The Oil Drum | DrumBeat: March 11, 2007

81 comments on DrumBeat: March 11, 2007

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alistairC on March 11, 2007 - 6:51pm

What you do is you have two tax rates. A low rate on the rationed amount, and a very high rate on the free-market amount. If deemed appropriate, the lower tax rate could be negative, i.e. the rationed price would be subsidised by the free market rate.

And of course rations should be negotiable. If I can get by with half my ration, or no gas at all, then I can sell my credit to a big user.

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Will on March 11, 2007 - 9:54pm

No... The point of rationing and taxing automobile fuel is not to set up profit opportunities for urban dwellers and such. They already get subsidized transport via bus and subway systems. And it is not to provide subsistence to retirees either.

Allowing a secondary market in "rations" defeats the goal which is reducing fuel use. Let's keep it simple.

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AlanfromBigEasy on March 11, 2007 - 10:22pm

Yes, when gasoline gets to $3.50/gallon; let us add an extra $1.50 gallon tax and use the money for such things as:

1) Higher food stamps and rental assistance for the working poor (take $ out of one pocket but put it back into the other)
2) Reduced Medicare premiums (likewise for retirees)
3) Reduced Payroll taxes (likewise for workers)
4) Building out Urban Rail
5) Reduced (Federal $ to local jurisdictions) property taxes for low energy TOD areas.
6) Eliminate property taxes on railroads that electricify
7) Renewable energy generation subsidies such as wind, geothermal, solar, hydro.

$5/gallon at the pump will change some behaviors (and is impossible politically). But it is simple and will work.

Best Hopes,

Alan

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81 comments on DrumBeat: March 11, 2007

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