Friday, May 2, 2008

summer tax holiday = bad idea

According to a New York Times article, for the first time in years the sale of compact cars has exceeded those of S.U.V.s and light trucks, due to the high gas prices. While I'm sure the auto industry and oil companies are concerned, I think this is GREAT news! Finally, people are making better decisions for the environment and economy. With any luck, this upward trend will actually lead to people driving less and the creation of innovative technologies for more fuel efficient vehicles, or better yet, alternative sources of energy (and not biodiesel, which has led to rising food prices in developing countries. Can I just point out that producers are growing corn so we can fuel our vehicles instead of growing food crops for millions of people worldwide? This is so incredibly wrong.) As for the McCain proposal to eliminate gas taxes for the summer, well, this just makes me so angry. It is just a ploy to appeal to low- and middle class voters by claiming to be giving something back to them. But what are they encouraging people to do? Go on vacation, spend more money in the economy, not save, and make sure that the oil industry continues healthy and keeping us in their iron grip. Sure, it'll save people a few bucks when they fill up their tanks, but enough? No. And McCain is under the impression that as soon as the kids are out of school, the family packs up the minivan and drives cross-country to Yellowstone or someplace. Nice idea, but in many communities, this is a fantasy because parents have to work (to be able to afford gas at all), and a vacation costs more than the tax on gas, especially in the weakened economy. and then Hillary has jumped on as well! People, the tax cut is 18.4 cents per gallon!!! You can't even get a slurpee with what you'd save on filling up at the 7-11!

Here's what Obama is saying about it. He has some good economic advisers.


We need leadership that will push for a sound energy and economic policy. The current administration (and the people proposing to continue the policies of the current administration, ahem Mr. McCain) are set on the destruction of the nation and oblivious to the environmental realities that we face.

4 comments:

Chris said...

you beat me to it! I've been writing something up on the same subject! This proposal is very disturbing, especially since Clinton jumped on board. I'm very impressed with Obama. He's actually focusing on policy in a tv commercial, which I don't think I've seen. If he wins this thing, it will change every election across this country... the new campaign strategy will be to talk about the truth, even if it's not what people want to hear... we've got to elect this guy.

Chris said...

ALSO, consider that gas is an inelastic good. Hillary says that she'll make up for the $9 billion shortfall by raising taxes on the gas companies -- which will be immediately passed to the consumer through higher gas prices. Whatever chump change we save at the pump will be washed out immediately with higher prices.

ALSO, the gas prices go up in the summer because of increased demand. So if the prices actually did drop, it would create a nation-wide gas shortage.

Ok, last thing... I think. The 18.4 cent gas tax goes toward maintaining our infrastructure. Well, our infrastructure is crumbling because we don't have enough money to maintain it. Each year we fall farther and farther behind because we are not keeping up with maintenance needs. On top of that, we should be investing billions of dollars in new mass transit infrastructure. The gas tax holiday would remove $9 billion (approximately 40%) of the gas tax revenue, completely leaving our government unable to barely meet minimum expectations.

THANKS FOR WATCHING OUT FOR US JOHN AND HIL!

suvi said...

Chris, I love that you wrote an entire public economics term paper as a comment on my blog.

Lindsay said...

I appreciate this post and comments -- it was really informational. I am currently a resident in if-you-don't-have-a-truck-you-must-not-be-a-man-idaho AND I work for a trucking company, so these things have been on my mind. There are a lot of people here who view the fuel crisis very differently, who would rather protect the trucking industry/ the distribution of goods industry than to innovate. I say let the market force innovation as it naturally will, which may be difficult in the short run, but will be better for the economy and our int'l political relations in the long run.