has a much better suggestion, a net zero tax on gas that raises the retail price to $3/gal and is offset by a $14/week reduction in FICA taxes. That way the net cost to taxpayers/consumers is zero and encourages energy conservation and makes alternatives more financially viable.

    http://weeklystandard.com/Content/Public/Articles/000/000/015/949rsrgi.asp

  • avatar
    PeteMoran

    @ reclusive_in_nature

    I’m sure their ideas of forcing “the common good” on it’s people won’t bother you at all. To make a long rant short, THANK GOD WE LIVE IN A COUNTRY WHERE OUR PEOPLE DON’T PUT UP WITH THAT SHIT.

    Unless you can ensure everyone is equally informed or equally educated about every aspect of any choice they make, it will always be necessary to provide rules and decisions for people.

    No country can afford to go on wasting energy collectively. Until you understand why, perhaps it’s best to let people make the decision for you.

    The rest of the world is already reaping the “benefits” of the USA’s Laissez-faire decades.

  • avatar
    Bridge2far

    “it will always be necessary to provide rules and decisions for people.’
    Very telling…

    What a surprise that the New York Slimes endorses higher taxes!

  • avatar
    Dr Lemming

    Willman: “I guess this post was to serve as a bit of Year End Comic Relief at the expense of Ivory Tower Communists, but you could still borrow my textbooks and see if a Commie is capable of Synthesizing and Crunching the ISLM on the Folly of this most Ill-Timed, Auto-Immolationist of Pork-Barrell Reacharounds.”

    This is what I enjoy about TTAC — a sophisticated, civil conversation where terms such as “communist” are used to communicate clearly and precisely rather than to taunt or demonize.

  • avatar
    Hells

    Well, to all those who are preaching that raising gas to 4-5 would spell economic doom for an already burdened family, how about implenting a car tax instead that scale with effiency?

    The net effect would be the same, but it wont punish users who have already bought one.

  • avatar
    carlos.negros

    Ronnie Schreiber: I don’t usually agree with Charles Krauthammer, but he may be on to something this time. Despite all the knee jerk reactions from the John Birch Society types, this suggestion is far less intrusive than many others, including CAFE standards and the guzzler tax. It is also a fairer way to pay the real costs of the oil industry such as the military and environmental costs.

    The beauty is that if gas is $3-4 per gallon, consumption will decrease and thus lower demand which may keep the prices stable for a while. The danger is what happens if/when the cost of gasoline exceeds $3-4 per gallon.

    I think there needs to be an exception for diesel since higher diesel prices push up the cost of food. People on fixed income, such as retirees, would not benefit from a cut in the payroll tax and would have to pay higher food prices.

  • avatar
    johnny ro

    This is pure politics and economics on a car site.

    Well here goes.

    I am not sure about Harvard but of course gasoline should cost more. We don’t have it here in USA ( how many percent is domestic?), it comes from unfriendly states, and we pay for it with Chinese loans which we have no hope of paying back and they know it.

    Use the $ raised to pay for nationalized healthcare. And infrastructure. Then whatever jobs are left will cost less for employers and will leave more slowly.

    The day of reckoning is postponed a few weeks, not a few generations. Lets get a grip here.

  • avatar
    Durask

    I have a simple suggestion.

    No New Taxes.

    If you combine my taxes, I already pay over 40% of my income to federal/state/SS/town – and that’s not counting sales tax.

    Enough is enough.

  • avatar
    trk2

    I can’t believe how many people want more government involved in their life.

  • avatar

    Ian and Chelsea

    LOL. My ex SIL & BIL have two kids named Ian & Chelsea. Not sure if they have cell phones. One is in college and the other lives with her folks in Italy where her dad serves in the US Navy.

  • avatar
    Bridge2far

    Durask-

    The best and most precise comment so far-

    What a concept! NO MORE tax increases! Keep your damn hands out of my pockets!

  • avatar

    Use the $ raised to pay for nationalized healthcare.

    Nah, First Thing We Do, Let’s Tax The Lawyers.

    They make everything more expensive, particularly health care.

    Bridge2Far, that’s what’s interesting about Krauthammer’s proposal because any gas tax increase would be offset by a similar reduction in FICA taxes. No extra money for Washington to play with.

  • avatar
    improvement_needed

    wow – what a bunch of mis-informed people throwing ideas around.

    Who in their right mind thinks that the government would impose a straight 2-4$/gallon tax starting (say jan 2010)?
    Of course they wouldn’t.
    It would be a progressive tax, like suggested.
    A 2-3 cents/month increase sounds about right.

    Also the wording of the ‘article posting’ is manipulative and misleading (though, this isn’t TRUTHFUL, it definately makes for a heated discussion, possibly higher internet traffic and thus potentially higher revenue for the site).

    It is written:
    ““If the Obama administration is to meet its twin objectives of reducing the nation’s dependence on foreign oil and cutting its emissions of greenhouse gases, it needs to start thinking now about mechanisms to curb the nation’s demand for energy when the economy emerges from recession in the future.”
    Interesting. Put that one on the back burner for us, will ya? Thanks.”

    Well, by putting energy independence on the back burner, the US got itself into its current mess.

    All the NYT is saying is:
    Hey, we have a problem, but one of the best solutions would hurt the working and under class in our nation because we (the country) screwed up and have a recession. In the mean time, we should do the background work, so that when we recover from our recession, we can actually take some ACTION to reduce our dependence of foreign oil.

    sounds like a good idea to me. work ahead!

  • avatar
    Driver23

    “Why stop there? Really, a person only needs about 400 sq. ft. to live comfortably. So, if yours is a family of four and your home is over 1,600 sq. ft., let’s tax the hell out of you! Heating/cooling/lighting that excess space is bad for the environment, and you should really get rid of a lot of crap anyway. Right?”

    Right. And it is already happening. Last time I checked my property tax numbers and utility bill, price per cf og natural gas and KW of electricity goes up cost more per unit above certain threshold.

    Actually, this is right approach. You can still own 5000 sq ft home and if you feel utility bill is a bit high, maybe switching to a more efficient furnace, lowering temperature by couple of degrees (and wearing a flannel shirt instead of t-shirt) and using fluorescent lights is in order? Besides, we are talking about taxing gasoline, although taxing fossil fuels in general may be good too. However, nobody is saying you should pay more per kilowatt for solar, wind, geothermal or nuclear energy, for example. Feel free to heat your mansion and charge your 500hp electric car.

  • avatar
    dzwax

    This gas tax would help redistribute more money from the rural south and west to the large cities in the east. No wonder the NYT supports it.

  • avatar

    @Dr Lemming: Awesome! +You’re welcome. The more I write, the more fans I have, it seems.

    ++You should also check out the other 13 funny & intelligent (paragraph+sentences) in the rest of my comment.

    I also write an even funnier and more intelligent health weblog over at http://metavitae.com; -check it out.

    Anyway: Cheers, man! -Glad to have you aboard! Best :D ,
    -W

    PS: Hey, If/When my book finally comes out, I’ll get you on the mailing list if you want.

  • avatar
    thoots

    Well, I’m with Detroit Todd :

    I think we’d be more likely to see Congress vote for compulsory homosexuality than to pass a huge gas tax (even an incremental one). It would be torches and pitchforks time.

    It is political suicide for a politician to vote for an increase in any gas tax. Oh, sure, raising gas taxes is about the only effective way to reduce consumption and perhaps help relieve our dependence on foreign oil, but the population just won’t stand for it. Someone go compile how many times gas tax increases have been defeated by voters in the US over the past 20 years, vs. how many have been approved. “If any” have actually been approved.

    Pitchforks and torches, indeed. More like strafing runs over Capitol Hill.

    Oh, and let me try to give you a look at U.S. oil production vs. imports. It’s always just “a snapshot in time,” but here’s some good perspective from 2006:

    The U.S. produces 5.1 million barrels (34%) of crude oil per day while importing 10.1 barrels (66%) per day. The top five countries we import from on a daily basis are:

    Canada – 1.8 million barrels
    Mexico – 1.6 million barrels
    Saudi Arabia – 1.4 million barrels
    Venezuela – 1.1 million barrels
    Nigeria – 1.0 million barrels

    In total, 79% of all imported crude oil came from non-Middle East OPEC countries in 2006.

  • avatar
    Dr. No

    Count me in!

    If higher taxes on gas are accompanied by lowering them elsewhere, I like the idea. Look, no one likes taxes, but taxes aren’t going away. Look at all the benefits:
    1. We will likely use less gas (environment)
    2. We pay ourselves instead of Saudi Arabia (on the premise we use less)
    3. It will incentivize new energy sources (clean).
    4. Encourage smaller vehicles, which are more friendly to the environment
    5. Less traffic, hopefully

    Among all the taxes we impose on ourselves, a gas tax will be the easiest tax to minimize, or avoid, at the individual level. To wit, the alternatives:
    a. Car pool
    b. Buy a more fuel-efficient vehicle
    c. Take the bus
    d. Move closer to work

    Dr. No in 2012…

  • avatar

    A gas sales tax does not reduce foreign oil dependence. As demand drops, we’ll stop buying from the most expensive sources first, which means domestic-sourced oil purchases will plummet.

    The only tax that will reduce foreign oil consumption per se is a tariff. But I do not want us to tariff ourselves into another depression…

  • avatar
    golden2husky

    Skip the gas tax. As I’ve posted before, use a registration surcharge for vehicles that don’t meet a certain threshold. We do have a choice in what we buy. We often DON’T have a choice TO drive. So a blanket tax is unfair. Some have pointed out that the government should just stay out of the fuel tax BS entirely, but what happens when cheap gas goes away again? Unless there is a continual effort to improve efficiency, we will be sitting ducks again, just like in the past. When fuel is too cheap, there just isn’t any effort made to be prepared for a spike in prices. Will America ever learn from history? This has noting to do with socialism or being a “commie”; it is just good sense. Often the free market approach is best, but not in this case, IMHO.

  • avatar

    Vehicle tax = interventionist & politicians make value judgments & nanny.

    Gas tax = consumer makes best decision for himself.

    golden2husky: We do have a choice in what we buy. We often DON’T have a choice TO drive.

    You’re contradicting yourself. Regardless, 10 year phase in makes it fair for everybody.

  • avatar
    Geotpf

    I don’t see the following as problems:

    1. Buying oil from the Middle East
    2. High greenhouse gas emmissions

    #1 isn’t a problem unless we make it a problem. That is, they have oil, we have money, we give them money, they give us oil, everybody’s happy. Osama Bin Laden doesn’t have any oil. His enemies, the House of Saud (who control Saudi Arabia) do.

    We make it a problem if instead of us giving them money, we instead bomb the crap out of them. But there’s no reason for us to do that, unless we are idiots like the soon-to-be-ex-President.

    As for #2, I should be more specific. Global warming is real. But there is absolutely no way to stop global warming by reducing greenhouse gas emissions. It simply isn’t possible in the real world; it won’t work. There’s no way to reduce carbon emmissions by enough to end global warming without banning modern society (which won’t happen, as the populous will revolt and vote in new leadership before it does). The way to solve global warming is by artifically creating global cooling on a massive scale. There are perfectly viabile ways to do this.

  • avatar

    The way to solve global warming is by artifically creating global cooling on a massive scale.

    Very bad idea. Read The King, the Mice and the Cheese and study up on the law of unintended consequences.

  • avatar
    ronin

    Everytime I talk to people who are in favor of raising taxes, I ask them one thing: Since they are so obviously passionate about other people paying out more of their earnings, how much of them have put their own money where their mouth is?

    People who believe it is the duty of American taxpayers to be compelled to give free money to GM, for example. I ask them how deeply they’ve already dug into their own pocket and sent a check to the Ren Center. So far, no takers.

    So for those in favor of this tax: Keep your receipts when you fill up. That ought to be about a hundred or two a week you voluntarily send to the central committe to demonstrate your solidarity.

    Raise your hand you who have done this.

  • avatar
    don1967

    As the oil price bubble heads into the history books forever, leave it to a left-wing intellectual windbag to make a desperate last-minute grab for our money before we get used to having it back.

    Perhaps we should put a tax on Harvard economists.

  • avatar
    don1967

    The way to solve global warming is by artifically creating global cooling on a massive scale.

    The way to solve the problem of global warming is to control solar flares and ocean currents, just like the way of solving the problem of sunrise is to stop the earth’s rotation.

  • avatar
    Pch101

    Everytime I talk to people who are in favor of raising taxes, I ask them one thing: Since they are so obviously passionate about other people paying out more of their earnings, how much of them have put their own money where their mouth is?

    An increase in fuel taxes is going to affect everyone, so the question isn’t meaningful. Even those who don’t drive will absorb some of it when businesses pass on some portion of it to consumers.

    In any case, there is a specious logic underlying your comment. You assume that if it isn’t taxed that the alternative is to save money.

    It isn’t. When the US has to borrow from the rest of the planet to support the trade deficit, that costs us something. When an increase in consumption increases the world price of oil, putting more cash into the pockets of petrodictatorships like Saudi Arabia or Iran, that costs us something. When the US goes to war to ensure that it has oil, that costs us something. When there is environmental degradation or damage to someone’s health because of it, that costs us something.

    A failure to act is still a form of action. None of the choices are free. The choice isn’t whether you get to avoid paying a price, but of choosing which price that you’d rather pay.

    Just because you don’t see it on the price signboard at your corner gas station doesn’t mean that you’re getting away with not paying for it. In the scheme of things, the tax may actually end up being cheaper than the lower gas tax alternative, when everything else is factored in.

  • avatar
    Bridge2far

    “I ask them how deeply they’ve already dug into their own pocket and sent a check to the Ren Center. So far, no takers.”

    Did you ask if they purchased a GM vehicle instead of an import?

    Also, Global warming= bunk.

  • avatar
    Driver23

    I don’t see the following as problems:

    1. Buying oil from the Middle East

    #1 isn’t a problem unless we make it a problem. That is, they have oil, we have money.

    Except we don’t have money. Look at the trade deficit, US national debt, state of banking system and social security program.

    Or did you mean “our credit cards still work” instead?

  • avatar
    don1967

    “Just because you don’t see it on the price signboard at your corner gas station doesn’t mean that you’re getting away with not paying for it. In the scheme of things, the tax may actually end up being cheaper than the lower gas tax alternative”

    And just because you’re paying an extra tax doesn’t mean you’re accomplishing anything. Giving a dollar to the government is the quickest way I know of turning it into 12 cents. Trust me. I’m a Canadian waiting for my government to provide an MRI of a shoulder injury… they tell me sometime next spring or summer.

    I would advise all Americans to think twice before embracing twisted socialist logic.

  • avatar
    Pch101

    I would advise all Americans to think twice before embracing twisted socialist logic

    The ghost of McCarthy lives on. The internet definition of “socialist” has been changed to mean “people who disagree with me.”

    Those who are concerned about managing the trade and budget deficits are actually fiscal conservatives, not socialists.

    Trade and budget deficits have to be supported with borrowing. Borrowing isn’t free, it requires paying the interest, plus repaying the principal.

    That money has to come from somewhere. If the debt isn’t eventually repaid from tax revenues, then you have to borrow even more money to repay what was borrowed before.

    It’s really odd how so many American conservatives have stopped acting like conservatives. They use the federal treasury like a Visa card, continually hoping that the bank will just keep raising the limit and lowering the minimum monthly payment. If concerning myself with fiscal management makes me a Commie, then bring on the hammer and sickle, comrades.

  • avatar
    psarhjinian

    As the oil price bubble heads into the history books forever, leave it to a left-wing intellectual windbag to make a desperate last-minute grab for our money before we get used to having it back.

    Oh, yes. Forever. I’m sure gas will never, ever get more expensive in an unexpected fashion. Just like we should never, ever have another economic hangover after the one in 1982. Or 1991. Or 2000.

    At least the intellectual wind-bag actually has a theory. All you have is rhetoric and name-calling.

    I’m a Canadian waiting for my government to provide an MRI of a shoulder injury… they tell me sometime next spring or summer.

    Whereas in the US, you flat-out wouldn’t get that MRI unless you can pay for it, or have insurance, which most people don’t. It’s not all pixie dust and roses.

    If you want to live somewhere without a social safety net, you’re free to move to the US, Central America, or much of Africa. You’ll have ample opportunity to flex your free market muscle as a warlord in Rwanda or Chad.

    Also, Global warming= bunk.

    I’ve really tried to ignore the postings to this effect, but I don’t think I can hold back a whole lot longer: Global Warming is the thirty-second soundbite version of what actual scientists call Climate Change. On one side of the debate, we have peer-reviewed journals from real scienists with independent funding; on the other, we have TV weathermen, oil-industry focus groups and right-wing think-tanks who cherry-pick theories to discredit them and treat science like a civil lawsuit.

    Find me one, real, peer-reviewed study that disputes human-derived climate change. Just one. And no, claiming a left-wing conspiracy doesn’t count, not when other equally contentious topics have been published. I’ve found studies on other politically-sensitive topics (homosexuality and eugenics, notably), so it’s shouldn’t be too hard.

    Except, of course, there isn’t one. You’d think that there would be. After all, cold fusion got published, and that was obviously bogus. The dollars available to any real climate scientist who could publish a paper debunking GCC is significant, as would be the fame and recognition. Yet no one has grabbed the brass ring.

  • avatar
    Michael Ayoub

    Let’s artificially raise the price of gas so that people have less money available to buy the alternative cars that they “should” be buying that, by the way, don’t even exist. Yes, that’s a fantastic plan!

    Stupid.

  • avatar
    ronin

    In any case, there is a specious logic underlying your comment. You assume that if it isn’t taxed that the alternative is to save money.

    It doesn’t matter what the alternative to paying taxes is. There need be no justification, and hence no need for any logic, in not paying a nonexistent tax. The natural alternative to not having a tax that does not support government operations is not, as you assume, saving money. Rather, the natural alternative is freedom to choose what I wish to do with the money I earned as a worker. Whether I waste it or invest it or send it to GM, as you do not, is none of your concern. It is not your money.

    Just because you don’t see it on the price signboard at your corner gas station doesn’t mean that you’re getting away with not paying for it. In the scheme of things, the tax may actually end up being cheaper than the lower gas tax alternative, when everything else is factored in.

    Possible. So what. There is nothing to indicate that you are correct, less to indicate that the government can do something better.

    But you know that. Because despite all the trappings, the dirty little secret is that there is nothing noble about this. No one really cares if it is true or not.

    It’s just a money grab, a scam wrapped in fine-sounding but empty blathering. And nothing changes. Except the people who actually work jobs are poorer, and their children are poorer.

    And getting back to the original question: How much extra have you donated, beyond tax requirements, to the government central committee to help the noble cause you expouse?

  • avatar
    Landcrusher

    PCH,
    We agree on taxing gas at a higher rate. However, I don’t believe in this price floor scheme one bit. OTOH, it will likely mean a LOT of money for my hometown, so I won’t protest too loudly. Also, I am more than sure that the money won’t be used to pay off debt.

    Lastly, it would be nice if the credits were set up so that only wage EARNERS got them. If you don’t have a job, take the bus or just drive less.

    I will now await the boohoo storie about the perfect victims of the plan who represent 2% of the population but whose stories are so sad we can’t do anything that might hurt them.

  • avatar
    Pch101

    It is not your money.

    That’s where you’re very, very wrong. When you put the country deeper into debt with your habits, it costs me money. If you refuse to moderate your behavior, then you are costing us a fortune over time.

    Economists refer to these costs as “externalities.” The costs impose a burden on others, but they aren’t immediately quantified at the time of purchase for the purchaser. In effect, society gets stuck with the bill, while the buyer goes on his merry way, unconcerned with the cost that he has imposed on others.

    Just because you aren’t adding the cost to your bill at the checkout stand does not mean that the cost doesn’t exist, it just means that you aren’t seeing it immediately when you use it.

    The US has a long-run interest in maintaining a budget and trade balance. At this very moment, we have to worry more about getting out of this latest mess, but once we have dug our way out of this hole, we then need to focus on getting our fiscal house in order.

    Your willingness to export borrowed American money abroad to our enemies does cost me something. It is in my interest to make sure that you aren’t motivated to do it. Since logic and self-interest won’t compel you, a tax is the only way to do it.

    I don’t believe in this price floor scheme one bit.

    I agree, this is not the way to do it. If it is structured in this way, producers will be motivated to form a cartel to limit supplies, so that their revenues go up. The consumer wouldn’t care because the retail price is staying the same, so the normal market forces that motivate changes in behavior would be tampered with. This particular approach has unintended consequences written all over it.

    Not that I believe that a fuel tax is going to be imposed, either. That’s political suicide and we’re not going to do it. The short-sighted thinkers would rather drown us in debt that people don’t understand than fix what is wrong here.

  • avatar
    PeteMoran

    Maybe Australia can help?

    Here, 35% of fuel is a tax component. Our price is about US $2.70/gallon at the moment, so about 95c is going to the government.

    With that they are doing things like implementing our transport future. In Australia, the freight task is expected to double by 2020, and much of those fuel tax funds will be needed to rebuild or expand the rail infrastructure.

    Australian people understand it, because they have been provided the information about WHY it is necessary and important. A properly functioning democracy (by no means perfect).

    No private venture is going to invest now to ensure we have efficient transport in 15 years time. This is where pure capitalism/freedom fails people. There is a vital future provision element of government that the private sector won’t deliver. This seems especially true in the USA, where many people can’t think past next week or their own selfish “choice”.

    That being said, a flat tax is regressive. Tackling the problem by forcing manufacturers to provide efficient vehicles (CAFE) is a good start and then you need to “help” the selfish out of their inefficient choices if the fuel price stays low.

    Fossil fuel dependence has to be reduced. It might not seem like an urgent problem today, but in thinking selfishly it will be much more expensive tomorrow maybe in your own lifetime too. Your “freedom” always has implications for others around you.

  • avatar
    Landcrusher

    PeteM,

    Given your feelings about Americans, I can’t see why you think CAFE will work and a gas tax will not. It is precisely our selfishness that makes CAFE fail. The CAFE ‘tax’ is hidden, most Ami’s don’t know it’s there, and they intuitively do the math on the cost of ownership before buying the larger, more reliable vehicles over the disposable hatchbacks.
    The not so secret that makes America work so well is that we depend on selfishness rather than try to deny it. I have lived in countries where this doesn’t get done, and the crap floats to the top of the bowl rather than the cream.

    Cheers

  • avatar
    nonce

    Detroit Todd :
    December 27th, 2008 at 6:47 pm

    (yes, you DO can fit two adults and two children in a Corolla and no, you do NOT need SUV or minivan for this – just take less crap with you),

    Why stop there? Really, a person only needs about 400 sq. ft. to live confortably.
    I’m printing up this comment and framing it and hanging it by my desk. Whenever anyone asks what Detroit’s problem is, I’ll just point to this.

  • avatar
    nonce

    I can’t believe how many people want more government involved in their life.

    I want much less government involvement. If we destroy the IRS and in its place create a flax tax on carbon, it will eliminate the single biggest Federal nose in my tent. They’ll just collect the tax from the energy companies.

  • avatar
    PeteMoran

    @ Landcrusher

    Given your feelings about Americans

    Just for clarification, Australian’s, myself included, generally like Americans. We have much in common. Sometimes we scratch our heads however regarding the “roads you travel” (metaphorically speaking).

  • avatar
    cpmanx

    Your willingness to export borrowed American money abroad to our enemies does cost me something. It is in my interest to make sure that you aren’t motivated to do it. Since logic and self-interest won’t compel you, a tax is the only way to do it.

    Pch101–as usual, it’s great to have you here as a voice of reason. Thanks for that.

  • avatar
    i6

    I’m all for the idea, and I have been for a decade because it makes sense. The only problem is that it moves the volatility risk of fuel prices away from the consumer and puts it in the government’s pocket. Basically, they couldn’t form a budget that relies on revenues drawn from such a tax. Or they’d have to make it revenue-neutral; if we get x amount of income from this new fuel tax then we reduce x amount of taxes on such and such. That would make it easier to sell to the public too.

  • avatar
    Landcrusher

    PeteMoran,

    We like ya’ll, too. We also scratch our heads over your “roads” and especially which side of the “road” you drive on.

    (couldn’t resist)

    Like how you guys keep beating the hell out of your general aviation community as well. Sad since you export one of the more popular light aircraft engines.

  • avatar
    PeteMoran

    @ Landcrusher

    We like ya’ll, too. We also scratch our heads over your “roads” and especially which side of the “road” you drive on.

    Yeah, I’m dangerous in a hire car on the first day or three of being back in the USA trying to figure out my left/right turns! I’m tempted to put an Australian flag apology in the window.

    Sad since you export one of the more popular light aircraft engines.

    You mean Jabiru? We’re not very supportive of manufacturing in general in Australia. An industry tends not to count here unless you dig something up and export it to China.

  • avatar
    Landcrusher

    Pete,
    This is too funny. In another thread I already made a poke about how your country kills the best businesses and lives off of selling resources to china!

    WoW.

  • avatar
    don1967

    I want much less government involvement. If we destroy the IRS and in its place create a flax tax on carbon, it will eliminate the single biggest Federal nose in my tent. They’ll just collect the tax from the energy companies.

    So the IRS is going to be destroyed if we all sign up for a “carbon tax” scam? I’d like that in writing, please.

    As for the climate change issue, there has never been a meeting of scientific minds that was not politically biased. When a thousand scientists commissioned by the U.N. unanimously declare that there should be no further debate on the subject, and that we must immediately start redistributing the world’s wealth, I become very concerned and very interested in what the dissenters (who were not invited, and who get shouted down in public forums like this one) have to say. And many of them say “hogwash”, that climate change is as natural as sunrise.

    http://www.sciencedaily.com/releases/2005/02/050212195414.htm

    http://en.wikipedia.org/wiki/Climate_change

  • avatar
    agenthex

    Your willingness to export borrowed American money abroad to our enemies does cost me something.

    You’re conflating buying oil with debt. We’re getting something of value, they get currency which is useful for a multiplicity of things. And if there’s anyone getting screwed if they buy bonds, it’s the foreigner who gets an IOU for all their natural resources.

    Landcrusher’s support for a gas tax is even funnier. Apparently he doesn’t support taxing anything unless it’s on poor people.

    Now, that said, I’m not necessarily against a higher gas tax, and if the reason is for energy conservation in general, then make it part of a wider plan.

  • avatar
    Landcrusher

    AgentX,
    Nonsense. I have stated already that working poor people don’t pay gas taxes. See the original post for more info.

  • avatar
    agenthex

    Are you talking about public transportation or tax credit. For the first, you’re mistaking ‘urban’ for ‘poor’, and the second is essentially making the tax more progressive, but how would that even be implemented? You save up your reciepts?


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