Following up on yesterday's story, WENY asked Randy Kuhl about his plan to lessen the impact of higher gas prices. Kuhl says he supports a federal gas tax holiday and also supports a $6,000 tax credit for those who buy a fuel-efficient car.
The gas tax holiday has been discussed earlier here and here. It just won't work.
The tax credit for buying a more economical car might actually be effective. But with the rising deficit, I'd like to see how it will be financed, and I'd also like to see a study showing that a tax credit is a significantly better incentive than the rising price of gas itself. Maybe $4/gallon gas by itself will spur people to buy smaller cars.
Comments
Aside from buying votes, a $6000 government check would motivate people to buy cars, and dealers to raise prices on efficient vehicles.
I'd suggest that fuel efficiency standards first need to be raised dramatically to match Europe's and Japan's. Once fuel-efficient cars are on the market in greater numbers, then gas taxes could be raised to enable the federal government to subsidize the purchase of vehicles using a sliding scale: The more efficient the vehicle the higher the subsidy.
To prevent higher prices from sucking up the subsidies, this would be a one shot deal -- one purchase per family -- and the program would only last, let's say, three years. Finally, there should be a liberal income cut-off, let's say $250,000 per family. People who aren't affected by the cost of owning a car shouldn't be subsidized.
Raising gas taxes would not be good for the rural poor who have to drive to their jobs and cannot afford a fuel efficient car even with the $6,000 incentive.
Increased taxes might also lead to an increase in mass transit prices in larger cities that would also impact the poorest.
Since we're social engineering, instead of a flat $6k subsidy, it could be income-related as well as fuel economy-rlated, with lower income people getting a bigger one-time subsidy. And we could funnel some of the money from the gas tax to mass transit to keep the costs of riding the bus or subway cheap.
That said, I think the invisible hand is going to be pushing people to buy more efficient cars, no matter what sort of social engineering is offered by Congress. And, unfortunately, poor people are going to suffer.
What would be helpful in the rural areas is an increase in mass transit and a willingness by employers to set up flexible schedules so that the workers can take advantage of the mass transit.
My daughter's best friend lives in the New York City area. She is down visiting this weekend and actually took Amtrak. She figures she saved about $80 by not driving.
A lot could be gained if the government spent some money on nuclear development, finding a way to burn coal cleanly, and opening up more areas for oil exploration.
Another idea is car-pooling. In urban areas with high-occupancy vehicle lanes, anonymous carpooling has been going on for years. The driver gets a faster commute home, the rider gets a free ride. People go to a website to hook up with other riders. This could work in rural areas, too.
What would be helpful in the rural areas is an increase in mass transit and a willingness by employers to set up flexible schedules so that the workers can take advantage of the mass transit.
I agree. It's going to take social changes along those lines to seriously reduce fuel consumption.
I don't have a good handle on the tax credit for hybrid angle. I'd have to see a detailed cost-benefit analysis before I rejected it out of hand, personally.
I don't think opening new areas for oil exploration accomplishes anything. It's just kicking the can a little further down the road for the next generation to pick up.
Perhaps now that the price of oil has risen so much, it would be feasible to start processing oil shale.
http://www.deseretnews.com/dn/view/0,1249,660227927,00.html
I agree with Exile. If we don't act as though we are at peak oil right now, we will end up repeating the same mistakes that we've made since the seventies. We will run out of oil at some point in the relatively near future and it is too important for us to be burning what's left. Plastics, medicine, the military, construction, agriculture rely on it and once it's gone it won't just be a matter of high prices. All kinds of disruptions, including war and famine are likely.
I agree with vdomeras - developing more domestic sources of oil is an important part of our strategic energy policy, but not simply to pour into our cars. The other issue with fossil fuels in general is pollution. I'd like us to spend more R&D on energy sources with a smaller carbon footprint.
We should have started acting like we are at peak oil 36 years ago. The government, mostly Republican presidents and Democrat congresses have managed to squander all that lead time. It will take decades to get to the point where we don't use much oil. In the meantime we had better get digging and drilling or there will be anarchy.
I know that many on the left won't agree with me, but I think the government should introduce incentives to burn coal, dig up shale oil and build nuclear plants. These steps will help us get through until the new technologies are in place.
I'd like us to spend more R&D on energy sources with a smaller carbon footprint.
Elitist. Why don't you just come out and recommend we run our cars on arugula-based ethanol?
Speaking of arugula, I just discovered that the arugula I buy at the public market comes from Appalachia -- Tompkins County is technically part of Appalachia. Are we still elitists if we eat it?
Only if it is grown by illegal immigrants
Exile: Only if you call yourself a "locavore".
Elmer: I know that many on the left won't agree with me, but I think the government should introduce incentives to burn coal, dig up shale oil and build nuclear plants. These steps will help us get through until the new technologies are in place.
I'm a broken record on this, but I don't have a problem with coal, shale, new-tech nuclear, or even drilling in ANWR, as long as it is part of an integrated, strategic energy policy. What's happened in the last few years is that we've had manipulative, distracting political battles about little pieces of the whole energy picture. ANWR is a perfect example. The "gas tax holiday" is another.
We need a plan that includes new mileage standards, developing new energy technology, better exploitation of our current domestic energy sources, etc. We need to have everything on the table when we develop and negotiate this plan, so advocates who have certain interests (such as environmentalists, oil companies, car companies, etc) will see what they will gain by making compromises. That's how important and long-lasting public policy is made, not by chipping off these stupid wedge issues in order to win a few votes every couple of years.
Only if it is grown by illegal immigrants
What if it's just picked by illegal immigrants?
"That's how important and long-lasting public policy is made, not by chipping off these stupid wedge issues in order to win a few votes every couple of years."
I think that's why the parties continue to gain and then loose power - nothing is ever really done.
Exile - grow it, pick it, pack it, ship it - it all counts
Exile - grow it, pick it, pack it, ship it - it all counts
I guess we're all elitists then, since nearly all of the produce at most supermarkets is picked by illegal aliens.