Dumb Idea of the Week: Repealing the Gas Tax Because Too Many People Drive Priuses

This article says that US fleet economy has increased 3 mpg in 80 years. Other sources say the fuel economy the last few years has plateaued around 27-28 mpg, excluding bumps during oil supply crisises.

So if there is any merit to this study of underfunded roads at all, it is not from the 3% hybrids running around, it is more likely do to a fuel tax that has not been adjusted for inflation for a *long* time.

 

At least $150 less, Mine is about $100 less, my wife gets paid once a month, and is half my pay, so figure another $50 from hers. So yeah, about $1800 less this year take home. That could buy me a new refrigerator.

 

Wait a Federal VAT tax may be in our future. GEEZ...

 

Perhaps but increased taxes is more a reality every day.

 

Ours make license plates after their term ends.

 

UPS can make a profit because
A) They are not required to take the low cost bulk mail and letters at a loss. As paid mail goes down there are just too many workers and buildings for the USPS
B) They have flexible work rules, while the USPS is riddled in a beurocratic seniority system.
C) They innovate

UPS funds there pention fund from operations. The USPS funds it from borrowing.
US Postal Service faces ruin without rescue from Congress, watchdog warns | Business | guardian.co.uk

The government then spends the money the USPS borrowed, and promises to pay the obligations back later.

USPS probably needs deep cuts as well as increased rates. UPS and Fedex privatized the profitable parts of package delivery.

I'll agree to that, but often the bidding process is corrupt. I still want to understand how the Texas legislature decided that having a Spanish Corporation fund and profit from toll roads was better for the state then raising the gas tax.

 

A bit more here on why the USPS has to borrow to fund its pensions. It's not as simple as it seems on the surface - as austin's article above points out:

"Since 2006, the postal service has been required – unlike any federal agency – to pre-fund its retirement and healthcare benefits to workers. This costs it about $5.5bn a year. Currently, the post office has paid in $330bn for benefits, but the Office of Personnel Management recently told Williams that it will need $394bn to satisfy the legal requirement."

This legislation was passed by a Republican-controlled Congress under Bush, its main goal being to put the USPS out of business.

 

Yes unlike most of the government, but like UPS and Fed Ex, the postal service has to fund its health insurance and pension programs.

I have no idea if there was some secret plot to kill the postal service, but the dire straights it is in are because of a fundamental shift in technology. Its called e-mail. This drastically reduces the amount of paid letters that the post office carries. I mainly get junk bulk mail. Government needs to transform it, increase rates, reduce size, and likely cut down on service in hard to reach places. Would dollar stamps and no saturday delivery be so bad? I would personally pay $5/year to the post office if it killed my junk mail. That's sayings right there. Packages can make money, but letters with cheap stamps are a losing proposition. I don't know why 75 years was chosen, or what it means, but it seems excessive. As I was trying to point out, the Postal payments hide part of the deficit from the budget, but increase the debt in real life. Its three card monte congress style.

Postal Service balks at pension funding requirement, others say it protects taxpayers | Deseret News
Part of the huge increase in state government spending is large pension and health care costs that were not paid for when the people were working.

btw: this is completely off topic. We still need roads, if only to get to the doctor and deliver those packages

 

Or a great public education system vs. US #57 from laying off teachers and closing schools and you having that Made in China refrigerator or color TV...yea hah.

 

Didn't you guys pay attention at the beginning of the year, when they passed this bill?

Both Democrats and Republicans were in favor of ending the temporary payroll tax cut of 2%. Letting a temporary tax cut expire is not a tax increase no matter what the politicians tell you. Reducing the growth in spending, is not cutting spending either. The payroll tax holiday was suposed to stimulate employment, but there is little evidence that it did. It did allow people to keep more of their money, but temporary stimulus rarely does what politicians tell us. Bush sent out checks to stimulate the economy and that doesn't look like it worked either. Permanent tax decreases do stimulate the economy.

This money is not going to teachers either. This was a temporary reduction in FICA, social security taxes. Even with the rate restored more money is going out of the social security trust fund than is going into it, this year. What happened when the holiday was in effect? Congress magically gave social security the money as if they were collecting it in tax. Now payrolls may increase enough that social security might not run a deficit this year, but it will soon, and payroll taxes will need to go up, or other taxes added in there place. We can't continue just printing bonds then buying them back forever.

 

Cash for clunkers was supposed to stimulate the economy too, all it did was remove vehicles from the used car lots that people who have little income could afford. It also destroyed used parts to keep older cars running.

Do not get me started on the waste called the education system. I have 2 children who have more time out of school than in it. The education system is one huge money pit, and the ones suffering the most are the good teachers and their students. The Unions protect the bad teachers, waste money, and are run by idiots like that waste of breath of the Chicago Union.

 

Yes that was another temporary stimulus that failed. The failure could be seen in the fact that Chrysler and GM were bailed out. It likely just pulled car sales forward. I don't think crushing inefficient cars was necessarily a bad thing, but there are much less expensive ways to improve fuel economy. The payroll holiday was much better than this as at least people got to hold onto their own money, instead of the money just transferred from the treasury to auto companies. My point was the end of the tax holiday was not a tax increase. There are many worse things government does than the holiday or letting it expire.

 

I'm not for any tax increase period.

 

The Oregon plan is misguided but arguably fair.

The VA plan is blatantly unfair from a state level since his proposal has no one paying gas taxes but then hybrids pay more annual tax. The only way this could be argued as fair is that he is trying to make up for the shortfall in federal gas taxes that a hybrid pays.

Obviously for anyone with a viewpoint that gasoline use should be decreased and is harmful for the environment, none of these things make sense. But if you believe that using energy is a positive form of economic activity and should be encouraged, then VA makes sense. It is surprising that we still have such individuals in power....and I am a conservative.

 

I'll take a wild guess that it was conservatives that put these jokers into office.

 

We have $14T in oil war debt to pay off. Gotta raise taxes to pay for it. Gasoline/Diesel transportation use is the main need for oil so gasoline/Diesel tax the correct tax to pay for it.

It pays off the debt it created and it discourages use and the threat to US economy, national security and environment it creates.

A noble tax.

 

IMHO the politicians talking about fair when it comes to taxes, just are trying to grab your wallet with both hands.

Both the Oregon and Virginia plans are put up by politicians looking for some anti hybrid/bev red meat. The Oregon one is less easily dismissed as bad old politicians doing the wrong thing, but hey its also more likely to actually go through. There is no way this Virginia thing is going through.

Attacking the cars few people have while promising to lower gas taxes that most pay is pandering.

Using energy is a positive form of economic activity, but using more oil in Virginia mainly benefits those in OPEC countries and hurts those living in Virginia and Oregon. Maybe those with the anti hybrid or anti bev part of the plan should have at least talked to an economist. Looking at how bad congress acts in Washington, how can you be surprised by a state election.

Do you honestly think that $14T out of the $16.5T debt came from oil wars? These dumb plans are in Virginia and Oregon. Not one penny from the new taxes will go to pay off debt, and the debt is still growing. If you think its time to raise a federal oil tax, then I'll agree, but not so high as to torpedo the economy.

yeah, um, there are not noble taxes, and you should really look at where the debt came from.

 

Just as easily dismissed as legislator proposing it was rural, right wing GOP'er. Typical pro-oil, anti-American ideologue that created the twin problems of massive oil war debt and US energy inefficiency.