Energy Independence? Raise Gas Tax, Lower Others
Published in SL Tribune, Jan 19 2007: Global warming, Middle East, suitcase nukes - how do we break free of the oil addiction that is at the root of so many of our problems?
Tax structure! If the nation will raise the gas tax, and at the same time lower the income tax, the market will kick in and do the rest. If there are any statesmen left, please champion this idea. Since it isn’t raising taxes, it should be something that red, blue and purple Americans can all support.
This is a letter I submitted to the Deseret News:
If you’re addicted or a glutton to something you know is harming you, do you hope society and markets will make it cheap and easy, or more expensive and difficult to obtain? It depends on whether you love the vice more than the freedom. Our President is right when he notes we are addicted to oil, which among other negatives is certainly helping our enemies perfect suitcase nukes!
OPEC is likely to inject higher doses of our “drug of choice” if they think we’re serious about breaking the addiction, but as with AA we must admit we are “Petroholics” and begin to truly temper our gluttony. How? By ensuring market conditions that will spur conservation and innovation. Incrementally raise the federal gas tax to ensure gas stays at $3.00 or higher.
I know it sounds loony and counter intuitive for a Red-Stater to propose raising the price of gas even as it is at record highs “ but if it is offset by lower taxes elsewhere we are no worse off. The higher price spurs growth in hybrids, fuel cells, ethanol, and transit as a means of avoiding the tax! We must begin to sacrifice what we want now if we ever hope to have the independence and healthier environment we need most.
That was the letter. I don’t like the term “social engineering”, but I do believe that one of the main roles of government is to help us do something we all agree is useful, but for which there is no profit incentive for the markets to do on their own. Defense is the classic example. Wouldn’t we all agree that energy independence is in our national interest? We wouldn’t all agree that driving light-weight tin cans is in our personal interest. We might agree that the market could use more incentive to find ways for us to drive mega-machines that are more efficient and environmentally friendly.
Reducing other taxes SO THAT we can raise the gas tax keeps everything whole. Granted, when things move some win and some lose even if the net take stays the same. The ramifications of my proposal would have to be studied, comprimises made, and gradual phasing employed.
But can you imagine? Say sales taxes went to zero, but the price of gas went to $6 per gallon. You can afford the gas from the savings on other purchases - so no problem driving an average SUV if you want (Hummer? Well maybe now you can’t afford it - Good!) But suddenly you have a real motive to save even more! Maybe you’ll take transit to “get rich” (penny saved, penny earned). Maybe you’ll buy a hybrid.
Of course, Detroit (or should I say Tokyo), that if you’re willing to tax the vice to break free of oil sooner, you will be very motivated to purchase anything that minimizes petroleum, so they kick into high gear on fuel cells, hybrids, etc.
I think it’s a creative solution that just might work! Of course it doesn’t stand a snowball’s chance because it would take some 10-minutes of education, and people only do fear-mongering headlines and soundbites these days, but if there were a real “Ronald Reagan” leader and communicator at the healm, people might just say, “That sounds like a zero-sum way that we can quit helping Iran build nukes! It also helps cut down green house gases that MIGHT (and I stress might) be harming our well being?
Note: Since I published this, the Utah Taxpayer’s Association has supported the same thing, as have a number of other prominent people. However polls show most don’t and even want to lower the tax, which shows ignorance of the consequences of lowering the cost of our drug of choice.
January 13th, 2007 at
I think that your fundamental premise is flawed. Governments job is to first do no harm, then to stay out of the way while providing the barest of essentials. Those essential are little up for debate, but the intent is clear. Your proposal violates every sensible reasoning that can be lain for a responsible federal government.
January 13th, 2007 at
Thanks for the comment. I agree with a minimalist government also, but the point of even a minimalist government is to accomplish things that the people need done, but cannot sufficiently organize privately to do.
Why is defense a government role? In part because we all know we need it, but none of us are willing to “buy” our share on our own.
The environment is similar. We all want clean air, but when catalytic converters came around few of us were sufficiently motivated to pay $700 extra to clean up our seemingly small contribution. It is right for government to protect our national security and to take reasonable steps that help us clean up environmental damage faster than the market can do it on its own.
That’s the point of raising the gas tax and lowering others. Not to grow government, but to fuel the market to get us out of depending on enemies, and to help us get out of greenhouse gas production more quickly.
Government has stayed out of the way on oil, and that’s exactly why the market has made us dependent on the Middle East!
January 13th, 2007 at
Um I live in Alaska, and can unequivically state that the Governmnet has not stayed out of oil at all. And they are preciesely the problem with oil. I do not agree with a standing army (see founding fathers and first presidency message of Feb. 1946). There are very few things that government can do that the people cannot themselves do. Those things are expressely articulated in the U.S. Constitution, no intended powers were left out.
March 8th, 2007 at
Mr. “Um I live in Alaska”: Are your observations infallable and mine clearly ludicrous because you live in an oil state? So we disagree. You sound like you’re simply regurgitating what you’ve heard other people say. To say we shouldn’t have a “standing army” is really illogical. What is a standing army in your opinion?
Of course we need “an army” of people to maintain our weaponry and readiness, and yes the people cannot do this themselves. There is no personal benefit to me contributing $1000 dollars per year to defense, so if left to fund it voluntarily, I will not do it because I’d be the only one, and hence my $1000 gets me no real defense. But if enough of us agree that it is in our best interest to force anyone who enjoys the benefits of common defense to pay for common defense, then we can have an impressive defense.
Government is not the problem with oil. If they “stay out” as you suggest and let the market take care of it, then the market will unwisely consume all of our domestic oil very quickly, enrich our enemies because foreign oil is a tad cheaper, and never make real progress toward environmental stewardship.
Government policy that incrementally raises the price of oil is in fact the best long term solution. People gripe that they want oil to be cheaper, and yes cheaper is good for the economy in the short run, but in seeking to “promote the general welfare” there is nothing wrong with raising the funds necessary for defense by high taxes on fuel and low taxes on everything else. This will in fact improve our common security, improve our common environment (which again, are you going to volunteer $1000 to maintain a clean environment?), and it will conserve our common resource oil, which is stuff of plastic and is something we’ll need long after high government taxes have spurred the market to break us free from burning all our future plastic in vanity-wagon Hummers.
Put that in your tail-pipe and smoke it.
August 9th, 2008 at
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