Re: Gas prices jump 11.5 cents in one week

Motor fuels taxes account for some 22 percent or so of the current per-
gallon cost of gasoline in this country. This is arguably both
regressive (because it hits people with low and moderate incomes
harder than it does the well-heeled) as well as disproportionate --
since the amount of tax is very high relative to the actual cost of
the item being taxed.

We don't, for example, stack a tax of 50 cents per quart onto the
price tag of milk -- because milk is considered a necessity. But how
is gasoline less of a necessity? Maybe we don't drink it -- but most
people have little choice about using a car to get to work. Public
transportation is a realistic option in only a relative handful of
major urban areas. And even then, it's often necessary to drive to the
train station (as in the case of the Metro system in Washington,
D.C.).

Yet there's no end to the sticky fingers of the state when it comes to
motor fuels taxes -- which are layered like a wedding cake. First
comes the Feds. They hit you up for 18.4 cents on every gallon of fuel
you buy. But that's just for openers. Next in line is your state
government -- which will have its hand out for another 20 or so cents
per gallon. (The amount varies depending on where you happen to live;
some states have considerably higher taxes than others.) Then there
are local taxes -- which add another few cents to the tab. The total
exaction can amount to some 60 cents per gallon in places like
California and New York.

Do the math.

If the total price of a gallon of unleaded regular is $2.75 and the
tax on that fuel is 60.8 cents per gallon (as in NY), then the tax
rate is on the order of 22 percent. If you spend $50 per week on gas,
that's about $572 in taxes you're paying each year. (On top of
federal, state and local income and other taxes.)

This is usurious by any standard. And it's made all the more obnoxious
given the fact that gas is as much a necessity for the average person
as groceries. Indeed, most people have no choice but to use their cars
(and thus, burn gas) in order to buy groceries.

But no quarter is given -- literally. If anything, the politicos
typically call for more and higher gas taxes. This is supposed to be
an incentive to lower consumption -- but if that standard were applied
to milk and cheese, there would be a massive public uproar.

And yet, no one really complains. "Big Oil" gets all the grief
instead.

Now, this isn't a defense of (or an apology for) the way oil companies
conduct business. Good, bad - or ugly - it's entirely beside the
point. What is worth discussing is how come it's okay for government
to gouge us so ruinously, on a commodity so essential to our day-to-
day lives.

These taxes are necessary -- or so the argument runs -- in order to
finance new road construction and to pay for the upkeep of existing
roads. The Highway Revenue Act of 1956 created the Highway Trust Fund,
into which motor fuels excise taxes are paid; the money collected is
then distributed by the Feds to each state to pay for various road/
highway projects, etc. (The taxes themselves are actually collected
from the large corporations/distributors, etc. selling fuel; the money
you pay at the pump "reimburses" them for what they paid the
government.)

But this process necessarily involves "administrative costs" -- the
various bureaucracies (and bureaucrats) who pull the levers, stamp the
forms and shuffle the paperwork. It's hard to put a figure on how much
all this costs, but when a federal program is involved that also
involves every state (and every county) in the entire United States,
you can bet it's considerable.

Also, motor fuels taxes end up going to pay for things that have
nothing to do with building or maintaining roads, such as funding mass
transit projects or the Leaking Underground Storage Tank Trust Fund.
These may be worthy projects, but it's a con to let people think
they're paying all these taxes solely in order to fund the roads
they're driving on.

And then there's the matter of all the political haggling that goes
on, under which some states end up getting back less than they paid
out. Motorists in, say, Montana end up paying to finance new roads for
New Jersey.

Prably, we could get much more bang for our buck -- and lower motor
fuels taxes -- if we switched over to some system of "pay as you go"
toll roads. Or at least, cut the federal government out of it
entirely.

There would be minimal overhead, and instead of gaming the funds
through a multi-tiered political process and bureaucracy, money would
be allocated to necessary upkeep and maintenance only. No more sending
money to Washington, with Washington then deciding how much it will
send back and to whom. No more siphoning funds for projects (make-work
or otherwise) that don't have anything to do with building new roads
and keeping the ones already built in good order.

But the current setup is not likely to be altered because there's next
to no outrage. People focus on the supposed machinations of "Big Oil"
-- and give Big Government a blank check.

It doesn't make much sense, but that's the way it is.
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Re: Gas prices jump 11.5 cents in one week

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