From the "The price of gas is high, let's make it higher" deparment

The main point of the logic seems to be we need to achieve "energy independence", and we can only do this if we remove our addiction to foreign oil. (And there are other ancillary benefits as well).

Why do we need to achieve energy independence? Advocates gives the following as some reasons: (a) Because we are paying too much for gasoline, (b) because we rely too much on gasoline, (c) because it hurts our balance of trade, or (d) because it entangles us in the Middle East.

Suppose the answer is:
(a) ... well then raising taxes would not seem reduce the price, only increase it.
(b) ... begs the question, why is reliance of itself a bad thing. We will rely on energy source A so long as it is available, and as its price rises, we will switch to energy source B when it is cost-effective to do so.
(c) ... begs the question of why a trade deficit a bad thing. Other countries are reliant on foreign food, or foreign aircraft from the United States. This is what trade is about, letting countries specialize in what they do. Assuming we are in fact buying more from overseas than we are selling (that is, assuming the statistics are properly measuring flows of both goods and services in the economy), we are exchaning paper (denominated in a currency we control) for things. That seems a pretty good deal.
(d) ... The US buys most of its oil from countries not in the Middle East.

Burning gasoline has lots of bad properties, environmental externalities (air pollution, carbon emissions) are foremost.

Reliance on the automobile also has associated with it many properties, it results in congestion when roads are unpriced, it takes people off of transit, which has the consequence hurts those who continue to use transit because service is worsened. The auto kills over 40,000 people per year in the United States alone. (And its opponents argue it causes sprawl and obesity and other ills).

But burning gasoline also has good properties compared to some alternatives. Gasoline power replaced horse power. Horses did far more environmental damage to our health in big cities than clean burning gasoline. (Which is not to say future technology cannot be cleaner still).

The automoile also has some good properties, enabling people to reach more things in less time, and thus afford larger homes and larger yards and live a higher quality of life.

A higher tax on gasoline for general revenue purposes is just too neat, it aims to be a silver bullet for all of society's ills.

I agree that raising the price of gas will reduce consumption of gas. I believe alternatives to fossil fuels will be found as the price rises.

I see no reason to move markets faster than they are going, it takes resources away from other things. For every action there is an equal and opposite reaction, for every decision there is an opportunity cost.

What is the opportunity cost of accelerating investment in alternatives to oil ... not investing in other things that might be more worthwhile.

Where would the scientists and engineers and companies who will chase the research dollars being spent on energy efficiency otherwise be engaged? What would people who no longer can afford auto travel and now have to take slower alternative modes have done with that time? What will no longer be purchased because the price of transportation is now higher throughout the economy?

-- dml

David Levinson

Network Reliability in Practice

Evolving Transportation Networks

Place and Plexus

The Transportation Experience

Access to Destinations

Assessing the Benefits and Costs of Intelligent Transportation Systems

Financing Transportation Networks

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This page contains a single entry by David Levinson published on May 10, 2006 9:47 PM.

Summary of my talk at Meshforum was the previous entry in this blog.

War for oil vs. war against oil is the next entry in this blog.

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