As loyal readers of this blog know by now (I'm talking about you, Mom), I've got a soft spot for gas taxes. In fact, I'm pretty convinced that America needs a higher gas tax, phased in over several years (so the working poor can adjust their driving habits). Over the past few weeks, I've noted that various conservative Republicans have also endorsed this plan (although none of them are actual politicians, just pundits). Now others are noticing the trend as well:
N. Gregory Mankiw, former chairman of the Council of Economic Advisers in the Bush White House, suggested raising energy taxes in an Oct. 20 op-ed in the Wall Street Journal, and former Fed Chairman Alan Greenspan talked it up in late September. Harvard's Martin Feldstein and Weekly Standard contributing editor Irwin Stelzer like the idea, too. Dan Gross took note of this unexpected GOP trend in an Oct. 8 New York Times column ("Raise the Gasoline Tax? Funny, It Doesn't Sound Republican").
Here's my dream scenario: Bush wakes up, and realizes that he has two years to rescue his historical legacy. But he's in luck. All he has to do is imitate Bill Clinton. Clinton's political strategy could be summarized in a single word: triangulation. He was the vertice somewhere in between Newt Gingrich and The Nation. Bush should pull a similar stunt, and wedge himself in the uncomfortable space between Nancy Pelosi and Sam Brownback.
The first thing Bush can triangulate is a gas tax. The Republican elite are already excited about the idea, and conservatives are supposed to prefer consumption taxes to income taxes. Lord knows the Democrats love the idea. So why not broker some sort of tax compromise? David Frum, Bush's former speechwriter, proposed just such a plan in the WSJ yesterday:
The president has likewise denounced America's "addiction to oil" and often presented nuclear power as a crucial element of an ideal energy policy. What if he baited the Democrats with some kind of energy tax (or, better, a carbon tax -- which exempts nuclear-generated energy) in exchange for permanent cuts in taxes on work, savings and investment. "Tax waste, not work" is not a bad slogan.
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NO! ABSOLUTELY NOT!
Bush must NOT do that! If I had to agree with something Bush wanted AGAIN I think my whole worldview would collapse!
(I also agreed with his intervention in the "eminent domain" abuse flap after the Supreme Court ruling...)
Uh, how so? What the Democrats have been talking about lately is a windfall profits tax on oil companies, not a consumption tax on gasoline. They did propose raising the gas tax in 2005, but only by an extremely modest amount and then only to provide funding for a transportation bill. This year the Democrats' only address of the issue has been a proposal of eliminating! the gas tax for a sixty day tax holiday.
In the meanwhile, the high gas prices were one of the factors fueling the dissatisfaction with the status quo this year which swept the Democrats into power, so I think the Democrats would possibly be a bit leery of trying to touch that one. At the least the issue would have to be really strangely framed (a carbon tax, that they might accept) for it to be anything but surprising if they touched it.
I tend to disagree on gas taxes simply because they're regressive taxes. They will affect the poor a great deal more than the rich.
If there were a provision that people with lower incomes could get a credit at the end of the year to cover the excess taxation it might be alright, but otherwise this is a very shortsighted taxation scheme that will hit the most vulnerable people first.