The Argument for a Gas Tax

Posted: January 6, 2012 in Rants
Tags: ,

WHOAH!  Now hold on a minute.  I know your immediate knee jerk reaction.  Gas is expensive enough already, what the hell is wrong with you?  This is ‘Mmurkah!  They took our jerbs!

Seriously, quiet down and pay attention – you’re going to learn something.

Quite recently, MIT researchers analyzed why we haven’t seen staggering fuel economy improvements, particularly in light of extremely efficient cars available elsewhere.

The article is available here and is worth a read – http://web.mit.edu/newsoffice/2011/cars-on-steroids-0104.html.

To summarize, between 1980 and 2006, the average fuel economy of cars in America improved by 15%.  However, during that time, the average weight of those vehicles increased by 26%, and horsepower rose 107%.

If cars stayed the same size, and made the same power, that 15% improvement in fuel economy would actually have been a 60% improvement in fuel economy.  Holy cow.  That means my beater 2011 GTI would get 51.2 mpg instead of 32 mpg on the highway, and my gas guzzling 12 cylinder GT car would get 22.4 mpg average instead of 14 mpg average.

However, the problem isn’t the technology.  The technology is obviously there.  The problem is YOU, the consumer.

You see, the problem with YOU is that YOU want more size, more power, more capability.  You don’t want to drive an 1800 lb economy car wheezing around with 100 horsepower and getting 50 mpg (look what Honda did with the Civic VX in the mid 90s).   You want big, stupid SUVs and outrageously powerful sports cars.  You see, not only has vehicle size in general increased, but the composition of the vehicles on the road have increased as well.

In 1980, light trucks only made up 20% of the passenger vehicles sold in the United States.  By 2004, that number had increased to 51% of all passenger vehicle sales.  Big, bloated tanks clogging up the road ways and getting in my way, filled with stupid, fat Americans and their stupid, fat children, trying to get to soccer practice.

The reality is, this is what people want.  My family bought an SUV – a 1993 Ford Explorer.  You know why?  Because even though our BMW 5-series fit the whole family and luggage and skis on the top for a weeklong ski trip, my Mom wanted to be able to fit more.  I don’t know why she needed so much crap because I’d pack one duffel bag for clothes and one for ski clothes, and she’d need two full suitcases plus a ski bag, but, whatever.  Most families were going through the same thing – more room means we can take more stuff.  Plus, a family of 3+ legitimately can use the space.

And, if you average it out, sure, the truck is getting 12 mpg.  But its carrying 5 people.  So really, its getting  SIXTY miles per gallon if you factor in each person isn’t taking their own car.  Even if you weed out the kids and assume they don’t have licenses so they have to be passengers, carrying just ONE adult with a driving license and taking just ONE car off the road improves that to 24 mpg instead of 12 mpg with just one passenger.

However, how often is that family using all that space?  Occasionally – more often than not the giant SUV was driven by one family member to the grocery store or to work, minimizing the efficiencies of large passenger carrying vehicles, but the market still wanted them.

And there was no incentive NOT to get a giant truck.  In 1999, when I graduated from high school, gas was $0.99 per gallon.  You read that right.  99 cents per gallon of gas.  Who gives a crap what kind of mileage you’re getting at those prices?

Now, here’s the problem with dictating that cars MUST get better fuel economy – you’re telling the manufacturers what they need to make, whereas the marketplace wants something else – big trucks and powerful sports cars.  In order to build these fuel efficient vehicles, the manufacturers have to spend extra money to produce an efficient big truck, or an efficient sports car – and they pass that cost on to the consumer.  But what if the consumer doesn’t give a fuck?

What if the consumer says, at no price point will the cost of gasoline change my buying habits.  I am going to buy a huge truck or powerful sports car.  Why should they be FORCED to buy fuel efficient wimpmobiles by the government?

The solution, obviously, is to change consumer preference.  And that cannot be done with CAFE and dictating fuel economy regulations, and forcing the cost on the consumer.

The only solution to changing the consumer preference is a gas tax.  A gas tax will raise the cost of gasoline, causing consumer preference to DEMAND more fuel efficient vehicles.  Consumers will not be forced to buy fuel efficient vehicles because that’s all that’s available – instead, they will make that choice on their own, and consumer demand will shift what the manufacturers make.

And better yet, social misfits such as myself can say – gas tax be damned!  I’m still going to purchase inefficient vehicles because this is what I want.  You can’t force me to make a choice.  I will, as a rational actor, decide I want a fuel efficient vehicle and change my lifestyle, or I will pay for the lifestyle choices I make.

The market will work, everyone will be happy.  Economics 100.

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