Apropos of British Columbia’s big announcement yesterday, I have some ranting to get off my chest. One of the most frustrating things about US climate policy is the reflexive fear that if we ever raise the price of gas—or of driving generally—people will riot in the streets or something. This makes it exceedingly difficult to re-arrange the economy away from oil and its carbon contents.
But, of course, the price of gas keeps rising anyway. In fact, crude oil prices have more than tripled over the last half-dozen years, with futures closing above $100 yesterday.
To be sure, there’s a silver lining to higher prices: they really do dampen demand, despite what you hear all the time. But it’s a silver lining to a dark and ugly cloud: high energy prices mean that consumers are taking it on the chin—and especially low-income consumers. And worse, all the revenue from the high prices goes to the energy companies. If prices had risen because of taxes or carbon fees, then the public could be reaping the windfall that big oil is raking in now.
For a decade, lawmakers have balked at the prospect of $20 per ton carbon taxes (a figure that is sometimes kicked around as a price that would get us on the right track). $80 per ton sets off screaming and wailing. But those figures translate into an additional 20 to 78 cents, respectively, per gallon at the pump. In the time that we’ve all been afraid of those comparatively modest figures, the price at the pump has jumped $2 or more.
We could have been intentional about getting ourselves off oil, and about protecting consumers from price spikes. But instead, we’ve opted for the expensive and volatile route: we’ll do nothing and hope for the best.
Now let’s just hope we can figure out a cap and trade program that doesn’t send any price signal to drivers </ranting>.
Now, Eric, you know that Markets = Freedom and Taxes = Slavery. A $2 increase that benefits big oil is just the price of admission that car owners have to pay to enter Libertyland, where even the toilets are drive-thru! While a $0.20-$0.78 tax would be just another link in the chains dragging them into the dungeons that are our subways. Oh, wait, you don’t have subways in Seattle. You do have a bus tunnel that could complete the metaphor, no? Of course, if voting car drivers were more open to gas taxes,then Seattle could more easily afford serious yet cheaper public transit for those drivers who are now taking (and will continue to take) it in the wallet from gas price increases; which is of course your point.
Say we increase taxes on fuel by 75 cents. Is there any speculation on how much of that would result in higher costs for consumers verses lower profits for oil companies? I suspect that a significant portion will come out of oil company profits and that the price at the pump might not actually reflect the entire tax. Or? (Then I think of the higher taxes and fuel prices in Europe…so perhaps I’m wrong on this.)
The political difficulty of raising the gas tax in Washington frustrates me to no end. The legisltaure has to finesse the situation with increased registration fees on gas guzzlers and other measures which are less fair, less direct, and more dodgable.Rodney, I won’t hazard a guess of how much of that 75 cents would come out of Big Oil’s profits, but anythin is enough to warm my heart.
Be cautious in advocating a gas tax increase. The Washington Constitution contains an amendment requiring fuel taxes to be used ONLY for “highway purposes.” The Washington State Supreme Court has interpreted this as excluding public transportation. When you advocate for fuel taxes you are essentially advocating for more road-building, which has proven to increase the frequency and distance people drive, thus increasing air and global warming pollution.Please consider advocating taxes that can be used for trip reduction, bicycle and pedestrian facilities and public transit, such as vehicle registration fees, parking taxes and tolls (if the legislature drafts the statute wisely).A second round of growth management, requiring cities to better manage growth INSIDE urban growth boundaries, would also be a huge step forward. Currently we have sprawl within the boundaries in most jurisdictions.
Perhaps another way to skin this cat is to advocate reducing the sales tax for extremely fuel efficient cars, and perhaps providing free vouchers for commuters that don’t use cars. I’m sure there are other ideas too.
The increase in the price of diesel, in particular, will have a cascading effect on all-round prices as the transportation costs will rise sharply.