Tuesday, April 25, 2006

Gas Prices Need To Be Higher

Everyone is smarting over the prices at the pump right now, and I understand that. I don't like paying what I'm paying any more than the rest of you. And I am really sickened by the fact that all that extra money is going right into oil baron pockets. But I have to agree with DuaneSmith over at Abnormal Interests.

He has a very good post about gas prices that I can't disagree with. It says, in short, that gas prices should be higher, not lower. The really pertinent part, to me, is this:

... The increase in price should be in the form of a partly revenue neutral tax. The tax should be so designed that the poor are not hurt. In fact, they should be given public transportation grants or the like from part of the tax that is not revenue neutral. Another part of the increased revenue should go to building public transportation infrastructure in areas where it is currently the least used and hardest to design and to improving it where it is the most used. Yes, it does need to be phased in but in a matter of a few years not a few decades. But we should borrow against it to start the infrastructure tasks ASAP.

On top of this, we need something like a truly revenue neutral tax on greenhouse gas emissions at every point in the supply and use chain.

For one thing, Americans are spoiled rotten when it comes to gas. When you factor in inflation, gas is still pretty damned cheap, all things considered. And our car culture feeds off that cheap gas. But that cheap gas does very little to help the areas in economic distress. His idea would redistribute (and I know, that's a nasty, leftist word, but I don't give a rat's ass) resources to where they are needed most, assuming decent management of the money. And we need solid infrastructure development for those areas now. Expansion into surrounding areas can come later. History has shown that any time you increase ease of transportation, you get an economic boom.

There's a reason Rome built roads everywhere it went, and it wasn't purely for ease of military use. They knew what decent, well-maintained roads did for the economy of the Empire. It's been said that the US is the new Roman Empire. I'm not sure I agree with that, but it can't be denied that the US interstate system has been an economic boon. This principal will also work on smaller scales, in the more economically backward areas of the country. Places like the inner city, southern West Virginia, Mississippi and Louisiana. Every one of those places has transportation issues. Fix those issues and you go a long way, although not the entire distance, towards fixing the other issues in the area. By fixing the local infrastructure, you improve school systems, lower crime rates, increase interest in corporate development and a plethora of other benefits. I'm not saying throw money at the problem. It would take wise stewardship to make it work in any given area. Using tax money of any sort always does. But if done correctly, it would, in the end, go a long way towards putting more money in the hands of the local populace, offsetting the increased burden on the the families in these areas, gas-price-wise.

And I think we can agree that having more money doesn't make everything better, but it sure doesn't hurt.


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Fire does not wait for the sun to be hot,

Nor the wind for the moon, to be cool.

-- the Zenrin Kushu