Clearing Up Myths on the Federal Gas Tax

In this Washington Post opinion, Paul Bledsoe, former staff member of the Senate Finance Committee, clears up five common misunderstandings about the federal gas tax to inform discussions on America's infrastructure funding crisis

4 minute read

January 4, 2015, 7:00 AM PST

By Irvin Dawid


Bledsoe's five gas tax myths are numbered below. There are some truths to them—but they are based more on perceptions. Bledsoe's piece delves into the reality behind each of them. Target audience includes environmentalists, some economists, and most importantly, politicians.

  1. Raising the gas tax serves to reduce oil consumption and cut carbon emissions, i.e., it's good for the environment.
  2. Democrats want to raise the gas tax (as well as other taxes); Republicans oppose it.
  3. Raising the gas tax is a sure way for a politician to not get reelected.
  4. Low gas taxes means low gas prices and thus lower gas bills.
  5. Raise gas taxes now when prices are cheap only means paying more when oil prices escalate.
The reality, according to Bledsoe:
  1. Environment: "Congress instituted the modern tax in the 1950s to help pay for construction of the interstate highway system; in essence it is a user tax on drivers," writes Bledsoe. It was not intended to reduce oil consumption (favored by some economists) or carbon emissions. Furthermore, "claims that higher taxes would have a positive impact on the environment or oil security are also questionable," he adds. "Even if the federal gas tax went up by, say, 10 cents, it would remain a relatively small portion of the overall price of gas and would have far less influence on behavior than market-driven price fluctuations."
  2. Political quiz: Name the four presidents (and their respective parties) who signed increases to the tax beginning with the Federal-Aid Highway Act of 1956. Need help? About.com has a one-pager: "History of the Federal Gas Tax." FHWA's "Rambler" really gets into the history if you want to know more. [Answers posted at end of post as well].
      • Bledsoe notes that liberals also oppose the gas tax because of its regressivity—hurting poor people, or so the perception goes. His solution: "offset (the increase) by other reductions for lower- and middle-income taxpayers. That’s the deal Democrats struck when the gas tax was last increased, in 1993."
  3. It's political suicide to support a gas tax increase: Sure, President Obama recently said, “So the gas tax hasn’t been increased for 20 years. There’s a reason for that,” he said. “In fairness to members of Congress, votes on gas taxes are really tough. Gas prices are one of those things that really bug people.” [Politico Morning Transportation, Dec. 4].  
    • Of the four presidents who raised gas prices in their first term, only one didn't get reelected—and that was more likely due to a different tax increase he signed—the income tax.
    • "Ross Perot made a 50-cent-a-gallon gas tax hike the centerpiece of his 1992 presidential campaign and won the highest third-party vote total in the past 100 years," writes Bledsoe.
    • On the state level, Bledsoe points to:
      • "New Hampshire Democratic Gov. Maggie Hassan (who) signed a [4.2 cents] gas tax increase into law in May and was reelected handily in November, even in a Republican 'wave election'." 
      • On the Republican side, he writes that "Wyoming almost doubled its gas tax [10-cent increase] in 2013, a move advocated by GOP Gov. Matt Mead, who won reelection this year by a wide margin." Transportation for America's campaign blog goes into the details of how Wyoming legislators who supported the tax increase fared in their reelection bids, and in other states which saw gas tax increases. 
      • Only Republican Pa. Gov. Tom Corbett lost his November bid for reelection, but pundits believe he would have lost even if he hadn't signed the tax increase a year earlier.
  4. Motorists save money with low gas taxes: Any savings from lower gas prices are lost by the United States being more auto-dependent than other industrialized nations. "U.S. total vehicle miles traveled in 2013 were just below 3 trillion, or about 9,000 miles per person, far higher than in any other country." Concurrent with auto-dependency is oil-dependency, regardless of the source of the oil. Bledsoe notes, "With less than 5 percent of the global population, the United States consumes well over 20 percent of the world’s oil."
  5. Last myth on why it's not good to raise gas taxes when oil prices are cheap: Raising gas taxes now means consumers will be doubly penalized when gas prices go up again. Bledsoe writes that increases in fuel efficiency standards means that the turnover in the vehicle fleet should shield them from increased gas costs—increased taxes or not.
Paul Bledsoe is a senior fellow on energy and society at the German Marshall Fund and president of Bledsoe & Associates, a policy consultancy. He was a staff member at the Senate Finance Committee and the Clinton White House.
======================================================

Political quiz answers: The short list of presidents who signed gas tax increases beginning in 1956

  1. President Eisenhower (R), one cent in 1956 and 1959, 
  2. The most celebrated gas tax increase, cited recently in Congress by gas tax bill author, Rep. Earl Blumenauer (D-Ore.) recently as he stood next to a life-size cardboard cut-out of the Gipper, no less. "In the largest single gas tax increase, President Ronald Reagan (R) authorized a 5 cent hike in the rate spelled out in the Surface Transportation Assistance Act of 1982, which helped to fund both highway construction and mass transit systems across the country," according to About.com. What's particularly noteworthy is that is more than doubled the tax, then at 4-cents.
  3. President George H.W. Bush (R), five cents in 1990.
  4. President Bill Clinton (D), five cents in 1993.

Hat tip to Katie Pearce of Streetsblog USA.

Friday, December 19, 2014 in The Washington Post

View of Mount Hood at golden hour with Happy Valley, Oregon homes in foreground.

Clackamas County Votes to Allow ADUs, Residential RVs

County officials hope the zoning changes will help boost the housing supply in the region.

June 18, 2024 - Mountain Times

Single-family homes in a suburban neighborhood in Florida.

New Florida Law Curbs HOA Power

The legislation seeks to cut down on ‘absurd’ citations for low-level violations.

June 16, 2024 - The Guardian

Aerial view of intersection in New York City with yellow cabs and zebra crosswalks.

Planners’ Complicity in Excessive Traffic Deaths

Professor Wes Marshall’s provocatively-titled new book, "Killed by a Traffic Engineer," has stimulated fierce debates. Are his criticisms justified? Let’s examine the degree that traffic engineers contribute to avoidable traffic deaths.

June 13, 2024 - Todd Litman

Close-up of mountain lion in the Santa Monica Mountains, California.

Cougar Death Highlights Urgent Need for Wildlife Crossing

A mountain lion was found dead on the 101 Freeway, less than half a mile from the steel and concrete endoskeleton of the Wallis Annenberg Wildlife Crossing.

7 seconds ago - The Acorn

Close-up of two children sitting on edge of swimming pool with their feet in the water.

Beating the Heat: Expanding Access to Swimming Pools

The swim season for Los Angles County public pools has been extended, with swim facilities open for five months to provide relief from the hot weather.

1 hour ago - ABC7 Eyewitness News

Scooters Portland

Report: Municipal Fees and Taxes Hinder Shared Micromobility Adoption

City taxes and fees on shared bikes and scooters are, on average, much higher per mile than similar taxes on cars.

2 hours ago - Streetsblog USA

City Planner I

Department of Housing and Community Development

City Planner II

Department of Housing and Community Development

City Planner Supervisor

Department of Housing and Community Development

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.