Posted on 05/21/2004 2:01:22 AM PDT by sarcasm
In the mid-1970s, the last happy days of America's oil innocence, the average American car was a monster weighing 4,000 pounds. The oil shocks induced belated rationality into American oil habits. By 1981, the average car was down to 3,202 pounds.
By the mid-1980s, rational consumer reaction to high prices - home insulation, fuel-efficient appliances and lighter cars - had actually solved the energy crisis. We had OPEC on the run. In July 1986, oil plunged to $7 a barrel.
It is now $41 a barrel. We had a golden moment and let it pass. The way to lock in our gains then would have been to artificially raise the price of gasoline with a tax that would have depressed consumption, maintained consumer demand for fuel efficiency and directed much of the pump price into the U.S. economy (via the U.S. Treasury) rather than having it shipped to Saudi Arabia, Russia and other sundry, less than friendly places.
(Excerpt) Read more at nydailynews.com ...
I see, a tax would have fixed things...
Anyone who tries to bend the rules of supply and demand gets burned in the end.
Yes, it's been a much better idea to completely shut down our own oil industry and let the Wahabis get all the profits, hasn't it?
Oh yeah. Let's do that again. I loved practically having to beg to be grossly underemployed because 'everyone knew' oil would be back up next month.....
>>and directed much of the pump price into the U.S. economy (via the U.S. Treasury)
Sounds wonderful doesn't it? Absolutely no downsides?
Doing the same thing today would have the same effect as then. Trash the economy.
Because the politicians spend the money on gobbly-gook.
What they need to do is reduce income tax to zero and raise the fossil fuel tax to compensate. Probably it will still trash the economy but we could have control of our taxes !!!
If anyone possibly thinks the government could handle oil and gas exploration, production, refining and distribution more efficiently, they should sign up for the Hillary Clinton health care plan!
It isn't an either or.
Gas shouldn't be taxed to cut demand and government shouldn't prevent drilling to restrict supply.
Both are artificial and cause problems with the markets.
Instead of taxing imported oil stop making it impossible to drill and develop domestic oil cost effectively.
Ya think, Charles? And what happened to domestic oil production when the price of oil plummeted?
One well I worked in Colorado was delayed 3 months so it wouldn't interfere with the elk mating. (Not much will stop a Bull Elk in rut.) Another client had to put chain link fences, complete with barbed wire around the location, because it was next to a gas processing plant--in Montana. I guess they were afraid the rig crews would somehow sabotage the Gas Plant. (Local boys, no chance.)
I once watched a BLM crew 'raid' a drilling location in Wyoming looking for violations (I was on a hilltop about 1/2 mile away) Two Suburbans full of people sped onto location, slid to a stop, and deployed (clipboards in hand. It looked like a drug raid. I found a nice spot to sit and watched them swarm all over the rig. Later I heard they did it that way so no one would have time to clean up any spills. Lucky they didn't run over a roughneck or two. Deer, antelope, bison, and all manner of other creatures can urinate on the ground--but if they catch a human it is a $10,000 fine. (as if humans never did this before the white man). Simply amazing.
The same thing that happened in 1982, and again in 1999.
But the key is to keep the tax. Indeed, let it increase to capture all of a price reduction. Consumers still pay $3, but the Saudis keep getting lower and lower world prices. The U.S. economy keeps the rest in the form of taxes - which should immediately be cycled back to consumers by a corresponding cut in, say, payroll or income taxes.
As if...
Oh, where to start?
First, depress consumption? There's a good idea! Gas consumption is...people driving to work, people driving to buy things, stores moving goods from place to place. Gas consumption is our economy humming along, which is why we worry when prices rise. Because it might depress consumption. I hate it when people describe consumption of fuel like it's a selfish, unpatriotic thing to do.
Secondly, the US Treasury is emphatically not the US Economy. The US Treasury is the US Economy's worthless, no-good, drunken loser brother. Unemployed, still lives with mom, drives home drunk from the bars at night and forever bumming a few bucks off his more responsible brother.
Let the market do its job. The price gets high enough, we'll find more oil. Or, better yet, find alternatives. People howling for alternate energy sources would be well-advised to remember that they only become viable as oil becomes more and more expensive.
Exactly where Charles Krauthammer went in his article. The big mystery is why the Democrats aren't pushing this. They say they want to reduce America's dependence on imported oil by encouraging more conservation and as oil becomes more expensive, development by the market of alternative energy sources. As Charlie noted, it would take a modicum of political courage to make it happen. And while liberals like the idea, they also recognize its not a political winner at the polls even though it would enhance over the long term, this country's economic security. But the more important point under discussion is that the Democrats are more concerned with power than what is good for America.
Is the tax on the graphic the 'average' tax? I know if you add the fed tax and state tax 21.4 in TN that brings it up to 39.8 cents per gal.
Charles Krauthammer had the second best solution in mind. Advocate a war in the Middle East. That helped bring down the price of petroleum. Then slap an additional tax on the product to pay for the added war costs. Isn't this man supposed to be a conservative?
New York City - New York State
Raise your taxes as high as you like.
Others will choose to follow, or not.
You first.
You've gotta' wonder about Charles. He's a gun-grabber, and now we find he is a statist, too.
Not to mention the fact that the purpose of taxation is to fund the constitutionally mandated functions of government; not to modify behavior.
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