Thursday, March 20, 2008

Rep. Dingle (D-MI), I see your $.50 & raise you $1.50

You want to that hard truth? I am to the left of Rep. Dingle (D-MI) - though actually I consider my idea much more Red American than Blue.

What am I talking about?
A Michigan congressman wants to put a 50-cent tax on every gallon of gasoline to try to cut back on Americans' consumption.

Polls show that a majority of Americans support policies that would reduce greenhouse gases. But when it comes to paying for it, it's a different story.

Rep. John Dingell, D-Mich., wants to help cut consumption with a gas tax but some don't agree with the idea, ...
$.50 is chump change. I want $2.00 a gallon on gas ($3.00 paid at the point of entry for imported oil or imported refined oil products), increased $.25 a FY Quarter (that would take 2 years to take full effect for those in Middleburg, FL) until you reach the $2 to $3 mark; and my proposal has nothing to do with "greenhouse" gas either.
At current oil prices, this country sends overseas $460 billion per year to finance the daily buying of 12 million barrels of imported oil. This amount of money is about the size of our defense budget and three times the size of the ''economic stimulus'' package recently passed by Congress. But the real economic impact of oil dependence is hidden to most Americans. Energy economist Milton Copulos (who passed away this month) calculated last year that the grand total of all external costs associated with foreign oil dependence -- including the cost of oil-related defense expenditures, amortized cost of supply disruptions, and lost economic activity and tax revenues -- stands at $825 billion per year.

A double whammy

To put the figure in perspective, this is equivalent to adding $8.35 to the price of a gallon of gasoline refined from Persian Gulf oil, making the cost of filling the gasoline tank of a sedan $214, and of an SUV $321. At today's oil prices, these costs would be even higher.

For the U.S. economy, oil dependence is a double whammy. While it contributes to our economic decline, it allows OPEC governments, many of which do not have our best interests in mind, not only to laugh all the way to the bank but to literally own the bank. The recent buyout by foreign governments of chunks of America's prime symbols of economic prowess -- like Citigroup, Merrill Lynch, Morgan Stanley, Blackstone Group and Bear Stearns -- is only the preview to what is yet to come should the petrodollar fueled transfer of wealth continue.

To understand the forces at play it is instructive to visualize the scale of OPEC's potential wealth in comparison to that of the consuming countries. At $100 a barrel, OPEC's oil assets stand at roughly $92 trillion, equivalent to almost half of the world's total financial assets and nearly twice the market capitalization of all the companies traded in the world's 27 top stock markets. If one adds the worth of OPEC's huge gas reserves as well as additional oil reserves that have not yet been discovered, the wealth of OPEC more than doubles.

If oil prices climb to $200, as President Hugo Chávez of Venezuela recently warned, this wealth would double again. While the value of the dollar and the U.S. economy is shrinking, OPEC's monumental wealth enables its countries unprecedented buying power. As an illustration, at current oil prices it would take OPEC just six days to buy GM and three years to buy a 20 percent voting block in every S&P 500 company.
Put all that new tax money in a fund to supply rebates for those that buy hybrid cars, flex fuel cars, LPG cars, or cars that get over 40 MPG in the city, any money left over goes towards the solar rebates listed below.

Bring diesel regulations in line with Europe so we can get moving towards 40% of US cars as diesels (next time you are in Europe, rent a VW diesel and then talk to me if you don't like diesels). That brings the 30-40% greater MPG of a diesel and expanded use of the more effective than ethanol/gas mixture bio-diesel online.

CAFE standards are for Leftists. Excise tax on every vehicle sold based on MPG and year. Stiff. If you want a 1976 El Dorado, then send $2,000 extra to the Hybrid-Flex Fuel fund. If your wife needs an Expedition to get groceries from Piggly Wiggly, then pony up $1,500 to the fund.

With that tax increase, we would also open drilling for oil and natural gas off Florida, California and Virginia (before you moan, actually spend some time on the beaches off the LA area - everything is fine) - open ANWAR. Wind farms off the Eastern Shore and Nantucket, Mass - in addition to significant tax breaks for all off-shore and on-shore wind farms based.

More nuke plants. 100% tax rebate for installation of solar panels on single family houses. 20% rebate on installations of solar panesl on new construction houses (i.e. $40,000 in panels and you get $8,000 back in addition to your tax rebate). All will be adjusted for inflation.

There is your political compromise. Slam the gas guzzlers, promote wind and solar. Move on nukes and support domestic production. Diversify transportation fuels.

Let China pay Saudi Arabia and Iran's bills.

Oh, and before you have a cow, in some places in Europe, they are paying about $8.50 (5.50 Euro) a gallon, and their economies are doing just fine.

Mr. and Mrs. America; welcome to the Long War. Glad you are willing to lean in and do your bit.

So yea; I will support a tax. Anti-terror tax that is; as part of an anti-terror comprehensive plan for domestic energy and economic security.

Everyone needs to take a bite of this sandwich - and who knows, in the end you might like it.

But - to make that happen you need Congress to do its job.....


Hat tip Cliff May at The Corner.

1 comment:

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