Antigeogreen California Democrats

What’s this? California Dems are proposing a tax cut?!?,” Blue State Conservatives, 6 April 2005, http://www.radiobs.net/thebluestateconservatives/archives/2005/04/whats_this_cali.html (from Bizblogger).

If it were an independent country, California would be one of the most influential in the world. Which makes the irresponsibility of the Democrats in the state’s assembly all the more worrying.

People would save a little gassing up the family Chevy but pay more to buy the car — and most everything else — under a proposal Tuesday by Assembly Democrats meant to spark new highway construction and improve public transit.

The plan would eliminate the 5 percent state sales tax on gasoline while increasing the sales tax on non-gas and non-food items by a quarter of a percent. The new money would be dedicated to transportation.

Also, voters would be asked to approve a $10 billion transportation bond next year. And the state’s 18-cent-per-gallon gas excise tax, which hasn’t risen since the early 1990s, would increase by a penny in 2006.

California Democrats propose lowering the gas tax so that America is encouraged to keep buying oil from decaying societies. The gas tax reduction would retard innovation and hurt California’s reputation for progress in oil.

I know it’s just intended to hurt Governor Schwarzenegger, but it is still disappointing.

5 thoughts on “Antigeogreen California Democrats”

  1. I would say that it's a partially well thought-out effort to support geogreen efforts in California.

    Because the highway maintenance budget is funded significantly by gas taxes, the adoption of fuel efficient vehicles is curbing their ability to pay for necessary maintenance.

    The fix was proposed to tax based on miles driven, but this raises privacy concerns and infrastructure cost concerns. By moving the tax away from gas consumption and toward other consumption, they've avoided causing a delay in the adoption of more fuel-efficient vehicles by people who are skeptical of the gains.

    The benefits of owning a fuel-efficient vehicle are primarily the reduction in outright gas cost. A change in taxes shouldn't be the driving force. But something must address this issue of lower fuel consumption yielding less fuel tax revenue. No one wants mileage monitors on their cars and no one wants to pay to install them, so by removing the gas tax and placing it somewhere else, they've doged the bullets of underfunding their transportation infrastructure, making folks uneasy, and discouraging fuel efficient vehicles.

  2. Aaron, I thought how to reply to your comment. It was well written, but the paragraph and the remainder had little to do with each other.

    You mention that the adoption of fuel efficient vehciles are negatively impacting state gas tax revenues. That is the point. Taxing discourages an activity. Saying “gas taxes designed to reduce consumption are reducing consumption and so should be scaled back” is irrational. The California Democrats' actions are antigeogreen.

    You say the California Democrats wanted to “fix” the system. But a larger problem is that “the highway maintenance budget is funded significantly by gas taxes.” Why? In a geogreen strategy the purpose of gas taxes is to reduce gas consumption, not pay for highways. The state should build and maintain highways as economic logic and the happiness of its citizens, not fuel tax receipts, dictate. Earmarking specific taxes for specific programs is always suspect. There is no reason why incomes from an arbitrary tax should equal wise payments for an arbitrary spending program. A tax on miles driven makes sense only if the government is attempting to discourage driving, regardless of how “green” such driving is. Highway payments should be paid out of a general fund.

    Further, this is a strange sort of health mullahism! To disproportionately discourage the poor from driving because the state wants to discourage transportation is suspect. Americans have traditionally believed in a right to travel. Travel allows people to keep in touch with family and friends, easily access public and private recreation features, as well as acess good jobs. Free governments have historically encouraged their citizens to travel. Why the California Democrats which to punish this is beyond me.

    Your last sentence is correct — the California Democrats actions discourage fuel efficient vehicles.

    There is nothing geogreen about that.

  3. I'm afraid that in desire to disagree with me you've missed the point. They ARE trying to pay for the highway maintenance with a general fund.

    They're trying to move it away from being derived from gasoline and putting it into a more general source, like a food tax. Here's the deal: they made a mistake in the past by paying for highways with fuel tax. It used to make sense. The people who use, pay. However, that's how it's been for some time. Now, when we really need to encourage fuel-efficiency, there are concerns that highways will be underfunded, because of less gas use. The proposal was made to tie transportation taxes to miles driven, but the infrastructure costs would be prohibitive, and people are uneasy with the government monitoring their driving. The solution that makes sense is to untie() highway maintenance (something we need whether vehicles use a lot of gas or a little) from gas consumption. We can't win the war against oil with higher-efficiency vehicle and then have no roads to drive on. They should continue to tax gas to curb consumption, but they should also figure out somewhere else to find the funds to keep critical infrastructure in good shape.

    I'm not worried about the taxes, as I've stated, I'd support a higher gas tax, (although as stated, the proposing senator / representative is committing political suicide) I think you're misreading their attempts to come up with a best-for-all solution (keep highways nice, keep encouraging fuel-efficient vehicles, keep ACLU and far-leftists appeased about privacy) for something more sinister, like a rollback of the gas taxes. This is a marginally good plan to dodge a sticky bullet.

    I've tried to remember to suggest this a few times, but I'm usually clamoring for you to start Anti-TDAXP and argue the other side of the issues. A feature I'd love to see on tdaxp: “Dan's Solution Would Be…”

  4. It definitely makes sense to untie highway funds from the gas tax. But a mileage tax isn't the way to do it. People should have the freedom to travel, and a mileage tax directly attacks that. You also mention the privacy oncerns.

    You ask for a solution, and I gave one: highway costs should be paid out of the general fund. It makes little sense to dedicated specific taxes to specific causes. Let road maintenance come out of general revenue.

  5. I reread your comment, and there's one other point I should make:

    I'm not sure what “a general fund like a food tax” would be. A specific tax certainly is not a general fund! Wheter, every state has a “general fund” that most tax revenue (from income, sales, real estate, etc) goes into. It is budged out of every year for whatever the legislature decides. This is where highway funds should come from.

    I still don't understand how reducing the gas tax makes sense from a geogreen perspective. On the other hand, a high gas tax could certainly be popular
    http://www.tdaxp.com/archive/2005/04/01/a_modest_geogreen_gas_tax_proposal_5_gal_gas.html

  6. That's because you're focusing too hard on the repeal of gas tax. Their hand is forced is what I'm trying to say. Their solution is a pretty good one, considering their options.

  7. The central theme of a geogreen push is the gas tax. On your first comment, you wrote

    “I would say that it's a partially well thought-out effort to support geogreen efforts in California.”

    You've never defended that assertion — your first assertion. Instead, you correctly mention that highways need to be maintained (which is good, though neither pro- nor anti- geogreen), brought up a geogreen-netural proposal to tax the miles, and now bring up a geogreen-neutral sales tax.

    Repealing the gas tax is an anti-geogreen effort. And it does so to score political points off Governor Schwartzenegger.

    If I'm wrong, how?

  8. I typically try to stay within the bounds of civilized debate, so I'll avoid the profanity I'm silently muttering, but you're simply being obstinate.

    I explained reasonably well my assertion across several posts. They have a real problem, and a potential problem depending on how they react, and they're coming up with a reasonable but not perfect solution for it. If you've chosen to begin reading my replies with “He's Wrong” locked and loaded, then I don't much see the point in elaborating further. I'm not sure how much more finely I could articulate my points.

    The points you think are geogreen-neutral are not in this case, because they're firmly tied to this geogreen-focused initial problem. If your state prison maintenance is funded with video lottery money and a public backlash against gambling results in lower revenue, your shortfall is now a gambling-related problem, even though state prisons may have little to do with gambling. In the past, they taxed highway maintenance on the people who were using the highways, gas purchasers. Perhaps it doesn't make perfect sense, but I'm sure if it _hadn't_ been that way in the past, and was proposed now, you'd be lauding their efforts at discouraging gasoline consumption while not economically hampering those who do not consume it.

    The ideal solution would be to leave the gas tax in place AND increase system-wide taxes to account for the decrease in fuel-tax revenue. Maybe that's how the final solution will work out. But doing something is surely better than doing nothing. If they leave things as-is, then the adoption of fuel-efficient vehicles may be retarded. Demand is going to fall a lot less with lower-consumption vehicles than it will by people saying “5% tax on gas? I'm never driving again!”

  9. We were in danger of talking past each other, but I like your last paragraph

    'The ideal solution would be to leave the gas tax in place AND increase system-wide taxes to account for the decrease in fuel-tax revenue. Maybe that's how the final solution will work out. But doing something is surely better than doing nothing. If they leave things as-is, then the adoption of fuel-efficient vehicles may be retarded. Demand is going to fall a lot less with lower-consumption vehicles than it will by people saying “5% tax on gas? I'm never driving again!”'

    As you have previously said to me, cars are sticky. People cannot and will not change vehicles immediately. So unless you repurpose the income from higher gas taxes (like in the form of a per citizen rebate) you will have higher revenue in the short term. The fall in income is less a medium-term problem (say, 3-4 yeras) that should not factor into short-term budget estimates (say, the current and next fiscal years).

    You are right that we should focus more on demand. But if gas prices are low, it makes little economic sense to switch to a more fuel efficient vehicle. A major goal Saudi oil policy is to keep oil prices “reasonable” enough that American consumers do not want more efficient vehicles. Fuel efficient vehicles will not happen on their own in the medium-term. We must encourage them.

    High gas taxes encourage fuel efficient vehicles.

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