Jenkin’s column, The Coming Oil Investment Boom, June 4, 2008 was really just a restating of the old maxim “the best solution for high oil prices is high oil prices”. But near the end he seems to agree with Al Gore’s idea (a revenue neutral gas tax, offsetting payroll taxes):
Finally, growing up means recognizing that their [evnvironmentalists] one politically and morally saleable proposition is to offer carbon taxes as a de facto consumption tax, with the proceeds used to offset labor and capital taxes that discourage work and investment. This would be a case of taxing “bads” not “goods,” with benefits for growth and the average voter’s bottom line independent of any problematic evidence about CO2 and climate.
Then, June 6th Krauthammer, At $4 Everybody gets Rational, he once again calls for gas taxes to supress demand, pitching the same idea of an offset to payroll taxes:
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….
Unfortunately, instead of hiking the price ourselves by means of a gasoline tax that could be instantly refunded to the American people in the form of lower payroll taxes, we let the Saudis, Venezuelans, Russians and Iranians do the taxing for us — and pocket the money that the tax would have recycled back to the American worker.
Krauthammer acknowledges that this is “an exercise in futility”.
So then, we’re all in agreement, right? Why do all our political leaders lack the will to institute a gas tax? Is it their fault, or the fault of the electorate? This has been blindingly obvious since (at least) the first Arab oil embargo, over thirty years ago.
Instead, here is a sampling of what we get; Arizona governor Janet Napolitano supports a plan to raise sales taxes to build more roads –there is no sales tax on fuel in Arizona, the state fuel tax was last raised in 1991. Senators Kyle and McCain (and, I suppose I should mention, Senator Hillary Clinton. And not Senator Obama) want to eliminate the federal gasoline tax over the summer to (ostensibly) lower the price.