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by Ben Fried
RE: The Friedman essay. I said the same thing on Room 8 in January in “The Only Energy Policy the U.S. Needs” about all fossil fuels.
Just impose require oil, gas and coal prices to be sold at the current level plus inflation, and impost a 90% tax on any savings for the oil, gas and coal industries if the price falls below that level.
That encourage a shift to alternative fuels and conservation for the long run.
But it would also, for the short run, encouarge domestic fossil fuel production to take the place of imports — by eliminating the cost savings of imports for consumers and limiting the cost savings for business to something like the cost of shipment. And, since coal has an environmental but not economic security impact, the tax on coal could be refunded to large purchasers (ie. power plants) that actually took the pollutants out of the air.
So even the pro-fossil fuel and “clean coal” interests would be in favor.
I’d be fossil fuel use would fall by 60%+ in 30 years, with almost all remaining supply coming from the Western Hemisphere, if people were merely forced to pay what their own gluttony has forced the to pay now anyway, without getting suckered again by temporarily cheap fuel.
Gasoline theft soaring.
From the Friedman article:
“We must not make that mistake again. Therefore, what our mythical candidate would be proposing, argues the energy economist Philip Verleger Jr., is a “price floor” for gasoline: $4 a gallon for regular unleaded, which is still half the going rate in Europe today. Washington would declare that it would never let the price fall below that level. If it does, it would increase the federal gasoline tax on a monthly basis to make up the difference between the pump price and the market price.”
If gas taxes would increase to maintain the pump price of $4/gallon, why would retailers ever drop their price below that point? Either your pump can say “$4/gallon” and that money can all go to you, or your pump can say $4/gallon” and you can keep $3.20 and give the government the other 80 cents. Pretty clear what they’d choose.
(If gas taxes would increase to maintain the pump price of $4/gallon, why would retailers ever drop their price below that point?)
Right. That’s why the gax should be on the fossil fuel at the point delivered to the refinery or (for gas and coal) distributor. And it should be 90% of the difference if the market price goes lower, to provide an disincentive to collude to keep the price high.
Excellent background article about Sheridan Expressway removal at http://www.gothamgazette.com/article/Sustainability%20Watch/20080527/210/2535.
I didn’t know that Robert “Moses named the road for his good friend, the Bronx commissioner of public works, Arthur V. Sheridan, who died in a car accident in 1952.”
“This would have the biggest improvement to the quality of the public realm and to transportation funding of anything that could be done. We need a bold, visionary elected official who is willing to step up to the plate to push for this.”
In response to "Public Support for NYC Toll Reform Highest in the Suburbs"