Oil Market Accomplishes What CAFE Regulations Intended

Conservative columnist Charles Krauthammer notes high gas prices are doing what Congress has taken decades to do – make the vehicle fleet more fuel efficient. He sees Congress repeating the mistake now with cap and trade - instead of gas taxes.

2 minute read

July 9, 2008, 10:00 AM PDT

By Irvin Dawid


"Mass transit ridership is at a 50-year high. Driving is down 4 percent. Hybrids and compacts are flying off the lots. SUV sales are in free fall....America's sudden change in car-buying habits makes suitable mockery of that absurd debate Congress put on last December on fuel efficiency standards.

You want more fuel-efficient cars? Don't regulate. Don't mandate. Don't scold. Don't appeal to the better angels of our nature. Do one thing: Hike the cost of gas until you find the price point.

Unfortunately, instead of hiking the price ourselves by means of a gasoline tax that could be instantly refunded to the American people in the form of lower payroll taxes, we let the Saudis, Venezuelans, Russians and Iranians do the taxing for us -- and pocket the money that the tax would have recycled back to the American worker.

This is insanity. For 25 years and with utter futility... I have been advocating the cure: a U.S. energy tax as a way to curtail consumption and keep the money at home. On this page in May 2004 and Nov. 2005 (see links)... I called for "the government -- through a tax -- to establish a new floor for gasoline," by fully taxing any drop in price below a certain benchmark."

Krauthammer now points to the "crazy carbon cap-and-trade system the Senate (debated in June). These are infinitely complex mandates for inefficiency and invitations to corruption. But they have a singular virtue: They hide the cost to the American consumer."

The solution: "Announce a schedule of gas tax hikes of 50 cents every six months for the next two years. And put a tax floor under $4 gasoline, so that as high gas prices transform the U.S. auto fleet, change driving habits and thus hugely reduce U.S. demand".

Thanks to Bob Maginnis

Friday, June 6, 2008 in The Washington Post

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I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

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