By Tuan Nguyen
Posting in Cities
A study shows that despite new technologies that improve fuel efficiency drivers still opt for gas guzzlers. Is it time for a gas tax?
You've probably noticed that the slow and steady emergence of electric cars is somewhat of a hot topic around these parts. But in case you missed it, the old-fashioned internal combustion engine technology that still powers the vast majority of cars has been undergoing its own eco-renaissance.
According to a recent report by Reuters, "...new cars with traditional engines are showing striking fuel efficiency gains thanks to technologies such as turbochargers, direct injection, and engines that shut down when the vehicle stops, then spring back to life when the driver presses the accelerator."
To put a number on all this progress, cars on the road today are 60 percent more fuel efficiency than what we were driving just 20 years ago. Yet for some reason, the average driver has yet to see it translate into a significant boost in gas mileage. For instance, in 1980, the country’s fleet of autos offered car owners an average of about 23 miles per gallon, whereas by 2006 that average increased just slightly to around 27 mpg.
So what gives?
Christopher Knittel, an economist at MIT, has sifted through many of these confounding figures and came up with an explanation. All these gains in fuel economy, he says, have been offset by the fact that cars on the road today have also become bigger and more powerful. His analysis found that during that 26 year period, the average curb weight of vehicles increased 26 percent, while their horsepower rose 107 percent. And had that not been the case, a typical vehicle today would boast an average mileage rating of 37 mpg.
I know it sounds a bit counter-intuitive but here's additional evidence of consumers trending toward ever-more muscular cars: In 1980, light trucks represented about 20 percent of passenger vehicles sold in the United States. By 2004, light trucks — including SUVs — accounted for 51 percent of passenger-vehicle sales.
- Related: Will drivers ever embrace the electric car?
- Related: $20,000, 350-mile-per-charge electric car only a few years away
To conduct the study, detailed in the journal American Economic Review as part of a report titled “Automobiles on Steroids,” Knittel drew upon data from the National Highway Transportation Safety Administration, auto manufacturers and trade journals.
“I find little fault with the auto manufacturers, because there has been no incentive to put technologies into overall fuel economy,” Knittel said. “Firms are going to give consumers what they want, and if gas prices are low, consumers are going to want big, fast cars.”
Even from a mile away, we can all see what he's getting at. While the benefits of better gas mileage and reduced emissions are attractive selling points, it appears that most consumers would still rather eschew them for something along the lines of an SUV or Dodge Ram. So there you have it. Once again, just more proof that free market forces are at odds with the environmental imperative. Still, the solution Knittel proposes, which works similarly in principle to taxing cigarette smokers, does come off as somewhat radical.
“When it comes to climate change, leaving the market alone isn’t going to lead to the efficient outcome,” Knittel said. “The right starting point is a gas tax.”
So far, government has opted for a less meddlesome approach to curb emissions by putting the impetus on car manufacturers instead of the consumers. The Obama administration has required that the industry design vehicles that meet certain fuel economy benchmarks known as the Corporate Average Fuel Economy or CAFE standards. For instance, future models are expected to travel an average of 35.5 mpg by 2016, and 54.5 mpg by 2025.
These rules, according to Knittel’s calculations, may lead to car companies rolling back the weight and horsepower capacity in future models as well as potentially spurring further innovation in fuel efficiency technologies. But even so, Knittel foresees any such gains being further offset by what he calls a "rebound effect," where an apparently ideal scenario ends up encouraging people to drive even more. A gas tax, he believes, would create demand for more fuel-efficient cars without as much rebound, the phenomenon through which greater efficiency leads to potentially greater consumption.
“I think 98 percent of economists would say that we need higher gas taxes,” he added.
So... this is the part where I pose the question to the always-informed and opinionated SmartPlanet readership: Is a gas tax the best way to curb emissions?
Learn more about fuel efficient technologies:
- ‘Supertruck’ big rig design doubles fuel efficiency
- New electric car 2x more fuel efficient than Nissan Leaf
- New engine radically improves fuel economy, cuts emissions
- New 9-speed transmission also a gas saver
- Gas-powered diesel engine may double fuel efficiency
- Ford’s powerful mini-motor saves fuel, cuts emissions
Smart transportation solutions:
- SmartPhone apps that can help you save on gas money
- Infographic: Which cities are hit hardest by rising gas prices?
- Breakthrough could lead to 732-mile electric car battery
- Electric car batteries can now power home appliances
- New electric car may signal the end of the road for gas guzzlers
- Innovative motor lets gas-powered cars go electric
Jan 4, 2012
We already have gasoline taxes. We already have a Gas Guzzler Tax. We probably should raise the former and eliminate the latter. Gas guzzlers pay more in gasoline tax because they use more gasoline. What's next? Congress mandating a cuckoo 65mpg CAFE? There are two issues. One is that for many applications, not only will you need a truck or SUV, but in many cases a truck or SUV will do a better job. For hauling my three kids plus the in-laws, we can haul them all in one minvan that get 20-24 mpg, or take two cars that get 24-30 mpg each. Guess which is more efficient? For hauling gear, a truck or van or SUV is mandatory. You want any work done or something moved? It probably requires a truck. The second issue is that the old-fashioned internal combustion engine just simply works better.
I live where we have carbon tax. It escalates annually, with the objective of changing peoples' fossil fuel consuming choices. The tax is indeed applied to reduce other costs otherwise funded by other taxes. If transparent in application, it works.
There's a group out there who is floating an idea whose idea is making more and more sense to me: http://www.citizensclimatelobby.org/ (http://www.citizensclimatelobby.org/) The idea is to put a tax on carbon period, whether it be in the form of gasoline, coal fired electricity, natural gas, whatever, and then refund the monies collected directly back to the consumer. Coupled with this, as I understand it, is to get rid of all subsidies as well. Both pieces of this would phase in over time and be collected and refunded thru existing IRS infrastructure, meaning that the tax would be revenue neutral. The trick is to keep politicians sticky fingers off the tax so they don't use it to pay down the deficit or some other pet project. By returning it to the consumer, the projections are that most folks would end up ahead of what they pay for in terms of higher prices. Only the flagrant consumers with a handful of Humvees will feel the sticker shock, and they typically would be the ones motivated then to buy new more energy efficient technology. So bottom line: since it goes back to the consumer, they can decide to spend it on energy saving low carbon devices or pay more and more for their hungry habits. Apparently there is a bill by Pete Stark that was introduced to this session of congress, but it being an election year, I don't expect it to leave committee this year. But maybe the momentum will grow, and with a revenue neutral refund directly to citizens, it might just have a chance of becoming bipartisan.
A tax on gasoline is nothing more than an additional tax on the middle-class and a financial burden to the under-privilaged. The wealthy use known loopholes to avoid paying gasoline taxes, so they don't feel pain as they drive around in their $150K company-leased vehicles that get only 5mpg. No...this kind of thing does NOTHING to curb the so-called carbon issue...But then again, I think you still need to prove that humans have anything to do with this global warming and prove that carbon has anything to do with it either! Other than a natural cycling of natural occuring events, everything is normal... besides, what do I care? I'll be lucky if I have another 50-60 years on this planet....what do I care when I'm gone?
Such is the problem with "democracy". We have little faith that the revenues from such taxes would go anywhere worthwhile, and so we're never going to support them, or the politicians who promote them. (That's why the EPA is acting instead) In Europe, the revenues don't really go towards anything "green", but to help fund the welfare state. And they don't truly diminish European's wishes to drive; they just force them into smaller cars with pathetic pollution controls and make the poor completely dependent upon mass transit. Progressives here have been arguing for decades that we need Euro-style fuel taxes. And yet when fuel prices spike, they scramble for cover, or scream that we need to investigate oil industry CEOs. The dirty secret is that they care less about the "green" and more about the wealth redistribution from the middle class that no longer pays significant amounts of income taxes.
The answer to "carbon" emissions is to make people pay more for gas.? Rather than destroy our economy for a theory why not try to get a decent form of power that doesn't cost several time that of gas power? If you look at the green technology it is a joke. We pay through our taxes subsidies on all green tech and if it were not for those subsidies green tech would be shown for what it is, several time more cost than gas power to do anything. Green will not be real until it is cost effective. Artificially increasing the cost of oil via tax is asinine. You may claim that carbon emissions are destroying our planet yet real evidence is difficult or not impossible to find.
This country is in trouble. The big threats are not military but economic. Our debt is going to kill us. Failure to properly regulate financial markets is a huge problem. One of the biggest problem that I see is pealk oil. I do not think that global warming is a big threat. I think it will take 30-50 years to happen. i think that peak oil could ruin our economy in 5-15 years if we do nothing. All the things that we need to do are more expensive than oil- at this time. That is the problem. We need to transition away from oil to alternative energy, mass transit, moving closer to work and other solutions. This will not happen till oil becomes expensive. We can artifically raise the price of oil slowly or see it spike up to depression causing levels. I say cause it to happen slowly with a gas tax. Put the money on alternative energy and lowering the business tax.
Why not redesign the engines to operate at an efficiency level that will remove the issue. The "Industry" (not sure who to blame here) only designs their engines to meet government requirements, no more. They can, and I have seen it happen, design the engines with less technology to operate more efficiently to the point of generating 'near zero' emissions. There is a mod being done to the throttlebody of different make/model/year/mileaged vehicles that reduces the emissions by increasing the performance efficiency of the burn process which also gives you, in most cases, better gas mileage. Check it out on Youtube... Search "Gadgetman Groove"
What you are calling for is a punitive tax. You want to punish people who buy more gas. Can I put a punitive tax on food because of all the fat bodies driving up the cost of health care? Rather than put the tax on gas punishing everyone that buys gas, why not put a tax on gas guzzelers? Or what about a limit on the horsepower of engines in cars sold? Or how about this, try raising the CAFE standards. They are currently a joke and all attempts to change them have been watered down to the point of useless. Or is this just another money grab to drive up the cost of living?
As someone who's daily commute is zero, personally I'd find this very favorable. However, I have little confidence it would work. Like you said, [i]"The trick is to keep politicians sticky fingers off the tax..."[/i] so that they don't use it for other purposes. Have you actually looked at the tax code recently? Do you really think they are capable of that? Just 2 weeks ago, they voted to rob Social Security so that we can all have an extra $40 a week. Exactly how long to do you really think it would take before they started voting to exempt certain users from paying, or re-directing the revenues to something more politically favorable? 2 weeks?
The ugly reality is that the class warfare rhetoric is a charade. There simply are not enough "rich" people to cover the trillions in unfunded liabilities we have, much less the additional trillions that the Progressives would like to spend. The money is going to have to come from everyone. Raising income taxes on "the 99" is politically impossible. So it will have to be via less transparent means, like a VAT and fuel taxes.
If your family is heavily in debt, would the solution be to spend even more money? Why do you see it as the solution at the governmental level? Europe with its VAT and other heavy taxes has been spending far greater percentage of its GDP on government than we have. Look where it's gotten them. Several countries such as Greece, Portugal, Spain, and Italy are teetering on economic collapse. The truth is that there is never enough money for a welfare state. It's an insatiable demand. As a conservative you should understand this.
I have a '93 Del Sol that gets 35Mpg easy. I get 40 hwy only. Here's the trick - it has one airbag and does not have all the 'crumple zones' that you find in a current vehicle. So while I get extremely good mileage, it's technically 'not as safe'. I highly doubt it meets current government standards for new vehicles. That said, check it out on fueleconomy.gov. The EPA estimate is off by almost 12% in my case - and almost 20% in the 'average user' score. I don't see more government interference, I mean regulation, helping that. Were I a conspiracy nut, I might suggest the old numbers are rigged to make newer cars look better. I'll all for more efficiency, and even all electric, but more taxes or more regulation aren't going to get us any closer than it has in the last 20 years.
I can understand the pain and anger Americans are feeling when they pay large sums of money to fill their tanks with gasoline. The elephant in the room problem is that tax or no tax, gas prices will only continue to trend upwards. After carefully studying the issue for several years, I've come to the conclusion that the world has reached a peak in oil production, and despite our best efforts to drill offshore and utilize new technologies to suck the last gallons of oil out of old wells, global world oil production from all sources will never exceed an average of 95 mbpd. (See: www.theoildrum.com/node/8797#more) Meanwhile, India and China each have triple our (U.S.) population and all seem to want to drive cars like we do. The resulting price increases in gas are a simple matter of limited supply facing growing global demand. Americans are currently paying foreign countries over a billion dollars a day for oil. Either we tax gas now to quicken the transition to alternatives and keep a little more wealth in the United States, or we will most likely lose our lead in world affairs.
"Or is this just another money grab to drive up the cost of living?" BINGO! Go to the head of the class. "Can I put a punitive tax on food because of all the fat bodies driving up the cost of health care?" Please, don't give them ideas.
There's no need for a big gas tax. Once the global economy gets back to normal, gas will naturally rise to well above $4 per gallon. I'm always amazed by people who say the solution to all our troubles is to simply give more money to governments. We've seen what that did to Europe, why do we need to go down that path?
Why, Because I cant afford a new car, So I bought a 10 year old used car for the price I could afford. And I am not alone.