How to Raise the Gas Tax - Autoline on Autoblog with John McElroy
You see, we don't like taxes of any sort. And we especially hate gas taxes. Owning a car in America isn't so much of a privilege as it is a necessity. Most our communities don't have public transportation. So we need our wheels to get to work, or school, or going out for fun, or whatever else we want to do with them. In America, even the poorest among us drive cars. And none of us want the government taxing our mobility out of our reach.
But maybe the problem is that the American people have never been properly sold on the need to raise the gas tax. Here's my pitch.
John McElroy is host of the TV program "Autoline Detroit" and daily web video "Autoline Daily". Every week he brings his unique insights as an auto industry insider to Autoblog readers.
Because we keep the price of oil so cheap, we use an awful lot of it: 20 million barrels a day, every single day. About half of that is used for transportation purposes. And because we import so much oil, it has a debilitating impact on our trade deficit. Every year we ship $300 billion out of this country to pay our oil bills. Indeed, it is a key contributor to why the United States has gone from being a creditor nation to a debtor nation, a shocking development that calls into question this nation's ability to remain a world leader. People in debt don't call the shots. They get told what to do.
Worse still, we import a lot of that oil from troubled hot spots in the world. It leaves us very vulnerable to cut-offs, and forces us to deal with less-than-friendly regimes that we could otherwise choose to ignore.
Then there's the impact on the auto industry. Automakers are under the gun to meet fuel efficiency standards that will force them to build millions of small cars that fit in the A, B and C-class segments. If the price of gasoline is high they should have no problem selling these cars, as we saw in the summer of 2008 when gas prices shot over $4 a gallon. But if gas prices remain relatively low, like they are right now, there's going to be acres of lonely small cars gathering dust on dealer lots. That alone will threaten the financial viability of most automakers in this country.
A lot of people assure me that gasoline prices are going to rise on their own anyway as the global economy recovers. But these are largely the same people who assured me a year ago that gas would never, ever fall back under $4 a gallon again. What if the "experts" are wrong this time too, and oil prices stay pretty much where they are? I can categorically guarantee you that would be a disaster for the auto industry.
Meanwhile, we have a deadly war that is raging in Afghanistan. The Defense Department says it will cost $65 billion next year without any troop build-up, and over $100 billion if the President decides to send in more troops. The escalating costs in Afghanistan are wiping out any savings from withdrawing from Iraq.
Our troops in Afghanistan need new types of MRAP vehicles (Mine Resistant Ambush Protected). They're being killed up by roadside bombs because the MRAPs we developed for Iraq are ineffective in Afghanistan's mountainous terrain and rocky dirt roads. We need to get our troops what they need, and we need to get it to them as fast as possible, cost be damned. But how do we come up with the money to pay for it?
I think we need to start by taxing oil, but not just any oil. Only imported oil. A $5 tax on every barrel of oil that is imported into this country would raise over $18 billion a year. A $25 tax on imported oil would just about pay for the entire Afghan war.
And this kind of tax would dovetail perfectly our national needs. We could get our troops the equipment that will save their lives. We could ensure stability in the auto industry. And we would spur development of new domestic sources of fuel.
With specific goals spelled out as to how this money would be spent, I believe the American people would finally accept a tax designed to raise the price of oil. All I have to do now is find a politician brave enough to propose it.
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