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November 14, 2007 at 13:15:42
How we could have saved billions with a gasoline tax by Richard Clark Page 1 of 1 page(s) 
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Some of the points recently made by Tom Friedman at: www.nytimes.com/2007/11/14/opinion/14friedman.html?_r=1&oref=slogin If only we could have slapped a “patriot tax” of $1 or more on every gallon of gasoline sold, this would have greatly diminished the transfers of wealth we were making to the very countries who are indirectly financing the ideologies of intolerance that are killing American soldiers. In addition, such a move would have spurred innovation in energy efficiency by U.S. manufacturers. But no, George Bush and Dick Cheney had a better idea. And the Democrats went along for the ride. They were all going to “let the market work” and not let our government shape the market, like OPEC does. But let’s imagine that some brave Democrat had proposed a tax on gasoline. Here’s how the debate could have gone: 
REPUBLICAN CANDIDATE: “My Democratic opponent, true to form, wants to raise your taxes. Yes, now he wants to raise your taxes at the gasoline pump by $1 a gallon. Another tax-and-spend liberal who wants to get into your pocket.”
DEMOCRATIC CANDIDATE: “Yes, my opponent is right. I do favor a gasoline tax phased in over 12 months. But let’s get one thing straight: My opponent and I are both for a tax. The difference is that I prefer that my taxes go to the U.S. Treasury, and he’s ready to see his go to the Russian, Venezuelan, Saudi and Iranian treasuries. His tax finances people who hate us. Mine would offset some of our payroll taxes, pay down our deficit, strengthen our dollar, stimulate energy efficiency and shore up Social Security. It’s called win-win-win-win-win for America. My opponent’s strategy is sit back, let the market work and watch America lose-lose-lose- lose-lose.”
If any Dem couldn’t win that debate, they don’t belong in politics.
We could have, and should have, replaced the current payroll tax with a gasoline tax. Middle-class consumers would have seen increased take-home pay of between six and nine percent, even though they would have had to pay more at the pump. In the long run, they all would have been money ahead. Plus, a stronger foundation for future economic growth would have been laid by keeping more oil revenue home, and we might not now be facing a recession.”
As a higher gas tax discouraged oil consumption, the price of oil would have fallen in world markets. As a result, the price of gas to [U.S.] consumers would have risen by less than the increase in the tax. In other words, some of the tax would in effect be paid by Saudi Arabia and Venezuela. (This according to Harvard economist and former Bush advisor Greg Mankiw.)
U.S. consumers would have known that, with a higher gasoline tax locked in for good, pump prices would never be going back to the old days, so they would have a much stronger incentive to switch to more fuel-efficient vehicles, and Detroit would have had to make more hybrids to survive. This would have put Detroit five years ahead of where it is now. “It’s called the America wins program instead of the petro-states win program,” said Phil Verleger, an energy economist.
In conclusion:
We simply cannot go on being as dumb as we wanna be. If you hate the war in Iraq, then you want a gasoline tax so you can argue that we can pull out of there without remaining dependent on an even more unstable region. If you want to see us negotiate with Iran, not bomb it, you want a gasoline tax that will give us some real leverage by helping to reduce the income of the ayatollahs.
A gasoline tax would (and will) reduce the flow of wealth to petrolist leaders -- who will never change if all they have to do is drill well holes rather than educate and empower their people.
A gasoline tax will spur U.S. innovation in energy efficiency.
Take action -- click here to contact your local newspaper or congress people:
Replace payroll taxes with a gasoline tax
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| 7 comments |
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Gasoline Tax Redux
I seem to recall that the last time a gas tax was seriously discussed was back in the 1970's when gasoline was selling for $0.50 a gallon. A proposal for a $0.50 a gallon tax was floated and was roundly denounced by most politicians and the all of the media. The rebuttal from all of these people was that $1/gallon gas would surely destroy the U.S. economy. by PrMaine (13 articles, 13 quicklinks, 3 diaries, 510 comments [22 recommended, 1 rejected]) on Wednesday, Nov 14, 2007 at 4:37:11 PM  (0+)
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Reply: Would have destroyed the US economy?
What a hoot! And I'm sure you'd agree. If we had employed such a tax, then, and invested the proceeds in the rapid development of hybrids and other electric-powered cars, we could have become independent of our reliance on Mideast oil and saved the estimated $2 trillion that this war in Iraq is ultimately going to cost us. by Richard Clark (30 articles, 0 quicklinks, 0 diaries, 101 comments [2 recommended, 0 rejected]) on Wednesday, Nov 14, 2007 at 7:00:03 PM (0+)
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Gasoline tax
Gasoline tax is a regressive tax just like a payroll tax. It targets the poor and middle classes. Since almost everyone has to drive a car there's no way to avoid the tax. Our troops are being killed because they invaded and are occupying other countries not because of anyone's ideology. If the government needs to raise taxes then it should be on taxes that target the rich. by Ty (0 articles, 0 quicklinks, 0 diaries, 888 comments [2 recommended, 0 rejected]) on Wednesday, Nov 14, 2007 at 6:19:14 PM (0+)
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Reply: Why the gasoline tax would not have to be regressive
<<< Gasoline tax is a regressive tax just like a payroll tax. It targets the poor and middle classes. >>> First of all, the gasoline tax could have replaced the payroll tax, so it would be no more costly, in total, than what the taxpayer had been paying previously. Secondly, the current cost of the Iraq war amounts to about $20,000 per American family. That cost could have been avoided with a gasoline tax the revenues from which could have been used to develop hybrid cars years before they were actually developed. --and/or we could have brought back purely electric cars, which have been around for many many decades.. <<< Our troops are being killed because they invaded and are occupying other countries not because of anyone's ideology. >>> As Alan Greenspan confirmed in his recently published book, the real purpose of invading Iraq was to take control of that country's vast oil reserves. (For more on this subject, see my OpEdNews article on this subject.) <<< If the government needs to raise taxes then it should be on taxes that target the rich. >>> I'm all in favor of increased taxes on the rich. by Richard Clark (30 articles, 0 quicklinks, 0 diaries, 101 comments [2 recommended, 0 rejected]) on Wednesday, Nov 14, 2007 at 7:13:46 PM (0+)
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Regressive by Degrees
One of the great progressive successes in our history was the introduction of the Social Security System, which was supported by a regressive tax that has remained at least regressive today. It is still a great program that progressives should and do support. This suggests we should not reject an idea just because it involves a regressive tax. Even our most progressive tax has become much less so in recent years. I believe the income tax is still slightly progressive, but the impact of the tax law changes passed by the Bush administration make one wonder how it can be, with top executives paying a considerably lower rate of tax than their secretaries. by PrMaine (13 articles, 13 quicklinks, 3 diaries, 510 comments [22 recommended, 1 rejected]) on Wednesday, Nov 14, 2007 at 7:18:55 PM (0+)
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Reply: Regressive taxes sometimes have huge benefits
We were also taxed plenty after WWII so as to provide free college educations to all the vets who wanted to take advantage of this opportunity. This was some of the 'smartest' money US taxpayers ever spent since economists today estimate that the resulting economic benefits to our economy and society (the return on investment) had a value that was approximately seven times the amount that all these college educations cost us. by Richard Clark (30 articles, 0 quicklinks, 0 diaries, 101 comments [2 recommended, 0 rejected]) on Wednesday, Nov 14, 2007 at 7:32:22 PM (0+)
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Recapping my article
A gasoline tax could: a) replace some percentage of the payroll tax, thereby providing a net SAVINGS to every low- or moderate-income taxpayer regardless of income. b) (could have) eliminated any need to invade Iraq (thereby saving every family in America an average of $20,000 -- their share of the $2 trillion that this war will cost us before it's all over. c) could have spurred innovation in energy efficiency by U.S. manufacturers, including all car manufacturers, thereby saving all taxpayers some money. d) could have greatly diminished the transfers of wealth we were (and are) making to the very countries who are indirectly financing the ideologies of intolerance that are killing American soldiers. Why should we continue to pay so much money, via our gas guzzlers, to the Russian, Venezuelan, Saudi and Iranian treasuries? Why finance people who hate us? Why not instead offset some of our payroll taxes, pay down our deficit, strengthen our dollar, stimulate energy efficiency and shore up Social Security? All this could be done with a gas tax that resulted in more efficient automobile engines, smaller cars, and fewer miles driven. Plus, a stronger foundation for future economic growth could have been laid, by keeping more oil revenue home, and we might not now be facing a recession. e) could discourage/reduce overall oil consumption in the US, and so the price of oil would have fallen in world markets. As a result, the price of gas to [U.S.] consumers would have, over the past 6 years, risen by less than the increase in the tax! In other words, some of the tax would in effect be paid by Saudi Arabia and Venezuela. (This according to Harvard economist and former Bush advisor Greg Mankiw.) U.S. consumers would have known that, with a higher gasoline tax locked in for good, pump prices would never be going back to the old days, so they would have a much stronger incentive to switch to more fuel-efficient vehicles, and Detroit would have had to make more hybrids to survive. This would have put Detroit five years ahead of where it is now (as regards fuel efficiency), which represents a large potential savings to most drivers. by Richard Clark (30 articles, 0 quicklinks, 0 diaries, 101 comments [2 recommended, 0 rejected]) on Wednesday, Nov 14, 2007 at 8:36:51 PM (0+)
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