Tuesday, May 17, 2011

Gas Tax Experiment

It looks like gas prices on on there way down, at least temporarily. Americans don't like paying $4.00 plus for a gallon of gas so demand is going down. That means oil producing companies have to charge less for oil. This shows that if the price of gas is too high Americans will find a way to use less of it. Using less energy resources is a good idea for us all. If we lower our consumption enough we wont have to spend as many tax dollars protecting oil resources all over the world in the name of democracy and freedom. A lot less people will die in conflict and that is a very worthy goal.

Now would be a good time for an experiment. Let's add a national gas tax of 25 cents per gallon. I suspect that will put downward pressure on gas consumption and people will use even less gas. This will in turn lower the price which can be charged for oil. In the end, impsoing a 25 cent tax may only result in a 5 cent increase at the pump. We don't know what the actual price at the pump will be but I think its worth finding out. I kind of like the idea of taking from oil producers to reduce the national deficit.

I realize a gas tax is a heavy burden for low income people. However, it is also true the low income people use oil resources and are part of the over consumption problem which leads to global conflict. Everyone who is part of the problem must be part of the solution.

Should this experiment work in a favorable way the US government should announce that the gas tax will continue to rise gradually until all military actions used to protect oil resources are paid for by a gas tax. At the same time federal income taxes should be reduced in an amount equal to what is collected by the gas tax.


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