The Newt Gingrich $2.50 gas plan

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Gingrich campaigns in Nashville

NASHVILLE, Tenn. - Republican Presidential Candidate Newt Gingrich was campaigning in Nashville on Monday. Gingrich attended a roundtable discussion about health care reform Monday. He was on a panel with doctors and other health care providers.

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Volunteer Cab "wins" approval, but may lose by delays. Update 2

Yesterday the Metro Transportation Licensing Commission approved an application from a group of taxi drivers wishing to start there own cab company called Volunteer Cab. However, the approval is contingent on a budget increase to fund more taxi cab inspectors. (link)

What? Would we prohibit new restaurants from opening because we do not have enough restaurant inspectors?  Would we prohibit new home construction because we do not have enough building inspectors. Would we prohibit the licensing of more vehicles because we do not have enough traffic cops? Would we prohibit the opening of new florist shops because we don't have enough florist shop inspectors? I think not.

Karen Johnson

Council Member Karen Johnson who has been a strong advocate for Volunteer Cab arguing for their right to start a new cab company said, "We are working on some things to address this.  Our preference is that they don't have to wait until this time.  We are working with Jerry Maynard to see what other options we have." 

I hope there are other options.  The next Metro Budget is not until June 1. According to the expanded version of this story in the print version of the Tennessean, the cab drivers are currently working for other cab companies and they fear retribution from their current employers due to this effort to start their own cab company. A delay could mean they are all out of work and financially ruined by the time they get final approval to go in business for this new driver-owned cab company. In Nashville most cab drivers own their own cab and pay all of their own expenses but pay a "lick" of between between $150 to $200 a week to the company they are associated with. If a cabbie is fired, his payments on his vehicle and some other expenses continue.

This delay is an injustice. There needs to be major reform of the way taxi cabs and limousines are licensed and regulated. It should not be the mission of the regulatory agencies to protect established businesses from competition.


Update: The City Paper does a much better job of reporting this story than the Tennessean, read here.
Update 2: For a more in-depth report from the Tennessean, see here.

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Obscene oil company profits

Not so obscene after all; actually quite modest.
Compared to other American industries, the oil and natural gas industry’s profit margin are mid-range compared to other industries – 5.7 percent for each dollar, according to 2010 U.S. Census Bureau data.

Those industries making much higher net income/sales percentages on the dollar include beverage and tobacco products (21.7 percent), pharmaceuticals (19.4 percent), computer and peripheral equipment (17.3 percent) and chemicals (14.7 percent). (link)

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Big Oil? That's me!

Corporate management owns only 1.5 percent of the U.S. oil and natural gas industry. The rest is owned by tens of millions of Americans through retirement accounts (14 percent) and pension funds (26 percent).  Mutual funds or other firms account for 29.5 percent ownership and individual investors own 23 percent of oil stock holdings. (link)

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$13.56 for each gallon of gas saved under Cash for Clunkers program

An estimated 125,000 new cars were purchased under the Cash for Clunkers program that would not have otherwise been purchased.

The average difference in gas mileage between the clunker that was traded in and the new car was 2 mpg.

The average driver drives 15,000 miles per year.

If the clunker was getting 15 mpg, it would have taken 1,000 gallons to drive those miles. If the new car gets 17 mpg, the car would require only 882 gallons for a savings of 118 gallons per year. In five years the savings would be 590 gallons per vehicle. For the net 125,000 new vehicles purchased, in five years 73,750,000 gallons of gas would be saved.

The cost of the program was $1 billion dollars. This equals $13.56 for each gallon of gas saved.

Does that sound like a bargain?

Obviously there is more than one way to calculate the savings in gas and I had to make some assumptions in the above calculation. One of the most obvious objections to my calculation is that the cars will be on the road longer than five years and will continue to save fuel. However, I am assuming that if customers had not purchased these cars that they would have delayed their purchase and the future cars they would have purchased instead would have gotten even better mileage than the cars they were enticed to purchase. If, for instance, hybrids gain popularity some people who would otherwise purchase a hybrid sooner will do so later because they will still be driving the car they purchased with the cash for clunkers enticement.

Another factor to consider is that if it cost less to drive a car people may simply drive more miles. This is a variable that is hard to calculate but is realistic. With cheaper gas or better gas mileage people will probably just drive more miles. Also, of course we do not know the future price of gasoline. Higher gas prices would decrease the miles driven thus making the cost per gallon saved even higher.

Another factor to consider is that in five years some of the cars will no longer be in service, others will be the "second" family car and will be driven less miles per year than when it was newer and was considered the first family car. Some of the cars will have been traded in and be driven by lower income people and be driven considerably fewer miles per year than the average of 15,000 miles a year. Some of the cars will simply no longer be in service. So, a five-year calculation seems reasonable, but admittedly this is arbitrary.

If you want to quibble with my figures, go ahead. In any event, whether the cost per gallon of gasoline saved is $9.00 or $13.56 or $21 it is still an expensive way to reduce gas consumption and curtail CO2 emissions. If there is some fatal flaw in my logic or my math, please point it out to me.

Obviously the purpose of the program was to stimulate the economy but it was also sold as a program to reduce gas consumption and help the environment. It was a very costly environmental program.

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More fuel efficient cars may increase global warming.

The Energy Independence and Security Act of 2007 required new car fleets to average 35 mpg by 2020; President Obama’s new rules tightens that standard by just a little and requires fleets to average 35.5 mpg by 2016.
While the federal government is pushing for more fuel efficient cars they are assuming that this will reduce fuel use and reduce auto emissions. There is an assumption that an X% increase in fuel efficiency will result in a corresponding X% reduction in auto emissions and fuel consumption. That is simply faulty logic. It does not take into account the way people really behave. From 1977 to 2001, the number of miles driven every year by Americans rose by 151%. More fuel efficient cars make driving cheaper, so people will do more of it. We can expect an increase in the rate of increase with stable gas prices and increases fuel efficiency.

More fuel efficient cars may mean we become even more mobile. Extended families can be scattered and still see each other frequently. More fuel efficient cars may mean that people who live in the country won’t think twice about jumping in the car go to the store ten miles away to rent a movie or buy a carton of drinks. There will be less need for thoughtful planning to combine trips With driving costing less you can take a Sunday afternoon drive just for pleasure. With greater fuel efficiency people may find that moving further away from urban centers is more attractive than moving closer in. College students away from home my go home more often with more fuel efficient cars. The family can take that summer vacation to the beach or even a further away beach with more fuel efficient cars. With more fuel efficient cars people will be less likely to use mass transit.

Fuel efficient cars, in the absence of higher fuel prices, will make consumption of fuel and driving more miles, more attractive. More fuel efficient cars will put more cars on the road driven more miles contributing to road wear and tear, urban sprawl, and more auto emissions.

Driving more miles needs to be made less desirable not more desirable. There must be an economic incentive to drive less. Greater fuel efficiency without an increase in the price of fuel provides an incentive to drive more.

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Drill Here; Drill Now!

Both presidential candidates are pandering on energy policy, and a gullible public, sick of high gas prices and who have little understanding of economics, is buying it.

If we lift the Congressional ban on most oil drilling off our coasts and in ANWR, this would do nothing in the short term to lower gas prices. It would take ten years before new oil would come to market even if we started today. OK, some will say, if we would have started ten years ago, we would be better off today. If we start now that oil will be coming to market in ten years; so get started!

I agree we should drill offshore and in ANWAR, but it will have no impact on oil prices now and probably none in the future. Drilling in ANWR and offshore will have minimal environmental impact. The drilling site footprint in ANWR is the equivalent of putting a postage stamp on a football field. Offshore drilling is environmentally safe. There is a greater danger of an oil tanker springing a leak than there is of accidental spillage from an oil derrick.

I think we should have a national objective to wean ourselves off of oil and transition to clean energy. For the foreseeable future, however, as we increase our use of other alternatives, we will still need oil. If we are going to continue to need oil, I would prefer for more of that oil to be drilled at home.

Many chatter and bloggers and pundits advocating “drill hear; drill now” claim that if we would only drill we could return to $1.50 gas prices and achieve energy independence. Opening these oil fields will do little to lower gas prices.

We do not have a National Oil company that is required to sell oil drilled in America to Americans at a discounted price. We are not Venezuela or Mexico. Oil taken from ANWR or offshore will not belong to the American people but will belong to the company that drills it. That oil will not be cheap oil and there is a worldwide market for oil, not just an American market. The value of oil drilled in America will still be valued at the market price for oil. While any increase in supply will have some impact on prices, the new contribution to oil supply will be minimal. ANWR oil would add only 1 to 2 percent to the overall world oil supply. The oil cartel can simply cut production to match any new supply from these oil fields and prices will not be affected.

The new oil drilled in ANWAR and offshore, may not even serve American markets. If the oil companies find it more cost effective to sell the oil in Japan than in America, that is where the oil will go. While we should not expect new oil from ANWR or offshore to lower prices, there are two advantages to drilling American oil. One advantage is the balance of trade. When we buy oil or anything else from foreign markets dollars flow out of America. Increasing domestic oil production will lower the U.S. trade deficit and strengthen the dollar.

The other advantage is that American production of oil will enhance American security. While most of our imported oil comes from our friends Canada and Mexico, much of it comes from unfriendly regimes. By purchasing oil from these unfriendly countries we fund Muslim terrorist and hostile states. Also, in time of crisis these countries could shut off the oil spigot and wreck our economy and hold American foreign policy hostage to their oil.

For balance of trade reasons and national security reasons, increasing production of American oil makes sense, but don’t expect offshore drilling or ANWR to lower the price at the pump.

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The Idiocy of Energy Independence

John Stossel Wednesday, August 20, 2008

It's amazing how ideas with no merit become popular merely because they sound good.

Most every politician and pundit says "energy independence" is a great idea. Presidents have promised it for 35 years. Wouldn't it be wonderful if we were self-sufficient, protected from high prices, supply disruptions and political machinations?

The hitch is that even if the United States were energy independent, it would be protected from none of those things. To think otherwise is to misunderstand basic economics and the global marketplace. (link)

Comment: While reducing dependence on foreign oil is an admirable goal, energy independence is neither desirable nor achievable. Stossel explains why.

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Would Politicians Pander?

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Is Nuclear Energy Our Best Hope?

by Gwyneth Cravens, Discover

Despite its negative image, nuclear energy may be the most efficient and realistic means of meeting the rapidly-growing demand for power in the United States. by Gwyneth Cravens

Four years ago this month, James Lovelock upset a lot of his fans. Lovelock was revered in the green movement for developing the Gaia hypothesis, which links everything on earth to a dynamic, organic whole. Writing in the British newspaper The Independent, Lovelock stated in an op-ed: “We have no time to experiment with visionary energy sources; civilisation is in imminent danger and has to use nuclear, the one safe, available energy source—now or suffer the pain soon to be inflicted by our outraged planet.”

Lovelock explained that his decision to endorse nuclear power was motivated by his fear of the consequences of global warming and by reports of increasing fossil-fuel emissions that drive the warming. Jesse Ausubel, head of the Program for the Human Environment at Rockefeller University, recently echoed Lovelock’s sentiment. “As a green, I care intensely about land-sparing, about leaving land for nature,” he wrote. To reach the scale at which they would contribute importantly to meeting global energy demand, renewable sources of energy such as wind, water, and biomass cause serious environmental harm. Measuring renewables in watts per square meter, nuclear has astronomical advantages over its competitors.”

All of this has led several other prominent environmentalists to publicly favor new nuclear plants. I had a similar change of heart. For years I opposed nuclear power, but while I was researching my book Power to Save the World: The Truth About Nuclear Energy, my views completely turned around. (link)

Commentary

If one accepts the scientific consensus, as I do, that global warming is a very serious problem and must be addressed and be addressed soon, there is little to be encouraged about. Kyoto has been a dismal failure. The world's output of greenhouse gases continues to increase rather than decrease. The carbon trading and carbon off-set mechanisms are scandal-ridden and are ineffective. In 2007 the US passed new CAFE standards, which will take years to have any impact and then, only minimal. In 2008 the US Congress considered, and wisely rejected, a seriously flawed Cap and Trade bill. If the next Congress should revive and pass the bill, it will enrich some, at the expense of others. It may also very well destroy the economy, while having minimal impact on our carbon output. The G-8 summit passed a very weak declaration to do something about global warming, someday and even that was rejected by India and China. The promise of ethanol turned out to be false. Ethanol has led to higher food prices, increased starvation in the undeveloped world, and has done little to curtail greenhouse gases.

Looking for bright spots in a gloomy picture, gas prices have increased, which for the first time ever has resulted in Americans reducing the amount of driving they do. The bad news is that politicians of both parties are pandering to a public which wants lower gas prices. Another piece of good news is that, thanks to the efforts of oilman T. Bone Pickens, there is a major push to promote wind power. This renewable resource looks like a viable, alternative energy source. Wind power alone, however, can not meet our energy needs.

Nuclear energy may be our best hope. Nuclear energy may be able to curtail global warming in time to avoid a calamity. This energy source would definitely have to be coupled with other alternative sources of clean energy; policies that curb carbon consumption, and futher investment in some promising new technological developments in carbon sequestration. Nuclear is not without its problems, but not using nuclear energy is more threatening than using it. In the above article, the author makes this argument. Unfortunately, many of the people who are most passionate and proactive about global warming are also the same people most passionate about stopping nuclear energy development.

James Lovestock, one of the world's most prominent environmentalist, has gone from being an opponent of nuclear energy to a proponent. This article explains why Lovestock and other rational environmentalist are now supporting nuclear energy as an important part of the strategy for stopping global warming.

Nuclear energy supplies only 20% of America's energy needs. That percentage is constantly slipping, and no new nuclear plants have been built in America in 30 years. America's energy demand continues to increase, and the US is the world's greatest contributor to global warming. If we are serious about combating global warming, we need to embrace nuclear energy.

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I Can’t Drive 55

Sen. John Warner, R-Va., has indicated that Congress may want to consider reimposing a national speed limit in an effort to curtail gasoline consumption. I have been expecting this. He has asked Energy Secretary Samuel Bodman to look into what speed limit would provide the optimum gasoline efficiency. He has asked if the administration might support efforts in Congress to require a lower speed limit.

In 1974 in response to the Arab oil embargo Congress set a national 55 mph speed limit. The speed limit stayed in effect until 1995.

In about 1987 I went through a divorce and my ex-wife moved from Nashville to McKenzie, Tennessee, a distance of about 125 miles. She had custody of our five-year-old daughter but I had liberal visitation. I was determined I would not lose contact with my daughter so I continued to exercise my visitation despite the distance. For about the first year after her move out of town, when my daughter was six, I continued my every other week visitation and the every Wednesday night visitation. Later I reduced the Wednesday night visits to the alternate Wednesdays when I did not have weekend visitation. A couple years later I discontinued the Wednesday night visitations all together. I thought while she was young, that the regular continued contact was important. And, it was certainly important to me.

I had the greatest car I ever had during this period. It was a 1986 Pontiac 6000, Sports Touring Edition. It had a sunroof, a great stereo with controls on the steering wheel, rack and pinion steering (what ever that is) and something called “engineered ride control.” The shocks would pump up and adjust to how fast you were driving and the amount of weight you were carrying. The car seemed glued to the road and the steering was real responsive. I loved that car!

I bought the absolutely best radar detector money could by and I burned up the road. Every Wednesday I would leave work early, drive to McKenzie, visit my daughter and drive back. Riding the same route every Wednesday night, I got to know every bump in the road and I learned where the state troopers usually hid. I would crank up the radio, and make the trip and did not mind the drive at all. After a while, it seemed like the car drove itself. I would leave McKenzie and when I hit the interstate I went into an almost trance-like state. I would enjoy the music and in no time at all it seemed like I was home.

I routinely drove at about 85-90 MPH. Sometimes my speed would creep up to over 100. The radar detector kept me from getting numerous tickets but radar detectors are not fool-proof. I had some friends in high places at the time and I got a couple tickets “dismissed.” A couple times, highway patrolmen cut me a break and gave me a warning or wrote the ticket for a lower speed than I was really driving. After about the fourth ticket however and notice that one more ticket would cause me to lose my license, I slowed down. By that time, I was ready to discontinue the Wednesday night trips anyway.

I hated driving 55. I hated driving 75. If I would have obeyed the speed limit, I would not have been able to visit my daughter. In a good car, Interstate driving at 80 is not so bad; interstate driving at 55 is hard work.

A 55 MPH speed limit will bring back CB radios and disrespect for the law. Like Sammy Hager says, "I Can’t Drive 55!"

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Democrats Broken Promises on Gas Prices

Nancy, I thought you promised to bring down gas prices.

In 2006, in the lead up to the Congressional elections, Nancy Pelosi promised "a commonsense plan to bring down skyrocketing gas prices." At the time gas was $2.23 per gallon; now it is $4.00.

Many people are looking to find a culprit and are looking for a conspiracy. The primary cause of higher gas prices is due to an increased demand from developing countries, primarily China and India. However, if one wants someone to blame, the Democrats are the prime candidates. Democrats have blocked new American exploration, drilling and refineries for the last twenty years.

Nancy Pelosi is not such an idiot that she does not understand the cause of higher gas prices. Since, however, she promised "a commonsense plan to bring down skyrocketing gas prices," she should be held accountable. Nancy did you not promise to bring down gas prices?

This video was copied from youtube and was a production of rocketsfan34.

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Hooray for High Gas Prices

What exhortations to love Mother Nature and change your evil ways couldn’t do, what feel-good environmentalist legislation couldn’t do, higher prices are doing. I know it is surprising to some folks but markets and prices really do work. Americans are conserving and substituting, new technologies are becoming more affordable, people are changing their energy habits, and smaller homes and smaller cars are becoming more desirable.

Just listen to what people around you are saying about rising gas prices or read your local paper and it is hard to escape the fact that high prices are causing beneficial results. Here is a sampling of recent news stories:

· Gas cost deflates prices on used SUVs, USA Today 5/9/08. The price of big used SUVs has dropped 17% from a year ago.

· Planes Fly more, emit less greenhouse gas, USA Today 5/9/2008. Airlines have taken many steps to curb fuel use, such as adding better navigational equipment, modifying wings for improved aerodynamics. From 2000 to 2006 fuel efficiency increased 22%.

· Gas cost squeezes daily life, USA Today 5/9/2008. People are changing their habits. They are combining errands. “February was the forth consecutive month in which miles driven in the USA declined, the first time since 1979 that that has occurred.”

· Developer bets that home buyers trade space for energy efficiency, The Tennessean 5/12/2008. Developer Randy Chastain has been a developer in the Nashville market for 30 years. Cheep materials, cheep land, and cheep gas led to bigger and bigger houses with little thought to energy efficiency, says Mr. Chastain. He believes higher energy costs are changing the market. Now, he is building homes that are 10% smaller than what he was building and considerably more energy efficient. He is building LEED certified homes.

· Demand for gas eases slightly as more carpool. The Tennessean 5/1/2008. This article notes that carpooling is increasing. It interviews several people who have started carpooling.

This is not to suggest that we are wining the war for energy independence or reducing global warming. We are not. But, for the first time, we are headed in the right direction. For a while, it seemed that the demand for energy was inelastic. However, it seems that just shy of the $4.00 per gallon mark is proving to be the price point at which people will conserve and change behavior.

Perhaps more important than the price of gas is the expectation that gas prices will stay high. According to the Gallup poll, in August 2003 only 33% of the public believed high fuel prices would last. The latest Gallup poll shows 78% believe high gas prices are here to stay. If people expect prices to stay high, it will influence where they live, how they work, and the car they drive.

Unfortunately, pandering politicians of both parties are promising the public they will do something about high gas prices. Both Hillary Clinton and John McCain have advocated removing the federal gas tax for the summer. Some smooth talking, lying politicians, such as Nancy Pelosi, have to gall to advocate lower gas prices and combating global warming in the same sentence.

We do not need to reverse the progress that is being made on the energy and global warming front. What needs to happen in order to break the American oil addiction is for there to be still higher gas prices and a reinforcement of the idea that high prices are here to stay. To expedite what the market is already doing, a revenue-neutral carbon tax could put us on the right track to begin winning the war for energy independence and reversing global warming.

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Shame on John McCain…

For shameless pandering on the gas tax.

Both Hillary Clinton and John McCain are proposing to suspend the federal gas tax as a response to rising gas prices; despite the fact that most economist and energy experts think that this is a counterproductive proposal. Obama deserves credit for not joining in the pandering. He has rightly called it a “silly idea.”

I am more disappointed in McCain than Clinton; I didn’t expect better from Hillary. It is not that I think Hillary Clinton is so dumb that she really thinks suspending the gas tax is a good Idea; I think she is so unprincipled and ambitions that she will do whatever it takes to be elected. I expected more from McCain. In the past he talked sense about energy independence, ethanol, and global warming. McCain has to know this is a stupid idea and I thought he had more integrity than to pander with the best of them.

The federal tax on gas is 18.4 cents per gallon. What happens if we cut the tax? For one thing, the price will fall temporarily, which will increase demand for gasoline and result in another increase in price, then when the 18.4 cents is added back, the resulting price will be higher than it otherwise would have been. Another thing that will happen is that not all of the 18.4 cents will be passed on to the consumer. The oil companies will keep part of it.

The reason prices are so high is neither due to an Arab oil embargo nor greedy oil companies. It is primarily due to the increase in demand. The people of India and China are beginning to drive private automobiles. It is basic Economics 101. Demand is exceeding supply and prices are increasing. Another reason is the slide of the dollar. It takes more dollars to trade for the same amount of other currencies and therefore anything we import cost more.

Every administration since the late seventies has talked about energy independence and instead we have steadily moved toward greater dependence. Americans continue to drive more and consume more gasoline every year than they did the year before. Urban sprawl continues and people move further from urban centers. Instead of choosing energy efficient vehicles, people choose to drive gas-guzzling SUVs.

What are the negative effects of increased gas consumption?

(1) We finance our enemies. It is an unfortunate accident of geology that the countries with the most oil are ruled by fanatics and despots. Saudi Arabia is officially an ally, but it has a Muslim population that takes seriously the mandate of their faith to give alms. So, American dollars flow to Saudi Arabia, some of which ends up the pockets of devout Muslims and they give to the clerics who build Wahhabi Muslim schools throughout the world where people are taught the most violent and radical strain of the Muslim religion. Every time you fill up your SUV you are contributing to the radical Muslim cause and the training of terrorist. Also we are financing the anti-Americanism of the Venezuelan dictatorship.

(2) We are increasing the rate of Global Warming. Despite all of the concern about global warming and all the talk about combating it, we have not yet decreased the rate of increase in CO2 emissions. Feel-good environmental measures and exhortations to properly inflate your tires and change light bulbs and wear a sweater are not going to be sufficient to curtail global warming. It is going to take some pain and sacrifice.

In today’s newspaper there was an article, Small-car sales help Nissan end April with gain. The article said that while U. S. auto sales were declining that the sale of the Nissan Altima and subcompact Versa was showing gains. Honda, Toyota and Volkswagen are also posting increased sales. Americans are starting to fall out of love with their gas-guzzlers and to prefer small fuel-efficient cars.

In yesterday’s newspaper there was an article that said "Demand for gas eases slightly as more carpool.” Markets work. Supply and demand is not right-wing dogma. it is as true as gravity. People cannot change their behavior overnight however but we are starting to see a decrease in demand. If gas prices were high and people thought they would stay high we would see greater reductions in consumption. Overtime, the American vehicle fleet would shift to more fuel-efficient cars. and we would start to see a lessening of urban sprawl. The cost of gas would enter into the equation in many decisions consumers make. Conservation would be cost effective is prices were expected to stay high. Investment in alternative fuels and alternative technologies would be worth the investment if there were not an expectation that gas would stay high. If we want to continue the trend of reducing gasoline consumption then we do not want to lower gasoline prices.

It is best if we do nothing about high gas prices and let the demand for gas fall.

Hillary, I didn’t expect better from you. John McCain, shame on you.

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Americans Start to Curb Their Thirst for Gasoline

By ANA CAMPOY March 3, 2008; Page A1 Wall Street Journal

As crude-oil prices climb to historic highs, steep gasoline prices and the weak economy are beginning to curb Americans' gas-guzzling ways.In the past six weeks, the nation's gasoline consumption has fallen by an average 1.1% from year-earlier levels, according to weekly government data.That's the most sustained drop in demand in at least 16 years, except for the declines that followed Hurricane Katrina in 2005, which temporarily knocked out a big chunk of the U.S. gasoline supply system. (link)

Commentary: What a concept! If something cost more people will consume less of it.

This is not rocket science. This is basic Economics 101.

The reason we have not seen an even greater reduction in consumption is because prices are not high enough for a long enough period of time. People look at high gas prices as an anomaly and think they will come back down. If gas prices reached, say, $5 a gallon and people did not expect prices to fall, is there any doubt that people would change their consumption patterns? Would that young family contemplating a housing purchase be as likely to more to the far-flung suburbs if gas was $5 a gallon as they would when it is $2.50 a gallon? When contemplating a car purchase, would MPG matter less or more if gas were $5 a gallon?

The other thing that would change if gas reached $5 a gallon and stayed there is that alternative renewable energy, technological innovation, and conservation would flourish. Automakers are already producing hybrid vehicles and developing new improved batteries. If gas cost more the alternative would be cheaper in comparison. The only thing holding back the alternatives is that they cannot compete with cheap gas.

For those who do not believe global warming is real, I can understand why they would oppose efforts to combat it. What I do not understand is why so many environmentalist who claim to care deeply about the issue of global warming are wasting their energy advocating feel-good measures and meaningless cajole and control schemes rather than getting behind a gas tax.

Some argue that sustained higher gas prices would be detrimental to the economy. If a gas tax was revenue-neutral and any increased revenue from a gas tax was off set, dollar for dollar, by an income tax reduction, a gas tax should have no detrimental effect on the economy. In fact, a reduction in the tax on income could result in greater production of income.I would much rather tax carbon, which I think is not desirable, than to tax income which I think is desirable.

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Smell Gas

A subject that makes congressmen stupid.
By Jacob Weisberg
Few topics seem to addle the collective brain of Washington like high gas prices. Politicians who raise this issue can generally be assumed to be partisan, cynical, demagogic, and dishonest. But one must not discount the possibility that something about the subject actually makes them stupid.
With gasoline prices now spiking around $3 a gallon—near their inflation-adjusted 1981 peak—we are witnessing stupidity on wheels.
What none can acknowledge is that higher gas prices in the United States are a good thing. To be sure, oil at $70 a barrel causes hardships for working people and delights some of the world's worst dictators. But cheap gasoline imposes its own costs on society: greenhouse gas emissions, air pollution and its attendant health risks, traffic congestion, and accidents. The ideal way to cope with these externalities would be with higher gas taxes or a carbon tax.
http://www.slate.com/id/2140613/

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Americans Would Drive less if Gas Cost More

Wow! What a concept! If something cost more, you will purchase less of it. Rod

Americans would hit brakes if gas hits $3.50: poll
Wed Jul 18, 2007 10:25AM EDT
By Rebekah Kebede
NEW YORK (Reuters) - Some 40 percent of Americans would curb their driving habits if retail gasoline prices shot up to $3.50 a gallon, according to a Reuters/Zogby poll released on Wednesday.
To continue reading:
http://www.reuters.com/article/domesticNews/idUSN1724728220070718?feedType=RSS&rpc=22&sp=true

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