Why not tax gas while it's cheaper?
The good old days of $2 a gallon gas have returned. Why not tack on a tax to help run a fuel-efficient economy down the road? Fortune Magazine's Allan Sloan explains to Scott Jagow why this is a good idea.
Allan Sloan is a senior editor-at-large at Fortune (APM)
More on Oil
TEXT OF INTERVIEW
Scott Jagow: I filled up my gas tank yesterday, and when the pump stopped, I thought there was a mistake. It was so cheap. The national average is now $2.10 and 16 states have gas under $2. But my friend Allan Sloan says now is the time for a gas tax.
Allan, what are you thinking? Why should we tack on a tax now?
Allan Sloan: Because if we're gonna get people to buy fuel-efficient or alternate energy cars, you don't do it when gas prices start at $2, run up to $4, and by the time, say, General Motors, if any of this happens in Washington, comes out with this magic green vehicle the government's going to offer to make, it may well be that no one's gonna want to buy them again.
Jagow: Do you really think that people will go back to their gas-guzzling ways considering what else is going on in this economy?
Sloan: Yeah, I think they will. And the reason I think that is I remember -- I'm so old, Scott, I remember '73, '74, when oil went from I think $2 a barrel to like $20 or $30, and everyone said it was the end of the world and we've learned something from it. And everything reverted as soon as oil prices went down. And it's gonna happen here, too. People will absolutely go back to their gas-guzzling ways if the price of gas stays at $2 or goes even lower -- of course they will. And we'll be at the mercy of events all over again, and I don't think that's any way to run a country.
Jagow: And what happens if oil and gas go back to the levels they were in July, and then the tax is added on top of that?
Sloan: If you do it now . . . let's say the average price of gas is $2.20 nationally, it's something like that, let say you make it $3.25. People survived more or less at $4, and if there's a problem caused by this, you know for people who can't pay, you'll give them their gas tanks back in some form or other, I'd rather we pay this tax to ourselves than we pay it to Saudi Arabia or Russia or Venezuela.
Jagow: And how do you think this would benefit -- if it would -- the American car makers?
Sloan: Well, if these companies are still alive, and we got rid of these what I consider idiotic rules about average fuel economy, where we mandate that the average mileage of the audio fleet has to be this or that, and then we say SUVs are really trucks so they're not included -- if you're running a U.S. car company, you go mad with this. If you say, here's the market, go serve it, that's a lot easier, let these guys make the cause they think they can sell. And if there are high . . . if gasoline prices are high enough, the socially-conscious among us will be happy, the consumers will buy this -- it's a lot better than being at the mercy of events, which is what our energy policy has consisted of.
Jagow: An interesting topic, Allan. Thanks for your input. Allan Sloan from Fortune Magazine.
Sloan: My pleasure.
Comments
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From Livonia, MI, 12/19/2008
In Michigan, state fuel taxes were shifted to expand freeways and roads by forcing public bus service reductions. This does not justify a gas tax increase. Type savethefueltax in google to see website about this and why we need to defeat transportation tax increases unless public bus service is restored in southeast Michigan
From Detroit Suburbs, MI, 12/01/2008
Why aren't we driving cars with 20% better mileage like the Europeans? Because the US taxes gas at less than HALF the rate of Europe. Americans just don't want to hear that paying more for gas will be better for our children and grandchildren--we want our two-ton trucks to buy a gallon of milk, and we WILL continue doing so unless there's consistent pain at the pump. Period. Ask any economist worth their salt: they all agree that markets operate most efficiently when you pay the TRUE cost of products, and by anyone's estimate, we are not paying the full cost of gasoline. Driving a car necessitates road and bridge repairs, an inflated defense budget and soldiers' lives, and the current tax isn't cutting it. So we should pay for that at the pump, not by closing down schools and paying teachers less than a Wal Mart manager. Where do you think the money to maintain our car infrastructure is coming from (aside from borrowing from China)? Lots of different places, both locally and federally, but I guarantee that the burden is falling disproportionally on the quality of life of the lower and middle class.
We need a gradually increasing gas tax (oops, call it a road/environment/battleship user fee) so we don't dump this problem AGAIN on future generations. Google and read an old Fortune article, "Why $3-a-gallon gas is good for America." The conclusion is clear--the money can stay here or it can keep going to terrorist regimes. Our politicians need to educate the public and display some leadership, and we need to tell them to do so. (Either that, or start thinking of something to tell your grandkids when they ask you, "Why didn't we do something about this a long time ago?")
From Detroit, MI, 11/25/2008
Yes to the gas tax, with a Michigan exception. All funding should be dedicated to developing a viable transit system within the Region of Detroit and other metropolitan areas before one highway can be widened. Tax me more but make sure that I have a viable alternative if I choose not to drive.
From Reno, NV, 11/19/2008
I say "This is a GOOD idea". Put the extra funds toward rebuilding our roads,etc.
From Palo Alto, CA, 11/18/2008
I wanted to respond to the question asked by David Wooddell of Washington, DC, (11/17/2008):
"I have to ask -- if the foreign auto makers can build dependable vehicles with high fuel mileage, why can't American automakers do the same?"
I think that was entirely Sloan's point - that Europe's high gas prices result in consumer demand for high mileage vehicles, and that the U.S. Congress' strategy of getting Detroit to build high mileage vehicles by using CAFE standards doesn't work when American's have been paying low gas prices - they have no reason to buy them and have opted for SUVs and other low-mileage vehicles.
Another comment on the note (By Michael Beneke-From Jefferson City, MO, 11/18/2008) about food banks being impacted because low income workers must choose between food and gas budgets - Sloan definitely indicated that low income people could see many refunded to them, or a reduction in payroll taxes, if gas prices rose again.
However, to follow the 'regressive argument' would mean gas must always be cheap so as not to hurt the poor. I don't think that's a good way to tackle poverty - and it conflicts with our environmental and energy policies.
A way to deal with this argument so it is compatible with environmental and energy goals would be to make the gas tax completely revenue neutral - a reduction in payroll taxes and tax credits for low income residents would help all low income people, not just those who drive!
11/18/2008
A gradual increase on fuel taxes is appropriate as is federal excise taxes on tires for larger vehicles; as is a certain btu value for heating larger homes.
Increased taxes here is the only way to give permanent incentives to more efficiency and thus less dependence on the oil thugs of the world.
Yes, in a perfect world, GM, Ford, VW, and Toyota would make only the 50 mpg vehicles that they are capable of----GM already has a V6 that can make over 35 mpg in a 3700# car--but they advertise the SUVs instead. Why, because that's where the profits are.
Right now, in the short term, tax penalties for wastefulness are the only solution
Mr Sloan, thanks for your courage!
From Jefferson City, MO, 11/18/2008
It took one special meal for me to realize how wrong Mr. Sloan is. Monday evening I attended a "Hunger Banquet." The Calloway County version of food bank gave a short presentation. The number of people who use her service has nearly tripled since 2000 (population increase less than 10%). She stated that many have to cut the food budget just to pay for gasoline to get to jobs. And she said this was happening at food banks all across the nation.
Gasoline is not an avoidable expense for most Americans. Although it will make a difference to what vehicle some will drive, there is a segment of our population that can't afford to buy a different vehicle and really can't afford the higher gas prices.
From Birmingham, AL, 11/18/2008
YES... to the gas change you can tax while gas is low and if gas raises then taxes can be cut. But us as citizens of the United States needs to see change and change will happen...! Just my basic thought of what I think.
From Plano, TX, 11/17/2008
We don't have to increase the tax on gas today. Simply make it a 10% sales tax: Roughly no increase from average price today. However, if/when prices increase, taxes will go up accordingly. This will actually put downward pressure on external and speculative price pressures. I think a % sales tax on gasoline would actually dampen the fluctuations we are experiencing today.
From newton, KS, 11/17/2008
Remember when John Anderson was running for President in 1980? He proposed a higher tax on gasoline, the proceeds of which were to be invested in energy efficient technology. If we had started then we would be independant of foreign oil now. It's never too late to do the right thing.
From Redding, CA, 11/17/2008
re Marcene Steinick's comments:
"In the heartland where we live, whether we carpool, or rideshare, or drive alone, it's still 30 miles to work, 30 miles to buy clothes, 30 miles to go out to dinner, 30 miles to go to the movies-you get the picture. Even though we are highly skilled at combining needs into one trip instead of three, it is STILL 30 miles.
We small community dwellers do not want to live in the city, and we should not be punished with a gas tax."
Unfortunately, your lifestyle and desire to live out in the boonies is only sustainable due to cheap fossil fuels.
That lifestyle will not be viable in the long term...due to reasons of global demand, national security, and global warming, the age of cheap fuel is coming to an end.
You will have to adapt (e.g., one or two trips to town per month), or make the decision to move closer to town.
From MN, 11/17/2008
I heard Allan Sloan's commentary in favor of the gas tax this morning. I was surprised to hear what amounts to a massive oversimplification on Marketplace - where I usually hear stories with a fair amount of insight. What Mr. Sloan fails to understand is how the law of diminishing returns, the credit cruch and the propensity of the american publinc to finance vehicles over longer and longer terms will affect the return to gas guzzlers. Here's what is actually happening in the marketplace:
The average auto loan term is just over 60 months. The average American owns a vehicle just under 3 years. When gas hit $4/gallon the value of that gas guzzling SUV dropped like a rock and many people found themselves with negativce equity - 'underwater' on that vehicle. Now that wasn't so bad back when captive finance companies and other banks would allow extended 'advances' on auto loans - think jumbo mortgage for your car. Now that the credit markets have tightened, lenders want to keep advance at around 90%. Thus, it is twice as hard to trade.
This fact alone would flatten the demand curve for efficient vehicles caused by a new gas tax like a pancake. It would exacerbate the current substition bias in the marketplace which is currently driving the values of efficient used cars under about the $4000 mark - no financing required - through the roof and driving the Detroit three to go begging in Washington.
From Allen, TX, 11/17/2008
I used to work for a fellow that moved here from Dublin, Ireland. He drove a mini-cooper and expressed shock and dismay at how wasteful we americans are driving big gas guzzling cars. After living in the U.S. for a year we went out to lunch together in his new SUV. I asked what was up with buying a gas guzzler. He repied, "Well, I sat down and ran the figures, and with gas so cheap I figured I might as well buy an SUV."
The point is, when gas is cheap, the majority of people will buy big cars.
Current federal tax on gas is 18.5 cents per gallon. This should be increased by at least 50 cents per gallon. The price would still be cheap compared to where it was. Gasoline is a limited global resource and will never be treated as such unless the price is higher. Making it cheaper may help certain people in the short run, but in the long haul we need to bite the bullet and start changing our transportation habits now.
The revenue could be used in three ways:
1) Increase infrastructure spending on roads and bridges. The current 18.5 cent tax falls short of funding these current needs and is being subisdized from other taxes.
2) Fund development of sustainable energy resources such as wind, solar, and biofuel.
3) Pay down the national debt
Yes this would hurt some financially, but for most of us we managed to get by on $4.00/gallon gasoline last summer, and I am more than willing to have the price of my gas increase from $2.00 to $2.50 if it helps fund the things I listed and it is the only way to motivate the average consumer to buy more fuel efficient automobiles.
I hope the current politicians have the courage to increase the tax on gasoline. They will catch a lot of flak, but it will be for the common good, and our grandchildren will thank us.
From Virginia Beach, VA, 11/17/2008
If you want to wean the US off of imported oil, google a company named LS9. If you are just a liberal/socialist looking for an excuse run other people's lives, don't bother.
From Virginia Beach, VA, 11/17/2008
As a lifelong Republican, I would LOVE to see President Obama announce a Federal Gas Tax increase of $1/gallon. (LOL)
From Charlotte, NC, 11/17/2008
I agree. Keep the price up to foster more efficent use of fuel supplies and development of alternatives. Use the tax income as an investment in infrastructure redevelopment i.e. bridge and highway repairs, and in developing the fueling infrastructure to support the alternatives to gasoline and diesel fuels.
From Livonia, MI, 11/17/2008
I do agree with Mr. Sloan, in that history repeats itself. I understand that high fuel prices do impact small businesses that must also transport their goods &/or services, but wouldn't it be easy enough to grant a small business a fuel tax credit? I do also like the idea of taxing the less fuel efficient vehicles, instead of the gasoline. A vehicle tax could be applied annually whenenever the owner needs to renew license plates, so that it's a recurring cost of the vehicle. But I don't think a vehicle tax would have as much impact as the gas tax, and there were way fewer drivers on the road when gas was $4+ per gallon making my daily commute a heck of a lot easier than it had been in years. I don't buy the argument that the gas tax hits the poor harder. i purchased my Ford Focus when it was 2-yr. old, for $10,000 & i get 30 MPH on average. It's now 6 yr old, and i still get 30MPH. I imagine its resale value is at least 1/2 of what i paid, so i really don't see the problem for lower income drivers, who typically drive older vehicles. There ARE affordable options out there.
From Medora, IN, 11/17/2008
While in principle I agree with a tax on gas, the effect it would have on the economy would be terrible. Actually, the straw that broke the economies back was the spike in energy costs. Most in America have been living on the financial edge, most notably the middle class and working poor as well as those on fixed incomes. When prices soared three and four times their normal, the thin line far too many must ride due to small salaries, vanished.
To add a substantial tax now, while people are losing their homes, jobs, benefits, equity and retirements is just fool hardy. It would worse the financial strain and crush retail stores.
From TX, 11/17/2008
We run a very expensive government. The money has to come from somewhere.
From Fairhope, AL, 11/17/2008
I'd have no problem with a gasoline tax if there were practical alternatives available now. We should encourage the conservation of a product that is environmentally destructive and makes our nation dependent on unfriendly countries. However, putting more taxes on gasoline when little people like me have no other options is regressive. I'd be happy to curtail my use of gasoline if I had another way to commute to my job, but I don't. When gas was $4 per gallon, it forced me and people like me to cut other spending to the bone and beyond. How is that good for the economy? Also, didn't Mr. Sloan notice that higher gas prices were resulting in inflated prices on other consumer goods? All we need is to add skyrocketing inflation to our current economic woes. Let's put more taxes on gasoline, but not until there are other options!
From Houston, TX, 11/17/2008
I'm a petroleum engineer/manager and I firmly believe the federal gas tax should be at least $1/gal higher than today's rate.
From Kennebunk, ME, 11/17/2008
I completely agree with Alan Sloan. It's only rational to tax what we want less of (and subsidize what we want more of - plug-in electrics, mass transit, and alternative energy).
From Santa Barbara, CA, 11/17/2008
Alan Sloan is right, and so it Tom Friedman, who has been calling for a tax on gas for a long time, with an even more compelling reason: our national security depends on it. During the seventies the then-high price of gasoline motivated people to consider fuel-efficient cars, but we can all see how long that lasted. It is astounding that Americans continue to buy and use gas-guzzling vehicles unnecessarily while our children, husbands, wives, dads, and moms are dying in Iraq because of our addiction to oil. The war didn't seem to motivate us to be more fuel-efficient, but $4 a gallon gas did!
From Lawrence, KS, 11/17/2008
Alan Sloan is exactly correct that an energy tax needs to be added to the price of gasoline to keep the price of gas at $2.50 to $2.75 per gallon. This does not prevent SUV owners from driving their vehicles, they still get to choose to do so. We have becomne accustomed to high fuel costs ($3.00 - $3.50 per gallon) so gas at $2.50 does not seem high.
At 20MM barrels per day of oil consumed in the US, a $0.50 tax on oil would bring in 153 Billion, $1.00 tax $306 Billion. Remember that our debt is now at least at $13,000 Billion dollars (Fannie, Freddie, FDIC, AIG, etc.), which we must begin to reduce now.
The problem with raising this tax is that there is NO ONE in Washington who can be trusted to take this money to begin paying down the debt; there is always another program that needs to be funded....
From Hartford, IA, 11/17/2008
Why does Mr. Sloan assume that all people who drive 'gas guzzlers' are suburban professionals who can afford more fuel efficient cars? There are millions of working poor in our country who are driving older cars because that is all they can afford. The poor are always hardest hit by these kinds of taxes. With the downturn of the American economy, more and more of these lower income workers will have to commute to go where the jobs are. This temporary relief at the pump is a welcome relief to their pocketbooks. Why punish these hard working lower classes with what essentially amounts to a 'luxury tax' for those who can afford it? Should we instead be punishing the Big 3 US automakers for spending so many years churning out cars with low fuel economy?
From Kansas City, MO, 11/17/2008
Mr. Sloan is absolutely right. I've been thinking that we should do this for a while. If we have been paying $4.00/gallon of gas and then it drops to $2.50, nobody would notice if there was an additional $0.10/gallon tax added. Now would be the time to do it. We could use the extra revenue generated to help wean us off of foreign oil. How much revenue could we save if we didn't have to keep our military guarding and protecting our fuel supply on the other side of the world?
From Washington, DC, 11/17/2008
For a number of years, we've been trying to change the average fuel economy of vehicles in America by forcing the automakers to do so. This will never work as the problem is on the demand side.
As long as fuel is cheap, we will not care about fuel economy and as such, the automakers won't make economical vehicles.
However, if the prices goes up (as it did), Americans will change their buying habits (as they did). So put a price floor on gas and guarantee $4/gallon. This price will happen eventually, but if we control it at the government level now, we can ease into the transition instead of it being a huge shock.
And now is the time as we just came off the higher prices, so let's just keep them in place and work to make the transition now.
From Omaha, NE, 11/17/2008
I totally agree with Sloan on this one. He is correct: we change our habits in the face of high gas prices and then, go totally back to our old habits when prices come down. And if we think prices cannot be manipulated, our experience of the past 2-3 months is absolutely evidence. Simply, a gas tax, while onerous, would send a message to the citizenry and to the auto industry who have not accepted any other message that we need to produce more fuel efficient cars.
From Carson, CA, 11/17/2008
Is Fortune Magazine's Allan Sloan out of his mind? Saddle already over-burdened tax payers with even MORE taxes?
I would remind Mr. Sloan that oil companies pushed us into this recession/near depression with their greed. They cranked gas prices up until consumers cut way back on travels and vacation plans and spending in general.
Consumers realized, hey this is not so bad, we CAN conserve but we won't be going to Palm Springs, The Grand Canyon or New York. Hotels, resorts and so many other industries suffered tremendous losses because America was staying home and cutting back on buying products they purchased before.
Hey, Mr. Sloan, here it is mid-November and stores are already having 'black sales' with Christmas music in the PA systems. Don't you get it? A legion Americans are almost broke as it is!
Now gas prices dropped almost 50% ~ after the oil industry and our deaf and dumb government realized they have almost killed their golden goose?
California voters (in recent years) have already authorized billions of dollars in additional gas taxes to build and repair freeways and roads, but to what end? California government siphoned-off huge chunks of that money for other pet projects and we still have pot holes but the millions and dangerous bridges everywhere.
And guess what? This November there was yet another measure begging for even more funds to repair those same freeways and roads and to build more this last ballot!
How about solutions? Hey GM, dust-off the prints again for your very successful *EV-1! Build a million of them. Instead GM is pushing that ugly Chevy Volt at a shocking $30,000 price tag! (pun intended). Sorry, they can't even get them out of the door.
Have you seen the front end of that Volt? God help you if you should crash that front bumper. That part alone will be a cool $2,500 or more I'd bet.
As for Ford, dust off the prints for your ORIGINAL Thunderbird hard top convertible (not the electric top that was crippled with problems). Keep the look absolutely the same, inch for inch, but put in a fuel efficient engine and use lightweight parts everywhere possible. Ford, you would sell two million of them if you didn't get greedy on the price.
The American auto industry has dug their own grave with built-in planned obsolescent, gas guzzling pig cars. Why is it a surprise that few want to buy them? And trust me, I've owned American cars, trucks and vans. Do I plan to buy another? Not just no, but hell no.
Please, Mr. Sloan, wake up. We have almost 10% unemployed and I am more than confident what they think of your outrageous plan. Yours is just one more way to reach deeper into the pockets of Americans for their hard earned dollars.
NO auto bailouts. Bankrupt, restructure with your best engineers and build efficient, dependable and economical cars! How tough is that?
Anthony O. Cardenas
Los Angeles
*See Who Killed the Electric Car?
From Tampa, FL, 11/17/2008
Tax $1 per gallon, and give me a check for the amount I would have spent; I'll save the gas money and invest in something more worth while. I drive 15,000 miles a year, at 20 mpg, so I spend about 750 gallons per year. If the government gives me a check for $750 and tax me $1 per gallon I would probably save on gas and spend in something else, or maybe invest in a more efficient vehicle. The government wins, I win, the economy wins, and the petro-rich countries with inflated wallets and ill intentions like Russia, Iran, and Venezuela would lose.
From FL, 11/17/2008
Mr.Sloan, You may be rich, you don't care about other people's economic situation.
On what basis you are suggesting that government should impose tax on gas?
How would a common person is going to be benefited by your suggestion??
If you think gas guzzlers are the problem THEN SUGGEST GOVERNMENT TO TAX ON THEM, WHY SHOULD A COMMON person be punished because of those IRRESPONSIBLE GAS GUZZLER VEHICLES??
I don't get it. Do you know how many people in this country live on pay check to pay check and we are struggling to go to work with kind of gas price. IF YOU THINK GAS IS CHEEP FOR YOU THROUGH some money in the trash can next to the gas pump and tell your self that the price is good, but FOR GOD sake don't give any stupid IDEAS like this. These kind of ideas and analysis brought us to this situation now.
Walk through the common man isles you will see how hard is it for us to live.
Now the time is to have little tax to survive.
I hope you will understand, yo have a great point but the time is not right.
GOD BLESS AMERICA.
Thanks,
Ravi
From Denmark, ME, 11/17/2008
While I support Mr. Sloan's stance on an added gas tax in theory, I don't think he's taking into consideration the vast economic diversity in this country. Here in rural southwestern Maine, it's virtually impossible to live without a car and, more often than not, a truck. Public transportation is non-existent. Couple that with below average incomes, and $4/gallon prices at the pump can be back breaking. Moreover, the tax would do nothing to solve the greater problem--our addiction to oil.
From St Charles, MO, 11/17/2008
Allen Sloan is absoultely correct. This would give us a tool to actually wean ourselves from forign oil while helping to promote alternative energy. This assumes of course that our government would actually use it for that purpose and not direct those funds to some pork barrel project.
From Norfolk, VA, 11/17/2008
As someone who received a complimentary subscription to Mis-Fortune magazine because of this recession, all I could do was shake my head when I heard Mr. Sloan suggest that those who could not afford the tax be given it back somehow or another. With the reduced (or eliminated) incomes many Americans are now facing, increasing living expenses does not seem to be a good idea.
His premise that raising fuel costs via a tax will increase the demand for fuel efficient cars may be correct however, as David Wooddell's response points out, "The auto makers have had 30 years to make smaller, more fuel-efficient automobiles, trucks and SUVs. " Raising operating costs to entice(force) citizens to purchase new vehicles is not the best long term solution for reducing consumption. It is just another way to increase expenses at the consumer level.
Lest anyone forget, in the 20's and 30's GM, along with Firestone, Phillips Petroleum, and others was behind the effort to eliminate streetcars, and increase the need for their products (buses, tires, gas, oil, etc). There is an excellent article about this at http://www.baycrossings.org/Archives/2003/04_May/paving_the_way_for_buses_the_great_gm_streetcar_conspiracy.htm
Rather than bailing out a somewhat predatory industry, I think any bailout moneys should be applied towards the creation of efficient mass-transit systems, and decrease the need for individual vehicles altogether!
From Baton Rouge, LA, 11/17/2008
I bought a hybrid in 2006 because gas prices were high. I look out of my rear windows at a parochial school student parking lot dominated by SUVs and pickups. These should all be subject to a gas guzzler tax except where a licensed business or farm is involved. If the auto makers are to be bailed out, such restrictions should be placed on their sales.
From Hollywood, FL, 11/17/2008
If Mr. Sloan thinks that the American people can handled a $3.50 per gallon gas with unemployement at the highest level, credit problems and people loosing thier investment, where has he been lately in a cacoon. Why again are the American people have to pay for the American Car Companies's stubbornness. I was around in the seventies and I saw then what I see now, the American car companies are stuck in their ways and then acted suprised when Japan introduce the small fuel inficient vehicle, while the japanies laught all the way to the bank. Now again they don't want to change their ways and expect the american people to pay for their stubbornness. Change is coming! Better yet where can I applied for his job, because I think I could do better.
From Lewistown, PA, 11/17/2008
Okay, I don't get it. More taxes on gasoline? Gas already has approximately 40% added on for taxes.
If I could believe that it would be used for that which it is intended? I doubt it. Put it into the hands of those who can use it; the consumer. Let's try to use basic economic theories of supply and demand to drive innovation not more government control.
From Takoma Park, MD, 11/17/2008
I hadn't owned a car for over 10 years before moving to the DC area for work last year. I had hoped to be able to commute by train to work...but instead I had to buy a car to make the 20 mile commute. The $4/gallon gas was just one more (actually rather small) piece of the commuting cost...and you know what? I think a gas tax to keep the cost per gallon up around $3-$4 is a great idea. I've been opposed to bailing out car companies because I'd much rather see that money go to better public transit so I don't have to own a car. But if we're talking about bailing them out so they can make more fuel efficient vehicles, why not pay for it with a gas tax? Maybe later we could use a gas tax to pay for more public transit.
From St. Michaels, MD, 11/17/2008
Hurray for a brave and honest voice! He can dare to suggest a gas tax because he is not facing voters. Americans need to change habits and realize, as Europeans do, that gas is an expensive commodity that impacts the environment as well as our pocketbooks.
From Fort Worth, TX, 11/17/2008
You're 100% correct. Its human nature to waste cheap resources and conserve expensive ones. Tax gas to ensure its an expensive resource and then people will want to drive those hybrid or electric cars. The added tax revenues could then be used to fund research and start-ups in alternative fuels. Then maybe we could be an exporter of clean burning fuels in the future...
From Prince George, VA, 11/17/2008
Yes! This is a great idea; it has been done in Europe for decades. The revenue generated should be used for improvements of the infrastructure in this country, which will create jobs.
The only problem is that Americans are not accustomed to paying taxes and will resist the idea at any cost. Even crumbling bridges will not make them accept the need for a higher gas tax.
Peace, Sabine D. Allen
From Madrid, IA, 11/17/2008
In the heartland where we live, whether we carpool, or rideshare, or drive alone, it's still 30 miles to work, 30 miles to buy clothes, 30 miles to go out to dinner, 30 miles to go to the movies-you get the picture. Even though we are highly skilled at combining needs into one trip instead of three, it is STILL 30 miles.
We small community dwellers do not want to live in the city, and we should not be punished with a gas tax. Paying $3.99 per gallon was punishment enough. Our incomes do not compare to the Allen Sloans of the world. Come visit us and you will see that we are intelligent, well informed, up to date with world events, and just beginning to be able to breathe again now that gas prices have dropped.
Mr. Sloan, if you were lucky enough to live here, you would know exactly what I mean.
From Washington, DC, 11/17/2008
Alan Sloan's commentary of what is wrong with the car industry could not be more off track, it is an apologist's view for allowing the auto makers to have less regulations so they can have a free hand and not have to retool their factories. The auto makers have had 30 years to make smaller, more fuel-efficient automobiles, trucks and SUVs. Instead, they talked Congress into giving a tax credit to everyone who could possibly claim a small business tax credit when they bought a new gas guzzling SUV or pickup truck, and they built them into the largest-selling sector of the US auto market, despite the need of consumers for gas economy and despite the needs of our economy to reduce oil imports. As for Mr. Sloan's scheme to bring in a gasoline tax and raise prices back to $4 a gallon, he could not be more wrong about the effect on consumers. None of us were doing all right at such high prices, with the exception of that 5% at the top of the economic chain. It accelerated debt for those middle class who did not have much margin between paying the bills and having to put more and more on credit cards each month. High gas prices accelerated the downturn in the economy when average people had to make choices between getting to work and buying something else they needed. Yes, I agree that the US consumers need to use less oil. We could more easily do that if the auto makers in the US could do what the Europeans and the Asians have done in their auto industry. I have to ask -- if the foreign auto makers can build dependable vehicles with high fuel mileage, why can't American automakers do the same? And why have the US makers been allowed to drag their feet on building hybrids and electric autos? Let Congress put in some regulations with real teeth to get the automakers to build what we need, and will buy, rather than covering their lack of business skill by giving them a handout.
From TX, 11/17/2008
I agree that we should use tax policy to help set the social agenda on this issue. It is the only rational way to set market expectations re desired gas mileage - CAFE is clearly trying to Push a scheme where the tax approach will drive a market Pull. The revenus should also be used for transportation items (not auto bailout) like regional electrified rail, local transit and some to auto support infrastructure.
Just imagine where we would be if John Anderson had been able to get this idea into mainstream in the 80's.
From woodstock, NY, 11/17/2008
YES to the gas tax
CHANGE?
Yes we can
CHANGE?
Yes we must
From Columbia, SC, 11/17/2008
Uh oh, the cost of gasoline has gotten affordable again. Looks like it's time for the federal government to meddle with the market and add some more tax burden to the US citizens.
I think the government's track record thus far with the management of our tax dollars (a la bailout decisions) is reason enough not to deepen their pockets with additional gasoline taxes. Who's to say that those tax dollars would remain allocated to "help run a fuel-efficient economy down the road"... whatever that means. Then again, how do we know that the cost of fuel will remain affordable, or how long it will remain affordable? There are already more than enough taxes (state and federal) attached to each gallon of fuel Americans purchase. Another tax is just not necessary.
From woodstock, NY, 11/17/2008
YES to the gas tax
CHANGE?
Yes we can
CHANGE?
Yes we must
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