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The Downside to Low Gas Prices
HughPickens.com writes Pat Garofalo writes in an op-ed in US News & World Report that with the recent drop in oil prices, there's something policymakers can do that will offset at least some of the negative effects of the currently low prices, while also removing a constant thorn in the side of American transportation and infrastructure policy: Raise the gas tax. The current 18.4 cent per gallon gas tax has not been raised since 1993, making it about 11 cents per gallon today, in constant dollars. Plus, as fuel efficiency has gotten better and Americans have started driving less, the tax has naturally raised less revenue anyway. And that's a problem because the tax fills the Highway Trust Fund, which is, not to put too fine a point on it, broke so that in recent years Congress has had to patch it time and time again to fill the gap. According to the Tax Policy Center's Howard Gleckman, if Congress doesn't make a move, "it will fumble one of those rare opportunities when the economic and policy stars align almost perfectly." The increase can be phased in slowly, a few cents per month, perhaps, so that the price of gas doesn't jump overnight. When prices eventually do creep back up thanks to economic factors, hopefully the tax will hardly be noticed.
Consumers are already starting to buy the sort of gas-guzzling vehicles, including Hummers, that had been going out of style as gas prices rose; that's bad for both the environment and consumers, because gas prices are inevitably going to increase again. According to data from the U.S. Energy Information Administration, taxes last year, even before the current drop in prices, made up 12 percent of the cost of a gallon of gasoline, down from 28 percent in 2000. And compared to other developed countries, US gas taxes are pretty much a joke. While we're at it, an even better idea, as a recent report from the Urban Institute makes clear, would be indexing the gas tax to inflation, so this problem doesn't consistently arise. "The status quo simply isn't sustainable, from an infrastructure or environmental perspective," concludes Garofalo. "So raise the gas tax now; someday down the line, it will look like a brilliant move."
Consumers are already starting to buy the sort of gas-guzzling vehicles, including Hummers, that had been going out of style as gas prices rose; that's bad for both the environment and consumers, because gas prices are inevitably going to increase again. According to data from the U.S. Energy Information Administration, taxes last year, even before the current drop in prices, made up 12 percent of the cost of a gallon of gasoline, down from 28 percent in 2000. And compared to other developed countries, US gas taxes are pretty much a joke. While we're at it, an even better idea, as a recent report from the Urban Institute makes clear, would be indexing the gas tax to inflation, so this problem doesn't consistently arise. "The status quo simply isn't sustainable, from an infrastructure or environmental perspective," concludes Garofalo. "So raise the gas tax now; someday down the line, it will look like a brilliant move."
Simply change the tax structure on commercial trucks which are the ones that do all the damage to the roads and highways. You fuel efficient Toyota Prius couldn't damage the road if it tried.
...is "broke" because we're funding a lot of things out of it that aren't highways.
If the money was used as originally intended - to fund building and maintenance of the Interstate highway system - it would be brimming with cash. Instead, it's also being used for lots of other projects, like mass transit, bicycle paths, and landscaping for roads. About a quarter of the income from the HTF goes to non-highway projects.
Oddly enough, if you moved the non-highway spending out of the Highway Trust Fund, it would be completely solvent, with a decent surplus for more highway spending on things like bridge repair.
A week back the BBC posted a chart comparing world gas prices. Might be of interest:
http://www.bbc.com/news/business-21238363
As opposed to....what.. not fixing roads?
You miss the point. If 100% of our gas tax went to roads and bridges we'd be golden. Instead it goes into the general fund, where it gets pissed away on politician's whims. Raising the gas tax in California does nothing for roads and bridges.