OPEC announced yesterday they would not increase oil production in the near future. The price of oil remains elevated, at around $100 a barrel, and this means prices will stay high. Goldman Sachs has estimated that gas prices could hit $5 a gallon this summer. The speculation embedded in the system of oil trading is adding close to $30 per barrel, according to the CEO of Exxon. Lowering gas prices (which have fallen slightly in recent weeks) is a function of cracking down on overspeculation, at least in the near term.
In the long term, there’s a credible argument that, to spur alternative, cleaner-burning fuels and transit options and lower greenhouse gas emissions, we need to increase the cost of gas. Here’s an unusual ally in that debate: the CEO of General Motors.
General Motors CEO Dan Akerson said his company and his industry would be helped, not hurt, if consumers paid higher gas taxes.
In an interview published in Tuesday’s Detroit News, Akerson floated the idea of a $1 a gallon increase in the gas tax as a way to encourage buyers to purchase smaller, more fuel efficient cars. Greg Martin, spokesman for GM’s Washington office, confirmed that the quotes reflect Akerson’s and GM’s view.
Akerson said he would support a jump in the gas tax if it came instead of tighter fuel economy regulations that GM and other automakers will have to meet in coming years. By the year 2025, automakers could be forced to hit fuel economy averages of as much as 62 mpg.
Notice here that he wants an increase in the gas tax INSTEAD of mandates on fuel economy. There’s no reason why you can’t have both. Higher gas taxes would encourage people to seek lower-cost options like cleaner cars and mass transit, and fuel economy mandates would force the provision of those cleaner cars. Theoretically they could work in concert.
At this time, however, the mass transit and clean car options simply don’t exist for the vast majority of people, particularly those in a lower income class. You would just make it unaffordable to own a car for a lot of low-income people, reducing their mobility and probably their job prospects. Currently, most Americans who don’t own a car are poor.
There’s a balancing act here. The gas tax is too low, it makes it unable for the government to finance the externalities of greenhouse gas emissions. But that gas tax needs to finance alternatives, which it does not currently.
The other option is to replace the income tax with a carbon tax that could be designed to be pretty progressive. But of course, the word “tax” makes all of these debates theoretical in a time when modern Republicans have even a modicum of power.





9 Comments


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What I really like about a $1 gas tax is that the poorer among us will have to pay a larger percentage of their income than the more wealthy. Or even better, we make it more progressive and create an entirely new federal bureaucracy to determine who deserves not to pay the buck. Has anyone here ever gone to the DMV? — SNARK
It’s not only the poor who cannot afford a fuel efficent car like say a volt or prieus. I know I can’t go out a buy any new car and I make 40 grand a year. Used cars arn’t much cheaper.
How about a war tax, one-tenth of one percent per person on annual war expenditures. That would currently be about a thousand dollars per person annually, but not for long because people wouldn’t stand for it, and then it would save hundreds of billions per year, enough to pay for health care and then some.
As a subway-riding New Yorker, I fully support much higher gas taxes. Yes, I understand that having higher gas prices would hurt a lot of people, but something has to be done about this monkey on our nation’s back.
So those folks who do not live in the city get to pay more. I had sorta thought that FDL might be in the corner of those with lesser means.
This, especially. There are places where trains or buses won’t ever make sense. The people who live or work in those places will end up paying more because the car companies don’t want to have to figure out ways to make cars better, or cleaner.
Well, you are paying a $3 tax hike to the Saudis, Iranians, Exxon, BP, Hugo Chavez, Monsanto, ADM relative to when Clinton was president.
Imagine if a 5 cent a year hike were passed in 1995 so you and everyone else knew then that gas would be at least 80 cents higher today, what do you think everyone would have done, from GM to the average commuter? That would have been a doubling gas to $2 a gallon by 2015! Shock and awe!
Gas prices have not increased by same percentage in Europe as the 300% increase in less than a decade here in the USA! ($1 in 1999 to $4 in 2007)
I similar how you write.Are you absorbing in a voice term writer job?
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Looks like the SPAM comments keep showing up here and there.
Is FDL able to remove the SPAM comments?