KaiserJeep wrote:$0.53 per gallon is not a deterrent to big cars, because Americans have genuine needs for bigger vehicles. $5 per gallon would be a deterrent, and smack the just recovering economy down pretty well. EVERYTHING we buy, make, grow, or import is transported with the fuels you would tax.
Read the article I quoted for onlooker. A mere $0.30 rise in the price of gasoline resulted in subcompact sales rising over 40%. Also, those fuel taxes you despise are needed to pay for the very roads, highways, etc that are needed to transport those goods. Moreover, currenly those taxes are coming up far short of that goal. This has resulted in the road/highway system pulling in funding from other sources, such as state sales taxes, federal income taxes, etc.
The price paid by US drivers for gas doesn’t even come close to covering the direct (much less indirect) costs of road use and maintenance. In other words, without even factoring in the effects of air pollution, auto accidents, associated healthcare costs, urban sprawl, etc, gas taxes in the US still don’t cover the costs of driving on US roads. What this means, when it really comes down to it, is that fuel costs should be higher in the US than they currently are. Or, to put it another way: Driving is, in the US, subsidized to a substantial degree.
Federal subsidies to the highway administration system are enormous. “Since 1947, the amount of money spent on highways, roads and streets has exceeded the amount raised through gasoline taxes and other so-called ‘user fees’ by $600 billion (2005 dollars), representing a massive transfer of general government funds to highways,” according to the report.
The price mechanism for road use is not based on a user fee because gas taxes, which are often referred to as user fees, are not necessarily directed to the actual roads the driver uses. In some cases, states subsidize federal highways, in other cases, the federal government has redirected gas tax revenues to pork-barrel infrastructure projects, and with the exception of tolled roads, drivers pay rates based on mileage, not the actual roads they use. Cortwright argues that if gas prices and other vehicle use fees reflected the true cost of use, single-occupant vehicle use would decrease, as drivers would opt for cheaper forms of travel.
“These facts put the widely agreed proposition that increasing the gas tax is politically impossible in a new light: What it really signals is car users don’t value the road system highly enough to pay for the cost of operating and maintaining it. Road users will make use of roads, especially new ones, but only if their cost of construction is subsidized by others.”
Considering that, amongst the younger generations in particular, car use is already becoming somewhat cost prohibitive at current gas prices, one can’t help but wonder how many fewer people would be driving if gas taxes were increased enough to cover associated costs.
Gas Taxes Don’t Cover US Road Costs — Not Even CloseTrucks also do several orders of magnitude more damage to our highways than do cars:
Vehicle Weight vs Road Damage LevelsHeavy vehicles are a major cause of pavement damage. By all accounts heavy truck traffic results in pavement damage many times that of traffic by passenger vehicles. A recent Congressional Budget Office report identified pavement damage caused by trucks as a
significant issue facing departments of transportation. Current fuel taxes also generate insufficient revenues to pay for the costs that users impose on the system. Estimates of pavement damage by trucks, the largest per-mile external cost of truck use,
range from about 5 to 55 cents per mile depending on the weight of the truck, the number of axles over which its weight is distributed, and where it operates—making those vehicles another significant source of external costs, even taking into account that truck travel represents less than 10 percent of miles traveled.
Trucks and infrastructure maintenance costsThe current system gives vast subsidies to inefficient and expensive road/highway travel at the expensive of more efficient and cheaper rail shipping. Higher fuel taxes combined with other taxes on trucking would go along way to correct this inefficient situation and result in lower costs for us americans.
As we always point out, getting the prices right — whether for parking or road use — is critically important to creating an efficient transportation system. When particular transportation system users don’t pay their full costs, demand is too high, and supply is too low. In this case, large federal subsidies for trucking encourages too much freight to be moved by truck, worsening congestion, pollution and road wear, while the fees and taxes paid by trucking companies aren’t enough to cover these costs. The classic solution for these currently unpriced external costs is to impose an offsetting tax on trucks that makes truck freight bear the full cost associate with road use, crashes and environmental damage. The CBO report considers a number of policies that could “internalize” these external costs associated with trucking — including higher diesel taxes, a tax on truck VMT, and even a higher tax on truck tires.
In addition, the higher tax would reduce freight moving by road — mostly by shifting cargo to rail — and lead to benefits of lower pollution, less congestion and less wear and tear on roads. We’d also save energy: net diesel fuel consumption for freight transportation would fall by 670 million gallons per year — a savings of about $2 billion annually at current prices.
Such a tax would make truck freight more expensive, but other costs — now borne by the rest of us — would go down by a comparable amount. And there would be important savings in costs for freight either moved by other modes (especially rail, which is about two-thirds cheaper), or sourced from closer locations.
There’s a clear lesson here: It may seem like we have a shortage of infrastructure, or lack the funding to pay for the transportation system, but the fact that truck freight is so heavily subsidized means that there’s a lot more demand (and congestion) on the the roads that there would be if trucks actually paid their way. On top of that, there’d be a lot more money to cover the cost of the system we already have.
Trucking Industry Imposes Up to $128 Billion in Costs on Society Each Year
The oil barrel is half-full.