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By 2g1c2 girls 1 cup

Who Hates the Ice Caps?

3rd June 2008

CAFE (the federal Corporate Average Fuel Economy law) should be repealed. Let me repeat that: CAFE should be repealed. You might think this means that I don’t believe in global warming or that I’m a conservative who doesn’t believe in regulation, or maybe that I’m just stupid. I’ll let you judge the 3rd point, but I assure you that neither of the 1st 2 are correct.

I believe in global warming, and I also believe we should do something about it. And while I am against this particular piece of regulation, I believe a tax is the better answer.

I don’t hate the ice caps! I’m all for lowering CO2 emissions everywhere we can. My argument is with CAFE. It does not work, and never has, and never will. It is flawed legislation written by morons who wouldn’t know a supply & demand curve if it slapped them in the face. The way to lower emissions is to give an incentive to people to buy a higher mileage car and to promote conservation. The way to do that is to increase the damn gas tax! Simply telling the manufacturers to increase economy doesn’t work. Billions are spent and the customer never sees it directly. Toyota, GM, Ford, etc. can’t price for this, because all of the cars will have to meet the higher standards, so you have no competitive advantage to justify the higher price. Because the consumers don’t see the cost of the economy, they have no incentive to drive smaller cars and/or drive less. A higher tax, though, would give the consumers an incentive to go buy the more fuel efficient vehicles (and would be willing to pay more for them) and drive less. American consumers and politicians are who they are, however. They want everything and don’t want to pay for it. This is a way to “stick it to big business” while the consumer gets this “free” gift. We need to grow up as a society and understand that there is no such thing as a free lunch!

Want proof? Cars average 36 mpg in Europe and 31 mpg in Japan vs. only 21 mpg in the United States. Why? Because gas taxes are about 10 times as high in Europe and about 8 times as high in Japan. Faced with such expense, consumers make the rational decision to avoid paying so much for fuel by conserving it. It’s classic economics. You reduce the demand for a product by raising its price, and raise the demand by reducing the price.

I also propose that this increase be channeled directly to improving highways and funding the research & development necessary to increase fuel economy. This funding should be apportioned amongst the automakers in direct proportion to the number of employees they have in the United States. For a change, let’s have a government that actually wants to preserve jobs here in the USA. This isn’t protectionist, it’s simply smart business. Other countries do it and it puts our jobs, our business and our national and economic security at risk.

That’s my opinion; what’s yours?

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2 Comments »

  1. I don’t believe an increased gas tax, in and of itself, will solve the current fuel cost problem.
    Why place the burden on the consumer, he didn’t create the problem. He simply bought the vehicles that gorge themselves on fuel.
    If a gax tax is enacted, it should be followed closely by (1) higher fuel standards, and I don’t mean adding another 2 to 3 miles per gallon to the present standards and (2) a excess profits tax placed upon the oil producers.
    Should the government increase the present gas tax we should not fall for the “lock box” trick as has been the case with highways that are in disrepair and social security that is running out of money.
    The fuel tax should be offered to the automakers in the form of dividends for each mile per gallon that they exceed the CAFE levels, whatever they are.
    The windfall profits tax should be dangled in front of the oil producers in the form of subsidies for construction of new facilities for producing more finished product.
    We can’t simply mandate our way out of this problem through a one-sided consumer tax. It’s everyone’s problem.
    That’s what I think. How ’bout you?

    Comment by Anonymous — 17 June 2008 @ 5:12 am

  2. Right on SLANDY!

    While I loathe the idea of paying more for gasoline, economic theories of supply and demand have been proven sound time and again, and your suggestion is an excellent example of them.

    With all that said, I’d like to see some relief in the form of Alaskan and off-shore drilling get funded by such a tax – if I’m paying more I’d like to see someone doing something to help reduce the tax.

    I’m sure someone will cry about how this is unfair to those poor people who can only afford 1 car and it has to be an SUV because they have a large family. For them I have only 1 word: Prophylactics.

    Comment by Doug — 24 June 2008 @ 5:46 pm

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