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Quick, what did the American colonists fight and die for during the Revolutionary War? Was is freedom of religion? Freedom from control of the King? Desire for self-rule? How about taxes? Two to three cents per gallon of rum, a couple pennies to file a legal document and a few cents for products imported from Great Britain like paint, lead and glass. It doesn’t seem like much, but in large part, the war for independence was fought because of taxes imposed rather arbitrarily by England.
I am reminded of this as I read that Congress is considering an increase in the federal gas tax. The 15-member National Commission on Surface Transportation Infrastructure Financing is calling for increasing the current 18.4 cents a gallon federal tax on gasoline and the 24.4 cents a gallon tax on diesel. Apparently they feel the best way to reward the American people who are buying more fuel efficient vehicles and driving less, is with a hefty increase in the cost per gallon of the gas they need to get to work each day and carry on their lives. The commission will urge Congress to raise the tax by 10 cents a gallon on gas and 12 to 15 cents a gallon for diesel. In addition, the commission will recommend tying future fuel tax rates to inflation. A few months ago I watched in amusement as Congress grilled oil executives, asking if they didn’t think that 8% profit was sinful. I only wish the guys in suits had the guts to say: “No actually, considering the costs of exploration, drilling, extracting and refining, plus paying the Government for leases and meeting environmental requirements...It seems a little low really.” How rich it would have been to hear one of the besieged execs respond: “What is the government doing for its 18 to 20% take on what we procure and make available to the American public?” But, so much for dreaming... Congress now finds itself in the position of demanding more fuel efficient vehicles from Detroit, while forcing biofuels and vegetable ethanol programs on our citizens only to realize that such measures dry up the major source of money for our transportation infrastructure. Not only that, but the commission’s recommendations hint that even these proposed increases won’t be adequate, which is the camel’s nose under the tent. Included in the commission findings is the notion that we need to move to a new system of taxation based on miles driven rather than fuel consumed. That means outfitting all cars and trucks with GPS transponders to record mileage and time of day (for differential taxation) and perhaps even location. I’m not an unmarked, black helicopter kind of guy, but I have to admit this prospect makes me a little uncomfortable. Clearly we need funds to maintain and improve our national highway system and if a gas tax is no longer adequate, I would much rather see toll roads. We’ve used them for years, and it is a proven and relatively inexpensive technology, which doesn’t invade anyone’s privacy. I also believe it is time for Congress and the President to tighten the budget belt, and cut some of the wasteful expenditures that steal funds from areas like highways, where it really needs to be spent. Instead of simply seeking new sources of income, Government would do well to work on living within its means. There I go, dreaming again.
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