So far, I have yet to spend as much as four dollars for a gallon of gasoline, which is perhaps surprising since my car demands premium (91-93 octane). However, the last tank I bought ran $3.919, and other stations in that chain crept up to $4.03 or so in the next day or two, so I suspect that some time this week I'll break through the four-dollar ceiling. I am not, you may be sure, enthusiastic about this, but it could be worse, and I expect it will be worse, at least for a while.
I didn't grumble too much about three-dollar gas, which has been around for only a year and a half or so, and, says Charles Krauthammer, neither did anybody else:
So now we know: The price point is $4.
And my typical summer road trip, which averages upwards of 4200 miles, will be trimmed back by a thousand or so this year in the hope of keeping the fuel cost under $500. At 28 miles per gallon, the figure I obtained in 2007, 4200 miles requires 150 gallons, which at four bucks a shot would be $600; last year's 4333-mile trip cost me $485 for fuel.
My cutback constitutes, Krauthammer might say, a step toward rationality. Maybe, maybe not. But this would seem indisputable:
Some things, like renal physiology, are difficult. Some things, like Arab-Israeli peace, are impossible. And some things are preternaturally simple. You want more fuel-efficient cars? Don't regulate. Don't mandate. Don't scold. Don't appeal to the better angels of our nature. Do one thing: Hike the cost of gas until you find the price point.
And that price point, as he's already noted, is four dollars a gallon. Had he his druthers, he'd keep it there even if the price of crude tumbles:
For 25 years and with utter futility (starting with "The Oil-Bust Panic," The New Republic, February 1983), I have been advocating the cure: a U.S. energy tax as a way to curtail consumption and keep the money at home. On this page in May 2004 (and again in November 2005), I called for "the government through a tax to establish a new floor for gasoline," by fully taxing any drop in price below a certain benchmark. The point was to suppress demand and to keep the savings (from any subsequent world price drop) at home in the U.S. Treasury rather than going abroad. At the time, oil was $41 a barrel. It is now $123.
I don't think they're that complex: jiggering CAFE standards is a handy way to pass the buck "It's your fault for building all those gas guzzlers" and both ethanol and cap-and-trade hew to Congress' primary goal, which is to get itself reelected at any cost. It's been said before that if people had to write one huge check for taxes every year instead of having it dribble out, paycheck by paycheck, the electorate would revolt; it should be no surprise that the government wants to keep the numbers at least slightly under wraps.
Krauthammer, to his credit, wants this fuel tax to be revenue-neutral:
Goldman Sachs is predicting we will be paying $6 by next year. Why have the extra $2 (above the current $4) go abroad? Have it go to the U.S. Treasury as a gasoline tax and be recycled back into lower payroll taxes.
Not a chance, at least under an Obama administration: the candidate has already announced plans to increase the payroll tax. And it's not like the Feds are going to use any extra gas tax for things like, oh, fixing roads and such.
Still, the gas tax has the advantage of being simply, excruciatingly fair: you buy this much gas, you pay that much tax. In a rational world, that would be a selling point. But asking Congress to be as rational as voters are? That's about as sensible as praying for cheaper fuel: Washington's will is nearly as inexorable as the Lord's, and just about as inscrutable.
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Copyright © 2008 by Charles G. Hill