Sunday, May 02, 2010

Could we finally get a Pigou Tax on gasoline now?

Lisa Margonelli in this morning's New York Times.

The Deepwater Horizon spill illustrates that every gallon of gas is a gallon of risks — risks of spills in production and transport, of worker deaths, of asthma-inducing air pollution and of climate change, to name a few. We should print these risks on every gasoline receipt, just as we label smoking’s risks on cigarette packs. And we should throw our newfound political will behind a sweeping commitment to use less gas — build cars that use less oil (or none at all) and figure out better ways to transport Americans.

I think it is safe to say that economists across the political spectrum approve of gasoline taxes. To the extent they are regressive, the revenue they raise could be used to provide better mass transport subsidies for low income people. Maybe now there will be political cover to do something.

24 comments:

ally said...

Fashion is all about lookingmoncler jackets good and being comfortable at the same time. monclermoncler coatsEvery woman loves being complimentedmoncler t-shirtmoncler vestmoncler outlet for her sense of style and elegance. ugg bootscheap ugg bootsdiscount ugg bootsNo woman wants to be labeled as outdated and old fashioned.ugg classic tall bootsclassic ugg bootsWomen are expected to be in constant touch with the latest trends in ordermoncler jacketsmonclernew moncler coats to adopt those trends and look fashionable and stylish. moncler vestmoncler outletmoncler polo t-shirtWomen need to make sure that whatever they wear, coach outletcoach handbagscoach bagsit should compliment their personality and they do not feel awkward while wearing it. coach totescoach outletlouis vuitton handbagsAn article about Gothic costume clothing and the importance of choosing Gothic choker. LV handbags 2010Louis Vuitton bagsLouis Vuitton totesThis article explores the wide variety of Gothicrain boots
rainweardiesel jeans chokers available from everyday to special occasions. Ture Religion Jeanslevis jeansabercrombie and fitch outletIt should inspire people to go shopping for their own Gothic chokers. ed hardy wholesaleed hardy outletcheap ed hardy wholesaleThe origins of the Flat cap span discount ed hardy wholesalewholesale ed hardy

athen said...

I found your blog on google and read a few of your other posts. I just added you to my Google News Reader. Keep up the good work. Look forward to reading more from you in the future.
credit card for bad credit

Agentslayer said...

Very interesting post on Could we finally get a Pigou Tax on gasoline, Thanks for sharing with us.


Free Property Advertising

rjs said...

certainly, some kind of adjustment could be made in the tax code to address the regressiveness of a gas tax, perhaps via the EITC, so that those who have to drive to work could get a tax rebate, so they would not be hurt too badly by a gas tax…the gas tax would be a four-fer beneficial – reduce oil consumption, reduce the trade deficit, reduce emissions, and increase revenues, nearly to the tune of $150B per $1 tax per gal of gas applied...

Mythbuster said...

What size tax do you have in mind? CBO estimated that a CO2 price increasing gasoline prices up to $1.75 per gallon would not significantly affect gasoline consumption in either the short or long term. http://www.cbo.gov/ftpdocs/98xx/doc9830/10-06-ClimateChange_Brief.pdf The reason is that the new CAFE standards will drive reduced consumption without the price increase.

EIA says we consume 138 billion gallons per year of gasoline. http://tonto.eia.doe.gov/energyexplained/index.cfm?page=gasoline_use So a $1.75 per gallon tax raises $242 billion per year--about $1,900 per household. A pretty big program with no environmental or national security benefit. I can't understand why I should be for it.

rjs said...

Mythbuster: you dont think there will demand destruction at $1900 a year per household? you dont think importing 2/3 of our oil is a national security issue?

Mythbuster said...

rjs: What I think is that CBO is essentially right. Do you have contrary data, or are you just consulting your gut?

Mythbuster said...

rjs: There is going to be demand destruction by CAFE. EIA projects that consumption of petroleum liquids will decline by about 3% between now and 2020 and then increase slowly--not reaching the 2007 level until after 2030. http://www.eia.doe.gov/oiaf/aeo/pdf/appa.pdf

rjs said...

pretty big assumption that there will be much oil left in 2030; DoE & DoD dont seem to think so:

The U.S. Department of Energy admits that “a chance exists that we may experience a decline” of world liquid fuels production between 2011 and 2015 “if the investment is not there”, according to an exclusive interview with Glen Sweetnam, main official expert on oil market in the Obama administration.
This warning on oil output issued by Obama’s energy administration comes at a time when world demand for oil is on the rise again, and investments in many drilling projects have been frozen in the aftermath of the tumbling of crude prices and of the financial crisis.

Glen Sweetnam, director of the International, Economic and Greenhouse Gas division of the Energy Information Administration at the DoE, does not say that investments will not be “there”. Yet the answer to the issue of knowing when, where and in which quantities additional sources of oil should be put on-stream remains widely “unidentified” in the eyes of the most prominent official analyst on energy inside the Obama administration.

http://www.eia.doe.gov/conference/2009/session3/Sweetnam.pdf

see chart on page 8 for expected 43% shortfall by 2030..

The Pentagon also expects an imminent oil shock - A report from the American Joint Forces Command published March 15 predicts that in 2015, the world capacity for petroleum prouction could be 10 million barrels per day less than the demand. The report of the American Department of Defense (DoD), titled Joint Operating Environemnt 2010 indicates (page 29):"By 2012, surplus oil production capacity could entirely disappear, and as early as 2015. the shortfall in output could reach nearly 10 MBD." 10 million barrels per day (MBD), that represents the production of Saudi Arabia, the world's leading petroleum producer. Such a shortfall, if it should come, would be more than 10 percent of the world demand for crude, which is today 86.5 MBD, and ought to reach 90 MBD in 2015.
source: pentagon joint operating environment pdf: http://www.fas.org/man/eprint/joe2010.pdf

Mythbuster said...

rjs: "Running out of oil" was supposed to happen at least three other times between when I became an energy company executive in 1972 and now. Maybe this time it will really happen. If it does, and we look back on the carnage, what good will we say a Pigou tax adopted in 2011 did? And what do you think the tax rate should be?

rjs said...

mythbuster: the tax should be at least high enough to even discourage my unnecessary driving...
that'd be at least $3/gal..

Mythbuster said...

So $3 per gallon will take a billion dollars a day out of the economy--even if you assume substantially reduced gasoline consumption. How much would you expect gasoline consumption would be reduced below the CAFE level? In my world, you can't make a business case for any initiative with numbers on both the costs and the benefits.

Mythbuster said...

I mean "without" numbers, not "with numbers. Sorry.

rjs said...

in my world, i dont have to make a business case for an initiative...i believe there will be more important uses than personal transport for oil in the future...and that there will come a day when future generations will shake their heads in disbelief that we actually BURNED this stuff...

RealityZone said...

Mythbuster:
RE: "when I became an energy company executive in 1972 and now."

It looks like you are still working [shilling] very hard for that "energy" company.
Drill baby drill was alive in 72, and with you guys it will always be alive.
That is until our dependence on fossil fuels becomes the our demise.
BP and the oil Corps will have their "agents" out in full force, to try and defuse this environmental night mare in the gulf.

Mythbuster said...

RealityZone: I left the energy business in 1983. What I haven't left is the idea that anybody who wants to dip into taxpayer pockets (or anybody's pockets) for hundreds of billions of dollars per year needs to quantify the benefits and show his work.

I'm a big fan of increasing energy efficiency to reduce demand. We should be so aggressive with that that refineries will have to be shuttered--and we could if we had the political will. CAFE has been found in several reputable (non-oil-industry) studies to be effective, but I'm persuadable on the gas tax idea if you can overcome with other evidence the evidence I presented. BTW, I have put out this challenge in various blogs from time to time and nobody yet has put up a quantified response.

fangfang said...

MBT will not only change,MBT boots,the way you use your MTB Shoes,What are the benefits?christian dior,Free shipping and free return shippingdior shoes,on all diorIncluded with each pair ofdior handbags,an instructional DVDWhat is Dior?dior sunglasses,look at another good paoduct such as Dior totesDo not worryThe urge to buy these goodsnew balancerevolutionary fitness aid from Swiss Masai,new balance shoes,which may help reduce cellulite andnew balance outlet,transforms flat hard artificial surfaces Puma Shoes, with top quality and cheap price. puma outlet,innovative sole design includes thePuma Sneaker,Here you can buy wide rangewholesale cl high heel sandalsquality and cheap car GPS navigation systemsMoncler,Very Cool, Comfortable and lightmoncler jacketsoriginal packing you can rest assured.moncler coatsYou might say that thediscount moncler vestNo one ever thought bothmoncler outlet,As with everything that comes fmonmoncler t-shirtThe new store has been decorated.north faceWe are offering you a wide range ofnorth face outletSome color combinations seem to getnorthfaceBut within the same community north face jacketsbecause it features just the right amount of north face coats,A little of these are given below.ugg bootswas a very well-known French fashionable boot,cheap ugg bootsbecause of the wisdom featuresdiscount ugg bootswhich you are buying is uniqueclassic ugg bootsthey obtain materials from domestic suppliers ugg classic tall boots,A stroll around the park with the GHD IV Salon Styler,We are offering you coach outlet,our store has been decorated coach handbags,Nicecoach totes

aiya said...

Office 2010
Microsoft Office 2010
Microsoft word
Office 2007
Microsoft Office
Microsoft Office 2007
Office 2007 key
Office 2007 download
Office 2007 Professional
Outlook 2010
Microsoft outlook
Microsoft outlook 2010
Windows 7

led said...

Christian Louboutin Tall Boots
Christian Louboutin Wedges
Christian Louboutin Pumps
Christian Louboutin Sandals
Jimmy Choo Shoes
Moncler Kid's Jackets
Moncler clothing wholesale
Wholesale Moncler Jackets
discount Moncler Jackets
http://www.shopmoncler.hk/moncler-jackets
http://www.utsource.net/BUK444-500B.html
http://www.utsource.net/MG50Q6ES41.html
http://www.utsource.net/UM150CDY-10.html
http://www.utsource.net/MP7002.html
http://www.utsource.net/TMS320F2812PGFA.html
http://www.utsource.net/CEM3374.html
http://www.utsource.net/2sj74.html

zhuzhulee said...

PDF Créateur
TIFF en PDF Convertisseur
Texte en PDF Convertisseur
PowerPoint en PDF Convertisseur
image en PDF convertisseur
Excel en PDF Convertisseur
CHM en PDF Convertisseur
Word en PDF Convertisseur

GHD Hair Straightener said...

Uggs are sheepskin boots.Babyliss Hair Straightener What this means is they are able to keep the ft dry and warm. Mostly utilized in cold nations, they've gain popularity around the globe. The sturdy stitch and soles helps make the boot durable.Ugg Classic Boots The outside area of the boot consists of fleece-like sheepskin material whereas the inside consists of made of woll.Ugg Classic Boots the lifeline from the Uggs dates back towards the year 1971 when Uggs-N-Area rugs first made and begin selling due to the fact. Initially viewers accustomed to put on due to the fact.gh uk The beach residents and viewers known as them ughs, ugly boots or simply the ughs in a nutshell. It's been thought that Uggs were worn initially on Alarms Beach in Victoria.Ugg Boots Outlet However, now Uggs have grown to be an worldwide logo and is worn both in winters and summer season.Ugg Boots Outlet Uggs-N-Area rugs around 2003 offered his company also it was just since that time the boots grew to become popular within the worldwide market. These come in plenty on the market.UGG Outlet Many online retailers sell the fake boots but go ahead and take same cost like this from the original ones.uggs clearance If you value the company Ugg you'd certainly not mind having to pay more with this brand.Ugg Online Store Is not it? Thus fake ones certainly mustn't become your choice.ugg classic boots The Australian made genuine Uggs are particularly produced from top quality materials.Cheap Ugg UK Furthermore they can undergo a comprehensive procedure of dying, cleaning, cutting as well as conditioning of sheepskin. The fake boots that are created to seem like the initial Uggs are constructed with poor textures and synthetic soles.Discount Uggs Boots So, before shopping your boots from Ugg online, perform a little more searching to discover which online shop provides a genuine set of Ugg boot.Uggs are available in different colours. So, the very best factor relating to this boot is you can choose the color of your liking when purchasing due to the fact. gh uk
Ugg Classic Boots
Ugg Classic Boots
Babyliss Hair Straightener
Ghd Australia

Admin said...

Great blog i never see before. Thank you for this blog.

Buy A Ready-Made Logo

justin albert said...

Thanks for your great post.I like this very much, please write more about these,wait for your update

Facebook Fan Page Developer

Ad min said...

This is a great inspiring article. I am pretty much pleased with your good work.You put really very helpful information.
Mobile Camera App