But the next thing we need to start thinking hard about is something we all hate…which is linked to something we all love. The collection of gax taxes and a smooth, efficient road system.

As we all know, gas taxes pay for road construction and repair.  Even though we hate the tax, we despise pot-holed roads with a religious fervor. Here in Chicago, we’re afflicted by a new breed of pothole, smaller but substantially deeper; perfect for shearing wheels and axles.

The tax is reasonably efficient in its administration.  He who buys gas helps pay for the roads.  How much do we buy and pay?

In 2007, Americans purchased 142 billion gallons of gasoline, which at 18.7 cents per gallon, gave us about $26 billion dollars in federal funds for highway repair.  That was based on an 2006 average of 23.27 mpg for all US passenger cars and light trucks. Clearly the number doesn’t include diesel taxes or state fuel taxes as well.

Just before I was ready to sharpen a pencil and do some “cipherin’”, as Jethro Bodine called it, I saw this great analysis on lost gas tax revenue due to higher MPG by the great state of Oregon. It’s from 2005, which shows you some people have been thinking about this for awhile. The study is a quick but dense read, so I encourage you to go to to page 6 for the assumptions, and page 8 for the conclusions.

Read more of this story »

Chrysler has recently launched its “Let’s Refuel America” campaign in which it claims to offer Americans protection from rising gas prices. Anyone buying a Chrysler in the month of May will get the deal. Here’s how it works: each qualifying buyer will get a ‘gas card’ that has been linked to their own credit card, but when they gas-up they will only pay $2.99 a gallon with Chrysler charged the difference. You can read more about it here.

This is a really lame-brained scheme. It reminds me of the McCain-Clinton proposal to cut federal gas taxes during the summer– it’s the wrong solution for our economic woes. Yes, we’re all hurting from gas prices and we need relief (what are the oil companies offering consumers in terms of help, hmmmm? anyone? hello?). But what Chrysler is offering is an incentive for consumers to ignore gas prices and drive, drive, drive– producing more green house gases and increasing global warming.

Read more of this story »