• Apr 22nd 2009 at 8:48AM
  • 67
By now you've surely noticed that gas prices have stabilized at around $2 a gallon (or less, depending on location) in the United States. That's about half of what gas cost just about one year ago, which is both a blessing and a curse, depending on how you look at it. Add Bill Ford, Executive Chairman at the automaker that bears his name, to the list of those unhappy about cheap fuel. He says:
When gasoline went to $3.50 a gallon we saw a sea change in customer behavior. Now people are turning away from more fuel-efficient vehicles and taking the bigger vehicles. I've been talking for five years now about the need for a gas tax. We have to have some predictability on fuel pricing and that price signal has to be strong enough so customers will continue buying smaller, fuel-efficient cars.
It's certainly not a popular view among many, but Ford's assertion that an artificial increase in the cost of fuel would force consumers into choosing more efficient automobiles is likely accurate. It would also make it much easier for automakers to plan future model launches, knowing that new car buyers would want to purchase a vehicle in two years that will save on their monthly fuel bills.

[Source: Green Wombat]

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    • 1 Second Ago
      • 6 Years Ago
      People are always on about all the great small high MPG cars in Europe. This is exactly the kind of policy that created them.

      High gas taxes will convince enough people buy the minimum vehicle they need, rather than the maximum that will fit in their garage.

      Higher fuel prices will also encourage alternative energy soruces, reduce consumption, reduce dependence of foreign oil suppliers.

      It is just about the best policy discussed in decades, but no one will have the balls to do it, because half the electorate is populated by unreasoning troglodytes.
      • 6 Years Ago
      One more thing,

      Like the ousted Waggoner, Billy just wants to be able to charge more for his cheap smaall cars that don't do what people want them to.

      And befor you bash me, my family owns 2 cars, the largest of which is a 2.4L 4-cyl. My choice, and we make it work for us. But I don't want to make YOU drive a small car if it isn't what you want.
        • 6 Years Ago
        I drive the smaller vehicles simply because I am concerned about giving the least possible amount of money and support that I can to :

        A) Oil Companies
        B) Foriegn Governments

        In addition, because I like the handling of them as opposed to an SUV or Minivan. My family does not need a larger vehicle at this time. Why consume more than you need to? I consider myself making informed choices that are right for me.

        Again, if you want to change how people use and view their cars, give them information, do not justify bigger, fatter government as the way to achieve it.

        • 6 Years Ago
        "Billy just wants to be able to charge more for his cheap small cars that don't do what people want them to."

        Billy (and I) actually want to change what people want their cars to do.

        It's not that you won't get what you want, it's that your wants will be more in line with national and environmental interests.

        Why, incidentally, do you choose to drive small cars?
      • 6 Years Ago
      That's right, raise taxes on the working poor by NOT adding a fuel tax. Last summer was an example of a fuel tax. The difference was 1. We were not able to plan for it and 2. Sent most of the "tax" revenue across the ocean.

      A fuel tax implemented in stages would 1. allow people to prepare for increases over time. 2. keep oil demand stunted. 3. stop the volatile price spikes and ultimately keep prices relatively low 4. keep our money in our country instead of giving it to countries overseas.

      Jharlan, Get a grip. Learn to understand the dynamics of imposing artificial demand dampening techniques to effect prices. Bill Ford's advocating for a fuel tax has little to do with generating income for the government or gaining an edge from a business standpoint. It does have a lot to do with keeping money in our country instead of letting other countries impose and collect the "tax".

      To the Politicians: Please implement an additional 50 cent per gallon tax each of the next 5 years! This should not be a road tax though. It should go towards paying down the debt. Do it and you have my vote!

      I drive a deisel vehicle that gets about 10 mpg. Last summer it cost over 50 cents per mile just for fuel. It was a 120 mile round trip daily. I only earn home about $1200 after expenses. Point is a $2.50 per gallon tax would greatly effect me in a very negative way but I still believe it is what should be done.
        • 6 Years Ago
        So why are you driving a 10 MPG vehicle? Buy yourself a Jetta Diesel and you will only have to fill up your 15 Gallon tank once a week!
        • 6 Years Ago

        Because that does not solve the problem.
        • 6 Years Ago
        So only people who drive cars are responsible for paying down the debt? Why penalize people who already drive high mpg cars? Do you really think politicians who will get this windfall will only use it to pay down the debt? If such a scheme was implemented, most of the funds would be spent on new "initiatives. Why not have a sliding scale of tax credits based on the mpg of the cars? Start at 30 mpg combined and go up from there. It would mean more fuel effecient cars and no penalty for people who already drive gas sippers.
      • 6 Years Ago
      Yes, by all means Bill, raise our taxes more so we can continue to send money to the Detroit ghetto. Bailout, bailouts, bailouts.....
        • 6 Years Ago
        How would that work exactly?
      • 6 Years Ago
      I find it amazing how many of you just want to keep giving away your paychecks. I think you're under the impression these taxes will somehow punish all those people driving around aimlessly with their Hummers. These taxes will punish cab drivers, truck drivers and people that need to drive for work AND yes you will punish the poor chump taking his family on vacation. Do you really think that many SUV drivers are just driving around in them because they have all this money to waste! One more dumb thought. What are all these taxes going to be used for? Improving out infrastructure. They've already taxed us for that a dozen other different ways!!
        • 6 Years Ago
        Joey: It's not about punishing people, it's about national policy. We as a have national interests in a) international balance of payments b) energy security c) environmental protection d) maintaining our transportation infrastructure. (am I forgetting any?)

        A gas tax can be a push in the right direction on all of these issues, without any new governmental entities, without any new laws, simply by adjusting the level of an existing tax.

        People who drive for a living will adjust their costs upwards, so consumers will pay incrementally more for their services.

        What dozen other taxes go to maintaining roadways?
      • 6 Years Ago
      IDIOTS, Does anyone really believe that any revenue the Federal government generates on additional fuel taxes will be used to pay down debt and not for more PORK? Any FOOL that wants the government to have more of their money is welcome to donate any amount they feel is reasonable! However do not saddle your neighbors with additional costs. Many people that live in the less populous areas must commute to work and drive distances to purchase the staples for living. I am sure that some will say that we should live close to cities to mitigate this problem, my own view is that I do not want to live in an open sewer as all cities meet this description. If you feel the need to give more please do so. I currently own a 99 GMC Safari cargo van and was planning to replace it with a Ford Transit Connect, now however I will be purchasing a HHR cargo. Nice move Bill!
      • 6 Years Ago
      No tax on gas! That hammers everyone. Instead, let's start adding a pollution and mileage-based fee to car registrations. Apply it to new cars going forward, but keep it on a relentless rise. For a given car, the "base" will always be the same (so people are not "priced out" of the cars they buy, but a given performance level will see ever higher fees over the years.

      Such a fee also avoids people being able to finance it into the purchase of a car like the current gas guzzler tax...it means they have to consider it when they think about resale value.

      Rather than try to push a rope (CAFE requirements, forcing automakers to build cars the public doesn't want to buy) let's pull the cart and encourage people to buy efficient cars.

      We can also create a deduction on income taxes based on the number of dependents in your family, so if one has five kids and so really needs a good seven seater, they won't be "punished" so much for it.
      • 6 Years Ago
      We don't need a higher gas tax. We need an oil import tax. The tax would apply to OPEC countries only.
      • 6 Years Ago
      Isn't it strange how Henry Ford made his first cars to be run on alcohol and came with a still. Huh, He was looking out for his customers! It would be nice if that frame of thought came around again!
      • 6 Years Ago
      The current retail price of gasoline is artificial because of direct and indirect government subsidies to oil companies and the fact that those companies are allowed to externalize the devastating human and ecological health effects of oil mining, transportation, refining, storage, and combustion. The most comprehensive study I've seen into the cumulative cost of all these subsidies and externalities was published by the International Center for Technology Assessment more than 10 years ago. It was titled "The Real Price of Gasoline," and the ICTA's estimate was that from $4.60 to $14.14 of subsidies and externalities weren't reflected in the retail price of each gallon of gasoline. Think about that: How would you change your life if you knew that, say, $6 of true costs were going to be internalized over the next several years into the price of each gallon of gasoline?

      Keep in mind that those figures don't reflect inflation since the report was published nor do they include the cost of the invasion and ongoing occupation of Iraq, which most certainly had a whole lot to do with oil. You can see the whole study online at http://www.icta.org/doc/Real%20Price%20of%20Gasoline.pdf. The Executive Summary is only 2 pages long so you don't need to read all 43 pages to get the gist of it.

      Note also that a much higher tax on fuel need not be a big burden on the poor. We could choose to lower payroll taxes to make the new fuel tax revenue-neutral in what's called a tax-shift. Tax-shifting typically involves raising taxes on activities that are doing us harm in order to discourage them and lowering taxes on activities we want to encourage, in this case employment. Some European countries are much farther along than we are in implementing such tax-shifting policies.
        • 6 Years Ago
        Lets not forget that this would be a tax on retail gasoline only. Not necessarily wholesale, and not on alternatives.
        • 6 Years Ago
        +1 on the tax shift.
        any approach to a tax should take into account a variety of other taxes and income levels and create a comprehensive tax package that works for a variety of income levels and cost of business. I think for once we all see this and the unusual political climate has mitigated much of the meddlesome influences that get politicians arguing about the donut hole to the detriment of the donut. a clean, thoughtful, and above all- comprehensive approach will serve us well.
      • 6 Years Ago
      But there is an even higher political price to a gas tax.
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