Quagmire? Well, maybe for the soon-to-be ex-Parrots of Fallujah.
Quagmire? Well, maybe for the soon-to-be ex-Parrots of Fallujah.
Josh Chafetz and Andrew Sullivan have been having a bit of a back-and-forth over whether the gas tax should be raised. As Josh pointed out yesterday, such a tax would be highly regressive, particularly hitting the working poor in rural communities that don’t have mass transit.
It would also be bad policy for another reason: the gasoline tax is essentially a user fee. Most of the revenues of the federal gas tax are returned to the states (according to a rather arcane formula that just happens to shift funds from rural America to the Northeast) to pay for the federal share of major highway construction and resurfacing projects, while the rest of the money helps pay for the federal mass transit subsidy (thus, Mr. Sullivan, who doesn’t operate his own vehicle, receives a massive subsidy from those of us who drive). Diverting gas tax revenues to the general fund would arguably be even more crooked than diverting money from the Social Security tax to pay for the defense budget, or taking FICA receipts and using those to operate the postal service.
And, while I generally share their dislike for the sport utility vehicle (though am puzzled why comparably gas-guzzling vehicles like minivans escape their wrath), raising the gas tax would be a very crude instrument for reducing demand for SUVs: while people do respond to price signals over the long term, over the short run the demand for gasoline is rather price inelastic. But if your animus for the SUV is motivated by its gas-guzzling properties, rather than its appearance, you’ll be happy to know that Toyota will be introducing a hybrid gas-electric SUV next year, the Highlander Hybrid, which will provide “the fuel economy of a four-cylinder compact sedan.”
Update: Stephen Karlson properly takes note of the market-distorting effects of the rather arbitrary division between cars and trucks in the CAFE standard, which “effectively preclude some sport-ute and minivan drivers from substituting one size downward” to station wagons and large sedans.
Von in pondering the continual PR nightmare that is the Bush administration observes:
Thank God there’s some good economic news—and that Kerry is so freaking weak as a candidate.
I suppose if you’re a Republican, that might be worth being thankful for. But, it seems to me, the completely lackluster nature of John F. Kerry would be a serious drawback if you wanted to be able to vote for a credible alternative to Bush this fall without holding your nose.
I spent most of the evening out at a bonfire (out in the boonies of Panola County) with some friends, some beer, and some hot dogs. A few choice observations:
Just another night in the soap opera that is my life.
I’ve set my TiVo for the lovely Ms. McArdle’s appearance on CNNfn Friday morning.