Thomas Friedman's Gas Tax

Thomas Friedman was all over TV this weekend advocating that the US government fix gas prices at $4.00 per gallon. His was pushing his new book The World Is Flat. I have yet to read the book (I hope to knock it out this week). While I almost always agree with Friedman's goals, I virtually never agree with his ideas of how to get there.

In this Grist article he suggests that the poor and middle class would get a gas rebate at the end of the year. Do you really think people living check to check can afford to float the US government a loan until they get their rebate? And how are they going to recover the higher prices they will have to pay for food and other goods. This is a dumb idea. If you want to push the American people into using less fuel, there are less painful ways to do this.

I would start by not only eliminating the tax break you get for buying vehicles that weigh more than 6000 pounds, but replacing it with a higher sales tax on those vehicles. Offer instantaneous tax breaks for buying a hybrid. The car dealer knocks off 15% of the cost of the car and recovers that money from the US government. We also should implement higher standards for gas mileage.

Now, we are going to need to gradually raise the gas tax due to lost revenue for state and federal highway funding that will be lost due to better mileage. I don't like the Oregon proposal of switching to a per mile tax, though. Any form of taxation that will recover lost highway funds needs to be pay as you go. You can't send people a large bill when the renew their license plates.

As for Friedman's assertions that this would force democratization in the Arab world, I think he's nuts. The emerging Asian markets will keep the the emirs flush with cash. But if it gets the idiotic neo-cons on board, fine.