Another cog in the wheel known as the Vast Right Wing Conspiracy to combat the Extreme Left-Wing Media.

Friday, April 27, 2007

Liberal response to higher gas prices

While foreign affairs and social issues get considerable coverage in describing the differences between conservatives and liberals, the differences on economic issues are equally telling. When gas prices go up due to unrest in the Middle East, or storms in the Atlantic, conservatives who understand economics realize it is just market forces at work. What is the liberal response to higher gas prices? We need more taxes.
Is it time to raise gas taxes?

Daniel Kammen, a professor of public policy at UC Berkeley who specializes in energy issues, said he expects gas prices to hit $4 per gallon in the not-too-distant future.

"I strongly believe that we need higher gas taxes to fund research into energy alternatives," he said. "We'll need European-level gas prices before the U.S. engine of innovation gets really serious."

So how high should gas prices be? "A doubling of where we are today is what we need," Kammen said. "It would do the country a world of good."
Yep, that's our problem, taxes aren't high enough. What moroons.

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Blogger Luke said...

What also doesn't make sense about this goons statement is that the "European gas prices" haven't spurred energy innovations in Europe. High gas prices do not spur a movement away from gas and oil. It spurs the movement towards gas and oil. Extremely LOW gas prices would spur innovation more than high gas prices.

7:57 AM

Blogger skh.pcola said...

There is a group of noted economists that advocates this very policy, also called Pigouvian taxes. The concept calls for heavily taxing those products and activities that have concomitant negative externalities, in the case of gasoline, traffic jams, air and ground pollution, etc.

The problem is, when libtards make a feeble attempt to paint all oil companies with the Evil brush, that oil companies make a pittance on the sale of a gallon of gasoline compared to the government. Making a case for higher fuel taxes is a non-starter for most folks...except the elitist liberals who yearn tro be in charge of everything.

Luke, you are trying to fight simple demand and supply. High prices for fuel decreases demand, but increases supply (eventually). Extremely low gas prices do nothing to stimulate innovation. Venezuelans, with their $0.12/gallon subsidized fuel, can think of absolutely no reason to consider alternatives to gasoline.

7:09 PM

Blogger jonas said...

Luke ~ I think you are committing a fallacy in your argument here. European gas prices have caused huge changes in the structure of transportation in the continent. More people ride the London Underground than drive to work each day. There are cars in France that get 50 miles to the gallon that are not hybrids. In the U.S., approx. 1 in 5 vehicles are SUVs, while in France and Spain, the number is closer to 2 in 17. High European gas prices have not caused innovation in terms of new fuel sources, because they were handled in other ways.

skh.pcola ~ Pigouvian taxes work. Taxing products that produce unfavorable externalities is one of few ways to handle those externalities. Take, for example, cigarette taxes. Taxes on cigarettes are the highest per dollar of any taxed item, and since this tax (called a "sin" tax by those opposed) was imposed, cigarette smoking has decreased incredibly. Another thing that is being overlooked by your analysis is that gas taxes, as per state and federal appropriations law, go directly into infrastructure funds. Thus, the tax on gas goes directly to fund better highways, to solve areas if high traffic jams. Your supply and demand argument is spot on, however.

I also would like to contend your argument that "libtards" like me like to paint Big Oil with the Evil brush. Honestly, I understand that their job is to make a profit, and that they are unable to control their own prices, which are set in openly traded commodities markets. If people want someone to blame, look to commodities speculators, who have no motivation to lower prices on gas, since their profit margins right now are amazing. However, the speculators step back out of the limelight, and the country notices little but Exxon's $41 billion profit last year. I don't argue that Exxon is "Evil" or that its prices should be regulated. I just think that a company making $41 billion in one year doesn't need $20 billion in tax breaks.

A higher fuel tax does make sense. Oil, a increasingly scarce commodity, is never going to go back down to the 1990's prices of around $1.50 or so a gallon. The idea of raising gas taxes does not come from a desire to subsidize alternative energy research (don't be mistaken, if prices get high enough, automakers will look to alternative energy research in order to maintain profit margins; however, it will be either funded from their own coffers or from the general fund of tax dollars), they come out of a desire to keep bridges from collapsing, to keep the streets from having potholes so large a child could hide in them (I live in MD, and let me tell you, they exist), or to widen highways to alleviate rush-hour traffic; there hasn't been a transportation omnibus funding bill with an increase in money for infrastructure repair in several years.

And just to fend of the inevitable "elitist" comeback, my wife and I have a combined income of under $50,000 per year. I am not a union member, I have never earned any amount of money over that amount. Referring to me as an elitist really won't accomplish anything, I'm sorry to say. What using the word "elitist" does is set up a straw man argument that allows you to discredit what I say as out of touch or delusional; sorry, but I'm not.

12:16 AM


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