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Gas%20pump.jpgThat which doesn't kill you makes you stronger. It's time to jack up the tax on gasoline so we're paying $1 a gallon, about double what the average driver pays now in the United States. The economy is hurting short term (for the next year or two probably) but America's energy problem is long-term. Here's why the gasoline tax needs to go up:

Americans have it good right now. The federal government taxes motor vehicle fuel at 18.4 cents per gallon and the average state tax is 28.6 cents per gallon, or 47 cents total. (New York, Hawaii, and California charge more than 40 cents per gallon; Alaska, New Jersey, and Wyoming all charge less than 15 cents per gallon.) But in the rest of the world, it's not uncommon to pay $5 a gallon in taxes and in some places the pump price (including gasoline) approaches $10 a gallon. Paying less for fuel is good individually; using more and more fuel that comes from outside the U.S. is a bad thing collectively. Most places that pump oil in quantity aren't America's BFFs.



Americans have it better right now at the pump. With oil falling to $70 a barrel (remember the talk of $200-a-barrel oil in the summer?), pump prices are as low as $2 a gallon for unleaded regular in low-tax states such as New Jersey. That's almost enough to make you run out and buy the Chevrolet Suburban. At $2 a gallon, a 12.5 mpg gas guzzler costs you the same as a 25 mpg compact sedan when gasoline costs $4 a gallon.

But there's still global warming and pollution. Other than Tina Fey arguing that climate change is just God hugging us closer, most people - not all - agree that this global warming thing looks to be more than statistical swings. It's easier for the candidates to say, "Drill, baby, drill," than to be a Michael Dukakis-scold and ask, "Is this trip really necessary ... in such a big vehicle ... and did you turn off the lights before you left?"

Economists agree: Costlier fuel makes us conserve. Most economists, no matter what their political bent, say that the one thing that makes drivers conserve fuel is the cost of fuel. (Duh.) Some have called for an increase of $1 in the gasoline tax, meaning you'd pay about $1.50 total in taxes per gallon, and the cheapest regular would be about $3 a gallon today, not $2. Politicians know this, too, just as they know that voting for higher fuel taxes makes sense only if you're not running for re-election. In other words, how can you do the right thing if it's tantamount to political suicide?

Costlier fuel spurs alternative-energy research. As everyone knows, oil companies are run by greedy people intent on pillaging the pristine wilderness but running "We're green" commercials on Monday Night Football to salve our collective conscience. Actually, it might be safer to say they're giving us a product we're demanding and they look for it in the cheapest places, with occasional collateral damage if you're a sportsman or recreationalist. The more traditional fuels cost, the greater the impetus to find newer, cleaner sources of energy.

Costlier fuel spurs new vehicle designs. The reason automakers are pushing ahead on hybrids, clean diesels, and electric vehicles is because they see demand based on likely higher fuel prices and scarcer energy resources over our lifetime. Were I a struggling automaker (what other kind is there now?), I'd be tempted to scale back my alternative-fuel R&D for a couple quarters ... which would mean the companies going ahead full throttle, such as Toyota, would be further ahead when the next crunch hits.

Proposal: Higher gas taxes, with rebates, incentives. Here's what I'd do: Raise the federal fuels tax by 10 cents a gallon for each of the next five years. Then split the extra revenues: half going to general government revenues (I'm sure it will be wisely spent) and half going to fund better highways, improve mass transit, and most of all for basic research into more efficient vehicles as well as smarter highways that further improve vehicle efficiency. Imagine a future in 10 to 20 years when cars could be partially self-driving and able to drive, in rush hours on the Interstate, at a constant 50 mph, instead of a stop-and-go commuting range of 10 mph to 65 mph with an average of 35 mph.

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