Wednesday, October 05, 2005

Thank goodness for high gas prices

posted by Rob at 6:33 PM

If you're an environmentalist or devotee of global warming, that has to be your slogan this week. Plenty of people want to bash Bush over prices at the pump, but it appears this country has finally found an energy policy that works.

Consider this:
New data from the Energy Department show that fuel consumption over the past month declined by almost 3 percent compared with last year. Analysts attributed the trend to soaring pump prices and a slowdown in economic activity
And this:
In the first look at sales since Hurricane Katrina drove gasoline pump prices to $3 a gallon and beyond, sales of passenger cars grew last month while large, fuel-thirsty sport-utility vehicles languished. Overall, industry sales in September slid 7.6 percent from a year ago. ...

At Honda, sales of the Civic, one of the industry's most popular small cars, grew 37 percent from a year ago. Honda reported a 25 percent sales increase in the gasoline-electric hybrid version of the Civic. Sales of the hybrid Toyota Prius nearly doubled, to 8,193 for the month.
Sure, there is still some real pain at the pump, but silver linings are taking root. Forget federal fuel-economy standards. Real positive action will only be taken when consumers, not suppliers, are forced to alternatives.
As demand for gas declines, supply will grow. That will bring prices down further. At which point, of course, us greedy Americans will return to our SUVs until forced again to use alternatives.

One way to possibly prevent that - keep prices high. As Slate observes:
Practically speaking, the only hope of changing America's driving habits is a hefty price increase that lasts. For, oh, five years. The data show that after that long, even the response of American drivers to higher prices can be pretty sizable. Five years gives people the time to come up with substitutes.

Well, why not a new gas tax? Not "new" in the sense of an add on, but new in the sense that federal and state gas taxes should be based on percentage. Instead of state and federal governments taxing 25 cents on the dollar, why not simply levy a 25 percent of the wholesale value of gasoline per gallon?

Legislators should love it, since when prices jump, government profits as well as business.

Liberals/environmentalists should love it, cause it would continue to hit SUV sales.

Educators would love it, because it would increase demand for good math skills.

Conservatives/Republicans? I don't know. Odds are they would hate it since it would be taking more money from consumers and handing it to the government.

I myself am unsure of the argument. As positive an influence as high gas prices are in some aspects, it still continues to hit me in the wallet. I drive a Dodge Neon which, after six years and 155,000 miles, still gets about 32 miles a gallon. Soon will come the time when it will roll no more. The wife wants an SUV (Ever gone five hours with two kids in a Neon?)

I guess this is what liberals mean when they demand sacrifice?


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