Don't end gas tax, increase it
by Walter Cronkite '11The most pressing political issue facing America is the urgent need to reduce our dependence on oil. This will be a difficult task that will require sacrifices and lifestyle changes from Americans of every demographic. The government will have to put in place cap-and-trade regulations that will reduce the profits of some companies. Energy companies will have to build many more nuclear power plants, and inevitably these will land in many people's backyards. The rich vacationers to Cape Cod, Martha's Vineyard, and Nantucket will have to see a wind farm built over their beloved Nantucket Sound.
The toughest pill for the American people to swallow is also the most important policy: a large increase in the consumption tax on oil. This tax would give serious financial incentives for Americans to buy smaller cars, drive less frequently, car pool, take mass transit, live closer to where they work, and shop in pedestrian friendly downtowns instead of sprawling commercial parks, among many other things. The current proceeds of the gasoline consumption tax go to repairing and developing America's crumbling infrastructure, which have been in dire need of a massive overhaul for some time. This massive and much needed rebuilding of our bridges, roads, and railways would stimulate the economy, alleviating much of the financial pain of the tax. It is something that has to be done eventually, why not kill two birds with one stone?
Given the importance of greatly increasing the gasoline consumption tax, I was stunned when a hero of mine, John McCain, an environmentalist since back when it was un-cool, and a man who has displayed remarkable political courage throughout his career, released an economic plan that included temporarily abolishing the consumption tax. The proposal was part of his plan to alleviate the hardship of working class Americans during this economic downturn, but congressional analysts believe that it won't save the average consumer more than 30 dollars. Although McCain freely admits economics is his weakness, he has served in Congress for over twenty-five years and must know better. The proposal was nothing more than an easy way for a man from an elite background to appeal to uneducated voters.
I was less surprised when Hilary Clinton, hoping to solidify her support among blue-collar workers, proposed a similar tax break a few days ago. Her plan seeks to defray lost revenue for our nation's infrastructure by imposing an excess profits tax on oil companies. In my view, the government should seek to encourage the productivity of American companies, not punish them when they are successful. A better idea (if one does believe there is such thing as "excess profit") would be to force oil companies to invest a percentage of these profits into the research and development of alternative energy. The excess profit tax would offer no incentives for Americans to use less oil, and temporarily abolishing the gasoline consumption tax would increase America's oil dependence.
Barack Obama is the one candidate who had resisted pressure to support temporarily abolishing the gasoline tax. Obama's campaign is desperate to court blue-collar workers after his recent loss in Pennsylvania, and Obama's denouncement of the proposal shows that he is starting to back up his lofty rhetoric with courageous, principled actions.