Carbon Tax, not a VAT

I agree with Matt Yglesias that if there is gonna be a consumption tax it should be a carbon tax not a VAT. I think part of the reason that some are still enamored with a VAT is that it can raise a ton of money, probably more than a carbon tax. That said, a carbon tax should generate substantial revenues and also would more efficiently curb carbon emissions while not sacrificing any ground on efficiency to the VAT.

Cap and Trade= Carbon Tax + Corporate Welfare part 1 million and five

I have previously stated my preference for a carbon tax over a cap and trade regimen. What I see as the weakness of a Cap and Trade program proponents see as its strength: its opaque nature. It is true that a cap and trade, were the emissions permits to be auctioned off, would simulate a carbon tax. All well and good. But the reason most cap and trade advocates prefer a cap and trade is not because it simulates a carbon tax, but that it does so and reformers can avoid saying the word tax. But as its opacity is a double edged sword, it is also much more susceptible to rent seeking as is evidenced in the form of the proposed Waxmen-Markey bill whereby 85% of the emissions permits would be allocated as opposed to auctioned off. I can imagine how rigorous the allocation methodology will be: 1. Do you pollute extensively? Check; 2. Are you headquartered in or provide service extensively in a key congressional district? Check; 3. Have you donated to my (insert namer or party) campaign? Check; 4. Here is a free emissions permit which you can now use to defray the costs of your pollution by either keeping or selling at a premium to a less politically connected power company.

Obama Backs Off Windfall Profits Tax

I think this is a good thing.  A windfall profits tax would do little other than increase our consumption of foreign oil while having a negligible impact on overall consumption.  If the end goal is to decrease consumption of fossil fuels the best means of achieving that goal is to tax the consumption of fossil fuels, not production.

Gas Taxes in Other Countries

Some perspective for the next time you curse at the pump.

Gas Tax Break?

McCain is proposing a gas tax holiday for the summer. McCain has confessed that he doesn't quite get the whole economics thing and this is further evidence thereof. This is a brain dead proposal. Tis the season for pandering, this is just an especially crass example.

MN Gas Tax Increase

Marty Seifert is a jackass for complaining about this.

Minnesota will increase the gas tax by 8.5 cents until current bonds are paid for, then drop back to 5 cents after that. After the bridge collapse last year--Yes, Repubs, it was a "design flaw," but one that could have been caught with better maintenance procedures--and having driven on all the crappy roads in a state that has harsh winters that tend to wreck pavement pretty quickly, I'd be willing to pay 20 bucks a month to make sure that things are safer and better maintained. I don't feel that that would be undue stress.


How much will the increase actually cost me? Well, I get 30 miles to the gallon on my car and I drive about 12000 miles per year. Crunching those numbers, it'll cost me...34 dollars.

If I were getting 20 miles/gallon, it'd cost me 51. Wow. What a huge tax increase. Anyone who complains about this is an idiot. Deciding not to go out to a nice dinner one time per year will relieve you of the undue stress of this massive increase. Or, perhaps, spending one week on vacation out of state, so that you won't have to buy any gas. Don't complain about 51 dollars for safer, better roads.