![lower-gas-prices[1]](files/lower-gas-prices%5B1%5D1229820020.jpg)
One thing I feel that the Obama administration should do concerning national energy policy is increase the tax on gasoline to the point that the price at the pump never goes below $3.50 a gallon. This would do several things:
- It would make gasoline less competitive than other forms of energy and encourage the use of alternative fuels and modes of transportation.
- It would start to reflect the true cost of gasoline in terms of the damage to the environment and costs to import oil from other countries and the associated costs of military involvement to protect those supplies of oil.
- The revenue from the taxes could be used to fund research and development of alternative sources of energy and modes of transportation and shipping in the United States. This, hopefully, would develop new industries in this country which could export these new technologies world wide.
I realize this tax is regressive, but the impact on lower income families could be reduced through tax rebates. Enough said.
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12/27/08
The New York Times ran an editorial today advocating a tax similar to what is proposed above. See http://www.nytimes.com/2008/12/27/opinion/27sat1.html?ref=opinion .
12/28/08
Tom Friedman wrote an editorial in today's NY Times supporting a gas tax similar to what is proposed above. See http://www.nytimes.com/2008/12/28/opinion/28friedman.html?_r=1&ref=opinion .
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Sean Murphy
Steven Axelrod
Critical Mess
Joan Walsh
Kerry Lauerman
Salon.com
Comments
1) A means-tested tax will have no effect; the rich can afford it and nobody else will care.
2) It means the state has a perverse incentive to continue and even expand the use of fossil fuels. It is profoundly counterproductive: imagine paying for national health care using cigarette taxes.
Thanks for your comments.
1) Increasing taxes on cigarettes and alcohol have been shown to reduce their consumption. As I recall, during the first 6 months of 2008, there was a decrease in the miles driven by Americans which was thought to be due to increased gasoline prices. This decrease was very likely associated with decreased gasoline consumption in this country.
2) The tax I propose would only kick in when the price of gasoline fell below $3.50 a gallon. If the price of gas was to go above $3.50, the extra tax would stop. I sincerely doubt that the price of gasoline will stay under $3.50 a gallon for very long, based on inevitable increasing world wide demand and the depletion of existing oil fields.
3) The tax is not means tested. It would apply to everyone. Some of the proceeds from the tax, though, could be used to give a tax break to lower income groups who would feel the impact of the tax most strongly.
4) If the state used the income from this tax to fund alternative energy and transportation systems, these systems would eventually become competitive with gasoline based transport because of the increasing cost of gasoline.
It's time to Pay The Piper, Amerika!!!
It's an important aspect of your proposal that the revenues go to something that can be proportionally defunded as oil use goes down. Rob's concern about cigarette taxes funding health care is, if I understand it, that if smoking went down so would funding of health care; that would be bad. But tying cigarette taxes to cigarette-induced disease would be better since that would go down as cigarette use went down (at least somewhat).
O'Steph, taking money from the oil companies sounds good in some abstract morality-centric way but it neglects the fact that these are international companies now, not US companies, and countries bid for the presence of those businesses in their country by offering them a hospitable place to do business, not vice versa. If it came down to it, I suspect the rest of the world would happily use and pay for all the oil, so making the business climate here hostile is just a way of hastening that, perhaps at a speed we aren't prepared to handle. The scenario under which what you suggest could work is where you're prepared to move really fast to alternate forms of fuel and you are trying to treat the oil companies as active criminals you'd like to rid from the streets sooner rather than later, without regard to a transition plan.
(Worse still, any move of the oil to other countries is probably "new use" and cause a sudden net rise in world energy use as price drops there. One weird problem with the US reducing fuel use is that the rest of the world has a lot of money it's itching to use, and the oil will probably still exist and still get used by others as long as it's being produced, so until we address the desire of other places to be like we've been, the planet is in trouble. I wish China would mount a campaign to tell their people that true wealth is riding a bicycle, not a car... at least while their people are already used to that, that's a plausible message. Once they're used to cars, and especially once the availability of cars is integrated into their business models as it is here in the US, it will be hard to go back.)